Document:

EXHIBIT 10.36

             AMENDMENT No. 1 TO SECURITY AND INTERCREDITOR AGREEMENT

         THIS  AMENDMENT  NO. 1,  dated as of June 7, 2000,  is to that  certain
Security and Intercreditor Agreement(the  "Agreement"),  dated December 1, 1999,
among Biofund, Inc., a Delaware corporation with an address at Box L, Millbrook,
NY 12545 ("Biofund"),  Donald C. Fresne ("Fresne"),  with an address at 69 North
Tower Hill Road,  Box L,  Millbrook,  NY 12545,  and  Epigen,  Inc.,  a Delaware
corporation with an address at North Tower Hill Road, Box L, Millbrook, NY 12545
("Epigen"). All capitalized terms used herein shall have the same meanings as in
the Agreement unless otherwise stated. In addition,  each of the shareholders of
Biofund whose names appear on the signature  page hereof are added as parties to
the Agreement to the extent set forth herein.

                                    RECITALS

         1. Epigen  obtained a loan from the Bank of  Millbrook  ("Bank") in the
original  principal  amount of up to $800,000 (the "First Loan")  secured by the
Guaranty.  The Guaranty was secured by collateral in the form of certificates of
deposit  issued by the Bank  aggregating  the original  principal  amount of the
First Loan (the  "Security").  Subsequently,  Epigen obtained an additional loan
from the Bank in the original  principal  amount of up to $120,000  (the "Second
Loan"). The Second Loan also was guaranteed by Biofund and secured by collateral
in the form of  certificates  of  deposit  issued  by the Bank  aggregating  the
original principal amount of the Second Loan (the "Additional Security").

         2. The parties to the Agreement  have agreed to modify the terms of the
arrangements  set  forth in the  Agreement  regarding  the  purchase  of  equity
securities of Epigen  pursuant to Paragraph 3.1 of the Agreement  and,  together
with the other signatories hereto to address certain other matters as herein set
forth.

         3. The  capitalization  table of Epigen attached hereto  represents the
capitalization  of Epigen,  on a fully diluted basis, as of December 31, 1999 is
attached hereto as Exhibit A.

         4. The Board of Directors  of Epigen,  at a meeting duly held on May 3,
2000, has reduced the exercise price per share of Epigen's  outstanding  options
and warrants with exercise prices of $1.00 per share or greater by one-half. The
Board of  Directors  of  Epigen,  at a meeting  duly held on June 6,  2000,  has
retired all treasury  stock of Epigen and  restored  such stock to the status of
authorized  but  unissued  stock  and has  revised  the  number  of  issued  and
outstanding  shares of Common Stock to that set forth in the records of Epigen's
transfer agent, American Stock Transfer & Trust Company.

         NOW, THEREFORE, in consideration of the foregoing and the covenants and
conditions herein contained, Biofund, Epigen and Fresne, intending to be legally
bound, hereby agree as follows:

                                      -19-

<PAGE>

         Section 1.   EXERCISE OF CONVERSION RIGHT.

         (a) As of the date hereof,  Biofund has the right to acquire  3,936,680
shares  of  Epigen's  Common  Stock at a price of $.01 per  share,  pursuant  to
Section 3.1 of the  Agreement.  Effective  immediately,  Epigen hereby grants to
Biofund the right, assignable to its shareholders,  immediately to exercise such
right.

         (b) Biofund hereby assigns to its shareholders,  pro rata, its right to
acquire  such shares of Epigen's  Common  Stock.  The number of shares of Epigen
Common  Stock each Biofund  shareholder  shall have the right to acquire and the
aggregate purchase price therefor is set forth on Exhibit B hereto. By executing
this Amendment,  each of the shareholders of Biofund hereby exercises his or her
right to acquire the shares of Epigen  Common  Stock and agrees to pay to Epigen
the purchase price for the shares to be acquired by such Biofund  shareholder by
his or her check upon his or her  execution of this  Amendment.  Each such check
shall be returned by the respective  shareholders  of Biofund to Epigen together
with such shareholder's signed copy of this Agreement.

         Section 2.   PURCHASE  OF NEW SHARES OF EPIGEN SECURITIES.

         2.1  SUBSCRIPTION  FOR  NEW  SHARES  OF  COMMON  STOCK.   Each  of  the
shareholders   of  Biofund   whose  names   appear  on  Exhibit  C  hereto  (the
"Participating  Biofund  Shareholders")  hereby  subscribes  for and  agrees  to
purchase  the  amount of  additional  shares of  Epigen  Common  Stock set forth
opposite his or her name on Exhibit C hereto at the price of $.50 per share. The
aggregate  purchase  price  for  such  shares  shall be paid to  Epigen  by each
Participating Biofund Shareholder concurrently with his or her execution of this
Amendment by wire transfer as follows:

                  Bank of Millbrook
                  P.O. Box AF
                  Millbrook, NY 12545
                  ABA No.:                  021907975
                  Account Name:             Epigen, Inc. Escrow Account
                  Account No.:              0220631
                  Contact:                  Ronald Mosca

         2.2 USE OF PROCEEDS  FROM SALE OF COMMON  STOCK.  Epigen  hereby agrees
that the entire  amount of the  proceeds  received by it pursuant to Section 2.1
hereof  shall  be used  solely  for the  purpose  of  repaying  the  outstanding
principal  amounts  of the First Loan and the  Second  Loan and to  release  the
Guaranty,  the  Security  and  the  Additional  Security.  Upon  release  of the
Guaranty,  the Security and the  Additional  Security,  Biofund shall deliver to
Epigen Termination Statements on Form UCC-3 terminating its security interest in
the Collateral.

         2.3  SUBSCRIPTION  FOR SHARES OF SERIES B PREFERRED  STOCK.  Each of W.
James Tozer  ("Tozer"),Jr.,  Lionel Goldfrank III and David Clapp (the "Series B
Purchasers")  hereby  agrees to  purchase  75,000  shares of  Epigen's  Series B
Preferred Stock, par value $.001 per share, at a price of $1.00 per share, or an
aggregate  purchase price of $225,000 (the "Series B Proceeds"),  which purchase
has been  authorized  by the Board of Directors of Epigen at its meeting held on
May 7, 2000. The relative  rights,  preferences  and privileges of such Series B
Preferred Stock are set

                                      -20-

<PAGE>

forth on Exhibit D hereto.  In  addition,  Epigen  may sell up to an  additional
275,000 shares of Series B Preferred Stock,  also at a price of $1.00 per share,
to such other existing  shareholders  of Epigen and to such other persons as its
Board of Directors may determine.

         2.4 USE OF  PROCEEDS  FROM SALE OF  SERIES B  PREFERRED  STOCK.  Epigen
hereby acknowledges receipt of the entire amount of the Series B Proceeds, which
are on  deposit at the Bank of  Millbrook,  New York in an Escrow  Account,  no.
0220631,  less the sum of $105,000  which  previously had been deposited in such
account and disbursed with the approval of a majority of the Series B Purchasers
for the purpose of paying certain  obligations  of Epigen  principally to Vacold
LLC. The balance of the Series B Proceeds  shall be used to pay  obligations  of
Epigen  principally  to Vacold LLC and for working  capital.  The balance of the
Series B Proceeds  shall be released  from  escrow upon  delivery by the parties
hereto of fully executed  counterparts  of this Amendment and delivery by Epigen
to the Series B Purchasers  of copies of the  resolutions  of Epigen's  Board of
Directors approving this Amendment and the transactions contemplated hereby.

         3.  REGISTRATION  RIGHTS.  Epigen  hereby grants to each of the Biofund
Shareholders  and the Series B  Purchasers  registration  rights with respect to
their shares of Epigen  Common  Stock and the shares of Common Stock  underlying
the shares of Series B Preferred Stock purchased  hereunder.  Such persons shall
have all of the rights and benefits,  pari passu,  with the  beneficiary  of any
registration rights agreement binding upon Epigen.

         4.  CONVERSION OF EPIGEN DEBT BY FRESNE.

         (a) As of April 30, 2000, Epigen is indebted to Fresne in the aggregate
amount  of  $1,743,378.48.   Effective  immediately,  Fresne  hereby  agrees  to
contribute to the capital of Epigen an aggregate of $1,387,164.85 in obligations
owed by Epigen to him.  Epigen shall issue to Fresne its promissory  note in the
original  principal amount of $356,213.63,  with interest thereon at the rate of
nine  percent  (9%) per  annum in the form  attached  hereto  as  Exhibit E (the
"Company  Note").  Of the principal  amount of such note,  $156,213.63  shall be
repaid in three equal  annual  installments  principal,  plus  accured  interest
thereon,  and $200,000 shall be payable on demand by Fresne shall continue to be
subject to the security  agreement  granted to Fresne  pursuant to the Agreement
dated as of May 1, 1995 between Fresne and Epigen (the "1995 Agreement").

         (b) In addition, as of the date hereof, Fresne is indebted to Epigen in
the amount of $156,213.63.  Fresne hereby agrees to repay such amount out of the
proceeds  received by him from Epigen  pursuant to the Company Note, in pro rata
installments,  if, as and when  received  by Fresne,  pursuant to the terms of a
promisory note substantially in the form of Exhibit F hereto.

         (c) Fresne hereby agrees that from and after April 30, 2000, any salary
owed to him by Epigen  which is unpaid  because  Epigen  lacks the funds to make
such payment shall accrue without interest  accruing  thereon,  any provision to
the contrary in the 1995 Agreement to the contrary notwithstanding.

         (d) Fresne  further agrees that,  notwithstanding  any provision to the
contrary  in the 1995  Agreement  to the  contrary,  he may  convert  all or any
portion of $200,000 of principal

                                      -21-

<PAGE>

amount of the Company Note only into shares of Epigen's Common Stock at the rate
of $.50 per share.

         5. INVESTMENT ANALYSIS.  Attached hereto as Exhibit G is an analysis of
the  shareholdings  of all  persons  holding of record at least 2% of the Common
Stock of Epigen,  on a fully diluted  basis,  including a listing of the shares,
options,  warrants and other rights to acquire  shares of Common Stock of Epigen
and the amounts invested by such persons, or good faith estimates thereof.

         6.  WAIVER OF  ANTI-DILUTION  RIGHTS.  Each of Fresne  and Tozer  holds
certain rights to receive  additional  shares of Epigen's  Common Stock,  in the
case of  Fresne  pursuant  to  that  certain  Amended  and  Restated  Employment
Agreement  with Epigen dated as of November 1, 1999,  and, in the case of Tozer,
pursuant to that certain letter  agreement dated as of May 4, 1998.  Solely with
respect to the issuances of the Series B Preferred  Stock  contemplated  hereby,
each of Fresne  and Tozer  hereby  permanently  waives his  respective  right to
receive additional shares of Epigen's Common Stock pursuant to such agreements.

         Section 7.   MISCELLANEOUS.

         7.1  NOTICES.  Except  as herein  provided,  all  notices  which may be
required  or  permitted  under  this  Agreement  shall be given  in  writing  by
certified mail, return receipt requested, or by hand, by facsimile or by Express
Mail or other  recognized over night delivery  service and shall be delivered or
transmitted to the parties hereto at their respective addresses set forth above,
or in the case of the Biofund  Shareholders,  their respective  addresses as set
forth in the books and records of Epigen, or such other addresses as any of them
shall designate in accordance with the provisions of this Section 7.1

         7.2  ENTIRE AGREEMENT.  This Agreement constitutes the entire agreement
of the parties  hereto  regarding the subject  matter hereof and  supersedes any
prior agreement of the parties hereto regarding such subject matter.

         7.3  GOVERNING LAW. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of New York.

         7.4  COUNTERPARTS.  This  Agreement  may  be  signed  in  one  or  more
counterparts which together shall constitute one and the same instrument.

         7.5  MODIFICATION. No modification or amendment of this Agreement shall
be effective unless in writing and signed by the parties hereto.

         7.6  SEVERABILITY. Should any provision of this Agreement be determined
to be  invalid  or  unenforceable  or at  variance  with any  present  or future
requirement of applicable law then such provision alone shall become inoperative
to the extent necessary,  and this Agreement may remain in full force and should
be  construed  so as to give  effect to the intent and purpose of the parties to
the maximum extent possible.

                                      -22-

<PAGE>

         7.7  ASSIGNMENT.  Except as herein provided, no party may assign all or
any portion of this  Agreement  without the prior  written  consent of the other
parties.

         7.8  HEADINGS.  The headings  contained in this  Agreement  are for the
convenience  of  reference  only and shall not affect in any way the  meaning or
interpretation of this Agreement.

                                      -23-

<PAGE>

         IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to
executed by their duly authorized  representatives  as of the day and year first
above written.

BIOFUND, INC.                          EPIGEN, INC.

By:/s/David Clapp                      By: /s/Donald C. Fresne
   ----------------------                  ---------------------
   David Clapp, President                 Donald C. Fresne, CEO,
                                        President and Chairman

/s/Donald C. Fresne                    /s/ W. James Tozer, Jr.
-------------------------              -------------------------
Donald C. Fresne,                      W. James Tozer, Jr.
individually

/s/David Clapp                         /s/ Raju L. Shah
-------------------------              -------------------------
David Clapp,                           Raju L. Shah
individually

/s/ Farran Tozer Brown                 /s/ Robert J. Corsglia
-------------------------              -------------------------
Farran Tozer Brown                     Robert J. Corsiglia

/s/ Richard D. Field                   /s/ Lionel Goldfrank III
-------------------------              ------------------------
Richard D. Field                       Lionel Goldfrank III

/s/ Katherine Tozer Roddy              /s/ Christy Parsons
-------------------------              -------------------------
Katherine Tozer Roddy                  Christy Parsons

                                      -24-

<PAGE>

                                    EXHIBIT A

Capitalization Table as of December 31, 1999.

<TABLE>

Epigen Inc.
Full Ownership Analysis
12/31/1999
<CAPTION>
                                                                                      ----------------- Options ------------------
         Shareholder Name                                Total Shares   % Owned       Options    No. Detail    Price        Expire
         ----------------                                ------------   -------       -------    ----------    -----        ------
<S>                                                      <C>            <C>           <C>        <C>           <C>          <C>
Venture Capital Investor .............                         0           --            --           --         --           --
Biofund, Inc. (23% Sale) .............          920            0           --            --           --         --           --
     Brown, Farran Tozer .............           25            0           --            --           --         --           --
     Clapp, David ....................          200            0           --            --           --         --           --
     Corsiglia, Robert J .............           25            0           --            --           --         --           --
     Field, Richard D ................          100            0           --            --           --         --           --
     Fresne, Donald C ................           50            0           --            --           --         --           --
     Goldfrank, III, Lionel ..........          150            0           --            --           --         --           --
     Parson, Christy .................          120            0           --            --           --         --           --
     Roddy, Katherine Tozer ..........           25            0           --            --           --         --           --
     Shah, Raju L ....................           25            0           --            --           --         --           --
     Tozer, Jr., W. James ............          200            0           --            --           --         --           --
Biofund Conversion ...................          920            0           --            --           --         --           --
     Brown, Farran Tozer .............           25            0           --            --           --         --           --
     Clapp, David ....................          200            0           --            --           --         --           --
     Corsiglia, Robert J .............           25            0           --            --           --         --           --
     Field, Richard D ................          100            0           --            --           --         --           --
     Fresne, Donald C ................           50            0           --            --           --         --           --
     Goldfrank, III, Lionel ..........          150            0           --            --           --         --           --
     Parson, Christy .................          120            0           --            --           --         --           --
     Roddy, Katherine Tozer ..........           25            0           --            --           --         --           --
     Shah, Raju L ....................           25            0           --            --           --         --           --
     Tozer, Jr., W. James ............          200            0           --            --           --         --           --
Mayday Financing ($1.00 per share) ...                         0           --            --           --         --           --
Accrued Interest / Notes Payable .....                         0           --            --           --         --           --
Payables to be Converted .............                         0           --            --           --         --           --
AST Exchange Agent ...................                         0           --            --           --         --           --
** Aminoff, Cary .....................                         0                         --           --         --           --
Biotag Inc ...........................                    17,026         0.30%           --           --         --           --
BMA ..................................                         0           --            --           --         --           --
JMG Bonfrer ..........................                    10,000        0.17%            --           --         --           --
Boston Biomedical Research Institute .                    41,988        0.73%            --           --         --           --
Buttyan, Ralph .......................                     1,137        0.02%            --           --         --           --
Cede & Co ............................                   159,708        2.79%            --           --         --           --
Chandler, Joseph .....................                     2,273        0.04%            --           --         --           --
Charbit, Ingrid ......................                    50,000        0.87%            --           --         --           --
Clapp, David .......................                      50,000        0.87%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Clapp Tte./Indian Creek Ptnrs ........                   156,845        2.74%            --           --         --           --
Codington, John F ....................                    18,826        0.33%            --           --         --           --
**Corsiglia, Robert J ................                   114,940        2.01%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Creative Biomolecules Inc ............                    22,565        0.39%            --           --         --           --
Daly, Daniel .........................                     4,268        0.07%            --           --         --           --
Deidrick, Aga B ......................                     8,000        0.14%            --           --         --           --
** Dr. Crawford ......................                         0          --             --           --         --           --
** Dr. Brauer ........................                         0          --             --           --         --           --
# Epigen Inc .........................                     1,173        0.02%            --           --         --           --
Experta Treyhand AG ..................                    14,773        0.26%            --           --         --           --
Fawwaz, Rashid .......................                     9,777        0.17%            --           --         --           --
Field, Richard .......................                   100,000        1.75%            --           --         --           --
*Fresne, Donald C ....................                 2,262,722       39.52%            --           --         --           --
      Prefered Stock .................                         0          --             --           --         --           --
     ##  Debt ........................                         0          --             --           --         --           --
Gelb, William ........................                     4,850        0.08%            --           --         --           --
Gelber, Cohava .......................                    10,000        0.17%            --           --         --           --
Goluboff, Eric .......................                     6,819        0.12%            --           --         --           --
Goldfrank, L .........................                   100,000        1.75%            --           --         --           --
Harley, Colin K ......................                    98,069        1.71%            --           --         --           --
Hilkens, John ........................                    10,000        0.17%            --           --         --           --
Hilton, Birgitt ......................                    12,500        0.22%            --           --         --           --
Hilton, Louis ........................                     9,091        0.16%            --           --         --           --
                                                               0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Howard, Reese E ......................                       467        0.01%           2,332         --        2.00      12/03/2002
                                                               0          --             --          1,931      2.00      03/25/2002
--                                                             0          --             --            401      2.00      12/03/2002
Johns, Marshall J & Marlene B ........                    25,000        0.44%            --           --         --           --
Kent, Richard E**** ..................                   177,589        3.10%          59,873         --        0.82      09/01/2007
--                                                             0          --             --          1,931      2.00      03/25/2002
--                                                             0          --             --            401      2.00      12/02/2002
--                                                             0          --             --          2,136      2.00      09/13/2001
--                                                             0          --             --          1,681      2.00      06/01/2002
--                                                             0          --             --          1,681      2.00      06/01/2003
--                                                             0          --             --          1,681      2.00      06/01/2004
--                                                             0          --             --          1,681      2.00      06/01/2005
--                                                             0          --             --         47,000      0.50      09/01/2007
--                                                             0          --             --          1,681      2.00      06/01/2006
--                                                             0          --             --           --         --           --
** Krane, Robert J ...................                     6,819        0.12%            --           --         --           --
Kuter, I .............................                         0          --             --           --         --           --
Lawson, Carole .......................                    10,000        0.17%            --           --         --           --
Ledbetter Moore & Associates Inc .....                     2,273        0.04%            --           --         --           --
Levin, Bruce .........................                     1,313        0.02%            --           --         --           --
Liss, Irvine .........................                    50,000        0.87%            --           --         --           --
Long, Leo William ....................                   214,869        3.75%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Martin E Janis & Company Inc .........                     2,534        0.04%            --           --         --           --
Mondschein, Lawrence .................                     5,910        0.10%            --           --         --           --
Mongiardo, James F ...................                   126,769        2.21%           2,273        2,273      2.00      02/01/2001
Montgomery, Deborah ..................                     8,000        0.14%            --           --         --           --
Moore, Nancy K .......................                    25,000        0.44%            --           --         --           --
Nikrui, Najosam ......................                     1,137        0.02%            --           --         --           --
** Olsson, Carl ......................                     6,819        0.12%            --           --         --           --
Paulsen, D ...........................                         0          --             --           --         --           --
Perisher Publishing ..................                    75,000        1.31%            --           --         --           --
Philadep & Co. .......................                         0          --             --           --         --           --
Potter, Ransel .......................                    21,685        0.38%            --           --         --           --
Rabinowitz, Jonathan D ...............                    30,125        0.53%            --           --         --           --
Rabinowitz, Joshua W .................                    30,125        0.53%            --           --         --           --
Rabinowitz, Peter D ..................                    30,125        0.53%            --           --         --           --
Rabinowitz, Rene S ...................                    30,125        0.53%            --           --         --           --
Rykowski, Emilia c/oRabinowitz .......                    30,125        0.53%            --           --         --           --
Rabinowitz, Rubin ....................                   124,628        2.18%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Richards & O'Neil LLP ................                     6,876        0.12%            --           --         --           --
Roberts, Paul ........................                     3,000        0.05%            --           --         --           --
Sandel Robert A ......................                   115,362        2.01%            --           --         --           --
Sandel Robert A  & Eleanor J .........                    27,273        0.48%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Schroder, L Courtney .................                   143,290        2.50%           2,106         --        2.00      03/25/2002
--                                                             0          --             --          1,705      2.00      03/25/2002
--                                                             0          --             --            401      2.00      12/03/2000
Schubach, Clark ......................                     1,516        0.03%            --           --         --           --
Smith. David H .......................                     6,423        0.11%            --           --         --           --
Somkey SA ............................                     1,273        0.02%            --           --         --           --
Sterman, Marshall ....................                       108        0.00%           2,106         --        2.00      03/25/2002
--                                                             0          --             --          1,705      2.00      03/25/2002
--                                                             0          --             --            401      2.00      12/03/2000
Strategica Group Inc .................                     1,470        0.03%            --           --         --           --
The Mayflower Group Ltd ..............                    68,182        1.19%            --           --         --           --
** 'Tozer Jr., W. James (<9/1/98) ....                   434,187        7.58%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Tozer Jr., W. James (>9/1/98) ........                    50,000        0.87%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Tozer Jr., W. James (>9/1/98) ........                         0          --             --           --         --           --
Tozer Jr., W. James (IRA)c ...........                    11,819        0.21%            --           --         --           --
Vacold, LLC ..........................                   433,705        7.58%            --           --         --           --
Weil, Steven & Janet .................                    10,000        0.17%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Westheimer, J. & A ...................                    12,500        0.22%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Westheimer, Laura ....................                    12,500        0.22%            --           --         --           --
--                                                             0          --             --           --         --           --
--                                                             0          --             --           --         --           --
Zahav Ltd ............................                    30,304        0.53%            --           --         --           --
Shareholders with less than1000 Shares                    21,802        0.38%             401          401       --           --
Variance: AST Exhange Variance .......                         1

                                                       ---------      ------           ------       ------
*TOTAL ...............................                 5,725,378      100.00%          69,091       69,091
                                                       =========      ======           ======       ======

<CAPTION>
                                                          -------------------- Warrants -----------------------       **Grant
         Shareholder Name                                 Warrants     No. Detail        Price         Expire       Commitments
         ----------------                                 --------     ----------        -----         ------       -----------
<S>                                                      <C>           <C>              <C>          <C>            <C>
Venture Capital Investor .............                        --           --           --               --              --
Biofund, Inc. (23% Sale) .............          920      3,936,680         --              0.01      note payoff         --
     Brown, Farran Tozer .............           25           --        106,975            0.01      note payoff         --
     Clapp, David ....................          200           --        855,800            0.01      note payoff         --
     Corsiglia, Robert J .............           25           --        106,975            0.01      note payoff         --
     Field, Richard D ................          100           --        427,900            0.01      note payoff         --
     Fresne, Donald C ................           50           --        213,950            0.01      note payoff         --
     Goldfrank, III, Lionel ..........          150           --        641,850            0.01      note payoff         --
     Parson, Christy .................          120           --        513,480            0.01      note payoff         --
     Roddy, Katherine Tozer ..........           25           --        106,975            0.01      note payoff         --
     Shah, Raju L ....................           25           --        106,975            0.01      note payoff         --
     Tozer, Jr., W. James ............          200           --        855,800            0.01      note payoff         --
Biofund Conversion ...................          920              0         --              0.50          --              --
     Brown, Farran Tozer .............           25           --              0            0.50          --              --
     Clapp, David ....................          200           --              0            0.50          --              --
     Corsiglia, Robert J .............           25           --              0            0.50          --              --
     Field, Richard D ................          100           --              0            0.50          --              --
     Fresne, Donald C ................           50           --              0            0.50          --              --
     Goldfrank, III, Lionel ..........          150           --              0            0.50          --              --
     Parson, Christy .................          120           --              0            0.50          --              --
     Roddy, Katherine Tozer ..........           25           --              0            0.50          --              --
     Shah, Raju L ....................           25           --              0            0.50          --              --
     Tozer, Jr., W. James ............          200           --              0            0.50          --              --
Mayday Financing ($1.00 per share) ...                        --           --           --               --              --
Accrued Interest / Notes Payable .....                        --           --           --               --              --
Payables to be Converted .............                        --           --           --               --              --
AST Exchange Agent ...................                        --           --           --               --              --
** Aminoff, Cary .....................                        --           --           --               --              --
Biotag Inc ...........................                        --           --           --               --              --
BMA ..................................                        --           --           --               --              --
JMG Bonfrer ..........................                        --           --           --               --              --
Boston Biomedical Research Institute .                        --           --           --               --              --
Buttyan, Ralph .......................                        --           --           --               --              --
Cede & Co ............................                        --           --           --               --              --
Chandler, Joseph .....................                        --           --           --               --              --
Charbit, Ingrid ......................                      50,000       50,000            1.50      08/31/2001          --
Clapp, David .......................                       118,182         --              1.79      various             --
--                                                            --          9,091            2.00      12/31/2001          --
--                                                            --          9,091            2.00      12/31/2001          --
--                                                            --         50,000            1.50      03/31/2004          --
--                                                            --         50,000            2.00      03/31/2004          --
Clapp Tte./Indian Creek Ptnrs ........                       4,546        4,546            2.00      09/01/2000          --
Codington, John F ....................                       9,091        9,091            2.00      02/28/2004          --
**Corsiglia, Robert J ................                      41,725         --              2.30      various           48,527
--                                                            --          4,546            2.00      09/01/2000          --
--                                                            --          9,091            2.00      12/31/2001          --
--                                                            --          9,091            2.00      12/31/2001          --
--                                                            --         18,997            2.66      01/16/2003          --
Creative Biomolecules Inc ............                        --           --           --               --              --
Daly, Daniel .........................                        --           --           --               --              --
Deidrick, Aga B ......................                        --           --           --               --              --
** Dr. Crawford ......................                        --           --           --               --            25,000
** Dr. Brauer ........................                        --           --           --               --            25,000
# Epigen Inc .........................                        --           --           --               --            (1,173)
Experta Treyhand AG ..................                        --           --           --               --              --
Fawwaz, Rashid .......................                       9,091        9,091            2.00      02/28/2004          --
Field, Richard .......................                     100,000      100,000            3.00      06/30/2004          --
*Fresne, Donald C ....................                      25,702         --              0.90      various             --
      Prefered Stock .................                        --         24,702            0.83      04/15/2003          --
     ##  Debt ........................                        --          1,000            2.66      12/31/2002          --
Gelb, William ........................                        --           --           --               --              --
Gelber, Cohava .......................                        --           --           --               --              --
Goluboff, Eric .......................                        --           --           --               --              --
Goldfrank, L .........................                     100,000      100,000            3.00      06/30/2004          --
Harley, Colin K ......................                        --           --           --               --              --
Hilkens, John ........................                        --           --           --               --              --
Hilton, Birgitt ......................                        --           --           --               --              --
Hilton, Louis ........................                       4,546         --              2.00      12/31/2001          --
                                                              --          2,273            2.00      12/31/2001          --
--                                                            --          2,273            2.00      12/31/2001          --
Howard, Reese E ......................                        --           --           --               --              --
                                                              --           --           --               --              --
--                                                            --           --           --               --              --
Johns, Marshall J & Marlene B ........                       4,546        4,546            2.00      09/01/2000          --
Kent, Richard E**** ..................                        --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
** Krane, Robert J ...................                        --           --           --               --           160,000
Kuter, I .............................                       2,273        2,273            2.00      02/28/2004          --
Lawson, Carole .......................                        --           --           --               --              --
Ledbetter Moore & Associates Inc .....                        --           --           --               --              --
Levin, Bruce .........................                        --           --           --               --              --
Liss, Irvine .........................                      50,000       50,000            1.50      10/31/2001          --
Long, Leo William ....................                     229,734         --              2.11      various             --
--                                                            --         18,182            2.00      11/21/2000          --
--                                                            --          9,091            2.00      02/09/2001          --
--                                                            --          9,091            2.00      02/09/2001          --
--                                                            --          9,091            2.00      06/30/2001          --
--                                                            --          9,091            2.00      06/30/2001          --
--                                                            --         75,188            2.66      01/21/2003          --
--                                                            --         50,000            1.50      03/31/2004          --
--                                                            --         50,000            2.00      03/31/2004          --
Martin E Janis & Company Inc .........                        --           --           --               --              --
Mondschein, Lawrence .................                       2,273        2,273            2.00      09/01/2000          --
Mongiardo, James F ...................                        --           --           --               --              --
Montgomery, Deborah ..................                        --           --           --               --              --
Moore, Nancy K .......................                        --           --           --               --              --
Nikrui, Najosam ......................                       2,273        2,273            2.00      02/28/2004          --
** Olsson, Carl ......................                       6,819        6,819            2.00      02/28/2004       100,000
Paulsen, D ...........................                       6,819        6,819            2.00      02/28/2004          --
Perisher Publishing ..................                        --           --           --               --              --
Philadep & Co. .......................                        --           --           --               --              --
Potter, Ransel .......................                        --           --           --               --              --
Rabinowitz, Jonathan D ...............                        --           --           --               --              --
Rabinowitz, Joshua W .................                        --           --           --               --              --
Rabinowitz, Peter D ..................                        --           --           --               --              --
Rabinowitz, Rene S ...................                        --           --           --               --              --
Rykowski, Emilia c/oRabinowitz .......                        --           --           --               --              --
Rabinowitz, Rubin ....................                     128,423         --              1.35      various             --
--                                                            --          9,091            2.00      12/31/2001          --
--                                                            --          9,091            2.00      12/31/2001          --
--                                                            --         60,241            0.83      04/15/2003          --
--                                                            --         25,000            1.50      03/31/2004          --
--                                                            --         25,000            2.00      03/31/2004          --
Richards & O'Neil LLP ................                        --           --           --               --              --
Roberts, Paul ........................                        --           --           --               --              --
Sandel Robert A ......................                        --           --           --               --              --
Sandel Robert A  & Eleanor J .........                      22,720         --              2.00      various             --
--                                                            --          9,091            2.00      09/01/2000          --
--                                                            --          3,637            2.00      03/21/2001          --
--                                                            --          2,723            2.00      10/23/2000          --
--                                                            --          2,723            2.00      10/23/2000          --
--                                                            --          2,273            2.00      06/30/2001          --
--                                                            --          2,273            2.00      06/30/2001          --
Schroder, L Courtney .................                        --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
Schubach, Clark ......................                        --           --           --               --              --
Smith. David H .......................                      11,364       11,364            2.00          --              --
Somkey SA ............................                        --           --           --               --              --
Sterman, Marshall ....................                        --           --           --               --              --
--                                                            --           --           --               --              --
--                                                            --           --           --               --              --
Strategica Group Inc .................                        --           --           --               --              --
The Mayflower Group Ltd ..............                        --           --           --               --              --
** 'Tozer Jr., W. James (<9/1/98) ....                     304,546         --              1.01      various          960,992
--                                                            --          4,546            2.00      09/01/2000          --
--                                                            --        300,000            1.00      08/31/2003          --
Tozer Jr., W. James (>9/1/98) ........                     100,000         --              1.75      various             --
--                                                            --         50,000            1.50      03/31/2004          --
--                                                            --         50,000            2.00      03/31/2004          --
Tozer Jr., W. James (>9/1/98) ........                        --           --           --               --              --
Tozer Jr., W. James (IRA)c ...........                        --           --           --               --              --
Vacold, LLC ..........................                        --           --           --               --              --
Weil, Steven & Janet .................                      20,000         --              1.75      03/31/2004          --
--                                                            --         10,000            1.50      03/31/2004          --
--                                                            --         10,000            2.00      03/31/2004          --
Westheimer, J. & A ...................                      25,000         --              1.75      03/31/2004          --
--                                                            --         12,500            1.50      03/31/2004          --
--                                                            --         12,500            2.00      03/31/2004          --
Westheimer, Laura ....................                      25,000         --              1.75      03/31/2004          --
--                                                            --         12,500            1.50      03/31/2004          --
--                                                            --         12,500            2.00      03/31/2004          --
Zahav Ltd ............................                        --           --           --               --              --
Shareholders with less than1000 Shares                        --           --           --               --              --
Variance: AST Exhange Variance .......

                                                         ---------    ---------                                     ---------
*TOTAL ...............................                   5,341,353    5,341,353                                     1,318,346
                                                         =========    =========                                     =========

<CAPTION>
                                                          Convertible   Con. Sec.     Principal      Conv.
         Shareholder Name                                 Securities     Detail        Amount        Rate         Yield
         ----------------                                 -----------   ---------     ---------      ----         -----
<S>                                                       <C>           <C>           <C>           <C>           <C>
Venture Capital Investor .............                        --           --           --           --            --
Biofund, Inc. (23% Sale) .............          920           --           --           --           --            --
     Brown, Farran Tozer .............           25           --           --           --           --            --
     Clapp, David ....................          200           --           --           --           --            --
     Corsiglia, Robert J .............           25           --           --           --           --            --
     Field, Richard D ................          100           --           --           --           --            --
     Fresne, Donald C ................           50           --           --           --           --            --
     Goldfrank, III, Lionel ..........          150           --           --           --           --            --
     Parson, Christy .................          120           --           --           --           --            --
     Roddy, Katherine Tozer ..........           25           --           --           --           --            --
     Shah, Raju L ....................           25           --           --           --           --            --
     Tozer, Jr., W. James ............          200           --           --           --           --            --
Biofund Conversion ...................          920           --           --           --           --            --
     Brown, Farran Tozer .............           25           --           --           --           --            --
     Clapp, David ....................          200           --           --           --           --            --
     Corsiglia, Robert J .............           25           --           --           --           --            --
     Field, Richard D ................          100           --           --           --           --            --
     Fresne, Donald C ................           50           --           --           --           --            --
     Goldfrank, III, Lionel ..........          150           --           --           --           --            --
     Parson, Christy .................          120           --           --           --           --            --
     Roddy, Katherine Tozer ..........           25           --           --           --           --            --
     Shah, Raju L ....................           25           --           --           --           --            --
     Tozer, Jr., W. James ............          200           --           --           --           --            --
Mayday Financing ($1.00 per share) ...                        --           --           --           --            0.0%
Accrued Interest / Notes Payable .....                    245,163      245,163          --          1.00           --
Payables to be Converted .............                        --           --           --          0.00           --
AST Exchange Agent ...................                        --           --           --           --            --
** Aminoff, Cary .....................                      11,429       11,429       20,000        1.75           0.0%
Biotag Inc ...........................                        --           --           --           --            --
BMA ..................................                        --           --           --           --            --
JMG Bonfrer ..........................                        --           --           --           --            --
Boston Biomedical Research Institute .                        --           --           --           --            --
Buttyan, Ralph .......................                        --           --           --           --            --
Cede & Co ............................                        --           --           --           --            --
Chandler, Joseph .....................                        --           --           --           --            --
Charbit, Ingrid ......................                        --           --           --           --            --
Clapp, David .......................                       100,000      100,000      100,000        1.00          14.0%
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Clapp Tte./Indian Creek Ptnrs ........                        --           --           --           --            --
Codington, John F ....................                        --           --           --           --            --
**Corsiglia, Robert J ................                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Creative Biomolecules Inc ............                        --           --           --           --            --
Daly, Daniel .........................                        --           --           --           --            --
Deidrick, Aga B ......................                        --           --           --           --            --
** Dr. Crawford ......................                        --           --           --           --            --
** Dr. Brauer ........................                        --           --           --           --            --
# Epigen Inc .........................                        --           --           --           --            --
Experta Treyhand AG ..................                        --           --           --           --            --
Fawwaz, Rashid .......................                        --           --           --           --            --
Field, Richard .......................                        --           --           --           --            --
*Fresne, Donald C ....................                   3,683,680         --           --           --            --
      Prefered Stock .................                        --        600,000      300,000        0.50           0.0%
     ##  Debt ........................                        --      3,083,680    1,226,848        0.50           9.0%
Gelb, William ........................                        --           --           --           --            --
Gelber, Cohava .......................                        --           --           --           --            --
Goluboff, Eric .......................                        --           --           --           --            --
Goldfrank, L .........................                        --           --           --           --            --
Harley, Colin K ......................                        --           --           --           --            --
Hilkens, John ........................                        --           --           --           --            --
Hilton, Birgitt ......................                      25,000       25,000       25,000        1.00          25.0%
Hilton, Louis ........................                        --           --           --           --            --
                                                              --           --           --           --            --
--                                                            --           --           --           --            --
Howard, Reese E ......................                        --           --           --           --            --
                                                              --           --           --           --            --
--                                                            --           --           --           --            --
Johns, Marshall J & Marlene B ........                        --           --           --           --            --
Kent, Richard E**** ..................                     196,000         --           --           --            --
--                                                            --         25,000       25,000        1.00          25.0%
--                                                            --        171,000       85,500        0.50           --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
** Krane, Robert J ...................                        --           --           --           --            --
Kuter, I .............................                        --           --           --           --            --
Lawson, Carole .......................                        --           --           --           --            --
Ledbetter Moore & Associates Inc .....                        --           --           --           --            --
Levin, Bruce .........................                        --           --           --           --            --
Liss, Irvine .........................                        --           --           --           --            --
Long, Leo William ....................                    100,000      100,000       100,000        1.00           --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Martin E Janis & Company Inc .........                        --           --           --           --            --
Mondschein, Lawrence .................                        --           --           --           --            --
Mongiardo, James F ...................                        --           --           --           --            --
Montgomery, Deborah ..................                        --           --           --           --            --
Moore, Nancy K .......................                      50,000       50,000       50,000        1.00          25.0%
Nikrui, Najosam ......................                        --           --           --           --            --
** Olsson, Carl ......................                        --           --           --           --            --
Paulsen, D ...........................                        --           --           --           --            --
Perisher Publishing ..................                        --           --           --           --            --
Philadep & Co. .......................                        --           --           --           --            --
Potter, Ransel .......................                        --           --           --           --            --
Rabinowitz, Jonathan D ...............                        --           --           --           --            --
Rabinowitz, Joshua W .................                        --           --           --           --            --
Rabinowitz, Peter D ..................                        --           --           --           --            --
Rabinowitz, Rene S ...................                        --           --           --           --            --
Rykowski, Emilia c/oRabinowitz .......                        --           --           --           --            --
Rabinowitz, Rubin ....................                      75,000       75,000       75,000        1.00          25.0%
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Richards & O'Neil LLP ................                        --           --           --           --            --
Roberts, Paul ........................                        --           --           --           --            --
Sandel Robert A ......................                      50,000       50,000       50,000        1.00          25.0%
Sandel Robert A  & Eleanor J .........                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Schroder, L Courtney .................                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Schubach, Clark ......................                        --           --           --           --            --
Smith. David H .......................                        --           --           --           --            --
Somkey SA ............................                        --           --           --           --            --
Sterman, Marshall ....................                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Strategica Group Inc .................                        --           --           --           --            --
The Mayflower Group Ltd ..............                        --           --           --           --            --
** 'Tozer Jr., W. James (<9/1/98) ....                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Tozer Jr., W. James (>9/1/98) ........                     100,000      100,000       50,000        0.50           --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Tozer Jr., W. James (>9/1/98) ........                      25,000       25,000       25,000        1.00          25.0%
Tozer Jr., W. James (IRA)c ...........                        --           --           --           --            --
Vacold, LLC ..........................                        --           --           --           --            --
Weil, Steven & Janet .................                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Westheimer, J. & A ...................                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Westheimer, Laura ....................                        --           --           --           --            --
--                                                            --           --           --           --            --
--                                                            --           --           --           --            --
Zahav Ltd ............................                        --           --           --           --            --
Shareholders with less than1000 Shares                        --           --           --           --            --
Variance: AST Exhange Variance .......

                                                         ---------    ---------    ---------
*TOTAL ...............................                   4,661,272    4,661,272    2,132,348
                                                         =========    =========    =========

<CAPTION>

                                                            Interest               ----- Fully Diluted -----
         Shareholder Name                                  12/31/1999      Notes      Shares         % Owned
         ----------------                                  ----------      -----      ------         -------
<S>                                                        <C>             <C>      <C>              <C>
Venture Capital Investor .............                         --           --              0           --
Biofund, Inc. (23% Sale) .............          920            --           --      3,936,680          23.00%
     Brown, Farran Tozer .............           25            --           --              0           --
     Clapp, David ....................          200            --           --              0           --
     Corsiglia, Robert J .............           25            --           --              0           --
     Field, Richard D ................          100            --           --              0           --
     Fresne, Donald C ................           50            --           --              0           --
     Goldfrank, III, Lionel ..........          150            --           --              0           --
     Parson, Christy .................          120            --           --              0           --
     Roddy, Katherine Tozer ..........           25            --           --              0           --
     Shah, Raju L ....................           25            --           --              0           --
     Tozer, Jr., W. James ............          200            --           --              0           --
Biofund Conversion ...................          920            --           --              0           --
     Brown, Farran Tozer .............           25            --           --              0           --
     Clapp, David ....................          200            --           --              0           --
     Corsiglia, Robert J .............           25            --           --              0           --
     Field, Richard D ................          100            --           --              0           --
     Fresne, Donald C ................           50            --           --              0           --
     Goldfrank, III, Lionel ..........          150            --           --              0           --
     Parson, Christy .................          120            --           --              0           --
     Roddy, Katherine Tozer ..........           25            --           --              0           --
     Shah, Raju L ....................           25            --           --              0           --
     Tozer, Jr., W. James ............          200            --           --              0           --
Mayday Financing ($1.00 per share) ...                         --       Cl. B Pfd.          0           --
Accrued Interest / Notes Payable .....                      245,163         --        245,163           1.43%
Payables to be Converted .............                         --           --              0           --
AST Exchange Agent ...................                         --           --              0           --
** Aminoff, Cary .....................                         --       prof serv.     11,429           0.07%
Biotag Inc ...........................                         --           --         17,026           0.10%
BMA ..................................                         --           --              0           --
JMG Bonfrer ..........................                         --           --         10,000           0.06%
Boston Biomedical Research Institute .                         --           --         41,988           0.25%
Buttyan, Ralph .......................                         --           --          1,137           0.01%
Cede & Co ............................                         --           --        159,708           0.93%
Chandler, Joseph .....................                         --           --          2,273           0.01%
Charbit, Ingrid ......................                         --           --        100,000           0.58%
Clapp, David .......................                              0      mat. note    268,182           1.57%
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
Clapp Tte./Indian Creek Ptnrs ........                         --           --        161,391           0.94%
Codington, John F ....................                         --           --         27,917           0.16%
**Corsiglia, Robert J ................                         --           --        205,192           1.20%
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
Creative Biomolecules Inc ............                         --           --         22,565           0.13%
Daly, Daniel .........................                         --           --          4,268           0.02%
Deidrick, Aga B ......................                         --           --          8,000           0.05%
** Dr. Crawford ......................                         --           --         25,000           0.15%
** Dr. Brauer ........................                         --           --         25,000           0.15%
# Epigen Inc .........................                         --           --              0           --
Experta Treyhand AG ..................                         --           --         14,773           0.09%
Fawwaz, Rashid .......................                         --           --         18,868           0.11%
Field, Richard .......................                         --           --        200,000           1.17%
*Fresne, Donald C ....................                         --           --      5,972,104          34.89%
      Prefered Stock .................                         --        Cl. A Pfd.         0           --
     ##  Debt ........................                      314,992         --              0           --
Gelb, William ........................                         --           --          4,850           0.03%
Gelber, Cohava .......................                         --           --         10,000           0.06%
Goluboff, Eric .......................                         --           --          6,819           0.04%
Goldfrank, L .........................                         --           --        200,000           1.17%
Harley, Colin K ......................                         --           --         98,069           0.57%
Hilkens, John ........................                         --           --         10,000           0.06%
Hilton, Birgitt ......................                            0      25% note      37,500           0.22%
Hilton, Louis ........................                         --           --         13,637           0.08%
                                                               --           --              0           --
--                                                             --           --              0           --
Howard, Reese E ......................                         --           --          2,799           0.02%
                                                               --           --              0           --
--                                                             --           --              0           --
Johns, Marshall J & Marlene B ........                         --           --         29,546           0.17%
Kent, Richard E**** ..................                         --           --        433,462           2.53%
--                                                                0      25% note           0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
** Krane, Robert J ...................                         --           --        166,819           0.97%
Kuter, I .............................                         --           --          2,273           0.01%
Lawson, Carole .......................                         --           --         10,000           0.06%
Ledbetter Moore & Associates Inc .....                         --           --          2,273           0.01%
Levin, Bruce .........................                         --           --          1,313           0.01%
Liss, Irvine .........................                         --           --        100,000           0.58%
Long, Leo William ....................                         --        mat. note    544,603           3.18%
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
Martin E Janis & Company Inc .........                         --           --          2,534           0.01%
Mondschein, Lawrence .................                         --           --          8,183           0.05%
Mongiardo, James F ...................                         --           --        129,042           0.75%
Montgomery, Deborah ..................                         --           --          8,000           0.05%
Moore, Nancy K .......................                            0      25% note      75,000           0.44%
Nikrui, Najosam ......................                         --           --          3,410           0.02%
** Olsson, Carl ......................                         --           --        113,638           0.66%
Paulsen, D ...........................                         --           --          6,819           0.04%
Perisher Publishing ..................                         --           --         75,000           0.44%
Philadep & Co. .......................                         --           --              0           --
Potter, Ransel .......................                         --           --         21,685           0.13%
Rabinowitz, Jonathan D ...............                         --           --         30,125           0.18%
Rabinowitz, Joshua W .................                         --           --         30,125           0.18%
Rabinowitz, Peter D ..................                         --           --         30,125           0.18%
Rabinowitz, Rene S ...................                         --           --         30,125           0.18%
Rykowski, Emilia c/oRabinowitz .......                         --           --         30,125           0.18%
Rabinowitz, Rubin ....................                            0      25% note     328,051           1.92%
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
Richards & O'Neil LLP ................                         --           --          6,876           0.04%
Roberts, Paul ........................                         --           --          3,000           0.02%
Sandel Robert A ......................                            0      25% note     165,362           0.97%
Sandel Robert A  & Eleanor J .........                         --           --         49,993           0.29%
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
--                                                             --           --              0           --
Schroder, L Courtney .................                         --           --        145,396           0.85%
--                                                             --           --              0           --
--                                                             --           --              0           --
Schubach, Clark ......................                         --           --          1,516           0.01%
Smith. David H .......................                         --           --         17,787           0.10%
Somkey SA ............................                         --           --          1,273           0.01%
Sterman, Marshall ....................                         --           --          2,214           0.01%
--                                                             --           --              0           --
--                                                             --           --              0           --
Strategica Group Inc .................                         --           --          1,470           0.01%
The Mayflower Group Ltd ..............                         --           --         68,182           0.40%
** 'Tozer Jr., W. James (<9/1/98) ....                         --           --      1,699,725           9.93%
--                                                             --           --              0           --
--                                                             --           --              0           --
Tozer Jr., W. James (>9/1/98) ........                         --        Cl. A Pfd.   250,000           1.46%
--                                                             --           --              0           --
--                                                             --           --              0           --
Tozer Jr., W. James (>9/1/98) ........                            0      25% note      25,000           0.15%
Tozer Jr., W. James (IRA)c ...........                         --           --         11,819           0.07%
Vacold, LLC ..........................                         --           --        433,705           2.53%
Weil, Steven & Janet .................                         --           --         30,000           0.18%
--                                                             --           --              0           --
--                                                             --           --              0           --
Westheimer, J. & A ...................                         --           --         37,500           0.22%
--                                                             --           --              0           --
--                                                             --           --              0           --
Westheimer, Laura ....................                         --           --         37,500           0.22%
--                                                             --           --              0           --
--                                                             --           --              0           --
Zahav Ltd ............................                         --           --         30,304           0.18%
Shareholders with less than1000 Shares                         --           --         22,203           0.13%
Variance: AST Exhange Variance .......

                                                         ----------                ---------          ------
*TOTAL ...............................                      560,155                17,115,439         100.00%
                                                          =========                ==========         ======

# The 12/31/99 Financials show that Epigen holds in treasury 5 shares, while the American Stock Transfer (AST) 12/31/99 shows 25,795
old shares registered to Epigen which would convert into 1,173 new shares in treasury.
Epigen's Board is taking action to retire all treasury shares and to confirm Epigen's common shares outstanding as of 12/31/99 being
equal to AST's records less the shares currently registered in Epigen's name which are being retired.

**Commitments to Issue Common Stock
Aminoff, Cary A.             $29,800 for 'Preparation of Business Plans
Robert J. Corsiglia          Shares to be issued to reflect an appropriate conversion rate of $.83 vs $2.66 on previously converted
                             notes.
Dr. Crawford                 Completion of lung cancer IRB for COD Test
Dr. Brauer                   Consulting Services
Olsson, Carl                 Consulting Services
Krane, R.                    Execution of definitive liscense agreement with strategic partner
Fresne, Donald               Perpetual 33 1/3% anti-dilution protection
Tozer, W. James Jr.          10% anti-dilution protection on 750,552 shares until definitive license agreement with strategic
                             partner

****By agreement Kent to receive $3000 per month in salary and 37000 option at $0.50 on June 1st of each year.
</TABLE>

                                      -25-

<PAGE>

                                    EXHIBIT B

                                      Number of Shares                  Amount
Name of Shareholder                   of Common Stock   Purchase Price  Invested
-------------------                   ---------------   --------------  --------

Farran Tozer Brown ...............        106,975       $   1,069.75    $ 25,000

David Clapp ......................        855,800           8,558.00     200,000

Robert J. Corsiglia ..............        106,975           1,069.75      25,000

Richard D. Field .................        427,900           4,279.00     100,000

Donald C. Fresne .................        213,950           2,139.50      50,000

Lionel Goldfrank III .............        641,850           6,418.50     150,000

Christy Parsons ..................        513,480           5,134.80     120,000

Katherine Tozer Roddy ............        106,975           1,069.75      25,000

Raju L. Shah .....................        106,975           1,069.75      25,000

W. James Tozer, Jr ...............        855,800           8,558.75     200,000

                                      -26-

<PAGE>

                                    EXHIBIT C

                                                   Number of Shares    Purchase
Name of Shareholder                                of Common Stock      Price
-------------------                                ----------------    ---------

Farran Tozer Brown .......................             50,000           $ 25,000

David Clapp ..............................            400,000            200,000

Robert J. Corsiglia ......................             50,000             25,000

Richard D. Field .........................            200,000            100,000

Donald C. Fresne .........................            100,000             50,000

Lionel Goldfrank III .....................            300,000            150,000

Christy Parsons ..........................            240,000            120,000

Katherine Tozer Roddy ....................             50,000             25,000

Raju L. Shah .............................             50,000             25,000

W. James Tozer, Jr .......................            400,000            200,000

                                      -27-

<PAGE>

                                    EXHIBIT D

                           CERTIFICATE OF AMENDMENT OF

                       DESIGNATION, PREFERENCES AND RIGHTS

                                       OF

                            SERIES B PREFERRED STOCK

                                       OF

                                  EPIGEN, INC.

         EPIGEN,  INC., a corporation  organized and existing  under the laws of
the State of Delaware (the  "Corporation),  in accordance with the provisions of
Section 151 of the General Corporation Law of the State of Delaware, does hereby
CERTIFY:

         1. The  Certificate of  Incorporation,  as amended,  of the Corporation
fixes the total  number of shares of all  classes  of  capital  stock  which the
Corporation  shall have  authority to issue as Sixty-Five  Million  (65,000,000)
shares,  of which Fifty Million  (50,000,000)  shares shall be Common Stock, par
value $.001 per share (the "Common  Stock"),  and Fifteen  Million  (15,000,000)
shares  shall be shares of  Preferred  Stock,  par  value  $.001 per share  (the
"Preferred Stock").

         2. The Certificate of  Incorporation,  as amended,  of the Corporation,
expressly  grants to the Board of  Directors  of the  Corporation  authority  to
provide for the issuance of said  Preferred  Stock in one or more  series,  with
such  voting  powers,  and with such  designations,  preferences  and  relative,
participating, optional or other special rights, and qualifications, limitations
or restrictions  thereof,  as shall be stated and expressed in the resolution or
resolutions providing for the issue thereof adopted by the Board of Directors as
are not stated and expressed in its Certificate of Incorporation, as amended.

         3. Pursuant to authority  conferred  upon the Board of Directors by the
Certificate of Incorporation,  as amended, the Board of Directors,  at a meeting
duly  held on June 17,  1996,  at which a quorum  was duly  present  and  acting
throughout,  duly authorized and adopted the provisions  establishing a Series B
Preferred  Stock of the  Corporation  pursuant to a Certificate of  Designation,
Preferences  and Rights of Series B Preferred  Stock filed with the Secretary of
State of Delaware on June 18, 1996.  All of the  outstanding  shares of Series B
Preferred  Stock were  acquired  by the  Corporation  pursuant to an exchange of
shares of its Common  Stock for such  outstanding  shares of Series B  Preferred
Stock on July 14, 1997 and  restored to the status of  authorized  but  unissued
shares of preferred stock, without designation.  Pursuant to authority conferred
upon the Board of Directors by the Certificate of Incorporation, as amended, the
Board of  Directors,  at a meeting duly held on June 7, 2000,  at which a quorum
was duly  present  and  acting  throughout,  duly  authorized  and  adopted  the
provisions set forth in the following

                                      -28-

<PAGE>

resolution providing for an Amended Certificate of Designation,  Preferences and
Rights of Series B Preferred Stock as follows:

         RESOLVED,  that an issue of a series of the Preferred  Stock, par value
$.001  per  share,  of the  Corporation  consisting  of  Five  Hundred  Thousand
(500,000)  shares is hereby  provided  for, and the voting  power,  designation,
preferences and relative,  participating,  optional or other special rights, and
the  qualifications,  limitations or restrictions  thereof,  are fixed hereby as
follows:

                  1.  DESIGNATION.  The  designation  of such  series  shall  be
         "Series B Preferred  Stock"  (hereinafter  referred to as the "Series B
         Preferred Stock") and the number of shares  constituting such series is
         Five Hundred  Thousand  (500,000).  The number of authorized  shares of
         Series B  Preferred  stock  may be  increased  or  reduced  by  further
         resolutions  of the board of Directors of the  Corporation  or any duly
         authorized  committee  thereof  and  by  the  filing  of a  certificate
         pursuant to the provisions of the General  Corporation Law of the State
         of  Delaware  stating  that  such  increase  or  reduction  has been so
         authorized,  but the number of shares of Series B Preferred Stock shall
         not be reduced  below  500,000  unless there shall be less than 500,000
         shares of  Series B  Preferred  Stock  outstanding,  in which  case the
         number of shares of Series B Preferred Stock may be reduced to a number
         of shares equal to the number of such shares  outstanding  from time to
         time.  Shares  of  Series  B  Preferred  Stock  shall be  evidenced  by
         certificates registered in the name of the record holder of such shares
         of Series B Preferred Stock.

                  2.  DIVIDENDS.  The Series B Preferred Stock shall be entitled
         to share pari passu on a share for share basis with the Common Stock of
         the  Corporation  if, in any  dividends if, as and when declared by the
         Corporation's Board of Directors.

                  3.  MANDATORY  REDEMPTION.  The  shares of Series B  Preferred
         Stock shall be redeemed  by the  Corporation  not later than August 31,
         2001 (the "Redemption  Date") at a price per share of $1.00;  provided,
         however, that the Corporation shall have the right at any time prior to
         the  Redemption  Date to  repurchase  all or any  portion  of the  then
         outstanding  shares of Series B  Preferred  Stock,  pro rata,  from the
         holders thereof providing it has funds legally available therefor.  Any
         such repurchase shall be upon thirty (30) days' prior written notice to
         the holders of the shares of Series B  Preferred  Stock,  which  notice
         shall set forth the number of shares of Series B Preferred  Stock to be
         repurchased  from the holder  receiving  such notice,  the date of such
         repurchase (the  "Repurchase  Date"),  and  instructions  for tendering
         certificates  representing the shares of Series B Preferred Stock to be
         repurchased.  From and after any Repurchase Date, the holders of shares
         of Series B Preferred shall have no rights as shareholders with respect
         to the shares of Series B Preferred Stock so purchased, but shall stand
         as creditors of the Corporation for the amount of the repurchase  price
         therefor.

                  4.  SHARES TO BE  RETIRED.  All  shares of Series B  Preferred
         Stock  redeemed or  purchased by the  Corporation  shall be retired and
         canceled and shall be restored to the status of authorized but unissued
         shares of Preferred Stock,  without  designation as to series,  and may
         thereafter be issued, but not as shares of Series B Preferred Stock.

                                      -29-

<PAGE>

                  5.  CONVERSION OR EXCHANGE.

                  (a) CONVERSION  RIGHT.  Except as set forth in subsection 5(c)
         hereof, at any time prior to the Mandatory Redemption Date set forth in
         Section 3 hereof,  the holders of Series B  Preferred  Stock shall have
         the right at any time to convert  all,  but not less than all,  of such
         shares of Series B  Preferred  Stock into  shares of the  Corporation's
         Common  Stock or such other  securities  into which such  Common  Stock
         shall have been converted,  or by which the Corporation's  Common Stock
         shall have been  replaced,  at the rate of one share of Common Stock of
         the Corporation for each share of Series B Preferred Stock.

                  (b) MANDATORY  CONVERSION.  In the event the Corporation shall
         engage  in  an  "equity   financing"  for  Common  Stock  and/or  other
         securities of the Corporation then each  outstanding  share of Series B
         Preferred  Stock must be converted by the holders of Series B Preferred
         Stock into Common Stock and/or other  securities of the  Corporation at
         one of the following rates: (i) the amount of shares of Common Stock or
         other securities of the Corporation set forth in Section 5(a) hereof or
         (ii) that number of shares of Common Stock and/or other  securities  of
         the  Corporation to be offered in such equity  financing  determined by
         (A) dividing the aggregate  purchase  price paid by such holder for his
         or her shares of Series B  Preferred  Stock by the  aggregate  purchase
         price paid by the  purchasers of the  Corporation's  securities in such
         equity  financing and (B)  multiplying  the  resulting  quotient by the
         number of  shares  of  Common  Stock  and/or  other  securities  of the
         Corporation to be issued in such equity financing. For purposes of this
         provision, the term "equity financing" shall mean the sale the sale, in
         one or more  transactions or offerings by the Corporation of its shares
         of Common Stock and/or other  securities  resulting in aggregate  gross
         proceeds to the Corporation of not less than  $2,000,000.  In the event
         the equity financing shall involve  transactions  with different terms,
         any election by a holder of Series B Preferred  Stock to convert his or
         her shares Series B Preferred Stock pursuant to subsection (ii) of this
         Section  5(b)  shall  be  pro  rata  among  the  various   transactions
         constituting the equity financing.

                  (c) NOTICE OF CONVERSION.  Any holder of outstanding shares of
         Series B Preferred  Stock may elect to convert  such shares of Series B
         Preferred  Stock into shares of Common Stock by serving  written notice
         on the  Corporation  setting  forth  (1) the  number  of shares of such
         holder's  Series B  Preferred  Stock to be  converted;  (2) the date by
         which such conversion must occur,  such date being at least twenty (20)
         and not more  than  sixty  (60)  days  after  the date of such  notice;
         provided, however, that in the event the Company exercises its right to
         redeem the Series B Preferred  Stock prior to the Mandatory  Redemption
         Date set forth in Section 3 hereof,  the  holders of Series B Preferred
         Stock shall have the right to elect to convert pursuant to Section 5(a)
         hereof  at any time  prior to such  early  redemption  date by  written
         notice to that effect received by the Corporation prior to the date set
         forth in the Corporation's notice of early redemption; (3) whether such
         shares of Common  Stock or other  securities  are to be  evidenced by a
         single  certificate or multiple  certificates (in which latter case the
         denominations of such certificates shall also be set forth); and (4) if
         such certificates are to be issued in the name

                                      -30-

<PAGE>

         or names of a person or  persons  other  than that of the holder of the
         Series B Preferred Stock so converting,  the name(s) and address(es) of
         such other person(s). Any securities issued pursuant to this subsection
         (b)(ii) shall be in addition to any securities  actually issued in such
         equity financing.

                  (d) ISSUANCE OF CERTIFICATES. Promptly following the effective
         date  of  any  conversion  in  accordance  with  this  Section  5,  the
         Corporation shall issue a certificate or certificates evidencing shares
         of Common Stock and/or other  securities of the Corporation  into which
         such  shares  of  Series B  Preferred  Stock  have  been  converted  in
         accordance with this Section 5.

                  6.  CERTAIN ADJUSTMENTS.

                  (a) STOCK DIVIDENDS,  SPLITS AND COMBINATIONS.  If at any time
         or from time to time,  the holders of Common Stock  become  entitled to
         receive  additional  shares or less shares because of a stock dividend,
         stock split or combination of shares,  the number of outstanding shares
         of   Series   B   Preferred   Stock   shall  be   proportionately   and
         correspondingly adjusted.

                  (b)  RECLASSIFICATIONS.  If at any time or from  time to time,
         the  holders of Common  Stock  become  entitled  to receive a different
         class of stock (the  "Entitlement  Event"),  any holder of  outstanding
         shares of Series B  Preferred  Stock  shall be  entitled to receive the
         same  number  and kind of  shares of stock as a holder of shares of the
         Common Stock immediately prior to the Entitlement Event was eligible to
         receive with respect to such Common Stock  pursuant to the  Entitlement
         Event. This provision shall include any  reclassification in connection
         with a merger of another corporation into the Corporation.

                  (c) MERGER INTO OR SALE OF ASSETS TO ANOTHER  CORPORATION.  If
         at any time or from  time to time,  the  holders  of the  Common  Stock
         become entitled to receive stock, securities,  property or cash (or any
         combination  of  them)  by  reason  of  a  capital   reorganization  or
         dissolution,  liquidation  or winding-up of the  Corporation,  a merger
         with,  a  consolidation  of the  Corporation  into,  a  sale  of all or
         substantially  all  of  the  assets  of  the  Corporation  to,  another
         corporation  (the  "Reorganization  Event"),  each  holder of shares of
         Series B  Preferred  Stock shall be entitled to receive the same stock,
         securities,  property or cash (or  combination  of them) as a holder of
         the same number of shares of the Common  Stock was  eligible to receive
         with respect to such Common Stock pursuant to the Reorganization Event.

                  7. VOTING RIGHTS.  The holders of shares of Series B Preferred
         Stock shall be  entitled,  at all meetings of the  Stockholders  of the
         Corporation  and on all occasions  where  stockholders  are entitled to
         vote or give their consent,  to one (1) vote for each share of Series B
         Preferred  Stock  owned by them.  The  holders  of  shares  of Series B
         Preferred  Stock shall vote with the holders of shares of Common  Stock
         as a single class on all matters,  except to the extent that holders of
         Common  Stock or holders of Series B Preferred  Stock shall be entitled
         to vote as a

                                      -31-

<PAGE>

         separate class only on matters which effect the rights, preferences and
         privileges of the Series B Preferred Stock.

                  8.  LIQUIDATION  PREFERENCE.  In the event of any voluntary or
         involuntary liquidation,  dissolution or winding up of the Corporation,
         the  holders  of the  Series B  Preferred  Stock  shall  entitled  to a
         liquidation preference of $1.00 per share, payable out of the assets of
         the  Corporation  therefor  prior to any  payment to the holders of the
         Corporation's  Series A Preferred  Stock of Common Stock.  In the event
         the assets of the  Corporation are not sufficient to pay such amount in
         full,  the  assets  legally  available  therefor  shall  be paid to the
         holders of Series B Preferred  Stock,  pro rata. The  consolidation  or
         merger of the Corporation  with or into any other  corporation,  or the
         sale  of  substantially  all  of  the  assets  of  the  Corporation  in
         consideration   for  the  issuance  of  equity  securities  of  another
         corporation,  shall not be regarded as a  liquidation,  dissolution  or
         winding up of the Corporation within the meaning of this Section 7, but
         only if such  consolidation,  merger or sale of assets shall not in any
         way impair  the  voting  power,  preferences  or special  rights of the
         Series B Preferred Stock.

                  9.  LIMITATIONS ON DIVIDENDS ON JUNION RANKING STOCK.  So long
         as any Series B Preferred Stock shall be  outstanding,  the Corporation
         shall not declare any  dividends on the Common Stock or any other stock
         of the Corporation  ranking as to dividends or  distributions of assets
         junior to the Series B Preferred  Stock (any such junior  ranking stock
         being  herein  referred to as "Junior  Stock"),  or make any payment on
         account of, or set apart money for, a sinking or other  analogous  fund
         for the  purchase,  redemption  or other  retirement  of any  shares of
         Junior Stock, or make any distribution in respect  thereof,  whether in
         cash or property or in obligations or stock of the  Corporation,  other
         than  Junior  Stock  (such  dividends,   payments,  setting  apart  and
         distributions being herein called "Junior Stock Payments"),  unless the
         Corporation  shall not be in default or in arrears  with respect to any
         sinking or other  analogous fund or any call for tenders  obligation or
         other agreement for the purchase, redemption or other retirement of any
         shares of Preferred Stock other than Junior Stock. For purposes of this
         Section 9, the  Corporation's  Series A Preferred Stock shall be deemed
         Junior Stock.

                  10. RESTRICTIONS ON TRANSFER.

                  (a)  RESTRICTIONS ON TRANSFER.  Neither the Series B Preferred
         Stock, nor any interest therein,  shall be transferable except upon the
         conditions  specified in this Section 10, which conditions are intended
         to ensure  compliance  with the Securities Act of 1933, as amended (the
         "Securities  Act") and all applicable  state securities laws in respect
         of the transfer of any such securities or any interest therein.

                  (b) RESTRICTIVE LEGEND. Each certificate,  if shares of Series
         B Preferred  Stock shall issued in  certificated  form,  shall  (unless
         otherwise  permitted  by the  provisions  of this Section 10) include a
         legend in a form similar to the following:

                                      -32-

<PAGE>

                  NEITHER THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE
         SECURITIES INTO WHICH THEY ARE CONVERTIBLE  HAVE BEEN REGISTERED  UNDER
         THE SECURITIES ACT OF 1933, AS AMENDED,  AND NEITHER SUCH SECURITIES NO
         ANY  INTEREST  THEREIN MAY BE SOLD,  TRANSFERRED,  PLEDGED OR OTHERWISE
         DISPOSED OF IN THE ABSENCE OF  REGISTRATION  OR AN EXEMPTION  THEREFROM
         UNDER  SUCH ACT,  APPLICABLE  STATE  SECURITIES  LAWS AND THE RULES AND
         REGULATIONS THEREUNDER.

                  (c)  NOTICE OF  PROPOSED  TRANSFER.  Each  holder of shares of
         Series B Preferred  Stock, by his acceptance of such shares,  agrees to
         comply in all respects with the provisions of this Section 10. Prior to
         any proposed transfer of any shares of Series B Preferred Stock, except
         in the case of registration  thereof  pursuant to the Securities Act of
         1933, as amended,  the holder  thereof shall give written notice to the
         Corporation of such holder's  intention of effect such  transfer.  Each
         such  notice  shall  describe  the  manner  and  circumstances  of such
         transfer  in  reasonable  detail,  and  shall be  accompanied  by (i) a
         written opinion of counsel reasonable  satisfactory to the Corporation,
         addressed to the Corporation,  to the effect that the proposed transfer
         may be effected  without  registration of the Series B Preferred Stock,
         or (ii)  written  assurance  from the  Securities  Exchange  Commission
         ("SEC")  that the SEC will not  recommend  any action be taken by it in
         the event such  transfer is effected  without  registration  under such
         Act.  Such proposed  transfer may be effected  only if the  Corporation
         shall have  received such notice and such opinion of counsel or written
         assurance,  whereupon  the holder of such  shares of Series B Preferred
         Stock shall be  entitled to transfer  such shares of Series B Preferred
         Stock in  accordance  with the terms of such notice.  Each  certificate
         evidencing shares of Series B Preferred Stock so transferred shall bear
         the legend set forth in Section 10(b) hereof,  and each  uncertificated
         share of Series B Preferred  Stock so  transferred  shall have  entered
         against it in the Corporation's  stock transfer ledger or other similar
         records a "stop transfer" legend, except that either such legend may be
         removed  if the  opinion of  counsel  or  written  assurance  is to the
         further effect that no such legend nor the  restrictions on transfer in
         this  Section 10 are required in order to ensure  compliance  with such
         Act.

                  11.  PREEMPTIVE  RIGHTS.  The  holders  of  shares of Series B
         Preferred Stock shall not be entitled to any preemptive or preferential
         rights for the  subscription  to any shares of any capital stock of the
         Corporation.

         IN WITNESS  WHEREOF,  the Corporation has caused this Certificate to be
signed by Donald C.  Fresne,  its  President,  who affirms,  under  penalties of
perjury,  that this  Certificate is the act and deed of the Corporation and that
the facts stated herein are true, as of the 7th th day of June, 2000.

                                       EPIGEN, INC.

                                       By: /s/ Donald C. Fresne
                                           --------------------
                                       Name: Donald C. Fresne
                                       Title: President

                                      -33-

<PAGE>

                                    EXHIBIT E

                                 PROMISSORY NOTE

U.S.$356,213.63                                               Date: June 7, 2000

         FOR VALUE RECEIVED,  Epigen, Inc., a Delaware corporation ("Borrower"),
hereby  promises  to pay to Donald C.  Fresne,  with an address at Tower  Lodge,
North Tower Hill Road, Box L, Millbrook,  NY 12545 ("Holder"),  or at such other
location as Holder  shall  specify in a written  notice to  Borrower,  in lawful
money of the United  States of America,  in  immediately  available  funds,  the
principal sum of U.S. Three Hundred Fifty-Six  Thousand Two Hundred Thirteen and
63/100  Dollars  (U.S.  $356,213.63),  together  with  interest on the principal
amount from time to time outstanding at the annual rate of nine percent (9%) per
annum.  Of the original  principal  amount of this Note,  the sum of $156,213.63
shall be paid by Borrower to Holder in three equal annual installments beginning
on  June 1,  2001,  together  with  interest  accrued  on the  principal  amount
outstanding  from time to time. Of the original  principal  amount of this Note,
the sum of $200,000  shall be payable by Borrower on demand by Holder,  together
with any accrued but unpaid interest hereunder.

         The  principal  balance of this Note may be prepaid by  Borrower at any
time, without premium or penalty.

         The sum of  $200,000  principal  amount of this note is  secured by the
grant of a security  interest  to Holder by Borrower  pursuant  to that  certain
Preferred Stock and Warrant  Purchase and Security  Agreement dated as of May 1,
1995 between Borrower and Holder.

         Presentation,  demand, protest and notice of dishonor are hereby waived
by the  undersigned.  No delay or  omission by Holder in  exercising  its rights
under this Note shall operate as a waiver of such rights, nor shall the exercise
of any right with respect to this Note waive or preclude  the later  exercise of
such right or any other right.

         Borrower promises to pay all costs and out-of-pocket expenses of Holder
in obtaining performance under this Note, including fees and expenses of counsel
for Holder. Borrower agrees to pay principal, interest and all other amounts due
under this Note without setoff, counterclaim or any deduction whatsoever.

         Delivery of any notice  required or  permitted  to be sent  pursuant to
this  Note  shall be deemed  to have  occurred  when  actually  received  by the
intended  recipient.  Any notice sent hereunder shall be sent by certified mail,
return receipt requested,  Express Mail or by a nationally  recognized overnight
courier  service.  For purposes of this Note,  the term "Business Day" means any
day  other  than a day on  which  banks  located  in the  State  of New York are
required or permitted to close.

                                      -34-

<PAGE>

         This Note shall be governed by and  construed  in  accordance  with the
laws of the State of New York.

                                       EPIGEN, INC.

                                       By:/s/ Donald C. Fresne
                                           -------------------
                                       Name: Donald C. Fresne
                                       Title: Chairman, President and
                                       Chief Executive Officer

                                      -35-

<PAGE>

                                    EXHIBIT F

                                 PROMISSORY NOTE

U.S.$ $156,213.63                                             Date: June 7, 2000

         FOR VALUE RECEIVED,  Donald C. Fresne,  with an address at Tower Lodge,
North Tower Hill Road, Box L, Millbrook, NY 12545 ("Borrower"),  hereby promises
to pay to Epigen,  Inc., a Delaware  corporation with an address at Tower Lodge,
North Tower Hill Road, Box L, Millbrook,  NY 12545 ("Holder"),  or at such other
location as Holder  shall  specify in a written  notice to  Borrower,  in lawful
money of the United  States of America,  in  immediately  available  funds,  the
principal sum of U.S. One Hundred  Fifty-Six  Thousand Two Hundred  Thirteen and
63/100 Dollars (U.S.$156,213.63), together with interest on the principal amount
from time to time outstanding at the annual rate of nine percent (9%) per annum.
Such  principal and accrued  interest shall be repaid in  installments  equal in
amount to the  installment  payments of principal and interest to be received by
Borrower from Holder  pursuant to that certain  Primissory  note in the original
principal  amount  of  $356,213.63,  dated  June 7,  2000,  if, as and when such
installments are received by Borrower.

         The  principal  balance of this Note may be prepaid by  Borrower at any
time, without premium or penalty.

         Presentation,  demand, protest and notice of dishonor are hereby waived
by the  undersigned.  No delay or  omission by Holder in  exercising  its rights
under this Note shall operate as a waiver of such rights, nor shall the exercise
of any right with respect to this Note waive or preclude  the later  exercise of
such right or any other right.

         Borrower promises to pay all costs and out-of-pocket expenses of Holder
in obtaining performance under this Note, including fees and expenses of counsel
for Holder. Borrower agrees to pay principal, interest and all other amounts due
under this Note without setoff, counterclaim or any deduction whatsoever.

         Delivery of any notice  required or  permitted  to be sent  pursuant to
this  Note  shall be deemed  to have  occurred  when  actually  received  by the
intended  recipient.  Any notice sent hereunder shall be sent by certified mail,
return receipt requested,  Express Mail or by a nationally  recognized overnight
courier  service.  For purposes of this Note,  the term "Business Day" means any
day  other  than a day on  which  banks  located  in the  State  of New York are
required or permitted to close.

                                      -36-

<PAGE>

         This Note shall be governed by and  construed  in  accordance  with the
laws of the State of New York.

                                       /s/ Donald C. Fresne
                                       --------------------
                                       Donald C. Fresne

                                      -37-

<PAGE>

                                    EXHIBIT G

Holders of 2% or more of Epigen Common Stock.

<TABLE>

Clapp, David
Indian Creek Partners, LP
Summary of Investments & Holdings in Epigen, Inc. & Biofund, Inc.

<CAPTION>
Investment Date ................................    07/07/97    12/23/97    07/29/98       n/a      02/23/99    11/12/99     Totals
                                                    --------    --------    --------    --------    --------    --------    --------
<S>                                                 <C>         <C>         <C>         <C>         <C>         <C>         <C>
Amount .........................................    $100,000        --      $100,000        --      $ 50,000        --      $250,000
Loan Amount ....................................        --      $100,000        --          --          --          --      $100,000
Terms of Promissory Note .......................        --      Prime+5%        --          --          --          --          --
Maturity Date ..................................        --      12/23/98        --          --          --          --          --
Shares Purchases ...............................      36,363        --       120,482        --        50,000        --       206,845
Price Per Share ................................    $   2.75        --      $   0.83        --      $   1.00        --          --
Available Conversion ...........................        --        37,594        --          --          --          --          --
Class C Warrants ...............................       9,091        --          --          --          --          --         9,091
Price Per Share ................................    $   2.00        --          --          --          --          --          --
Expiration Date ................................    12/31/01        --          --          --          --          --          --
Class D Warrants ...............................       9,091        --          --          --          --          --         9,091
Price Per Share ................................    $   2.00        --          --          --          --          --          --
Expiration Date ................................    12/31/01        --          --          --          --          --          --
Escrow Agreement Date ..........................        --          --          --      12/23/97        --          --          --
Escrow Agreement w/D. Fresne ...................        --          --          --       160,000        --          --       160,000
Escrow Agent Certificate Number ................        --          --          --      CS3066          --          --          --
Price Per Share ................................        --          --          --      $   2.66        --          --          --
Expiration Date ................................        --          --          --      12/28/02        --          --          --
Series F Warrants ..............................        --          --          --          --        50,000        --        50,000
Price Per Share ................................        --          --          --          --      $   1.50        --          --
Expiration Date ................................        --          --          --          --      03/31/04        --          --
Series G Warrants ..............................        --          --          --          --        50,000        --        50,000
Price Per Share ................................        --          --          --          --      $   2.00        --          --
Expiration Date ................................        --          --          --          --      03/31/04        --          --
Biofund, Inc. CD Collateral Loan ...............        --          --          --          --          --      $200,000    $200,000
Biofund, Inc. Shares Owned .....................        --          --          --          --          --           200         200

Summary
-------
Epigen, Inc.
  Total Investment                                    $350,000
  Common Shares Purchased                              206,845
  Exercisable Warrants & Options                       278,182
Biofund, Inc.
  Total Investment                                    $200,000
  Shares Owned                                             200

</TABLE>
<PAGE>

<TABLE>

Corsiglia, Robert
Summary of Investments & Holdings in Epigen, Inc. & Biofund, Inc.

<CAPTION>
Investment Date .................   08/11/95   12/18/96    10/10/97        01/16/98      07/02/98
                                    --------   --------    --------        --------      --------
<S>                                <C>        <C>        <C>             <C>             <C>
Amount .........................   $ 25,000   $100,000   Equity Kicker   Equity Kicker   $ 25,000
Common Shares Issued ............      4,545     36,364          12,500           9,399     30,121
Price Per Share .................   $   5.50   $   2.75            --              --     $   0.83
Warrant .........................      4,545       --              --              --         --
Strike Price ....................   $   2.00       --              --              --         --
Expiration Date .................   09/01/00       --              --              --         --
Warrant .........................       --         --              --            18,997       --
Strike Price ....................       --         --              --     $        2.66       --
Expiration Date .................       --         --              --        01/16/03         --
Class C Warrants ................       --        9,091            --              --         --
Strike Price ....................       --     $   2.00            --              --         --
Expiration Date .................       --     12/31/01            --              --         --
Class D Warrants ................       --        9,091            --              --         --
Strike Price ....................       --     $   2.00            --              --         --
Expiration Date .................       --     12/31/01            --              --         --
 Biofund, Inc. CD Collateral Loan       --         --              --              --         --
Biofund, Inc. Shares Owned ......       --         --              --              --         --

<CAPTION>
Investment Date .................     09/17/98       11/18/99      03/13/00         Totals
                                      --------       --------      --------         ------
<S>                                <C>               <C>        <C>                <C>
Amount .........................   Debt to Equity        --     Debt to Equity     $150,000
Common Shares Issued ............           22,010       --          48,527         163,466
Price Per Share .................   $         0.83       --     $         0.83         --
Warrant .........................             --         --            --              --
Strike Price ....................             --         --       Conversion           --
Expiration Date .................             --         --        Rate of             --
Warrant .........................             --         --       09/17/1999         55,417
Strike Price ....................             --         --        Changed             --
Expiration Date .................             --         --       From $2.66           --
Class C Warrants ................             --         --        to $.83.           9,091
Strike Price ....................             --         --       (See Board           --
Expiration Date .................             --         --       Minutes of           --
Class D Warrants ................             --         --       1/21/00.)           9,091
Strike Price ....................             --         --            --              --
Expiration Date .................             --         --            --              --
 Biofund, Inc. CD Collateral Loan             --     $ 25,000          --          $ 25,000
Biofund, Inc. Shares Owned ......             --           25          --                25

</TABLE>
<PAGE>

Field, Richard D.
Summary of Investments & Holdings in Epigen, Inc. & Biofund, Inc.

Investment Date .........................     07/27/99     11/18/99      Totals
                                              --------     --------     --------
Amount .................................      $100,000         --       $100,000
Common Shares Purchased ................       100,000         --        100,000
Price Per Share ........................      $   1.00         --           --
Series H Warrant .......................       100,000         --        100,000
Strike Price Per Share .................      $   3.00         --           --
Expiration Date .........................     06/30/04         --           --
Biofund, Inc. CD Collateral Loan .......          --       $100,000     $100,000
Biofund, Inc. Shares Owned ..............         --            100          100

<PAGE>

Fresne, Donald C.
Summary of Investments & Holdings in Epigen, Inc. & Biotag, Inc.

Date .............................     At 12/31/99    At 12/31/00       Totals
                                       -----------    -----------     ----------
Considertion (approximate) .......     $4,000,000         --          $4,000,000
Common Shares Issued .............      2,260,325         --           2,260,325
Assuming Series A Conversion .....        600,000         --             600,000
Warrants .........................         24,702        1,000            25,702
Strike Price .....................     $     0.83       $ 2.66             --
Expiration Date ..................       04/15/03       12/31/02           --

Biotag, Inc. Shares ..............         17,026         --              17,026

<PAGE>

Goldfrank, III, Lionel
Summary of Investments & Holdings in Epigen, Inc. & Biofund, Inc.

Investment Date .........................     06/24/99     11/30/99      Totals
                                              --------     --------     --------
Amount .................................      $100,000         --       $100,000
Common Shares Purchased ................       100,000         --        100,000
Price Per Share ........................      $   1.00         --           --
Series H Warrant .......................       100,000         --        100,000
Price Per Share ........................      $   3.00         --           --
Expiration Date .........................     06/30/04         --           --
Biofund, Inc. CD Collateral Loan ........         --        150,000     $150,000
Biofund, Inc. Shares Owned ..............         --            150          150

<PAGE>

<TABLE>

Kent, Richard E.
Summary of Investments & Holdings in Epigen, Inc.

<CAPTION>
Date .................   07/14/97  09/25/97   At 12/31/99    At 12/31/99   At 12/31/99   At 12/31/99
                         --------  --------   -----------    -----------   -----------   -----------
<S>                      <C>       <C>        <C>            <C>           <C>           <C>
Debt Conversion Amount   $45,307      --           --             --            --            --
Conversion Rate ......   $ 0.095      --      (Bonus/Svcs)        --            --            --
Shares Issued ........    21,678    12,500      143,411           --            --            --
Amount ...............      --     $25,000         --             --            --            --
Promissory Note Issued      --          25%        --             --            --            --
Maturity Date ........      --     10/06/98        --             --            --            --
Options ..............      --        --           --            2,136         1,931         1,681
Strike Price .........      --        --           --           $ 2.00        $ 2.00        $ 2.00
Expiration Date ......      --        --           --          09/13/01      03/25/02      06/01/02

<CAPTION>
Date .................   At 12/31/99   At 12/31/99   At 12/31/99   At 12/31/99   At 12/31/99   At 12/31/99     Totals
                         -----------   -----------   -----------   -----------   -----------   -----------   --------
<S>                      <C>           <C>           <C>           <C>           <C>           <C>         <C>
Debt Conversion Amount        --            --            --            --            --            --     $ 45,307
Conversion Rate ......        --            --            --            --            --            --         --
Shares Issued ........        --            --            --            --            --            --      177,589
Amount ...............        --            --            --            --            --            --     $ 25,000
Promissory Note Issued        --            --            --            --            --            --         --
Maturity Date ........        --            --            --            --            --            --         --
Options ..............         401         1,681         1,681         1,681         1,681        47,000     59,873
Strike Price .........      $ 2.00        $ 2.00        $ 2.00        $ 2.00        $ 2.00        $ 0.50       --
Expiration Date ......     12/02/02      06/01/03      06/01/04      06/01/05      06/01/06      11/01/06      --

</TABLE>

<PAGE>

Long, Leo William
Summary of Holdings

Investments
-----------
  11/10/95                                 $ 100,000
  01/01/96                                   200,000
  05/24/96                                    50,000
  08/20/96                                    50,000
  02/01/97                                   100,000
  01/21/98                                   100,000
  02/26/99                                    50,000
                                      ---------------
    Total Investment                       $ 650,000

Shares of Common Stock                       177,273

Warrants                                                Exp Date
--------                                                --------
  $2.00 strike price                          18,182    11/30/00
  $2.00 strike price                          36,364    01/31/01
  $2.66 strike price                          75,188    01/21/03
  Class C, $2.00 strike price                 18,182    06/30/01
  Class D, $2.00 strike price                 18,182    06/30/01
  Series F, $1.50 strike price                50,000    03/31/04
  Series G, $2.00 strike price                50,000    03/31/04
                                      ---------------
    Total Warrants                           266,098

Promissory Note
---------------
  Rate:  Prime + 5%                        $ 100,000
  (Included in the $650,000
   investment.)

<PAGE>

Parsons, Christy
Summary of Investments & Holdings in Biofund, Inc.

Investment Date ................................        04/13/00         Totals
                                                        --------        --------
Biofund, Inc. CD Collateral Loan ...............        $120,000        $120,000
Biofund, Inc. Shares Owned .....................             120             120

<PAGE>

<TABLE>

Tozer, Jr., W. James
Summary of Investments & Holdings in Epigen, Inc. & Biofund, Inc.

<CAPTION>
Investment Date ................   08/18/95   07/14/97    10/17/97    04/28/98
                                   --------   --------    --------    --------
<S>                                <C>       <C>          <C>         <C>
Amount ........................   $ 25,000      --           --      $100,000
Loan Amount ...................       --        --       $ 25,000        --
Promissory Note Issued .........      --        --             25%       --
Date of Maturity ...............      --        --       10/17/98        --
Common Stock Issued ...........      4,545     7,273       12,500     120,482
Series A Preferred Stock Issued       --        --           --          --
Price Per Share ...............   $   5.50   Additional      --      $   0.83
Warrant .......................      2,273     Shares        --          --
Price Per Share ...............   $   2.00   Issued as       --          --
Expiration Date ...............   09/01/00     Price         --          --
Warrant .......................      2,273   Protection      --          --
Price Per Share ...............   $   2.00   Arrangement     --          --
Expiration Date ...............   09/01/00      --           --          --
Series F Warrants .............       --        --           --          --
Price Per Share ...............       --        --           --          --
Expiration Date ................      --        --           --          --
Series G Warrants .............       --        --           --          --
Price Per Share ...............       --        --           --          --
Expiration Date ................      --        --           --          --
Biofund, Inc. CD Collateral Loan      --        --           --          --
Biofund, Inc. Shares Owned .....      --        --           --          --

<CAPTION>
Investment Date ................   08/24/98   02/23/99   05/12/99   11/16/99     Totals
                                   --------   --------   --------   --------     ------
<S>                                <C>        <C>        <C>        <C>        <C>
Amount ........................   $250,000   $ 50,000   $ 50,000       --     $475,000
Loan Amount ...................       --         --         --         --     $ 25,000
Promissory Note Issued .........      --         --         --         --         --
Date of Maturity ...............      --         --         --         --         --
Common Stock Issued ...........    301,205     50,000       --         --      496,005
Series A Preferred Stock Issued       --         --       50,000       --       50,000
Price Per Share ...............   $   0.83   $   1.00   $   1.00       --         --
Warrant .......................    300,000       --         --         --      302,273
Price Per Share ...............   $   1.00       --         --         --         --
Expiration Date ...............   08/31/03       --         --         --         --
Warrant .......................       --         --         --         --        2,273
Price Per Share ...............       --         --         --         --         --
Expiration Date ...............       --         --         --         --         --
Series F Warrants .............       --       50,000       --         --       50,000
Price Per Share ...............       --     $   1.50       --         --         --
Expiration Date ................      --     03/31/04       --         --         --
Series G Warrants .............       --       50,000       --         --       50,000
Price Per Share ...............       --     $   2.00       --         --         --
Expiration Date ................      --     03/31/04       --         --         --
Biofund, Inc. CD Collateral Loan      --         --         --     $200,000   $200,000
Biofund, Inc. Shares Owned .....      --         --         --          200        200

Summary
-------
Epigen, Inc.
  Total Investment                                    $ 500,000
  Common Stock Purchased                                496,005
  Series A Preferred Stock                               50,000
  Exercisable Warrants & Options                        404,545
Biofund, Inc.
  Total Investment                                    $ 200,000
  Shares Owned                                              200

</TABLE>

                                      -38-EXHIBIT

<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                           IMPAC SECURED ASSETS CORP.,
                                    Company,

                            IMPAC FUNDING CORPORATION
                                Master Servicer,

                                       and

                    BANKERS TRUST COMPANY OF CALIFORNIA, N.A.
                                     Trustee

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

                         POOLING AND SERVICING AGREEMENT

                            Dated as of June 1, 2000

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

                       Mortgage Pass-Through Certificates

                                  Series 2000-2

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<PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS
                                                 -----------------
                                                                                                               Page
                                                                                                               ----
<S>      <C>                                                                                                   <C>
ARTICLE I

         DEFINITIONS..............................................................................................3
         1.01.  Defined Terms.....................................................................................3
         Accretion Directed Certificates..........................................................................3
         Accretion Termination Date...............................................................................3
         Accrual Certificates.....................................................................................3
         Accrual Distribution Amount..............................................................................3
         Accrued Certificate Interest.............................................................................3
         Advance  ................................................................................................4
         Aggregate Stated Principal Balance.......................................................................4
         Agreement................................................................................................4
         Anniversary..............................................................................................4
         Assignment...............................................................................................4
         Available Distribution Amount............................................................................4
         Balloon Loan.............................................................................................5
         Balloon Payment..........................................................................................5
         Bankruptcy Amount........................................................................................5
         Bankruptcy Code..........................................................................................5
         Bankruptcy Loss..........................................................................................5
         Book-Entry Certificate...................................................................................5
         Business Day.............................................................................................6
         Cash Liquidation.........................................................................................6
         Certificate..............................................................................................6
         Certificate Account......................................................................................6
         Certificate Account Deposit Date.........................................................................6
         Certificateholder" or "Holder............................................................................6
         Certificate Owner........................................................................................6
         Certificate Principal Balance............................................................................7
         Certificate Register.....................................................................................7
         Class    ................................................................................................7
         Class A Certificate......................................................................................7
         Class B Certificate......................................................................................8
         Class B Percentage.......................................................................................8
         Class B-1 Certificate....................................................................................8
         Class B-1 Percentage.....................................................................................8
         Class B-1 Prepayment Distribution Trigger................................................................8
         Class B-2 Certificate....................................................................................8
         Class B-2 Percentage.....................................................................................8
         Class B-2 Prepayment Distribution Trigger................................................................9
         Class B-3 Certificate....................................................................................9
         Class B-3 Percentage.....................................................................................9

                                                         i

<PAGE>

         Class B-3 Prepayment Distribution Trigger................................................................9
         Class M Certificate......................................................................................9
         Class M Percentage.......................................................................................9
         Class M-1 Certificate....................................................................................9
         Class M-1 Percentage.....................................................................................9
         Class M-2 Certificate...................................................................................10
         Class M-2 Percentage....................................................................................10
         Class M-2 Prepayment Distribution Trigger...............................................................10
         Class M-3 Certificate...................................................................................10
         Class M-3 Percentage....................................................................................10
         Class M-3 Prepayment Distribution Trigger...............................................................10
         Closing Date............................................................................................11
         Code     ...............................................................................................11
         Collateral Value........................................................................................11
         Commission..............................................................................................11
         Company  ...............................................................................................11
         Compensating Interest...................................................................................11
         Corporate Trust Office..................................................................................11
         Curtailment.............................................................................................11
         Custodial Account.......................................................................................12
         Cut-off Date............................................................................................12
         Debt Service Reduction..................................................................................12
         Defaulted Mortgage Loan.................................................................................12
         Deficient Valuation.....................................................................................12
         Definitive Certificate..................................................................................12
         Deleted Mortgage Loan...................................................................................12
         Depository..............................................................................................12
         Depository Participant..................................................................................12
         Determination Date......................................................................................12
         Discount Fraction.......................................................................................12
         Discount Mortgage Loan..................................................................................13
         Disqualified Organization...............................................................................13
         Distribution Date.......................................................................................13
         Due Date ...............................................................................................13
         Due Period..............................................................................................13
         Eligible Account........................................................................................13
         Eligible Funds..........................................................................................14
         Event of Default........................................................................................14
         Excess Bankruptcy Loss..................................................................................14
         Excess Fraud Loss.......................................................................................14
         Excess Proceeds.........................................................................................14
         Excess Special Hazard Loss..............................................................................14
         Extraordinary Events....................................................................................14
         Extraordinary Losses....................................................................................15
         Fannie Mae..............................................................................................15
         FDIC     ...............................................................................................15

                                                        ii

<PAGE>

         Fitch    ...............................................................................................15
         Fraud Loss Amount.......................................................................................15
         Fraud Losses............................................................................................16
         Freddie Mac.............................................................................................16
         Funding Date............................................................................................16
         Initial Certificate Principal Balance...................................................................16
         Initial Notional Amount.................................................................................16
         Insurance Policy........................................................................................16
         Insurance Proceeds......................................................................................16
         Interest Accrual Period.................................................................................16
         Interest Only Certificate...............................................................................16
         Late Collections........................................................................................16
         LIBOR    ...............................................................................................17
         LIBOR Business Day......................................................................................17
         Liquidation Proceeds....................................................................................17
         Loan-to-Value Ratio.....................................................................................17
         Lockout Certificate Percentage..........................................................................17
         Lockout Certificates....................................................................................17
         Lockout Distribution Percentage.........................................................................17
         Lockout Priority Percentage.............................................................................17
         Lost Note Affidavit.....................................................................................18
         Maturity Date...........................................................................................18
         Master Servicer.........................................................................................18
         Monthly Payment.........................................................................................18
         Mortgage ...............................................................................................18
         Mortgage File...........................................................................................18
         Mortgage Loan...........................................................................................18
         Mortgage Loan Purchase Agreement........................................................................18
         Mortgage Loan Schedule..................................................................................18
         Mortgage Note...........................................................................................20
         Mortgage Rate...........................................................................................20
         Mortgaged Property......................................................................................20
         Mortgagor...............................................................................................20
         Net Mortgage Rate.......................................................................................20
         Non-Discount Mortgage Loan..............................................................................20
         Nonrecoverable Advance..................................................................................20
         Non-United States Person................................................................................20
         Notional Amount.........................................................................................20
         Officers' Certificate...................................................................................21
         Opinion of Counsel......................................................................................21
         Original Senior Percentage..............................................................................21
         OTS      ...............................................................................................21
         Outstanding Mortgage Loan...............................................................................21
         Ownership Interest......................................................................................21
         Pass-Through Rate.......................................................................................21
         Percentage Interest.....................................................................................22

                                                        iii

<PAGE>

         Permitted Investment....................................................................................22
         Permitted Transferee....................................................................................23
         Person   ...............................................................................................23
         Pool Strip Rate.........................................................................................23
         Prepayment Distribution Percentage......................................................................24
         Prepayment Distribution Trigger.........................................................................25
         Prepayment Interest Shortfall...........................................................................25
         Prepayment Period.......................................................................................25
         Primary Hazard Insurance Policy.........................................................................25
         Primary Insurance Policy................................................................................25
         Principal Only Certificates.............................................................................25
         Principal Prepayment....................................................................................26
         Principal Prepayment in Full............................................................................26
         Purchase Price..........................................................................................26
         Qualified Insurer.......................................................................................26
         Qualified Substitute Mortgage Loan......................................................................26
         Radian   ...............................................................................................27
         Radian Insured Loans....................................................................................27
         Radian Lender-Paid PMI Policy...........................................................................27
         Radian PMI Pool Policy..................................................................................27
         Radian PMI Policy Rate..................................................................................27
         Rate Adjustment Date....................................................................................27
         Rating Agency...........................................................................................27
         Realized Loss...........................................................................................28
         Record Date.............................................................................................28
         Regular Certificate.....................................................................................28
         Relief Act..............................................................................................28
         REMIC    ...............................................................................................28
         REMIC Provisions........................................................................................29
         Remittance Report.......................................................................................29
         REO Acquisition.........................................................................................29
         REO Disposition.........................................................................................29
         REO Imputed Interest....................................................................................29
         REO Proceeds............................................................................................29
         REO Property............................................................................................29
         Request for Release.....................................................................................29
         Reserve Banks...........................................................................................30
         Reserve Interest Rate...................................................................................30
         Residual Certificate....................................................................................30
         Responsible Officer.....................................................................................30
         Seller   ...............................................................................................30
         Senior Accelerated Distribution Percentage..............................................................30
         Senior Interest Distribution Amount.....................................................................31
         Senior Percentage.......................................................................................31
         Senior Principal Distribution Amount....................................................................32
         Servicing Account.......................................................................................32

                                                        iv

<PAGE>

         Servicing Advances......................................................................................32
         Servicing Fees..........................................................................................32
         Servicing Fee Rate......................................................................................32
         Servicing Guide.........................................................................................32
         Servicing Officer.......................................................................................32
         Single Certificate......................................................................................32
         Special Deposit.........................................................................................32
         Special Hazard Amount...................................................................................32
         Special Hazard Loss.....................................................................................33
         Special Hazard Percentage...............................................................................33
         Standard & Poor's.......................................................................................34
         Startup Day.............................................................................................34
         Stated Principal Balance................................................................................34
         Subordinate Certificate.................................................................................34
         Subordinate Percentage..................................................................................34
         Subordinate Principal Distribution Amount...............................................................34
         Sub-Servicer............................................................................................34
         Sub-Servicer Remittance Date............................................................................35
         Sub-Servicing Account...................................................................................35
         Sub-Servicing Agreement.................................................................................35
         Tax Returns.............................................................................................35
         Transfer ...............................................................................................35
         Transferor..............................................................................................35
         Trust Fund..............................................................................................35
         Trustee  ...............................................................................................35
         Trustee's Fee...........................................................................................35
         Trustee Fee Rate........................................................................................35
         Uncertificated Principal Balance........................................................................35
         Uncertificated REMIC I Accrued Interest.................................................................36
         Uncertificated REMIC I IO Notional Amount...............................................................36
         Uncertificated REMIC I IO Regular Interests.............................................................36
         Uncertificated REMIC I Pass-Through Rate................................................................37
         Uncertificated REMIC I Regular Interest T...............................................................37
         Uncertificated REMIC I Regular Interest U...............................................................37
         Uncertificated REMIC I Regular Interest V...............................................................37
         Uncertificated REMIC I Regular Interest W...............................................................37
         Uncertificated REMIC I Regular Interest X...............................................................38
         Uncertificated REMIC I Regular Interest Y...............................................................38
         Uncertificated REMIC I Regular Interests................................................................38
         Uncertificated REMIC I IO Regular Interest Distribution Amount..........................................38
         Uncertificated REMIC I Regular Interest T Distribution Amount...........................................38
         Uncertificated REMIC I Regular Interest U Distribution Amount...........................................38
         Uncertificated REMIC I Regular Interest V Distribution Amount...........................................38
         Uncertificated REMIC I Regular Interest W Distribution Amount...........................................38
         Uncertificated REMIC I Regular Interest X Distribution Amount...........................................39
         Uncertificated REMIC I Regular Interest Y Distribution Amount...........................................39

                                                         v

<PAGE>

         Uncertificated REMIC I Regular Interest Distribution Amounts............................................39
         Uninsured Cause.........................................................................................39
         United States Person....................................................................................39
         Voting Rights...........................................................................................39
         Wendover ...............................................................................................39
         1.02     Determination of LIBOR.........................................................................40

ARTICLE II

         CONVEYANCE OF MORTGAGE LOANS;
         ORIGINAL ISSUANCE OF CERTIFICATES.......................................................................41
         2.01.    Conveyance of Mortgage Loans...................................................................41
         2.02.    Acceptance of the Trust Fund by the Trustee....................................................44
         2.03.    Representations, Warranties and Covenants of the Master Servicer and the
                  Company........................................................................................45
         2.04.    Representations and Warranties of the Seller...................................................47
         2.05.    Issuance of Certificates Evidencing Interests in the REMIC I Certificates......................49
         2.06.    Conveyance of Uncertificated REMIC I Regular Interests; Acceptance by the
                  Trustee........................................................................................49
         2.07.    Issuance of Certificates Evidencing Interest in REMIC II.......................................50

ARTICLE III

         ADMINISTRATION AND SERVICING
         OF THE TRUST FUND.......................................................................................50
         3.01.    Master Servicer to Act as Master Servicer......................................................50
         3.02.    Sub-Servicing Agreements Between Master Servicer and Sub-Servicers.............................51
         3.03.    Successor Sub-Servicers........................................................................52
         3.04.    Liability of the Master Servicer...............................................................53
         3.05.    No Contractual Relationship Between Sub-Servicers and Trustee or
                  Certificateholders.............................................................................53
         3.06.    Assumption or Termination of Sub-Servicing Agreements by Trustee...............................53
         3.07.    Collection of Certain Mortgage Loan Payments...................................................54
         3.08.    Sub-Servicing Accounts.........................................................................55
         3.09.    Collection of Taxes, Assessments and Similar Items; Servicing Accounts.........................55
         3.10.    Custodial Account..............................................................................56
         3.11.    Permitted Withdrawals From the Custodial Account...............................................57
         3.12.    Permitted Investments..........................................................................58
         3.13.    Maintenance of Primary Hazard Insurance. ......................................................58
         3.14.    Enforcement of Due-on-Sale Clauses; Assumption Agreements......................................61
         3.15.    Realization Upon Defaulted Mortgage Loans......................................................62
         3.16.    Trustee to Cooperate; Release of Mortgage Files................................................63
         3.17.    Servicing Compensation.........................................................................64
         3.18.    Maintenance of Certain Servicing Policies......................................................64
         3.19.    Annual Statement as to Compliance..............................................................65
         3.20.    Annual Independent Public Accountants' Servicing Statement.....................................65

                                                        vi

<PAGE>

         3.21.    Access to Certain Documentation................................................................66
         3.22.    Title, Conservation and Disposition of REO Property............................................67
         3.23.    Additional Obligations of the Master Servicer..................................................69
         3.24     Optional Purchase of Defaulted Mortgage Loans..................................................70
         3.25.    Additional Obligations of the Company..........................................................70
         3.26.    Periodic Filings with the Securities and Exchange Commission; Additional
                  Information....................................................................................70

ARTICLE IV

         PAYMENTS TO CERTIFICATEHOLDERS..........................................................................72
         4.01.    Certificate Account; Distributions.............................................................72
         4.02.    Statements to Certificateholders...............................................................80
         4.03.    Remittance Reports; Advances by the Master Servicer............................................82
         4.04.    Allocation of Realized Losses..................................................................83
         4.05.    Information Reports to Be Filed by the Master Servicer.........................................85
         4.06.    Compliance with Withholding Requirements.......................................................85

ARTICLE V

         THE CERTIFICATES........................................................................................87
         5.01.    The Certificates...............................................................................87
         5.02.    Registration of Transfer and Exchange of Certificates..........................................89
         5.03.    Mutilated, Destroyed, Lost or Stolen Certificates..............................................94
         5.04.    Persons Deemed Owners..........................................................................94
         5.05.    Rule 144A Information..........................................................................94

ARTICLE VI

         THE COMPANY AND THE MASTER SERVICER.....................................................................96
         6.01.    Liability of the Company and the Master Servicer...............................................96
         6.02.    Merger, Consolidation or Conversion of the Company or the Master Servicer......................96
         6.03.    Limitation on Liability of the Company, the Master Servicer and Others.........................96
         6.04.    Limitation on Resignation of the Master Servicer...............................................97
         6.05.    Sale and Assignment of Master Servicing........................................................97

ARTICLE VII

         DEFAULT.................................................................................................99
         7.01.    Events of Default..............................................................................99
         7.02.    Trustee to Act; Appointment of Successor......................................................101
         7.03.    Notification to Certificateholders............................................................101
         7.04.    Waiver of Events of Default...................................................................102
         7.05.    List of Certificateholders....................................................................102

                                                        vii

<PAGE>

ARTICLE VIII

         CONCERNING THE TRUSTEE.................................................................................103
         8.01.    Duties of Trustee.............................................................................103
         8.02.    Certain Matters Affecting the Trustee.........................................................104
         8.03.    Trustee Not Liable for Certificates or Mortgage Loans.........................................105
         8.04.    Trustee May Own Certificates..................................................................105
         8.05.    Trustee's Fees................................................................................106
         8.06.    Eligibility Requirements for Trustee..........................................................106
         8.07.    Resignation and Removal of the Trustee........................................................107
         8.08.    Successor Trustee.............................................................................107
         8.09.    Merger or Consolidation of Trustee............................................................108
         8.10.    Appointment of Co-Trustee or Separate Trustee.................................................108

ARTICLE IX

         TERMINATION............................................................................................110
         9.01.    Termination Upon Repurchase or Liquidation of All Mortgage Loans or upon
                  Purchase of Certificates......................................................................110
         9.02.    Termination of REMIC II.......................................................................113
         9.03.    Additional Termination Requirements...........................................................113

ARTICLE X

         REMIC PROVISIONS.......................................................................................115
         10.01.   REMIC Administration..........................................................................115
         10.02.   Prohibited Transactions and Activities........................................................117
         10.03.   Master Servicer and Trustee Indemnification...................................................118

ARTICLE XI

         MISCELLANEOUS PROVISIONS...............................................................................119
         11.01.   Amendment.....................................................................................119
         11.02.   Recordation of Agreement; Counterparts........................................................120
         11.03.   Limitation on Rights of Certificateholders....................................................120
         11.04.   Governing Law.................................................................................121
         11.05.   Notices.......................................................................................121
         11.06.   Severability of Provisions....................................................................122
         11.07.   Successors and Assigns; Third Party Beneficiary...............................................122
         11.08.   Article and Section Headings..................................................................122
         11.09.   Notice to Rating Agencies.....................................................................122

         Signatures
         Acknowledgments

         Exhibit A         Form of Class A Certificate
</TABLE>

                                      viii

<PAGE>

Exhibit B-1    Form of Class M Certificate
Exhibit B-2    Form of Class B Certificate
Exhibit B-3    Form of Class R-I and Class R-II Certificate
Exhibit C      Form of Trustee Initial Certification
Exhibit D      Form of Trustee Final Certification
Exhibit E      Form of Remittance Report
Exhibit F-1    Request for Release
Exhibit F-2    Request for Release for Mortgage Loans Paid in Full
Exhibit G-1    Form of Investor Representation Letter
Exhibit G-2    Form of Transferor Representation Letter
Exhibit G-3    Form of Rule 144A Investment Representation
Exhibit G-4    Transferor Certificate for Transfers of Residual Certificates
Exhibit G-5    Transfer Affidavit and Agreement for Transfers of Residual
               Certificates
Exhibit G-6    Form of Investor Representation Letter for Insurance Companies
Exhibit H      Mortgage Loan Schedule
Exhibit I      Seller Representations and Warranties
Exhibit J      Form of Notice Under Section 3.25
Exhibit K      Impac Funding Corporation Servicing Guide

                                       ix

<PAGE>

                  This Pooling and Servicing Agreement, dated and effective as
of June 1, 2000, among Impac Secured Assets Corp., as company (the "Company"),
Impac Funding Corporation, as master servicer (the "Master Servicer"), and
Bankers Trust Company of California, N.A., as trustee (the "Trustee").

                             PRELIMINARY STATEMENT:

                  The Company intends to sell mortgage pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Mortgage Loans (as defined herein). As provided herein, the Trustee will
make, in accordance with Section 10.01, an election to treat the entire
segregated pool of assets described in the definition of REMIC I (as defined
herein), and subject to this Agreement (including the Mortgage Loans), as a real
estate mortgage investment conduit (a "REMIC") for federal income tax purposes
and such segregated pool of assets will be designated as "REMIC I." The
Uncertificated REMIC I Regular Interests will be "regular interests" in REMIC I
and the Class R-I Certificates will be the sole class of "residual interests" in
REMIC I for purposes of the REMIC Provisions (as defined herein) under the
federal income tax law. A segregated pool of assets consisting of the
Uncertificated REMIC I Regular Interests will be designated as "REMIC II," and
the Trustee will make, in accordance with Section 10.01, a separate REMIC
election with respect thereto. The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-8, Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2 and Class B-3 Certificates will be "regular interests" in
REMIC II, and the Class R-II Certificates will be the sole class of "residual
interests" therein for purposes of the REMIC Provisions (as defined herein)
under federal income tax law.

         The following table irrevocably sets forth the designation, the
Uncertificated REMIC I Pass- Through Rate, the initial Uncertificated Balance
and, solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC I
Regular Interests. None of the REMIC I Regular Interests will be certificated.

<TABLE>
<CAPTION>
                                  Uncertificated REMIC I       Initial Uncertificated            Latest Possible
         Designation                 Pass-Through Rate            Principal Balance             Maturity Date(1)
         -----------                 -----------------            -----------------             ----------------
<S>                               <C>                          <C>                              <C>
Uncertificated REMIC I                 8.225003725%                $147,664,000.00               July 25, 2030
Regular Interest T

Uncertificated REMIC I                     9.05%                    $73,831,000.00               July 25, 2030
Regular Interest U

Uncertificated REMIC I                     8.50%                     $3,966,000.00               July 25, 2030
Regular Interest V

Uncertificated REMIC I                     8.50%                    $27,500,000.00               July 25, 2030
Regular Interest W

REMIC I Regular Interest X                 8.50%                    $22,001,363.83               July 25, 2030
REMIC I Regular Interest Y                 0.00%                        $42,449.00               July 25, 2030
REMIC I IO Regular Interest                 (2)                              (3)                 July 25, 2030
</TABLE>

<PAGE>

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

(1)   Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
      regulations, the Distribution Date immediately following the latest
      possible maturity date for the Mortgage Loans has been designated as the
      "latest possible maturity date" for each REMIC I Regular Interest.

(2)   Calculated in accordance with the definition of "Uncertificated REMIC I
      Pass-Through Rate" herein.

(3)   Based on the Uncertificated REMIC I IO Notional Amount.

                  The following table sets forth the designation, initial
Pass-Through Rate, aggregate initial Certificate Principal Balance and certain
features for each Class of Certificates comprising the certificated interests in
the Trust Fund created hereunder.

<TABLE>
<CAPTION>
                                           Aggregate Initial
                                              Certificate                                                          Initial
                           Pass-Through        Principal                                              Maturity     Ratings
  Designation  Type            Rate             Balance                  Designations                   Date         S&P    Fitch
  -----------  ----           ------           --------                  ------------                  ------       ----    -----
<S>           <C>          <C>             <C>                   <C>                                <C>            <C>      <C>
Class A-1     Senior          8.00%           $147,664,000.00    Senior/Sequential/Accretion        July 25, 2030    AAA     AAA
                                                                     Directed/Fixed Rate

Class A-2     Senior     Adjustable Rate       $73,831,000.00    Senior/Sequential/Accretion        July 25, 2030    AAA     AAA
                                                                    Directed/Floating Rate

Class A-3     Senior     Adjustable Rate             (1)         Senior//Interest Only/Inverse      July 25, 2030    AAAr    AAA
                                                                        Floating Rate

Class A-4     Senior          8.50%            $3,966,000.00       Senior/Accrual/Fixed Rate        July 25, 2030    AAA     AAA

Class A-5     Senior          8.00%           $27,500,000.00       Senior/Lockout/Fixed Rate        July 25, 2030    AAA     AAA

Class A-6     Senior          8.50%                  (1)           Senior/Fixed Rate/Interest Only  July 25, 2030    AAAr    AAA

Class A-7     Senior          0.00%               $42,449.00       Senior/Principal Only            July 25, 2030    AAAr    AAA

Class A-8     Senior      Variable Rate              (1)           Senior/Variable Rate/            July 25, 2030    AAAr    AAA
                                                                      Interest Only

Class R-I     Senior          8.50%                 $100.00        Senior/Residual                  July 25, 2030    AAA     AAA

Class R-II    Senior          8.50%                 $100.00        Senior/Residual                  July 25, 2030    AAA     AAA

Class M-1    Mezzanine        8.50%          $10,313,000.00        Mezzanine/Fixed Rate             July 25, 2030    AA      N/A

Class M-2    Mezzanine        8.50%           $3,437,000.00        Mezzanine/Fixed Rate             July 25, 2030    A       N/A

Class M-3    Mezzanine        8.50%           $2,750,000.00        Mezzanine/Fixed Rate             July 25, 2030    BBB     N/A

Class B-1    Subordinate      8.50%           $2,613,000.00        Subordinate/Fixed Rate           July 25, 2030    BB      N/A

Class B-2    Subordinate      8.50%           $1,375,000.00        Subordinate/Fixed Rate           July 25, 2030    B       N/A

Class B-3    Subordinate      8.50%           $1,513,263.83        Subordinate/Fixed Rate           July 25, 2030   N/A      N/A
</TABLE>

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

(1)           Based on the related Notional Amount.

         Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date for
the Mortgage Loan with the latest maturity date in the Mortgage Pool has been
designated as the "latest possible maturity date" for the Certificates.

         As of the Cut-off Date, the Mortgage Loans have an aggregate Stated
Principal Balance equal to approximately $275,004,913.83.

                                        2

<PAGE>

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

                                    ARTICLE I

                                   DEFINITIONS

                  SECTION 1.01.  Defined Terms.

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

                  "Accretion Directed Certificates": The Class A-1 Certificates
and Class A-2 Certificates.

                  "Accretion Termination Date": The earlier to occur of (i) the
Distribution Date on which the aggregate Certificate Principal Balance of the
Class A-1 Certificates and Class A-2 Certificates has been reduced to zero and
(ii) the Credit Support Depletion Date.

                  "Accrual Certificates": The Class A-4 Certificates.

                  "Accrual Distribution Amount": With respect to each
Distribution Date prior to the Accretion Termination Date, an amount equal to
the amount of Accrued Certificate Interest on the Class A-4 Certificates for
such date, to the extent added to the Certificate Principal Balance thereof
pursuant to Section 4.01(f); provided that, with respect to each Distribution
Date on or after the Accretion Termination Date, an amount equal to the amount
of the Accrued Certificate Interest on the Class A-4 Certificates for such date
will be payable, as interest, to the Class A-4 Certificateholders pursuant to
Section 4.01(c)(i) hereof, to the extent not required to fully reduce the
aggregate Certificate Principal Balance of the Class A-1 Certificates and Class
A-2 Certificates to zero on the Accretion Termination Date; and provided
further, that if the Accretion Termination Date is the Credit Support Depletion
Date, the entire amount of Accrued Certificate Interest for that date will be
payable to the Class A-4 Certificateholders pursuant to Section 4.01(c)(i)
hereof.

                  "Accrued Certificate Interest": With respect to each
Distribution Date, (a) as to any Certificate other than the Interest Only
Certificates and the Principal Only Certificates, interest accrued during the
related Interest Accrual Period at the related Pass-Through Rate on the
Certificate Principal Balance thereof immediately prior to such Distribution
Date; (b) as to the A-3 Certificates and Class A-6 Certificates, the aggregate
amount of interest accrued during the related Interest Accrual Period at the
related Pass-Through Rate on the related Notional Amount thereof immediately
prior to such Distribution Date; and (c) as to the Class A-8 Certificates, the
aggregate amount of interest accrued during the related Interest Accrual Period
at the then applicable Uncertificated REMIC I Pass-Through Rate on each
Uncertificated REMIC I IO Regular Interest on the related Uncertificated REMIC I
IO Notional Amount thereof immediately prior to such

                                        3

<PAGE>

Distribution Date. Accrued Certificate Interest will be calculated on the basis
of a 360-day year consisting of twelve 30-day months. In each case Accrued
Certificate Interest on any Class of Certificates will be reduced by the amount
of (i) Prepayment Interest Shortfalls, if any, which are not covered by the
Master Servicer with a payment of Compensating Interest pursuant to Section 3.23
with respect to such Distribution Date, (ii) the interest portion (adjusted to
the related Net Mortgage Rate) of Realized Losses (including Excess Special
Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses and Extraordinary
Losses) not allocated solely to one or more Classes of Certificates pursuant to
Section 4.04 and (iii) any other interest shortfalls not covered by the
subordination provided by the Class M Certificates or Class B Certificates,
including interest that is not collectible from the Mortgagor pursuant to the
Relief Act or similar legislation or regulations as in effect from time to time,
with all such reductions in clauses (i) through (iii) allocated among all of the
Certificates in proportion to their respective amounts of Accrued Certificate
Interest payable on such Distribution Date which would have resulted absent such
reductions. In addition to that portion of the reductions described in the
preceding sentence that are allocated to any Class of Class M Certificates or
Class B Certificates, Accrued Certificate Interest on any Class of the Class M
Certificates or Class B Certificates, as applicable, will be reduced by the
interest portion (adjusted to the related Net Mortgage Rate) of the portion of
Realized Losses that are allocated solely to the Class M Certificates and Class
B Certificates, as applicable, pursuant to Section 4.04. The Principal Only
Certificates do not have a Pass-Through Rate and are not entitled to Accrued
Certificate Interest.

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

                  "Aggregate Stated Principal Balance": As of any date of
determination, the aggregate Stated Principal Balance of the Mortgage Loans.

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

                  "Anniversary": Each anniversary of June 1, 2000.

                  "Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage.

                  "Available Distribution Amount": With respect to any
Distribution Date, an amount equal to (a) the sum of (i) the balance on deposit
in the Custodial Account as of the close of business on the related
Determination Date and (ii) the aggregate amount of any Advances made and all
amounts required to be paid by the Master Servicer pursuant to Sections 3.13 and
3.23 by deposits into the Certificate Account on the immediately preceding
Certificate Account Deposit Date, reduced by (b) the sum, as of the close of
business on the related Determination Date, of (i) Monthly Payments collected
but due during a Due Period subsequent to the Due Period ending on the first day
of the month of the related Distribution Date, (ii) all interest or other income
earned on deposits in

                                        4

<PAGE>

the Custodial Account or the Certificate Account, (iii) any other amounts
reimbursable or payable to the Trustee, Master Servicer or any Sub-Servicer
pursuant to Section 3.11, (iv) the Servicing Fees payable on such Distribution
Date, (v) any amounts in respect of the premium payable to Radian under the
Radian PMI Pool Policies or the Radian Lender-Paid PMI Policies and (vi)
Insurance Proceeds, Liquidation Proceeds, Principal Prepayments, REO Proceeds
and the proceeds of Mortgage Loan purchases made pursuant to Section 2.02, 2.04,
3.14, 3.22 or 3.24, in each case received or made in the month of such
Distribution Date.

                  "Balloon Loan": Each of the Mortgage Loans identified in the
Mortgage Loan Schedule as having an original term to maturity that is shorter
than the related amortization term.

                  "Balloon Payment": With respect to any Balloon Loan, the
related Monthly Payment payable on the stated maturity date of such Balloon
Loan.

                  "Bankruptcy Amount": As of any date of determination prior to
the first Anniversary, an amount equal to the excess, if any, of (A) $151,879.00
over (B) the aggregate amount of Bankruptcy Losses allocated solely to one or
more specific Classes of Certificates in accordance with Section 4.04. As of any
date of determination on or after the first Anniversary, an amount equal to the
excess, if any, of the lesser of (a) the Bankruptcy Amount calculated as of the
close of business on the Business Day immediately preceding the most recent
Anniversary coinciding with or preceding such date of determination (or, if such
date of determination is an Anniversary, the Business Day immediately preceding
such date of determination) (for purposes of this definition, the "Relevant
Anniversary") and (b) the greater of (i) $75,000 and (ii) 0.0006 times the
aggregate principal balance of all the Mortgage Loans in the Mortgage Pool as of
the Relevant Anniversary having a Loan-to-Value Ratio at origination which
exceeds 75%.

         The Bankruptcy Amount may be further reduced by the Master Servicer
(including accelerating the manner in which such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i) obtain written
confirmation from each Rating Agency that such reduction shall not reduce the
rating assigned to any Class of Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.

                  "Bankruptcy Code": The Bankruptcy Code of 1978, as amended.

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

                  "Book-Entry Certificate": Any Certificate registered in the
name of the Depository or its nominee.

                                        5

<PAGE>

                  "Business Day": Any day other than a Saturday, a Sunday or a
day on which banking institutions in California or New York (and such other
state or states in which the Custodial Account or the Certificate Account are at
the time located) or in the city in which the Corporate Trust Office of the
Trustee is located are authorized or obligated by law or executive order to
close.

                  "Cash Liquidation": As to any defaulted Mortgage Loan other
than a Mortgage Loan as to which an REO Acquisition occurred, a determination by
the Master Servicer that it has received all Insurance Proceeds, Liquidation
Proceeds and other payments or cash recoveries which the Master Servicer
reasonably and in good faith expects to be finally recoverable with respect to
such Mortgage Loan.

                  "Certificate": Any Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-8, Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2, Class B-3, Class R-I or Class R-II Certificate.

                  "Certificate Account": The trust account or accounts created
and maintained pursuant to Section 4.01, which shall be entitled "Bankers Trust
Company of California, N.A., in trust for registered holders of Impac Secured
Assets Corp., Mortgage Pass-Through Certificates, Series 2000- 2, and which
account or accounts must each be an Eligible Account.

                  "Certificate Account Deposit Date": With respect to any
Distribution Date, the third Business Day immediately preceding such
Distribution Date.

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

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

                                        6

<PAGE>

                  "Certificate Principal Balance": With respect to any
Certificate other than an Interest Only Certificate, on any date of
determination, an amount equal to (i) the Initial Certificate Principal Balance
of such Certificate as specified on the face thereof, plus (ii) in the case of
each Accrual Certificate, an amount equal to the aggregate Accrued Certificate
Interest added to the Certificate Principal Balance thereof prior to such date
of determination minus (iii) the sum of (a) the aggregate of all amounts
previously distributed with respect to such Certificate (or any predecessor
Certificate) and applied to reduce the Certificate Principal Balance thereof
pursuant to Section 4.01, and (b) the aggregate of all reductions in Certificate
Principal Balance deemed to have occurred in connection with Realized Losses
which were previously allocated to such Certificate (or any predecessor
Certificate) pursuant to Section 4.04. With respect to each Class M Certificate,
on any date of determination, an amount equal to (i) the Initial Certificate
Principal Balance of such Class M Certificate as specified on the face thereof,
minus (ii) the sum of (x) the aggregate of all amounts previously distributed
with respect to such Certificate (or any predecessor Certificate) and applied to
reduce the Certificate Principal Balance thereof pursuant to Section 4.01 and
(y) the aggregate of all reductions in Certificate Principal Balance deemed to
have occurred in connection with Realized Losses which were previously allocated
to such Certificate (or any predecessor Certificate) pursuant to Section 4.04;
provided, that if the Certificate Principal Balances of all of the Class B
Certificates have been reduced to zero, the Certificate Principal Balance of
each Class M Certificate of those Class M Certificates outstanding with the
highest numerical designation at any given time shall thereafter be calculated
to equal the Percentage Interest evidenced by such Certificate times the excess,
if any, of (A) the then aggregate Stated Principal Balance of the Mortgage Loans
over (B) the then aggregate Certificate Principal Balance of all Certificates of
all other Classes then outstanding. With respect to each Class B Certificate, on
any date of determination, an amount equal to (i) the Initial Certificate
Principal Balance of such Class B Certificate as specified on the face thereof,
minus (ii) the sum of (x) the aggregate of all amounts previously distributed
with respect to such Certificate (or any predecessor Certificate) and applied to
reduce the Certificate Principal Balance thereof pursuant to Section 4.01 and
(y) the aggregate of all reductions in Certificate Principal Balance deemed to
have occurred in connection with Realized Losses which were previously allocated
to such Certificate (or any predecessor Certificate) pursuant to Section 4.04;
provided, that the Certificate Principal Balance of each Class B Certificate of
those Class B Certificates outstanding with the highest numerical designation at
any given time shall be calculated to equal the Percentage Interest evidenced by
such Certificate times the excess, if any, of (A) the then aggregate Stated
Principal Balance of the Mortgage Loans over (B) the then aggregate Certificate
Principal Balance of all Certificates of all other Classes then outstanding. The
Interest Only Certificates have no Certificate Principal Balance.

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

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

                  "Class A Certificate": Any one of the Class A-1, Class A-2,
Class A-3, Class A-4, Class A-5, Class A-6, Class A-7 or Class A-8 Certificates,
each executed, authenticated and

                                        7

<PAGE>

delivered by the Trustee substantially in the form annexed hereto as Exhibit A
and each evidencing an interest designated as a "regular interest" in REMIC II
for purposes of the REMIC Provisions.

                  "Class B Certificate": Any one of the Class B-1 Certificates,
Class B-2 Certificates or Class B-3 Certificates.

                  "Class B Percentage": The Class B-1 Percentage, Class B-2
Percentage and Class B-3 Percentage.

                  "Class B-1 Certificate": Any one of the Class B-1 Certificates
executed, authenticated and delivered by the Trustee substantially in the form
annexed hereto as Exhibit B-2, subordinate to the Class A Certificates and the
Class M Certificates with respect to distributions and the allocation of
Realized Losses as set forth in Section 4.04 and evidencing an interest
designated as a "regular interest" in REMIC II for purposes of the REMIC
Provisions.

                  "Class B-1 Percentage": With respect to any Distribution Date,
the lesser of 100% and a fraction, expressed as a percentage, the numerator of
which is the aggregate Certificate Principal Balance of the Class B-1
Certificates immediately prior to such Distribution Date and the denominator of
which is the aggregate Stated Principal Balance of all of the Mortgage Loans (or
related REO Properties) (other than the related Discount Fraction of each
Discount Mortgage Loan) immediately prior to such Distribution Date.

                  "Class B-1 Prepayment Distribution Trigger": With respect to
any Distribution Date, a test that shall be satisfied if the fraction (expressed
as a percentage) equal to the sum of the Certificate Principal Balances of the
Class B-1 Certificates, Class B-2 Certificates and Class B-3 Certificates
immediately prior to such Distribution Date divided by the aggregate Stated
Principal Balance of all of the Mortgage Loans (or related REO Properties)
immediately prior to such Distribution Date is greater than or equal to 2.00%.

                  "Class B-2 Certificate": Any one of the Class B-2 Certificates
executed, authenticated and delivered by the Trustee substantially in the form
annexed hereto as Exhibit B-2, subordinate to the Class A Certificates, Class M
Certificates and Class B-1 Certificates with respect to distributions and the
allocation of Realized Losses as set forth in Section 4.04 and evidencing an
interest designated as a "regular interest" in REMIC II for purposes of the
REMIC Provisions.

                  "Class B-2 Percentage": With respect to any Distribution Date,
the lesser of 100% and a fraction, expressed as a percentage, the numerator of
which is the aggregate Certificate Principal Balance of the Class B-2
Certificates immediately prior to such Distribution Date and the denominator of
which is the aggregate Stated Principal Balance of all of the Mortgage Loans
(and related REO Properties) (other than the related Discount Fraction of each
Discount Mortgage Loan) immediately prior to such Distribution Date.

                                        8

<PAGE>

                  "Class B-2 Prepayment Distribution Trigger": With respect to
any Distribution Date, a test that shall be satisfied if the fraction (expressed
as a percentage) equal to the sum of the Certificate Principal Balances of the
Class B-2 Certificates and Class B-3 Certificates immediately prior to such
Distribution Date divided by the aggregate Stated Principal Balance of all of
the Mortgage Loans (and related REO Properties) immediately prior to such
Distribution Date is greater than or equal to 1.05%.

                  "Class B-3 Certificate": Any one of the Class B-3 Certificates
executed, authenticated and delivered by the Trustee substantially in the form
annexed hereto as Exhibit B-2, subordinate to the Class A Certificates, Class M
Certificates, Class B-1 Certificates and Class B-2 Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.04
and evidencing an interest designated as a "regular interest" in REMIC II for
purposes of the REMIC Provisions.

                  "Class B-3 Percentage": With respect to any Distribution Date,
the lesser of 100% and a fraction, expressed as a percentage, the numerator of
which is the aggregate Certificate Principal Balance of the Class B-3
Certificates immediately prior to such Distribution Date and the denominator of
which is the aggregate Stated Principal Balance of all of the Mortgage Loans
(and related REO Properties) (other than the related Discount Fraction of each
Discount Mortgage Loan) immediately prior to such Distribution Date.

                  "Class B-3 Prepayment Distribution Trigger": With respect to
any Distribution Date, a test that shall be satisfied if the fraction (expressed
as a percentage) equal to the aggregate Certificate Principal Balance of the
Class B-3 Certificates immediately prior to such Distribution Date divided by
the aggregate Stated Principal Balance of all of the Mortgage Loans (or related
REO Properties) immediately prior to such Distribution Date is greater than or
equal to 0.55%.

                  "Class M Certificate": Any one of the Class M-1 Certificates,
Class M-2 Certificates or Class M-3 Certificates.

                  "Class M Percentage": The Class M-1 Percentage, Class M-2
Percentage and Class M-3 Percentage.

                  "Class M-1 Certificate": Any one of the Class M-1 Certificates
executed, authenticated and delivered by the Trustee substantially in the form
annexed hereto as Exhibit B-1, subordinate to the Class A Certificates with
respect to distributions and the allocation of Realized Losses as set forth in
Section 4.04 and evidencing an interest designated as a "regular interest" in
REMIC II for purposes of the REMIC Provisions.

                  "Class M-1 Percentage": With respect to any Distribution Date,
the lesser of 100% and a fraction, expressed as a percentage, the numerator of
which is the aggregate Certificate Principal Balance of the Class M-1
Certificates immediately prior to such date and the denominator of which is the
aggregate Stated Principal Balance of all of the Mortgage Loans (or related REO

                                        9

<PAGE>

Properties) (other than the related Discount Fraction of each Discount Mortgage
Loan) immediately prior to such Distribution Date.

                  "Class M-2 Certificate": Any one of the Class M-2 Certificates
executed, authenticated and delivered by the Trustee substantially in the form
annexed hereto as Exhibit B-1, subordinate to the Class A and Class M-1
Certificates with respect to distributions and the allocation of Realized Losses
as set forth in Section 4.04 and evidencing an interest designated as a "regular
interest" in REMIC II for purposes of the REMIC Provisions.

                  "Class M-2 Percentage": With respect to any Distribution Date,
the lesser of 100% and a fraction, expressed as a percentage, the numerator of
which is the aggregate Certificate Principal Balance of the Class M-2
Certificates immediately prior to such date and the denominator of which is the
aggregate Stated Principal Balance of all of the Mortgage Loans (or related REO
Properties) (other than the related Discount Fraction of each Discount Mortgage
Loan) immediately prior to such Distribution Date.

                  "Class M-2 Prepayment Distribution Trigger": With respect to
any Distribution Date, a test that shall be satisfied if the fraction (expressed
as a percentage) equal to the sum of the Certificate Principal Balances of the
Class M-2 Certificates, Class M-3 Certificates, Class B-1 Certificates, Class
B-2 Certificates and Class B-3 Certificates immediately prior to such
Distribution Date divided by the aggregate Stated Principal Balance of all of
the Mortgage Loans (or related REO Properties) immediately prior to such
Distribution Date is greater than or equal to 4.25%.

                  "Class M-3 Certificate": Any one of the Class M-3 Certificates
executed, authenticated and delivered by the Trustee substantially in the form
annexed hereto as Exhibit B-1, subordinate to the Class A, Class M-1 and Class
M-2 Certificates with respect to distributions and the allocation of Realized
Losses as set forth in Section 4.04 and evidencing an interest designated as a
"regular interest" in REMIC II for purposes of the REMIC Provisions.

                  "Class M-3 Percentage": With respect to any Distribution Date,
the lesser of 100% and a fraction, expressed as a percentage, the numerator of
which is the aggregate Certificate Principal Balance of the Class M-3
Certificates immediately prior to such date and the denominator of which is the
aggregate Stated Principal Balance of all of the Mortgage Loans (or related REO
Properties) (other than the related Discount Fraction of each Discount Mortgage
Loan) immediately prior to such Distribution Date.

                  "Class M-3 Prepayment Distribution Trigger": With respect to
any Distribution Date, a test that shall be satisfied if the fraction (expressed
as a percentage) equal to the sum of the Certificate Principal Balances of the
Class M-3 Certificates, Class B-1 Certificates, Class B-2 Certificates and Class
B-3 Certificates immediately prior to such Distribution Date divided by the
aggregate Stated Principal Balance of all of the Mortgage Loans (and related REO
Properties) immediately prior to such Distribution Date is greater than or equal
to 3.00%.

                                       10

<PAGE>

                  "Class R Certificate": Any one of the Class R-I Certificates
or Class R-II Certificates.

                  "Class R-I Certificate": Any one of the Class R-I Certificates
executed by the Trustee and authenticated by the Trustee substantially in the
form annexed hereto as Exhibit B-3 and evidencing an interest designated as a
"residual interest" in REMIC I for purposes of the REMIC Provisions.

                  "Class R-II Certificate": Any one of the Class R-II
Certificates executed by the Trustee and authenticated by the Trustee
substantially in the form annexed hereto as Exhibit B-3 and evidencing an
interest designated as a "residual interest" in REMIC II for purposes of the
REMIC Provisions.

                  "Closing Date":  June 29, 2000.

                  "Code":  The Internal Revenue Code of 1986.

                  "Collateral Value": The appraised value of a Mortgaged
Property based upon the lesser of (i) the appraisal (as reviewed and approved by
the Seller) made at the time of the origination of the related Mortgage Loan, or
(ii) the sales price of such Mortgaged Property at such time of origination.
With respect to a Mortgage Loan the proceeds of which were used to refinance an
existing mortgage loan, the appraised value of the Mortgaged Property based upon
the appraisal (as reviewed and approved by the Seller) obtained at the time of
refinancing.

                  "Commission":  The Securities and Exchange Commission.

                  "Company": Impac Secured Assets Corp., or its successor in
interest.

                  "Compensating Interest": With respect to any Distribution
Date, an amount equal to Prepayment Interest Shortfalls resulting from Principal
Prepayments during the related Prepayment Period, but not more than the
Servicing Fees for the immediately preceding Due Period.

                  "Corporate Trust Office": The principal corporate trust office
of the Trustee at which at any particular time its corporate trust business
related to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 1761 East St. Andrew Place, Santa Ana,
California 92705, Attention: Corporate Trust, Impac Secured Assets Corp. Series
2000- 2.

                  "Credit Support Depletion Date": The first Distribution Date
on which the Senior Percentage equals 100%.

                  "Curtailment": Any Principal Prepayment made by a Mortgagor
which is not a Principal Prepayment in Full.

                                       11

<PAGE>

                  "Custodial Account": The custodial account or accounts created
and maintained pursuant to Section 3.10 in the name of a depository institution,
as custodian for the holders of the Certificates. Any such account or accounts
shall be an Eligible Account.

                  "Cut-off Date":  June 1, 2000.

                  "Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction constituting a Deficient Valuation or any reduction that results in a
permanent forgiveness of principal.

                  "Defaulted Mortgage Loan" means any Mortgage Loan as to which
the Mortgagor has failed to make unexcused three or more consecutive scheduled
Monthly Payments.

                  "Deficient Valuation": With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged Property in an
amount less than the then outstanding indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
scheduled Monthly Payment that constitutes a permanent forgiveness of principal,
which valuation or reduction results from a proceeding under the Bankruptcy
Code.

                  "Definitive Certificate": Any definitive, fully registered
Certificate.

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

                  "Depository" The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository for purposes
of registering those Certificates that are to be Book-Entry Certificates is Cede
& Co. The Depository shall at all times be a "clearing corporation" as defined
in Section 8-102(5) of the Uniform Commercial Code of the State of New York and
a "clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.

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

                  "Determination Date": The 15th day (or if such 15th day is not
a Business Day, the Business Day immediately preceding such 15th day) of the
month of the related Distribution Date.

                  "Discount Fraction": With respect to each Discount Mortgage
Loan, the fraction expressed as a percentage, the numerator of which is 8.500%
minus the Net Mortgage Rate (or the initial Net Mortgage Rate with respect to
any Discount Mortgage Loans as to which the Mortgage

                                       12

<PAGE>

Rate for such Mortgage Loan is modified pursuant to Article III of this
Agreement) and the denominator of which is 8.500%.

                  "Discount Mortgage Loan": Any Mortgage Loan having a Net
Mortgage Rate (or the initial Net Mortgage Rate) of less than 8.500% per annum
and any Mortgage Loan deemed to be a Discount Mortgage Loan pursuant to the
definition of Qualified Substitute Mortgage Loan.

                  "Disqualified Organization": Any organization defined as a
"disqualified organization" under Section 860E(e)(5) of the Code, which includes
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 Freddie Mac, a
majority of its board of directors is not selected by such governmental unit),
(ii) a 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 and (v) any other Person so designated by the Trustee based upon an Opinion
of Counsel that the holding of an Ownership Interest in a Class R Certificate by
such Person may cause either REMIC I or REMIC II or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class R
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, or if such
25th day is not a Business Day, the Business Day immediately following such 25th
day, commencing in July 2000.

                  "Due Date": The first day of the month of the related
Distribution Date.

                  "Due Period": With respect to any Distribution Date, the
period commencing on the second day of the month preceding the month of such
Distribution Date (or, with respect to the first Due Period, the day following
the Cut-off Date) and ending on the related Due Date.

                  "Eligible Account": An account maintained with a federal or
state chartered depository institution (i) the short-term obligations of which
are rated A-1 or better by Standard & Poors and F1 or better by Fitch at the
time of any deposit therein, or (ii) insured by the FDIC (to the limits
established by such Corporation), the uninsured deposits in which account are
otherwise secured such that, as evidenced by an Opinion of Counsel (obtained by
the Person requesting that the account be held pursuant to this clause (ii))
delivered to the Trustee prior to the establishment of such account, the
Certificateholders will have a claim with respect to the funds in such account
and a perfected first priority security interest against any collateral (which
shall be limited to Permitted Investments, each of which shall mature not later
than the Business Day immediately

                                       13

<PAGE>

preceding the Distribution Date next following the date of investment in such
collateral or the Distribution Date if such Permitted Investment is an
obligation of the institution that maintains the Certificate Account or
Custodial Account) securing such funds that is superior to claims of any other
depositors or general creditors of the depository institution with which such
account is maintained or (iii) a trust account or accounts maintained with a
federal or state chartered depository institution or trust company with trust
powers acting in its fiduciary capacity or (iv) an account or accounts of a
depository institution acceptable to the Rating Agencies (as evidenced in
writing by the Rating Agencies that use of any such account as the Custodial
Account or the Certificate Account will not have an adverse effect on the
then-current ratings assigned to the Classes of the Certificates then rated by
the Rating Agencies). Eligible Accounts may bear interest.

                  "Eligible Funds": On any Distribution Date, the portion, if
any, of the Available Distribution Amount remaining after reduction by the sum
of (i) the Trustee's Fees for such Distribution Date, (ii) the aggregate amount
of Accrued Certificate Interest on the Class A and Class R Certificates, (iii)
the Senior Principal Distribution Amount, (iv) the Principal Only Distribution
Amount (determined without regard to Section 4.01(d)(i)(E) hereof) and (v) the
aggregate amount of Accrued Certificate Interest on the Class M, Class B-1 and
Class B-2 Certificates.

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

                  "Excess Bankruptcy Loss": Any Bankruptcy Loss, or portion
thereof, which exceeds the then applicable Bankruptcy Amount.

                  "Excess Fraud Loss": Any Fraud Loss, or portion thereof, which
exceeds the then applicable Fraud Loss Amount.

                  "Excess Proceeds":  As defined in Section 3.22.

                  "Excess Special Hazard Loss": Any Special Hazard Loss, or
portion thereof, that exceeds the then applicable Special Hazard Amount.

                  "Extraordinary Events": Any of the following conditions with
respect to a Mortgaged Property or Mortgage Loan causing or resulting in a loss
which causes the liquidation of such Mortgage Loan:

                  (a) losses which are otherwise covered by the fidelity bond
         and the errors and omissions insurance policy maintained pursuant to
         Section 3.18, but are in excess of the coverage maintained thereunder;

                  (b) nuclear reaction or nuclear radiation or radioactive
         contamination, all whether controlled or uncontrolled, or remote or be
         in whole or in part caused by, contributed to or aggravated by a peril
         covered by the definition of the term "Special Hazard Loss";

                                       14

<PAGE>

                  (c) hostile or warlike action in time of peace or war,
         including action in hindering, combating or defending against an
         actual, impending or expected attack;

                           1. by any government or sovereign power, de jure or
                  de facto, or by any authority maintaining or using military,
                  naval or air forces; or

                           2. by military, naval or air forces; or

                           3. by an agent of any such government, power,
                  authority or forces;

                  (d) any weapon of war employing atomic fission or radioactive
         force whether in time of peace or war; or

                  (e) insurrection, rebellion, revolution, civil war, usurped
         power or action taken by governmental authority in hindering, combating
         or defending against such an occurrence, seizure or destruction under
         quarantine or customs regulations, confiscation by order of any
         government or public authority; or risks of contraband or illegal
         transportation or trade.

                  "Extraordinary Losses": Any loss incurred on a Mortgage Loan
caused by or resulting from an Extraordinary Event.

                  "Fannie Mae": Federal National Mortgage Association or any
successor.

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

                  "Fitch": Fitch, Inc., or any successor.

                  "Fraud Loss Amount": As of any date of determination after the
Cut-off Date, an amount equal to: (X) prior to the first Anniversary, an amount
equal to 2.00% of the aggregate outstanding principal balance of all of the
Mortgage Loans as of the Cut-off Date minus the aggregate amount of Fraud Losses
allocated solely to one or more specific Classes of Certificates in accordance
with Section 4.04 since the Cut-off Date up to such date of determination and
(Y) from the first to the fifth Anniversary, an amount equal to 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 of the
Mortgage Loans as of the most recent Anniversary minus (2) the Fraud Losses
allocated solely to one or more specific Classes of Certificates in accordance
with Section 4.04 since the most recent Anniversary up to such date of
determination. On and after the fifth Anniversary, the Fraud Loss Amount shall
be zero.

                  The Fraud Loss Amount may be further reduced by the Master
Servicer (including accelerating the manner in which such coverage is reduced)
provided that prior to any such reduction, the Master Servicer shall (i) obtain
written confirmation from each Rating Agency that such reduction shall not
reduce the rating assigned to any Class of Certificates by such Rating

                                       15

<PAGE>

Agency below the lower of the then-current rating or the rating assigned to such
Certificates as of the Closing Date by such Rating Agency and (ii) provide a
copy of such written confirmation to the Trustee.

                  "Fraud Losses": Losses on Mortgage Loans as to which there was
fraud in the origination of such Mortgage Loan.

                  "Freddie Mac": Federal Home Loan Mortgage Corporation or any
successor.

                  "Funding Date": With respect to each Mortgage Loan, the date
on which funds were advanced by or on behalf of the Seller and interest began to
accrue thereunder.

                  "Initial Certificate Principal Balance": With respect to each
Class of Certificates (other than the Interest Only Certificates), the
Certificate Principal Balance of such Class of Certificates as of the Cut-off
Date as set forth in the Preliminary Statement hereto, or with respect to any
single Certificate, the Initial Certificate Principal Balance as stated on the
face thereof.

                  "Initial Notional Amount": With respect to the Class A-3,
Class A-6 and Class A-8 Certificates, $73,831,000.00, $1,617,647.00 and
$271,840,344.00, respectively.

                  "Insurance Policy": With respect to any Mortgage Loan, any
insurance policy (including a Radian PMI Pool Policy or Radian Lender-Paid PMI
Policy) which is required to be maintained from time to time under this
Agreement in respect of such Mortgage Loan.

                  "Insurance Proceeds": Proceeds paid in respect of the Mortgage
Loans pursuant to any Primary Hazard Insurance Policy, any title insurance
policy or any other insurance policy covering a Mortgage Loan, to the extent
such proceeds are not applied to the restoration of the related Mortgaged
Property or released to the Mortgagor in accordance with the procedures that the
Master Servicer would follow in servicing mortgage loans held for its own
account.

                  "Interest Accrual Period": With respect to any Certificate
(other than a Class A-2 or Class A-3 Certificate) and each Uncertificated REMIC
I IO Regular Interest, and any Distribution Date the calendar month preceding
the month in which the Distribution Date occurs. The Interest Accrual Period for
the Class A-2 and Class A-3 Certificates is the one-month period commencing on
the 25th day of the month preceding the month in which such Distribution Date
occurs and ending on the 24th day of the month in which such Distribution Date
occurs.

                  "Interest Only Certificate": Any Class A-3, Class A-6 or Class
A-8 Certificates.

                  "Late Collections": With respect to any Mortgage Loan, all
amounts received during any Due Period, whether as late payments of Monthly
Payments or as Insurance Proceeds, Liquida tion Proceeds or otherwise, which
represent late payments or collections of Monthly Payments due but delinquent
for a previous Due Period and not previously recovered.

                                       16

<PAGE>

                  "LIBOR": With respect to any Distribution Date and the
Pass-Through Rates on the Class A-2 and Class A-3 Certificates, the arithmetic
mean of the London interbank offered rate quotations of reference banks (which
will be selected by the Trustee after consultation with the Master Servicer) for
one-month U.S. dollar deposits, expressed on a per annum basis, determined in
accordance with Section 1.02.

                  "LIBOR Business Day": Any day other than (i) a Saturday or a
Sunday or (ii) a day on which banking institutions in the city of London,
England and New York City are required or authorized by law to be closed.

                  "Liquidation Proceeds": Amounts (other than Insurance
Proceeds) received by the Master Servicer in connection with the taking of an
entire Mortgaged Property by exercise of the power of eminent domain or
condemnation or in connection with the liquidation of a defaulted Mortgage Loan
through trustee's sale, foreclosure sale or otherwise, other than amounts
received in respect of any REO Property.

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

                  "Lockout Certificate Percentage": For any Distribution Date,
the percentage equal to the aggregate Certificate Principal Balance of the
Lockout Certificates divided by the sum of the aggregate Certificate Principal
Balances of the Class A Certificates, in each case immediately prior to such
Distribution Date.

                  "Lockout Certificates": The Class A-5 Certificates.

                  "Lockout Distribution Percentage": For any Distribution Date,
a percentage equal to the Lockout Priority Percentage multiplied by the Lockout
Certificate Percentage.

                  "Lockout Priority Percentage" With respect to any Distribution
Date, the percentage indicated below:

<TABLE>
<CAPTION>
                                                                   Lockout
               Month of Distribution Date                    Priority Percentage
               --------------------------                    -------------------
<S>                                                          <C>
July 2000 through June 2005.............................              0%
July 2005 through June 2006.............................             30%
July 2006 through June 2007.............................             40%
July 2007 through June 2008.............................             60%
July 2008 through June 2009.............................             80%
July 2009 and thereafter................................            100%
</TABLE>

                                       17

<PAGE>

                  "Lost Note Affidavit": With respect to any Mortgage Note, an
original lost note affidavit from the Seller stating that the original Mortgage
Note was lost, misplaced or destroyed, together with a copy of the related
Mortgage Note.

                  "Maturity Date": The latest possible maturity date, solely for
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations, by which
(i) the Certificate Principal Balance of each Class of Certificates (other than
the Interest Only Certificates) or (ii) the Notional Amount of each Class of
Interest Only Certificates would be reduced to zero, which is July 25, 2030, the
Distribution Date immediately following the latest scheduled maturity date of
any Mortgage Loan.

                  "Master Servicer": Impac Funding Corporation, or any successor
master servicer appointed as herein provided.

                  "Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by a Mortgagor from time to time under the related Mortgage Note as
originally executed (after adjustment, if any, for Deficient Valuations
occurring prior to such Due Date, and after any adjustment by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or grace
period).

                  "Mortgage": The mortgage, deed of trust or any other
instrument securing the Mortgage Loan.

                  "Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement; provided, that
whenever the term "Mortgage File" is used to refer to documents actually
received by the Trustee, such term shall not be deemed to include such
additional documents required to be added unless they are actually so added.

                  "Mortgage Loan": Each of the mortgage loans, transferred and
assigned to the Trustee pursuant to Section 2.01 or Section 2.04 and from time
to time held in the Trust Fund (including any Qualified Substitute Mortgage
Loans), the Mortgage Loans so transferred, assigned and held being identified in
the Mortgage Loan Schedule. As used herein, the term "Mortgage Loan" includes
the related Mortgage Note and Mortgage.

                  "Mortgage Loan Purchase Agreement": The Mortgage Loan Purchase
Agreement dated as of June 1, 2000, among Impac Funding Corporation, as seller,
Impac Mortgage Holdings, Inc., as guarantor, and the Company as purchaser, and
all amendments thereof and supplements thereto.

                  "Mortgage Loan Schedule": As of any date of determination, the
schedule of Mortgage Loans included in the Trust Fund. The initial schedule of
Mortgage Loans with accompanying information transferred on the Closing Date to
the Trustee as part of the Trust Fund for the Certificates, attached hereto as
Exhibit H (as amended from time to time to reflect the

                                       18

<PAGE>

addition of Qualified Substitute Mortgage Loans) (and, for purposes of the
Trustee pursuant to Section 2.02, in computer-readable form as delivered to the
Trustee), which list shall set forth the following information with respect to
each Mortgage Loan:

                (i)        the loan number and name of the Mortgagor;

               (ii)        the street address, city, state and zip code of the
                           Mortgaged Property;

              (iii)        (A) the original term to maturity and (B) if such
                           Mortgage Loan is a Balloon Loan, the amortization
                           term thereof;

               (iv)        the original principal balance and the original
                           Mortgage Rate;

                (v)        the first payment date;

               (vi)        whether the Mortgage Loan is a Balloon Mortgage Loan
                           or a Mortgage Loan the terms of which do not provide
                           for a Balloon Payment;

              (vii)        the type of Mortgaged Property;

             (viii)        the Monthly Payment in effect as of the Cut-off Date;

               (ix)        the principal balance as of the Cut-off Date;

               (xi)        the Mortgage Rate as of the Cut-off Date and the Pool
                           Strip Rate;

              (xii)        the occupancy status;

             (xiii)        the purpose of the Mortgage Loan;

              (xiv)        the Collateral Value of the Mortgaged Property;

               (xv)        the original term to maturity;

              (xvi)        the paid-through date of the Mortgage Loan;

             (xvii)        the Servicing Fee Rate;

            (xviii)        the Net Mortgage Rate for such Mortgage Loan;

              (xix)        whether such Mortgage Loan is a Radian PMI Loan and,
                           if so, the related Radian PMI Policy Rate, and
                           whether the Radian PMI Loan is covered by Radian PMI
                           Pool Policy or a Radian Lender-Paid PMI Policy;

                                       19

<PAGE>

               (xx)        whether the Mortgage Loan is covered by a private
                           mortgage insurance policy or an original certificate
                           of private mortgage insurance; and

              (xxi)        the documentation type.

                  The Mortgage Loan Schedule may be in the form of more than one
schedule, collectively setting forth all of the information required.

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

                  "Mortgage Rate": With respect to any Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan, as adjusted from time to
time in accordance with the provisions of the Mortgage Note.

                  "Mortgaged Property": The underlying property securing a
Mortgage Loan.

                  "Mortgagor":  The obligor or obligors on a Mortgage Note.

                  "Net Mortgage Rate": With respect to each Mortgage Loan Due
Date, a per annum rate of interest equal to the then-applicable Mortgage Rate on
such Mortgage Loan less the sum of the Servicing Fee Rate and the Trustee Fee
Rate and, with respect to the Radian Insured Loans, the Radian PMI Policy Rate.

                  "Non-Discount Mortgage Loan": The Mortgage Loans other than
the Discount Mortgage Loans.

                  "Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan which, in
the good faith judgment of the Master Servicer, will not or, in the case of a
proposed Advance or Servicing Advance, would not be ultimately recoverable from
related Late Collections, Insurance Proceeds, Liquidation Proceeds or REO
Proceeds. The determination by the Master Servicer that it has made a
Nonrecoverable Advance or that any proposed Advance or Servicing Advance would
constitute a Nonrecoverable Advance, shall be evidenced by a certificate of a
Servicing Officer delivered to the Company and the Trustee.

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

                  "Notional Amount": With respect to the Class A-8 Certificates
as of any Distribution Date, the aggregate Stated Principal Balance of the
Non-Discount Mortgage Loans as of the first date of the related Due Period for
such Distribution Date. With respect to the Class A-3 Certificates, the
Certificate Principal Balance of the Class A-2 Certificates. However, for
federal income tax purposes, the Notional Amount of the Class A-3 Certificates
will be the Uncertificated Principal Balance of Uncertificated REMIC I Regular
Interest U. With respect to the Class A-6 Certificates

                                       20

<PAGE>

as of any Distribution Date, 1/17 multiplied by the Certificate Principal
Balance of the Class A-5 Certificates, immediately prior to such date. However,
for federal income tax purposes, the Notional Amount of the Class A-6
Certificates will be the Uncertificated Principal Balance of Uncertificated
REMIC I Regular Interest W.

                  "Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
and by the Treasurer, the Secretary, or one of the assistant treasurers or
assistant secretaries of the Company, the Seller, the Master Servicer or of any
Sub-Servicer and delivered to the Company and Trustee.

                  "Opinion of Counsel": A written opinion of counsel, who may be
counsel for the Company, the Seller, or the Master Servicer, reasonably
acceptable to the Trustee; except that any opinion of counsel relating to (a)
the qualification of any account required to be maintained pursuant to this
Agreement as an Eligible Account, (b) the qualification of REMIC I or REMIC II
as REMICs, (c) compliance with the REMIC Provisions or (d) resignation of the
Master Servicer pursuant to Section 6.04 must be an opinion of counsel who (i)
is in fact independent of the Company and the Master Servicer, (ii) does not
have any direct financial interest or any material indirect financial interest
in the Company or the Master Servicer or in an affiliate of either and (iii) is
not connected with the Company or the Master Servicer as an officer, employee,
director or person performing similar functions.

                  "Original Senior Percentage": The fraction, expressed as a
percentage, the numerator of which is the aggregate Initial Certificate
Principal Balance of the Senior Certificates (other than the Principal Only
Certificates) and the denominator of which is the aggregate Stated Principal
Balance of the Mortgage Loans (other than the Discount Fraction of the Discount
Mortgage Loans) as of the Cut-off Date, which percentage is approximately 92.00%
as of the Closing Date.

                  "OTS":  Office of Thrift Supervision or any successor.

                  "Outstanding Mortgage Loan": As to any Due Date, a Mortgage
Loan (including an REO Property) which was not the subject of a Principal
Prepayment in Full, Cash Liquidation or REO Disposition and which was not
purchased prior to such Due Date pursuant to Sections 2.02, 2.04, 3.14 or 3.24.

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

                  "Pass-Through Rate": A rate equal to, (i) with respect to all
Certificates other than the Class A-2, Class A-3, Class A-8 and Principal Only
Certificates, a fixed rate set forth in the Preliminary Statement hereto;
provided however, for federal income tax purposes, the Pass-Through Rate for the
Class A-6 Certificates will be 0.50% per annum, (ii) with respect to the Class
A-2 and Class A-3 Certificates, as follows:

                                       21

<PAGE>

                  (1) The Pass-Through Rate on the Class A-2 Certificates with
         respect to the initial Interest Accrual Period is 7.10125% per annum,
         and as to any Interest Accrual Period thereafter, will be a per annum
         rate equal to 0.45% plus LIBOR, with a maximum rate of 9.50% per annum
         and a minimum rate of 0.45% per annum; and

                  (2) The Pass-Through Rate on the Class A-3 Certificates with
         respect to the initial Interest Accrual Period is 2.39875% per annum,
         and as to any Interest Accrual Period thereafter, will be a per annum
         rate equal to 9.05% minus LIBOR, with a maximum rate of 9.05% per annum
         and a minimum rate of 0.00% per annum;

and (iii) with respect to the Class A-8 Certificates, the weighted average (by
Stated Principal Balance) of the Pool Strip Rates on the Non-Discount Mortgage
Loans.

The Principal Only Certificates do not have a Pass-Through Rate and are not
entitled to Accrued Certificate Interest.

                  "Percentage Interest": With respect to any Certificate (other
than a Class R Certificate), the undivided percentage ownership interest in the
related Class evidenced by such Certificate, which percentage ownership interest
shall be equal to the Initial Certificate Principal Balance thereof or Initial
Notional Amount thereof (in the case of the Interest Only Certificates) divided
by the aggregate Initial Certificate Principal Balance or initial Notional
Amount, as applicable, of all of the Certificates of the same Class. With
respect to a Class R Certificate, the interest in distributions to be made with
respect to such Class evidenced thereby, expressed as a percentage, as stated on
the face of each such Certificate.

                  "Permitted Investment": One or more of the following:

                  (i) obligations of or guaranteed as to principal and interest
         by the United States or any agency or instrumentality thereof when such
         obligations are backed by the full faith and credit of the United
         States;

                  (ii) repurchase agreements on obligations specified in clause
         (i) maturing not more than one month from the date of acquisition
         thereof, provided that the unsecured obligations of the party agreeing
         to repurchase such obligations are at the time rated by each Rating
         Agency in its highest short-term rating available;

                  (iii) federal funds, certificates of deposit, demand deposits,
         time deposits and bankers' acceptances (which shall each have an
         original maturity of not more than 90 days and, in the case of bankers'
         acceptances, shall in no event have an original maturity of more than
         365 days or a remaining maturity of more than 30 days) denominated in
         United States dollars of any U.S. depository institution or trust
         company incorporated under the laws of the United States or any state
         thereof or of any domestic branch of a foreign depository institution
         or trust company; provided that the debt obligations of such depository
         institution or trust company (or, if the only Rating Agency is Standard
         & Poor's, in the case of the

                                       22

<PAGE>

         principal depository institution in a depository institution holding
         company, debt obligations of the depository institution holding
         company) at the date of acquisition thereof have been rated by each
         Rating Agency in its highest short-term rating available; and provided
         further that, if the only Rating Agency is Standard & Poor's and if the
         depository or trust company is a principal subsidiary of a bank holding
         company and the debt obligations of such subsidiary are not separately
         rated, the applicable rating shall be that of the bank holding company;
         and, provided further that, if the original maturity of such short-term
         obligations of a domestic branch of a foreign depository institution or
         trust company shall exceed 30 days, the short-term rating of such
         institution shall be A-1+ in the case of Standard & Poor's if Standard
         & Poor's is the Rating Agency;

                  (iv) commercial paper (having original maturities of not more
         than 365 days) of any corporation incorporated under the laws of the
         United States or any state thereof which on the date of acquisition has
         been rated by Fitch in its highest short-term rating available and by
         Standard & Poor's at least A-1; provided that such commercial paper
         shall have a remaining maturity of not more than 30 days;

                  (v) a money market fund or a qualified investment fund rated
         by each Rating Agency in its highest long-term rating available,
         including any such funds for which Bankers Trust Company of California,
         N.A. or any affiliate thereof serves as an investment advisor, manager,
         administrator, shareholder, servicing agent, and/or custodian or
         sub-custodian; and

                  (vi) other obligations or securities that are acceptable to
         each Rating Agency as a Permitted Investment hereunder and will not
         reduce the rating assigned to any Class of Certificates by such Rating
         Agency below the lower of the then-current rating or the rating
         assigned to such Certificates as of the Closing Date by such Rating
         Agency, as evidenced in writing;

provided, however, that no instrument shall be a Permitted Investment if it
represents, either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest payments with respect to such instrument provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations.

                  "Permitted Transferee": Any transferee of a Residual
Certificate other than a Disqualified Organization, a Non-United States Person
or an "electing large partnership" (as defined in Section 775 of the Code).

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

                  "Pool Strip Rate": With respect to any Distribution Date and
any Mortgage Loan, the Net Mortgage Rate thereon minus 8.500%, but not less than
0.000%.

                                       23

<PAGE>

                  "Prepayment Assumption": represents an assumed rate of
prepayment each month relative to the then outstanding principal balance of a
pool of new mortgage loans. A prepayment assumption of 100% of the Prepayment
Assumption assumes a constant prepayment rate of 4% per annum of the then
outstanding principal balance of such mortgage loans in the first month of the
life of the mortgage loans and an additional amount of approximately 1.2727% per
annum in each month thereafter until the twelfth month. Beginning in the twelfth
month and in each month thereafter during the life of the mortgage loans, 100%
of the Prepayment Assumption assumes a constant prepayment rate of 18% per annum
each month.

                  "Prepayment Distribution Percentage": With respect to any
Distribution Date and each Class of Class M Certificates and Class B
Certificates, under the applicable circumstances set forth below, the respective
percentages set forth below:

       (i)        For any Distribution Date on which any Class of Class M
                  Certificates or Class B Certificates are outstanding:

                           (a) in the case of the Class of Class M Certificates
                  then outstanding with the lowest numerical designation, or in
                  the event the Class M Certificates are no longer outstanding,
                  the Class of Class B Certificates then outstanding with the
                  lowest numerical designation and each other Class of Class M
                  Certificates and Class B Certificates for which the related
                  Prepayment Distribution Trigger has been satisfied, a
                  fraction, expressed as a percentage, the numerator of which is
                  the Certificate Principal Balance of such Class immediately
                  prior to such date and the denominator of which is the sum of
                  the Certificate Principal Balances immediately prior to such
                  date of (1) the Class of Class M Certificates then outstanding
                  with the lowest numerical designation, or in the event the
                  Class M Certificates are no longer outstanding, the Class of
                  Class B Certificates then outstanding with the lowest
                  numerical designation and (2) all other Classes of Class M
                  Certificates and Class B Certificates for which the respective
                  Prepayment Distribution Triggers have been satisfied; and

                           (b) in the case of each other Class of Class M
                  Certificates and Class B Certificates for which the Prepayment
                  Distribution Triggers have not been satisfied, 0%; and

                  (ii) Notwithstanding the foregoing, if the application of the
         foregoing percentages on any Distribution Date as provided in Section
         4.01 (determined without regard to the proviso to the definition of
         "Subordinate Principal Distribution Amount") would result in a
         distribution in respect of principal of any Class or Classes of Class M
         Certificates and Class B Certificates in an amount greater than the
         remaining Certificate Principal Balance thereof (any such class, a
         "Maturing Class"), then: (a) the Prepayment Distribution Percentage of
         each Maturing Class shall be reduced to a level that, when applied as
         described above, would exactly reduce the Certificate Principal Balance
         of such Class to zero; (b) the Prepayment Distribution Percentage of
         each other Class of Class M Certificates and Class B Certificates

                                       24

<PAGE>

         (any such Class, a "Non-Maturing Class") shall be recalculated in
         accordance with the provisions in paragraph (i) above, as if the
         Certificate Principal Balance of each Maturing Class had been reduced
         to zero (such percentage as recalculated, the "Recalculated
         Percentage"); (c) the total amount of the reductions in the Prepayment
         Distribution Percentages of the Maturing Class or Classes pursuant to
         clause (a) of this sentence, expressed as an aggregate percentage,
         shall be allocated among the Non-Maturing Classes in proportion to
         their respective Recalculated Percentages (the portion of such
         aggregate reduction so allocated to any Non-Maturing Class, the
         "Adjustment Percentage"); and (d) for purposes of such Distribution
         Date, the Prepayment Distribution Percentage of each Non- Maturing
         Class shall be equal to the sum of (1) the Prepayment Distribution
         Percentage thereof, calculated in accordance with the provisions in
         paragraph (i) above as if the Certificate Principal Balance of each
         Maturing Class had not been reduced to zero, plus (2) the related
         Adjustment Percentage.

                  "Prepayment Distribution Trigger": The Class M-2 Prepayment
Distribution Trigger, Class M-3 Prepayment Distribution Trigger, Class B-1
Prepayment Distribution Trigger, Class B-2 Prepayment Distribution Trigger or
Class B-3 Prepayment Distribution Trigger.

                  "Prepayment Interest Shortfall": As to any Distribution Date
and any Mortgage Loan (other than a Mortgage Loan relating to an REO Property)
that was the subject of (a) a Principal Prepayment in Full during the related
Prepayment Period, an amount equal to the excess of one month's interest at the
Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan over the
amount of interest (adjusted to the Net Mortgage Rate) paid by the Mortgagor for
such Prepayment Period to the date of such Principal Prepayment in Full or (b) a
Curtailment during the prior calendar month, an amount equal to one month's
interest at the Net Mortgage Rate on the amount of such Curtailment.

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

                  "Primary Hazard Insurance Policy": Each primary hazard
insurance policy (other than a Radian PMI Pool Policy) required to be maintained
pursuant to Section 3.13.

                  "Primary Insurance Policy": Any primary policy of mortgage
guaranty insurance other than the Radian PMI Pool Policy but including the
Radian Lender-Paid PMI Policies, or any replacement policy therefor providing
coverage for certain Mortgage Loans included in the Trust Fund with
Loan-to-Value Ratios in excess of 80.00%.

                  "Principal Only Certificates": The Class A-7 Certificates.

                  "Principal Only Collection Shortfalls": With respect to the
Cash Liquidation or REO Disposition of a Discount Mortgage Loan and any
Distribution Date, the excess of the amount described in Section
4.01(d)(i)(C)(1) over the amount described in Section 4.01(d)(i)(C)(2).

                                       25

<PAGE>

                  "Principal Only Distribution Amount": As defined in Section
4.01(d)(i).

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

                  "Principal Prepayment in Full": Any Principal Prepayment made
by a Mortgagor of the entire unpaid principal balance of the Mortgage Loan.

                  "Purchase Price": With respect to any Mortgage Loan (or REO
Property) required to be purchased pursuant to Section 2.02, 2.04 or 3.14 or
that the Master Servicer is entitled to repurchase pursuant to Section 3.24, an
amount equal to the sum of (i) 100% of the Stated Principal Balance thereof,
(ii) unpaid accrued interest (or REO Imputed Interest) at the applicable Net
Mortgage Rate on the Stated Principal Balance thereof outstanding during each
Due Period that such interest was not paid or advanced, from the date through
which interest was last paid by the Mortgagor or advanced and distributed to
Certificateholders together with unpaid Servicing Fees, Trustee's Fees and, if
such Mortgage Loan is a Radian Insured Loan, fees due Radian at the Radian PMI
Policy Rate, from the date through which interest was last paid by the
Mortgagor, in each case to the first day of the month in which such Purchase
Price is to be distributed, plus (iii) the aggregate of all Advances and
Servicing Advances made in respect thereof that were not previously reimbursed.

                  "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.

                  "Qualified Substitute Mortgage Loan": A Mortgage Loan
substituted by the Company for a Deleted Mortgage Loan which must, on the date
of such substitution, as confirmed in an Officers' Certificate of the Seller
delivered to the Trustee, (i) have an outstanding principal balance, after
deduction of the principal portion of the monthly payment due in the month of
substitution (or in the case of a substitution of more than one Mortgage Loan
for a Deleted Mortgage Loan, an aggregate outstanding principal balance, after
such deduction), not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan (the amount of any shortfall to be paid to the Master Servicer for
deposit in the Custodial Account in the month of substitution); (ii) have a
Mortgage Rate and a Net Mortgage Rate no lower than and not more than 1% per
annum higher than the Mortgage Rate and Net Mortgage Rate, respectively, of the
Deleted Mortgage Loan as of the date of substitution; (iii) have a Loan-to-Value
Ratio at the time of substitution no higher than that of the Deleted Mortgage
Loan at the time of substitution; (iv) have a remaining term to stated maturity
not greater than (and not more than one year less than) that of the Deleted
Mortgage Loan; (v) comply with each representation and warranty set forth in
Section 2.04 hereof; (vi) have a Pool Strip Rate

                                       26

<PAGE>

equal to or greater than that of the Deleted Mortgage Loan and, (vii) comply
with each representation and warranty set forth in the Mortgage Loan Purchase
Agreement. Notwithstanding any other provisions herein, (x) with respect to any
Qualified Substitute Mortgage Loan substituted for a Deleted Mortgage Loan which
was a Discount Mortgage Loan, such Qualified Substitute Mortgage Loan shall be
deemed to be a Discount Mortgage Loan and to have a Discount Fraction equal to
the Discount Fraction of the Deleted Mortgage Loan and (y) in the event that the
"Pool Strip Rate" of any Qualified Substitute Mortgage Loan as calculated
pursuant to the definition of "Pool Strip Rate" is greater than the Pool Strip
Rate of the related Deleted Mortgage Loan, (i) the Pool Strip Rate of such
Qualified Substitute Mortgage Loan shall be equal to the Pool Strip Rate of the
related Deleted Mortgage Loan for purposes of calculating the Uncertificated
REMIC I Pass-Through Rate for the Uncertificated REMIC I IO Regular Interests
and (ii) the excess of the Pool Strip Rate on such Qualified Substitute Mortgage
Loan as calculated pursuant to the definition of "Pool Strip Rate" over the Pool
Strip Rate on the related Deleted Mortgage Loan shall be payable to the Class
R-II Certificates pursuant to Section 4.01 hereof.

                  "Radian": Radian Guaranty, Inc. (f/k/a Commonwealth Mortgage
Assurance Company), or its successors or assigns.

                  "Radian Insured Loans": The Mortgage Loans included in the
Trust Fund covered by the Radian PMI Pool Policy or by a Radian Lender-Paid PMI
Policy, as indicated on the Mortgage Loan Schedule.

                  "Radian Lender-Paid PMI Policy": A Primary Insurance Policy
issued by Radian in accordance with a May 1, 2000 letter between the Seller and
Radian.

                  "Radian PMI Pool Policy": Either one of the two modified
primary insurance pool policies issued with respect to certain of the Mortgage
Loans by Radian.

                  "Radian PMI Policy Rate": With respect to any Radian Insured
Loan, the rate per annum at which the related premium on the Radian PMI Pool
Policy or the Radian Lender-Paid PMI Policy accrues.

                  "Rate Adjustment Date": With respect to each Distribution Date
and the Class A-2 and Class A-3 Certificates, the second LIBOR Business Day
immediately preceding the commencement of the related Interest Accrual Period on
which banks are open for dealing in foreign currency and exchange in London,
England.

                  "Rating Agency": Standard & Poor's or Fitch and each of their
successors. If such agencies and their successors are no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating agency,
or other comparable Person, designated by the Company, notice of which
designation shall be given to the Trustee and Master Servicer. References herein
to the two highest long term debt rating categories of a Rating Agency shall
mean "AA" or better in the case of Fitch, and "AA" or better in the case of
Standard & Poor's and references herein to the highest short-term debt rating of
a Rating Agency shall mean "A-1+" in the case of Standard & Poor's, and

                                       27

<PAGE>

"F1+" in the case of Fitch, and in the case of any other Rating Agency such
references shall mean such rating categories without regard to any plus or
minus.

                  "Realized Loss": With respect to each Mortgage Loan or REO
Property as to which a Cash Liquidation or REO Disposition has occurred, an
amount (not less than zero) equal to (i) the Stated Principal Balance of the
Mortgage Loan as of the date of Cash Liquidation or REO Disposition, plus (ii)
interest (and REO Imputed Interest, if any) at the Net Mortgage Rate from the
Due Date as to which interest was last paid or advanced to Certificateholders up
to the date of the Cash Liquidation or REO Disposition on the Stated Principal
Balance of such Mortgage Loan outstanding during each Due Period that such
interest was not paid or advanced, minus (iii) the proceeds, if any, received
during the month in which such Cash Liquidation or REO Disposition occurred, to
the extent applied as recoveries of interest at the Net Mortgage Rate and to
principal of the Mortgage Loan, net of the portion thereof reimbursable to the
Master Servicer or any Sub- Servicer with respect to related Advances or
Servicing Advances not previously reimbursed. With respect to each Mortgage Loan
which has become the subject of a Deficient Valuation, the difference between
the principal balance of the Mortgage Loan outstanding immediately prior to such
Deficient Valuation and the principal balance of the Mortgage Loan as reduced by
the Deficient Valuation.

                  "Record Date": The last Business Day of the month immediately
preceding the month of the related Distribution Date.

                  "Regular Certificate": Any of the Certificates other than a
Residual Certificate.

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

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

                  "REMIC I": The segregated pool of assets, with respect to
which a REMIC election is to be made, consisting of: (i) each Mortgage Loan
(exclusive of payments of principal and interest due on or before the Cut-off
Date, if any, received by the Master Servicer which shall not constitute an
asset of the Trust Fund) as from time to time are subject to this Agreement and
all payments under and proceeds of such Mortgage Loans (exclusive of any
prepayment fees and late payment charges received on the Mortgage Loans),
together with all documents included in the related Mortgage File, subject to
Section 2.01; (ii) such funds or assets as from time to time are deposited in
the Custodial Account or the Certificate Account and belonging to the Trust
Fund; (iii) any REO Property; (iv) the Primary Hazard Insurance Policies, if
any, the Primary Insurance Policies, if any, and all other Insurance Policies
with respect to the Mortgage Loans; (v) the Radian PMI Pool Policies; and (vi)
the Company's interest in respect of the representations and warranties made by
the Seller in the Mortgage Loan Purchase Agreement as assigned to the Trustee
pursuant to Section 2.04 hereof.

                  "REMIC I Certificates":  The Class R-I Certificates.

                                       28

<PAGE>

                  "REMIC II": The segregated pool of assets consisting of the
Uncertificated REMIC I Regular Interests conveyed in trust to the Trustee for
the benefit of the holders of the Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-8, Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2, Class B-3 and Class R-II Certificates pursuant to Section
2.06, with respect to which a separate REMIC election is to be made.

                  "REMIC II Certificates": Any of the Class A-1, Class A-2,
Class A-3, Class A-4, Class A-5, Class A-6, Class A-7, Class A-8, Class M-1,
Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class R-II
Certificates.

                  "REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Sections
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and proposed, temporary and final regulations and published rulings,
notices and announcements promulgated thereunder, as the foregoing may be in
effect from time to time.

                  "Remittance Report": A report prepared by the Master Servicer
providing the information set forth in Exhibit E attached hereto.

                  "REO Acquisition": The acquisition by the Master Servicer on
behalf of the Trustee for the benefit of the Certificateholders of any REO
Property pursuant to Section 3.15.

                  "REO Disposition": The receipt by the Master Servicer of
Insurance Proceeds, Liquidation Proceeds and other payments and recoveries
(including proceeds of a final sale) which the Master Servicer expects to be
finally recoverable from the sale or other disposition of the REO Property.

                  "REO Imputed Interest": As to any REO Property, for any
period, an amount equivalent to interest (at the Mortgage Rate that would have
been applicable to the related Mortgage Loan had it been outstanding) on the
unpaid principal balance of the Mortgage Loan as of the date of acquisition
thereof (as such balance is reduced pursuant to Section 3.15 by any income from
the REO Property treated as a recovery of principal).

                  "REO Proceeds": Proceeds, net of directly related expenses,
received in respect of any REO Property (including, without limitation, proceeds
from the rental of the related Mortgaged Property and of any REO Disposition),
which proceeds are required to be deposited into the Custodial Account as and
when received.

                  "REO Property": A Mortgaged Property acquired by the Master
Servicer on behalf of the Trust Fund through foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.

                  "Request for Release": A release signed by a Servicing
Officer, in the form of Exhibits F-1 or F-2 attached hereto.

                                       29

<PAGE>

                  "Reserve Banks": Leading banks selected by the Trustee and
engaged in transactions in Eurodollar deposits in the international Eurocurrency
market (i) with an established place of business in London, (ii) whose
quotations appear on the Telerate Screen Page 3750 on the Rate Adjustment Date
in question, (iii) which have been designated as such by the Trustee and (iv)
not controlling, controlled by, or under common control with, the Company or the
Seller.

                  "Reserve Interest Rate": As determined by the Trustee, either
(i) the arithmetic mean (rounded upwards if necessary to the nearest whole
multiple of 0.0625%) of the rates quoted by one or more major banks in New York
City, selected by the Trustee after consultation with the Master Servicer, as of
11:00 a.m., New York time, on such date for loans in U.S. Dollars to the
principal London offices of leading banks in the London interbank market for a
period of one month in amounts approximately equal to the aggregate Certificate
Principal Balance of the Class A-2 Certificates and the Class A-3 Certificates
then outstanding or (ii) if no such quotations can be obtained, the rate shall
be the lowest one-month United States dollar lending rate which New York City
banks selected by the Trustee are quoting on such Rate Adjustment Date to
leading European banks.

                  "Residual Certificate": Any of the Class R-I Certificates or
Class R-II Certificates.

                  "Responsible Officer": When used with respect to the Trustee,
the Chairman or Vice Chairman of the Board of Directors or Trustees, the
Chairman or Vice Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, the Chairman of the Committee on Trust
Matters, any vice president, any assistant vice president, the Secretary, any
assistant secretary, the Treasurer, any assistant treasurer, the Cashier, any
assistant cashier, any trust officer or assistant trust officer, the Controller
and any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.

                  "Seller": Impac Funding Corporation, or its successor in
interest.

                  "Senior Accelerated Distribution Percentage": With respect to
any Distribution Date, the percentage indicated below:

<TABLE>
<CAPTION>
                                                     Senior Accelerated
Distribution Date                                    Distribution Percentage
-----------------                                    -----------------------
<S>                                                  <C>
July 2000 through                                    100%
 June 2005

July 2005 through                                    Senior Percentage, plus 70% of
   June 2006                                                  the Subordinate Percentage

July 2006 through                                    Senior Percentage, plus 60% of

                                       30

<PAGE>

   June 2007                                                  the Subordinate Percentage

July 2007 through                                    Senior Percentage, plus 40% of
   June 2008                                                  the Subordinate Percentage

July 2008 through                                    Senior Percentage, plus 20% of
   June 2009                                                  the Subordinate Percentage

July 2009 and                                                 Senior Percentage,
  thereafter
</TABLE>

provided, however, (i) that any scheduled reduction to the Senior Accelerated
Distribution Percentage described above shall not occur as of any Distribution
Date unless either (a)(1)(x) the outstanding principal balance of Mortgage Loans
delinquent 60 days or more (including foreclosure and REO Property) averaged
over the last six months as a percentage of the aggregate outstanding
Certificate Principal Balance of the Class M Certificates and the Class B
Certificates, is less than 50%, or (y) the outstanding principal balance of
Mortgage Loans delinquent 60 days or more (including foreclosure and REO
Property) averaged over the last six months, as a percentage of the aggregate
outstanding principal balance of all Mortgage Loans averaged over the last six
months, does not exceed 2% and (2) Realized Losses on the Mortgage Loans to date
for such Distribution Date if occurring during the sixth, seventh, eighth, ninth
or tenth year (or any year thereafter) after the Closing Date are less than 30%,
35%, 40%, 45% or 50%, respectively, of the sum of the Initial Certificate
Principal Balances of the Class M Certificates and Class B Certificates or (b)
(1) the aggregate outstanding principal balance of the Mortgage Loans delinquent
60 days or more (including foreclosure and REO Property) averaged over the last
six months, as a percentage of the aggregate outstanding principal balance of
all Mortgage Loans averaged over the last six months, does not exceed 4% and (2)
Realized Losses on the Mortgage Loans on or prior to such Distribution Date are
less than 10% of the sum of the Initial Certificate Principal Balances of the
Class M Certificates and Class B Certificates and (ii) that for any Distribution
Date on which the Senior Percentage is greater than the Original Senior
Percentage, the Senior Accelerated Distribution Percentage for such Distribution
Date shall be 100%. Notwithstanding the foregoing, upon the reduction of the
aggregate Certificate Principal Balance of the Class A Certificates (other than
the Certificate Principal Balance of the Principal Only Certificates) and the
Class R Certificates to zero, the Senior Accelerated Distribution Percentage
will equal 0%.

                  "Senior Interest Distribution Amount": As defined in Section
4.01(c)(i).

                  "Senior Percentage": As of any Distribution Date, the lesser
of 100% and a fraction, expressed as a percentage, the numerator of which is the
aggregate Certificate Principal Balance of the Class A Certificates (other than
the Principal Only Certificates) and Class R Certificates immediately prior to
such Distribution Date and the denominator of which is the aggregate Stated
Principal Balance of all of the Mortgage Loans or related REO Properties (other
than the Discount Fraction of the Discount Mortgage Loans) immediately prior to
such Distribution Date.

                                       31

<PAGE>

                  "Senior Principal Distribution Amount": As to any Distribution
Date, the lesser of (a) the balance of the Available Distribution Amount
remaining after the distribution of all amounts required to be distributed
pursuant to Section 4.01(c)(i) and (b) the sum of the amounts required to be
distributed to the Class A Certificates and Class R Certificates on such
Distribution Date pursuant to Section 4.01(c)(ii)(Y), (xv) and (xvi).

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

                  "Servicing Advances": All customary, reasonable and necessary
"out of pocket" costs and expenses incurred in connection with a default,
delinquency or other unanticipated event in the performance by the Master
Servicer or any Sub-Servicer of its servicing obligations, including, but not
limited to, the cost of (i) the preservation, restoration and protection of a
Mortgaged Property, (ii) any enforcement or judicial proceedings, including
foreclosures, (iii) the management and liquidation of any REO Property,
including reasonable fees paid to any independent contractor in connection
therewith, and (iv) compliance with the obligations under the second paragraph
of Section 3.01, Section 3.09 and Section 3.13 (other than any deductible
described in the last paragraph thereof).

                  "Servicing Fees": As to each Mortgage Loan, an amount, payable
out of any payment of interest on the Mortgage Loan, equal to interest at the
Servicing Fee Rate on the Stated Principal Balance of such Mortgage Loan for the
calendar month preceding the month in which the payment is due (alternatively,
in the event such payment of interest accompanies a Principal Prepayment in full
made by the Mortgagor, interest for the number of days covered by such payment
of interest).

                  "Servicing Fee Rate": With respect to each Mortgage Loan, the
per annum rate of 0.28%.

                  "Servicing Guide": The Impac Funding Corporation Servicing
Guide attached hereto as Exhibit K.

                  "Servicing Officer": Any officer of the Master Servicer
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.

                  "Single Certificate": A Certificate of any Class evidencing an
Initial Certificate Principal Balance of $1,000.

                  "Special Deposit":  As defined in Section 2.01(a).

                  "Special Hazard Amount": As of any Distribution Date, an
amount equal to $2,750,049 (the initial "Special Hazard Amount") minus the sum
of (i) the aggregate amount of Special Hazard Losses allocated solely to one or
more Classes of Certificates in accordance with

                                       32

<PAGE>

Section 4.04 and (ii) the Adjustment Amount (as defined below) as most recently
calculated. For each Anniversary, the "Adjustment Amount" shall be calculated
and shall be equal to the amount, if any, by which the amount calculated in
accordance with the preceding sentence (without giving effect to the deduction
of the Adjustment Amount for such Anniversary) exceeds the greater of (A) the
greatest of (i) twice the outstanding principal balance of the Mortgage Loan in
the Trust Fund which has the largest outstanding principal balance on the
Distribution Date immediately preceding such anniversary, (ii) the product of
1.00% multiplied by the outstanding principal balance of all Mortgage Loans on
the Distribution Date immediately preceding such anniversary and (iii) the
aggregate outstanding principal balance (as of the immediately preceding
Distribution Date) of the Mortgage Loans in any single five-digit California zip
code area with the largest amount of Mortgage Loans by aggregate principal
balance as of such anniversary and (B) the greater of (i) the product of 0.50%
multiplied by the outstanding principal balance of all Mortgage Loans on the
Distribution Date immediately preceding such anniversary multiplied by a
fraction, the numerator of which is equal to the aggregate outstanding principal
balance (as of the immediately preceding Distribution Date) of all of the
Mortgage Loans secured by Mortgaged Properties located in the State of
California divided by the aggregate outstanding principal balance (as of the
immediately preceding Distribution Date) of all of the Mortgage Loans, expressed
as a percentage, and the denominator of which is equal to 27.60% (which
percentage is equal to the percentage of Mortgage Loans initially secured by
Mortgaged Properties located in the State of California) and (ii) the aggregate
outstanding principal balance (as of the immediately preceding Distribution
Date) of the largest Mortgage Loan secured by a Mortgaged Property located in
the State of California.

                  The Special Hazard Amount may be further reduced by the Master
Servicer (including accelerating the manner in which coverage is reduced)
provided that prior to any such reduction, the Master Servicer shall (i) obtain
written confirmation from each Rating Agency that such reduction shall not
reduce the rating assigned to any Class of Certificates by such Rating Agency
below the lower of the then-current rating or the rating assigned to such
Certificates as of the Closing Date by such Rating Agency and (ii) provide a
copy of such written confirmation to the Trustee.

                  "Special Hazard Loss": Any Realized Loss not in excess of the
cost of the lesser of repair or replacement of a Mortgaged Property suffered by
such Mortgaged Property on account of direct physical loss, exclusive of (i) any
loss of a type covered by a hazard policy or a flood insurance policy required
to be maintained in respect of such Mortgaged Property pursuant to Section
3.13(a), except to the extent of the portion of such loss not covered as a
result of any coinsurance provision and (ii) any Extraordinary Loss.

                  "Special Hazard Percentage": As of each Anniversary, the
greater of (i) 1.00% and (ii) the largest percentage obtained by dividing the
aggregate outstanding principal balance (as of the immediately preceding
Distribution Date) of the Mortgage Loans secured by Mortgaged Properties located
in a single, five-digit zip code area in the State of California by the
outstanding principal balance of all the Mortgage Loans as of such immediately
preceding Distribution Date.

                                       33

<PAGE>

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

                  "Startup Day": The day designated as such pursuant to Article
X hereof.

                  "Stated Principal Balance": With respect to any Mortgage Loan
or related REO Property at any given time, (i) the principal balance of the
Mortgage Loan outstanding as of the Cut- off Date, after application of
principal payments due on or before such date, whether or not received, minus
(ii) the sum of (a) the principal portion of the Monthly Payments due with
respect to such Mortgage Loan or REO Property during each Due Period ending
prior to the most recent Distribution Date which were received or with respect
to which an Advance was made, and (b) all Principal Prepayments with respect to
such Mortgage Loan or REO Property, and all Insurance Proceeds, Liquidation
Proceeds and REO Proceeds to the extent applied by the Master Servicer as
recoveries of principal in accordance with Section 3.15 with respect to such
Mortgage Loan or REO Property, which were distributed pursuant to Section 4.01
on any previous Distribution Date, and (c) any Realized Loss with respect
thereto allocated pursuant to Section 4.04 for any previous Distribution Date.

                  "Subordinate Certificate": Any of the Class M, Class B-1,
Class B-2 or Class B-3 Certificates.

                  "Subordinate Percentage": As of any date of determination, a
percentage equal to 100% minus Senior Percentage as of such date.

                  "Subordinate Principal Distribution Amount": With respect to
any Distribution Date and each Class of Class M Certificates and Class B
Certificates, the sum of (i) the product of (x) the related Class M Percentage
or Class B Percentage for such Class and (y) the aggregate of the amounts
calculated for such Distribution Date under clauses (1), (2) and (3) of Section
4.01(c)(ii)(Y)(A) without giving effect to the Senior Percentage; (ii) such
Class's pro rata share, based on the Certificate Principal Balance of each Class
of Class M Certificates and Class B Certificates then outstanding, of the
principal collections described in Section 4.01(c)(ii)(Y)(B)(b) (without giving
effect to the Senior Accelerated Distribution Percentage), to the extent such
collections are not otherwise distributed to the Senior Certificates; (iii) the
product of (x) the related Prepayment Distribution Percentage for such
Distribution Date and (y) the aggregate of all Principal Prepayments in Full and
Curtailments received in the related Prepayment Period to the extent not payable
to the Senior Certificates; and (iv) any amounts described in clauses (i), (ii)
and (iii) as determined for any previous Distribution Date, that remain
undistributed to the extent that such amounts are not attributable to Realized
Losses which have been allocated to a subordinate Class of Class M Certificates
or Class B Certificates; provided, however, that such amount shall in no event
exceed the outstanding Certificate Principal Balance of such Class of
Certificates immediately prior to such date.

                  "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.

                                       34

<PAGE>

                  "Sub-Servicer Remittance Date": The 18th day of each month, or
if such day is not a Business Day, the immediately preceding Business Day.

                  "Sub-Servicing Account": An account established by a
Sub-Servicer which meets the requirements set forth in Section 3.08 and is
otherwise acceptable to the Master Servicer.

                  "Sub-Servicing Agreement": The written contract between the
Master Servicer and a Sub-Servicer and any successor Sub-Servicer relating to
servicing and administration of certain Mortgage Loans as provided in Section
3.02.

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

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

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

                  "Trust Fund": REMIC I and REMIC II.

                  "Trustee": Bankers Trust Company of California, N.A., or its
successor in interest, or any successor trustee appointed as herein provided.

                  "Trustee's Fee": As to each Mortgage Loan and Distribution
Date, an amount equal to interest at the Trustee Fee Rate on the Stated
Principal Balance of such Mortgage Loan as of the Due Date in the month
immediately preceding the month in which such Distribution Date occurs.

                  "Trustee Fee Rate": With respect to each Mortgage Loan, the
per annum rate of 0.0050%.

                  "Uncertificated Principal Balance": With respect to each
Uncertificated REMIC I Regular Interest on any date of determination, the amount
set forth in the Preliminary Statement hereto minus the sum of (x) the aggregate
of all amounts previously deemed distributed with respect to such interest and
applied to reduce the Uncertificated Principal Balance thereof pursuant to
Section 4.07(a)(ii) and (y) the aggregate of all reductions in Certificate
Principal Balance deemed to have occurred in connection with Realized Losses
that were previously deemed allocated to the

                                       35

<PAGE>

Uncertificated Principal Balance of such Uncertificated REMIC I Regular Interest
pursuant to Section 4.07(d).

                  "Uncertificated REMIC I Accrued Interest": With respect to
each Distribution Date, (i) as to Uncertificated REMIC I Regular Interest T, an
amount equal to the aggregate amount of Accrued Certificate Interest that would
result under the terms of the definition thereof on the Class A-1 Certificates
if the Pass-Through Rate on such Class were equal to the Uncertificated REMIC I
Pass-Through Rate on Uncertificated REMIC I Regular Interest T, (ii) as to
Uncertificated REMIC I Regular Interest U, an amount equal to the aggregate
amount of Accrued Certificate Interest that would result under the terms of the
definition thereof on the Class A-2 Certificates if the Pass- Through Rate on
such Class were equal to the Uncertificated REMIC I Pass-Through Rate on
Uncertificated REMIC I Regular Interest U; (iii) as to Uncertificated REMIC I
Regular Interest V, an amount equal to the aggregate amount of Accrued
Certificate Interest that would result under the terms of the definition thereof
on the Class A-4 Certificates if the Pass-Through Rate on such Class were equal
to the Uncertificated REMIC I Pass-Through Rate on Uncertificated REMIC I
Regular Interest V, (iv) as to Uncertificated REMIC I Regular Interest W, an
amount equal to the aggregate amount of Accrued Certificate Interest that would
result under the terms of the definition thereof on the Class A-5 Certificates
if the Pass-Through Rate on such Class were equal to the Uncertificated REMIC I
Pass-Through Rate on Uncertificated REMIC I Regular Interest W, (v) as to
Uncertificated REMIC I Regular Interest X, an amount equal to the aggregate
amount of Accrued Certificate Interest that would result under the terms of the
definition thereof on the Class M-1, Class M-2, Class M-3, Class B-1, Class B-2,
Class B-3 and Class R-II Certificates if the Pass-Through Rate on such Class
were equal to the Uncertificated REMIC I Pass-Through Rate on Uncertificated
REMIC I Regular Interest X; (vi) as to Uncertificated REMIC I Regular Interest
Y, an amount equal to the aggregate amount of Accrued Certificate Interest that
would result under the terms of the definition thereof on the Class A-7
Certificates if the Pass-Through Rate on such Classes were equal to the
Uncertificated REMIC I Pass-Through Rate on Uncertificated REMIC I Regular
Interest Y, and (vii) as to each Uncertificated REMIC I IO Regular Interest, an
amount equal to the aggregate amount of Accrued Certificate Interest that would
result under the terms of the definition thereof on each such uncertificated
interest, if the Pass-Through Rate on such uncertificated interest was equal to
the related Uncertificated REMIC I Pass-Through Rate and the notional amount of
such uncertificated interest was equal to the related Uncertificated REMIC I IO
Notional Amount; provided, that any reduction in the amount of Accrued
Certificate Interest resulting from the allocation of Prepayment Interest
Shortfalls, Realized Losses or other amounts to the Class A-8 Certificateholders
pursuant to Sections 4.02(a) and 4.05 hereof shall be allocated to the
Uncertificated REMIC I IO Regular Interests pro rata in accordance with the
amount of interest accrued with respect to each related Uncertificated REMIC I
IO Notional Amount and such Distribution Date.

                  "Uncertificated REMIC I IO Notional Amount": With respect to
each Uncertificated REMIC I IO Regular Interest, the Stated Principal Balance of
the related Non-Discount Mortgage Loan.

                  "Uncertificated REMIC I IO Regular Interests": The
uncertificated partial undivided beneficial ownership interests in REMIC I, each
relating to a particular Non-Discount Mortgage

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<PAGE>

Loan, having no principal balance, and bearing interest at the Uncertificated
REMIC I Pass-Through Rate on the Uncertificated REMIC I IO Notional Amount.

                  "Uncertificated REMIC I Pass-Through Rate": With respect to
each of Uncertificated REMIC I Regular Interests as follows:

         (i)      Uncertificated REMIC I Regular Interest T, 8.225003725%;

         (ii)     Uncertificated REMIC I Regular Interest U, 9.05%;

         (iii)    Uncertificated REMIC I Regular Interest V, 8.50%;

         (iv)     Uncertificated REMIC I Regular Interest W, 8.50%;

         (v)      Uncertificated REMIC I Regular Interest X, 8.50%;

         (vi)     Uncertificated REMIC I Regular Interest Y, 0.00%; and

         (vii)    Uncertificated REMIC I IO Regular Interest, the Pool Strip
                  Rate.

                  "Uncertificated REMIC I Regular Interest T": An uncertificated
partial undivided beneficial ownership interest in REMIC I having a principal
balance equal to the aggregate Stated Principal Balance of the Mortgage Loans
and REO Properties from time to time multiplied by a fraction, the numerator of
which is the aggregate Certificate Principal Balance of the Class A-1
Certificates and the denominator of which is the aggregate Certificate Principal
Balance of all of the Certificates, and which bears interest at a rate equal to
8.225003725% per annum.

                  "Uncertificated REMIC I Regular Interest U": An uncertificated
partial undivided beneficial ownership interest in REMIC I having a principal
balance equal to the aggregate Stated Principal Balance of the Mortgage Loans
and REO Properties from time to time multiplied by a fraction, the numerator of
which is the aggregate Certificate Principal Balance of the Class A-2
Certificates and the denominator of which is the aggregate Certificate Principal
Balance of all of the Certificates, and which bears interest at a rate equal to
9.05% per annum.

                  "Uncertificated REMIC I Regular Interest V": An uncertificated
partial undivided beneficial ownership interest in REMIC I having a principal
balance equal to the aggregate Stated Principal Balance of the Mortgage Loans
and REO Properties from time to time multiplied by a fraction, the numerator of
which is the Certificate Principal Balance of the Class A-4 Certificates and the
denominator of which is the aggregate Certificate Principal Balance of all of
the Certificates, and which bears interest at a rate equal to 8.50% per annum.

                  "Uncertificated REMIC I Regular Interest W": An uncertificated
partial undivided beneficial ownership interest in REMIC I having a principal
balance equal to the aggregate Stated Principal Balance of the Mortgage Loans
and REO Properties from time to time multiplied by a

                                       37

<PAGE>

fraction, the numerator of which is the Certificate Principal Balance of the
Class A-5 Certificates and the denominator of which is the aggregate Certificate
Principal Balance of all of the Certificates, and which bears interest at a rate
equal to 8.50% per annum.

                  "Uncertificated REMIC I Regular Interest X": An uncertificated
partial undivided beneficial ownership interest in REMIC I having a principal
balance equal to the aggregate Stated Principal Balance of the Mortgage Loans
and REO Properties from time to time multiplied by a fraction, the numerator of
which is the aggregate Certificate Principal Balances of the Class M-1, Class
M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class R-II Certificates and
the denominator of which is the aggregate Certificate Principal Balance of all
of the Certificates, and which bears interest at a rate equal to 8.50% per
annum.

                  "Uncertificated REMIC I Regular Interest Y": An uncertificated
partial undivided beneficial ownership interest in REMIC I having a principal
balance equal to the aggregate Stated Principal Balance of the Mortgage Loans
and REO Properties from time to time multiplied by a fraction, the numerator of
which is the aggregate Certificate Principal Balance of the Class A-7
Certificates and the denominator of which is the aggregate Certificate Principal
Balance of all of the Certificates, and which bears interest at a rate equal to
0.00% per annum.

                  "Uncertificated REMIC I Regular Interests": Uncertificated
REMIC I Regular Interest T, Uncertificated REMIC I Regular Interest U,
Uncertificated REMIC I Regular Interest V, Uncertificated REMIC I Regular
Interest W, Uncertificated REMIC I Regular Interest X, Uncertificated REMIC I
Regular Interest Y and the Uncertificated REMIC I IO Regular Interests.

                  "Uncertificated REMIC I IO Regular Interest Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I IO Regular Interest for such
Distribution Date pursuant to Section 4.07(a).

                  "Uncertificated REMIC I Regular Interest T Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Regular Interest T for such
Distribution Date pursuant to Section 4.07(a).

                  "Uncertificated REMIC I Regular Interest U Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Regular Interest U for such
Distribution Date pursuant to Section 4.07(a).

                  "Uncertificated REMIC I Regular Interest V Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Regular Interest V for such
Distribution Date pursuant to Section 4.07(a).

                  "Uncertificated REMIC I Regular Interest W Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Regular Interest W for such
Distribution Date pursuant to Section 4.07(a).

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<PAGE>

                  "Uncertificated REMIC I Regular Interest X Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Regular Interest X for such
Distribution Date pursuant to Section 4.07(a).

                  "Uncertificated REMIC I Regular Interest Y Distribution
Amount": With respect to any Distribution Date, the sum of the amounts deemed to
be distributed on the Uncertificated REMIC I Regular Interest Y for such
Distribution Date pursuant to Section 4.07(a).

                  "Uncertificated REMIC I Regular Interest Distribution
Amounts": The Uncertificated REMIC I Regular Interest T Distribution Amount,
Uncertificated REMIC I Regular Interest U Distribution Amount, Uncertificated
REMIC I Regular Interest V Distribution Amount, Uncertificated REMIC I Regular
Interest W Distribution Amount, Uncertificated REMIC I Regular Interest X
Distribution Amount, Uncertificated REMIC I Regular Interest Y Distribution
Amount and Uncertificated REMIC I IO Regular Interest Distribution Amount.

                  "Uninsured Cause": Any cause of damage to property subject to
a Mortgage such that the complete restoration of such property is not fully
reimbursable by the hazard insurance policies or flood insurance policies
required to be maintained pursuant to Section 3.13.

                  "United States Person": A citizen or resident of the United
States, a corporation or a partnership (including an entity treated as a
corporation or partnership for United States federal income tax purposes)
created or organized in, or under the laws of, the United States or any State
thereof or the District of Columbia (except, in the case of a partnership, to
the extent provided in regulations) 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.

                  "Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. At all times during the
term of this Agreement, 96% of all of the Voting Rights shall be allocated among
Holders of the Certificates (other than the Interest Only and Residual
Certificates), 1% of all Voting Rights shall be allocated to the Holders of the
Class A-3 Certificates, 1% of all Voting Rights shall be allocated to the
Holders of the Class A-6 Certificates, 1% of all Voting Rights shall be
allocated to the Holders of the Class A-8 Certificates and the Holders of the
Class R-I Certificates and Class R-II Certificates shall be entitled to 0.5% and
0.5% of all of the Voting Rights, respectively, allocated among the Certificates
of each such Class in accordance with their respective Percentage Interests.

                  "Wendover": Wendover Funding, Inc.

                                       39

<PAGE>

         SECTION 1.02               Determination of LIBOR.

         LIBOR applicable to the calculation of the Pass-Through Rates on the
Class A-2 and Class A-3 Certificates for any Interest Accrual Period (other than
the initial Interest Accrual Period) will be determined on each Rate Adjustment
Date as follows:

         For the first Interest Accrual Period, LIBOR will equal 6.65125%. For
any Interest Accrual Period other than the first Interest Accrual Period, the
rate for United States dollar deposits on the basis of the offered rates of the
Reserve Banks for one-month United States dollar deposits, as such rate appears
on the Dow Jones Telerate Screen Page 3750 as of 11:00 A.M., London, England
time, on the second LIBOR Business Day prior to the first day of such Interest
Accrual Period. If such rate does not appear on such page (or such other page as
may replace that page on that service, or if such service is no longer offered,
such other service for displaying LIBOR or comparable rates as may be reasonably
selected by the Trustee after consultation with the Master Servicer), the rate
will be the Reserve Interest Rate. If no such quotations can be obtained and no
Reserve Interest Rate is available, LIBOR will be LIBOR applicable to the
preceding Distribution Date; provided however, if, under the priorities
described above, LIBOR for a Distribution Date would be based on LIBOR for the
previous Distribution Date for the third consecutive Distribution Date, the
Trustee shall select an alternative comparable index (over which the Trustee has
no control), used for determining one- month Eurodollar lending rates that is
calculated and published (or otherwise made available) by an independent party.

         The establishment of LIBOR by the Trustee on any Rate Adjustment Date
and the Trustee's subsequent calculation of the Pass-Through Rates applicable to
the Class A-2 and Class A-3 Certificates for the relevant Interest Accrual
Period, in the absence of manifest error, will be final and binding.

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<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

                  SECTION 2.01.             Conveyance of Mortgage Loans.

                  The Company, as of the Closing Date, and concurrently with the
execution and delivery hereof, does hereby assign, transfer, sell, set over and
otherwise convey to the Trustee without recourse all the right, title and
interest of the Company in and to the Mortgage Loans identified on the Mortgage
Loan Schedule (exclusive of any prepayment fees and late payment charges
received thereon) and all other assets included or to be included in the Trust
Fund for the benefit of the Certificateholders. Such assignment includes all
principal and interest received by the Master Servicer on or with respect to the
Mortgage Loans (other than payment of principal and interest due on or before
the Cut-off Date).

                  The Master Servicer hereby acknowledges the receipt by it of
cash in an amount equal to $159,275.10 (the "Special Deposit"), representing
interest at the Mortgage Rate, for the calendar month of June 2000, for those
Mortgage Loans which do not have Monthly Payments due on July 1, 2000. The
Master Servicer shall hold such amount in the Custodial Account and shall
include such amount in the Available Distribution Amount for the Distribution
Date in July 2000.

                  In connection with such transfer and assignment, the Company
has caused the Seller to deliver to, and deposit with the Trustee, as described
in the Mortgage Loan Purchase Agreement the following documents or instruments:

                (i) the original Mortgage Note endorsed without recourse,
         "Bankers Trust Company of California, N.A., as trustee under the
         Pooling and Servicing Agreement relating to Impac Secured Assets Corp.,
         Mortgage Pass-Through Certificates, Series 2000-2" with all intervening
         endorsements showing an unbroken chain of endorsements from the
         originator to the Person endorsing it to the Trustee or, with respect
         to any Mortgage Loan as to which the original Mortgage Note has been
         permanently lost or destroyed and has not been replaced, a Lost Note
         Affidavit;

               (ii) the original recorded Mortgage or, if the original Mortgage
         has not been returned from the public recording office, a copy of the
         Mortgage certified by the Seller or the public recording office in
         which such Mortgage has been recorded to be a true and complete copy of
         the original Mortgage submitted for recording;

              (iii) a duly executed original Assignment of the Mortgage, without
         recourse, in recordable form to "Bankers Trust Company of California,
         N.A., as trustee," or to "Bankers Trust Company of California, N.A., as
         trustee for holders of Impac Secured Assets Corp., Mortgage
         Pass-Through Certificates, Series 2000-2";

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<PAGE>

               (iv) the original recorded Assignment or Assignments of the
         Mortgage showing an unbroken chain of assignment from the originator
         thereof to the Person assigning it to the Trustee or, if any such
         Assignment has not been returned from the applicable public recording
         office, a copy of such Assignment certified by the Seller to be a true
         and complete copy of the original Assignment submitted to the title
         insurance company for recording;

                (v) the original title insurance policy, or, if such policy has
         not been issued, any one of an original or a copy of the preliminary
         title report, title binder or title commitment on the Mortgaged
         Property with the original policy of the insurance to be delivered
         promptly following the receipt thereof;

              (vi) a copy of the related hazard insurance policy;

              (vii) a true and correct copy of any assumption, modification,
         consolidation or substitution agreement; and

             (viii) the original or a copy of the private mortgage insurance
         policy or original certificate of private mortgage insurance for each
         Mortgage Loan so identified on the Mortgage Loan Schedule (other than a
         Radian Lender-Paid PMI Policy).

                  The Seller is obligated as described in the Mortgage Loan
Purchase Agreement to deliver to the Trustee: (a) either the original recorded
Mortgage, or in the event such original cannot be delivered by the Seller, a
copy of such Mortgage certified as true and complete by the appropriate
recording office, in those instances where a copy thereof certified by the
Seller was delivered to the Trustee pursuant to clause (ii) above; and (b)
either the original Assignment or Assignments of the Mortgage, with evidence of
recording thereon, showing an unbroken chain of assignment from the originator
to the Seller, or in the event such original cannot be delivered by the Seller,
a copy of such Assignment or Assignments certified as true and complete by the
appropriate recording office, in those instances where copies thereof certified
by the Seller were delivered to the Trustee pursuant to clause (iv) above.
However, pursuant to the Mortgage Loan Purchase Agreement, the Seller need not
cause to be recorded any assignment in any jurisdiction under the laws of which,
as evidenced by an Opinion of Counsel delivered by the Seller to the Trustee and
the Rating Agencies, the recordation of such assignment is not necessary to
protect the Trustee's interest in the related Mortgage Loan; provided, however,
notwithstanding the delivery of any Opinion of Counsel, each assignment shall be
submitted for recording by the Seller in the manner described above, at no
expense to the Trust or the Trustee, upon the earliest to occur of: (i)
direction by the Holders of Certificates evidencing at least 25% of the Voting
Rights, (ii) the occurrence of a Event of Default, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Seller, (iv) the
occurrence of a servicing transfer as described in Section 7.02 hereof and (v)
if the Seller is not the Master Servicer and with respect to any one assignment,
the occurrence of a bankruptcy, insolvency or foreclosure relating to the
Mortgagor under the related Mortgage.

                  Notwithstanding anything to the contrary contained in this
Section 2.01, in those instances where the public recording office retains the
original Mortgage after it has been recorded,

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<PAGE>

the Seller shall be deemed to have satisfied its obligations hereunder upon
delivery to the Trustee of a copy of such Mortgage certified by the public
recording office to be a true and complete copy of the recorded original
thereof.

                  If any Assignment is lost or returned unrecorded to the
Trustee because of any defect therein, the Seller is required, as described in
the Mortgage Loan Purchase Agreement, to prepare a substitute Assignment or cure
such defect, as the case may be, and the Seller shall cause such Assignment to
be recorded in accordance with this section.

                  The Seller is required as described in the Mortgage Loan
Purchase Agreement to exercise its best reasonable efforts to deliver or cause
to be delivered to the Trustee within 120 days of the Closing Date the original
or a photocopy of the title insurance policy with respect to each Mortgage Loan
assigned to the Trustee pursuant to this Section 2.01.

                  All original documents relating to the Mortgage Loans which
are not delivered to the Trustee are and shall be held by the Master Servicer in
trust for the benefit of the Trustee on behalf of the Certificateholders.

                  Except as may otherwise expressly be provided herein, none of
the Company, the Master Servicer or the Trustee shall (and the Master Servicer
shall ensure that no Sub-Servicer shall) assign, sell, dispose of or transfer
any interest in the Trust Fund or any portion thereof, or cause the Trust Fund
or any portion thereof to be subject to any lien, claim, mortgage, security
interest, pledge or other encumbrance.

                  It is intended that the conveyance of the Mortgage Loans by
the Company to the Trustee as provided in this Section be, and be construed as,
a sale of the Mortgage Loans and the Uncertificated REMIC I Regular Interests as
provided for in this Section 2.01 by the Company to the Trustee for the benefit
of the Certificateholders. It is, further, not intended that such conveyance be
deemed a pledge of the Mortgage Loans and the Uncertificated REMIC I Regular
Interests by the Company to the Trustee to secure a debt or other obligation of
the Company. However, in the event that the Mortgage Loans and the
Uncertificated REMIC I Regular Interests are held to be property of the Company,
or if for any reason this Agreement is held or deemed to create a security
interest in the Mortgage Loans and the Uncertificated REMIC I Regular Interests,
then it is intended that, (a) this Agreement shall also be deemed to be a
security agreement within the meaning of Articles 8 and 9 of the New York
Uniform Commercial Code and the Uniform Commercial Code of any other applicable
jurisdiction; (b) the conveyance provided for in this Section shall be deemed to
be (1) a grant by the Company to the Trustee of a security interest in all of
the Company's right (including the power to convey title thereto), title and
interest, whether now owned or hereafter acquired, in and to (A) the Mortgage
Loans, including the Mortgage Notes, the Mortgages, any related Insurance
Policies and all other documents in the related Mortgage Files, (B) all amounts
payable to the holders of the Mortgage Loans in accordance with the terms
thereof, (C) the Uncertificated REMIC I Regular Interests and (D) all proceeds
of the conversion, voluntary or involuntary, of the foregoing into cash,
instruments, securities or other property, including without limitation all
amounts from time to time held or invested in the Certificate Account or the
Custodial Account, whether in the form of cash,

                                       43

<PAGE>

instruments, securities or other property and (2) an assignment by the Company
to the Trustee of any security interest in any and all of the Seller's right
(including the power to convey title thereto), title and interest, whether now
owned or hereafter acquired, in and to the property described in the foregoing
clauses (1)(A) through (D); (c) the possession by the Trustee or any other agent
of the Trustee of Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to be
"possession by the secured party" or possession by a purchaser or a person
designated by such secured party, for purposes of perfecting the security
interest pursuant to the New York Uniform Commercial Code and the Uniform
Commercial Code of any other applicable jurisdiction (including, without
limitation, Sections 9-115, 9-305, 8-102, 8-301, 8-501 and 8-503 thereof); and
(d) notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Trustee for the purpose
of perfecting such security interest under applicable law. The Company and the
Trustee shall, to the extent consistent with this Agreement, take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Mortgage Loans and the Uncertificated REMIC I Regular
Interests, such security interest would be deemed to be a perfected security
interest of first priority under applicable law and will be maintained as such
throughout the term of the Agreement.

                  SECTION 2.02.             Acceptance of the Trust Fund by the
                                            Trustee.

                  The Trustee acknowledges receipt (subject to any exceptions
noted in the Initial Certification described below), of the documents referred
to in Section 2.01 above and all other assets included in the definition of
"Trust Fund" and declares that it holds and will hold such documents and the
other documents delivered to it constituting the Mortgage Files, and that it
holds or will hold such other assets included in the definition of "Trust Fund"
(to the extent delivered or assigned to the Trustee), in trust for the exclusive
use and benefit of all present and future Certificateholders.

                  The Trustee agrees, for the benefit of the Certificateholders,
to review or cause to be reviewed on its behalf, each Mortgage File on or before
the Closing Date to ascertain that all documents required to be delivered to it
are in its possession, and the Trustee agrees to execute and deliver, or cause
to be executed and delivered, to the Company and the Master Servicer on the
Closing Date, an Initial Certification in the form annexed hereto as Exhibit C
to the effect that, as to each Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan
specifically identified in such certification as not covered by such
certification), (i) all documents required to be delivered to it pursuant to
this Agreement with respect to such Mortgage Loan are in its possession, (ii)
such documents have been reviewed by it and appear regular on their face and
relate to such Mortgage Loan and (iii) based on its examination and only as to
the foregoing documents, the information set forth in items (i), (ii), (iii) and
(iv) of the definition of the "Mortgage Loan Schedule" accurately reflects
information set forth in the Mortgage File. Neither the Trustee nor the Master
Servicer shall be under any duty to determine whether any Mortgage File should
include any of the documents specified in clause (vi) or (vii) of Section 2.01.
Neither the Trustee nor the Master Servicer shall be under any duty or
obligation to inspect, review

                                       44

<PAGE>

or examine said documents, instruments, certificates or other papers to
determine that the same are genuine, enforceable or appropriate for the
represented purpose or that they have actually been recorded, or they are in
recordable form or that they are other than what they purport to be on their
face.

                  Within 90 days of the Closing Date the Trustee shall deliver
to the Company and the Master Servicer a Final Certification in the form annexed
hereto as Exhibit D evidencing the completeness of the Mortgage Files, with any
applicable exceptions noted thereon.

                  If in the process of reviewing the Mortgage Files and
preparing the certifications referred to above the Trustee finds any document or
documents constituting a part of a Mortgage File to be missing or defective in
any material respect, the Trustee shall promptly notify the Seller, the Master
Servicer and the Company. The Trustee shall promptly notify the Seller of such
defect and request that the Seller cure any such defect within 60 days from the
date on which the Seller was notified of such defect, and if the Seller does not
cure such defect in all material respects during such period, request on behalf
of the Certificateholders that the Seller purchase such Mortgage Loan from the
Trust Fund at the Purchase Price within 90 days after the date on which the
Seller was notified of such defect; provided that if such defect would cause the
Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure or repurchase must occur within 90 days
from the date such breach was discovered. It is understood and agreed that the
obligation of the Seller to cure a material defect in, or purchase any Mortgage
Loan as to which a material defect in a constituent document exists shall
constitute the sole remedy respecting such defect available to
Certificateholders or the Trustee on behalf of Certificateholders. The Purchase
Price for the purchased Mortgage Loan shall be deposited or caused to be
deposited upon receipt by the Master Servicer in the Custodial Account and, upon
receipt by the Trustee of written notification of such deposit signed by a
Servicing Officer, the Trustee shall release or cause to be released to the
Seller the related Mortgage File and shall execute and deliver such instruments
of transfer or assignment, in each case without recourse, as the Seller shall
require as necessary to vest in the Seller ownership of any Mortgage Loan
released pursuant hereto and at such time the Trustee shall have no further
responsibility with respect to the related Mortgage File.

                  SECTION 2.03.             Representations, Warranties and
                                            Covenants of the Master Servicer and
                                            the Company.

                  (a) The Master Servicer hereby represents and warrants to and
covenants with the Company and the Trustee for the benefit of Certificateholders
that:

                        (i) The Master Servicer is, and throughout the term
         hereof shall remain, a corporation duly organized, validly existing and
         in good standing under the laws of the state of its incorporation
         (except as otherwise permitted pursuant to Section 6.02), the Master
         Servicer is, and shall remain, in compliance with the laws of each
         state in which any Mortgaged Property is located to the extent
         necessary to perform its obligations under this Agreement, and the
         Master Servicer is, and shall remain, approved to sell mortgage loans
         to and service mortgage loans for Fannie Mae and Freddie Mac;

                                       45

<PAGE>

                       (ii) The execution and delivery of this Agreement by the
         Master Servicer, and the performance and compliance with the terms of
         this Agreement by the Master Servicer, will not violate the Master
         Servicer's articles of incorporation or bylaws or 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
         agreement or other instrument to which it is a party or which is
         applicable to it or any of its assets;

                      (iii) The Master Servicer has the full power and authority
         to enter into and consummate all transactions contemplated by this
         Agreement, has duly authorized the execution, delivery and performance
         of this Agreement, and has duly executed and delivered this Agreement;

                       (iv) This Agreement, assuming due authorization,
         execution and delivery by the Company and the Trustee, constitutes a
         valid, legal and binding obligation of the Master Servicer, enforceable
         against the Master Servicer in accordance with the terms hereof,
         subject to (A) applicable bankruptcy, insolvency, reorganization,
         moratorium and other laws affecting the enforcement of creditors'
         rights generally, and (B) general principles of equity, regardless of
         whether such enforcement is considered in a proceeding in equity or at
         law;

                        (v) The Master Servicer is not in violation of, and its
         execution and delivery of this Agreement and its performance and
         compliance with the terms of this Agreement will not constitute a
         violation of, any law, any order or decree of any court or arbiter, or
         any order, regulation or demand of any federal, state or local
         governmental or regulatory authority, which violation is likely to
         affect materially and adversely either the ability of the Master
         Servicer to perform its obligations under this Agreement or the
         financial condition of the Master Servicer;

                       (vi) No litigation is pending (other than litigation with
         respect to which pleadings or documents have been filed with a court,
         but not served on the Master Servicer) or, the best of the Master
         Servicer's knowledge, threatened against the Master Servicer which
         would prohibit its entering into this Agreement or performing its
         obligations under this Agreement or is likely to affect materially and
         adversely either the ability of the Master Servicer to perform its
         obligations under this Agreement or the financial condition of the
         Master Servicer;

                      (vii) The Master Servicer will comply in all material
         respects in the performance of this Agreement with all reasonable rules
         and requirements of each insurer under each Insurance Policy;

                     (viii) The execution of this Agreement and the performance
         of the Master Servicer's obligations hereunder do not require any
         license, consent or approval of any state or federal court, agency,
         regulatory authority or other governmental body having jurisdiction
         over the Master Servicer, other than such as have been obtained; and

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<PAGE>

                       (ix) No information, certificate of an officer, statement
         furnished in writing or report delivered to the Company, any affiliate
         of the Company or the Trustee by the Master Servicer in its capacity as
         Master Servicer, and not in its capacity as a Seller hereunder, will,
         to the knowledge of the Master Servicer, contain any untrue statement
         of a material fact.

                  It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.03(a) shall survive the
execution and delivery of this Agreement, and shall inure to the benefit of the
Company, the Trustee and the Certificateholders. Upon discovery by the Company,
the Trustee or the Master Servicer of a breach of any of the foregoing
representations, warranties and covenants that materially and adversely affects
the interests of the Company or the Trustee, the party discovering such breach
shall give prompt written notice to the other parties.

                  (b) The Company hereby represents and warrants to the Master
Servicer and the Trustee for the benefit of Certificateholders that as of the
Closing Date, the representations and warranties of the Seller with respect to
the Mortgage Loans and the remedies therefor that are contained in the Mortgage
Loan Purchase Agreement are as set forth in Exhibit I hereto.

                  It is understood and agreed that the representations and
warranties set forth in this Section 2.03(b) shall survive delivery of the
respective Mortgage Files to the Trustee.

                  Upon discovery by either the Company, the Master Servicer or
the Trustee of a breach of any representation or warranty set forth in this
Section 2.03 which materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach shall
give prompt written notice to the other parties.

                  SECTION 2.04.             Representations and Warranties of
                                            the Seller.

                  The Company hereby assigns to the Trustee for the benefit of
Certificateholders all of its rights (but none of its obligations) in, to and
under the Mortgage Loan Purchase Agreement. Insofar as the Mortgage Loan
Purchase Agreement relates to such representations and warranties and any
remedies provided thereunder for any breach of such representations and
warranties, such right, title and interest may be enforced by the Trustee on
behalf of the Certificateholders. Upon the discovery by the Company, the Master
Servicer or the Trustee of a breach of any of the representations and warranties
made in the Mortgage Loan Purchase Agreement in respect of any Mortgage Loan
which materially and adversely affects the interests of the Certificateholders
in such Mortgage Loan, the party discovering such breach shall give prompt
written notice to the other parties. The Trustee shall promptly notify the
Seller of such breach and request that the Seller shall, within 90 days from the
date that the Seller was notified or otherwise obtained knowledge of such
breach, either (i) cure such breach in all material respects or (ii) purchase
such Mortgage Loan from the Trust Fund at the Purchase Price and in the manner
set forth in Section 2.02; provided that if such breach would cause the Mortgage
Loan to be other than a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code, any such cure or repurchase must occur within 90 days from the date
such breach was discovered. However, in the case of a breach under the Mortgage
Loan Purchase

                                       47

<PAGE>

Agreement, subject to the approval of the Company the Seller shall have the
option to substitute a Qualified Substitute Mortgage Loan or Loans for such
Mortgage Loan if such substitution occurs within two years following the Closing
Date, except that if the breach would cause the Mortgage Loan to be other than a
"qualified mortgage" as defined in Section 860G(a)(3) of the Code, any such
substitution must occur within 90 days from the date the breach was discovered
if such 90 day period expires before two years following the Closing Date. In
the event that the Seller elects to substitute a Qualified Substitute Mortgage
Loan or Loans for a Deleted Mortgage Loan pursuant to this Section 2.04, the
Trustee shall enforce the obligation of the Seller under the Mortgage Loan
Purchase Agreement to deliver to the Trustee and the Master Servicer, as
appropriate, with respect to such Qualified Substitute Mortgage Loan or Loans,
the original Mortgage Note, the Mortgage, an Assignment of the Mortgage in
recordable form, and such other documents and agreements as are required by
Section 2.01, with the Mortgage Note endorsed as required by Section 2.01. No
substitution will be made in any calendar month after the Determination Date for
such month. Monthly Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution, to the extent received by the Master
Servicer or any Sub-Servicer, shall not be part of the Trust Fund and will be
retained by the Master Servicer and remitted by the Master Servicer to the
Seller on the next succeeding Distribution Date. For the month of substitution,
distributions to Certificateholders will include the Monthly Payment due on a
Deleted Mortgage Loan for such month and thereafter the Seller shall be entitled
to retain all amounts received in respect of such Deleted Mortgage Loan. The
Company shall amend or cause to be amended the Mortgage Loan Schedule for the
benefit of the Certificateholders to reflect the removal of such Deleted
Mortgage Loan and the substitution of the Qualified Substitute Mortgage Loan or
Loans and the Company shall deliver the amended Mortgage Loan Schedule to the
Trustee. Upon such substitution, the Qualified Substitute Mortgage Loan or Loans
shall be subject to the terms of this Agreement in all respects, the Seller
shall be deemed to have made the representations and warranties with respect to
the Qualified Substitute Mortgage Loan contained in the Mortgage Loan Purchase
Agreement as of the date of substitution, and the Company shall be deemed to
have made with respect to any Qualified Substitute Mortgage Loan or Loans, as of
the date of substitution, the representations and warranties set forth in
Exhibit I hereof (other than representations (xiv), (xvi), (xxix) and (xxxiii)
through (xli)).

                  In connection with the substitution of one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer will determine the amount (if any) by which the aggregate principal
balance of all such Qualified Substitute Mortgage Loans as of the date of
substitution is less than the aggregate Stated Principal Balance of all such
Deleted Mortgage Loans (in each case after application of the principal portion
of the Monthly Payments due in the month of substitution that are to be
distributed to Certificateholders in the month of substitution). The Trustee
shall enforce the obligation of the Seller under the Mortgage Loan Purchase
Agreement to provide the Master Servicer on the day of substitution for
immediate deposit into the Custodial Account the amount of such shortfall,
without any reimbursement therefor. In accordance with the Mortgage Loan
Purchase Agreement, the Seller shall give notice in writing to the Trustee of
such event, which notice shall be accompanied by an Officers' Certificate as to
the calculation of such shortfall and by an Opinion of Counsel to the effect
that such substitution will not cause (a) any federal tax to be imposed on REMIC
I or REMIC II, including without limitation, any federal tax imposed on
"prohibited transactions" under Section 860F(a)(1) of the Code or on

                                       48

<PAGE>

"contributions after the startup date" under Section 860G(d)(1) of the Code or
(b) any portion of REMIC I or REMIC II to fail to qualify as a REMIC at any time
that any Certificate is outstanding. The costs of any substitution as described
above, including any related assignments, opinions or other documentation in
connection therewith shall be borne by the Seller.

                  Except as expressly set forth herein neither the Trustee nor
the Master Servicer is under any obligation to discover any breach of the above
mentioned representations and warranties.
It is understood and agreed that the obligation of the Seller to cure such
breach, purchase or to substitute for such Mortgage Loan as to which such a
breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to Certificateholders or the Trustee on behalf
of Certificateholders.

                  SECTION 2.05.             Issuance of Certificates Evidencing
                                            Interests in the REMIC I
                                            Certificates.

                  The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery of the Mortgage Files to it, subject to any exceptions
noted pursuant to Section 2.02 above, together with the assignment to it of all
other assets included in REMIC I, receipt of which is hereby acknowledged.
Concurrently with such delivery and in exchange therefor, the Trustee, pursuant
to the written request of the Company, executed by an officer of the Company,
has executed and caused to be authenticated and delivered to, or upon the order
of, the Company the Class R-I Certificates in authorized denominations which
together with the Uncertificated REMIC I Regular Interests, evidence ownership
of REMIC I. The rights of the Class R-I Certificateholders and REMIC II to
receive distributions from the proceeds of REMIC I in respect of the Class R-I
Certificates and the Uncertificated REMIC I Regular Interests, and all ownership
interests of the Class R-I Certificateholders and REMIC II in such
distributions, shall be as set forth in this Agreement.

                  SECTION 2.06.             Conveyance of Uncertificated REMIC I
                                            Regular Interests; Acceptance by the
                                            Trustee.

                  The Company, as of the Closing Date, and concurrently with the
execution and delivery hereof, does hereby assign without recourse all the
right, title and interest of the Company in and to the Uncertificated REMIC I
Regular Interests to the Trustee for the benefit of the Class A-1, Class A-2,
Class A-3, Class A-4, Class A-5, Class A-6, Class A-7, Class A-8, Class M-1,
Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class R-II
Certificateholders. The Trustee acknowledges receipt of the Uncertificated REMIC
I Regular Interests and declares that it holds and will hold the same in trust
for the exclusive use and benefit of all present and future Class A
Certificates, Class M Certificates, Class B Certificates and Class R-II
Certificateholders. The rights of the Class A Certificates, Class M
Certificates, Class B Certificates and Class R-II Certificateholders to receive
distributions from the proceeds of REMIC II in respect of the Class A
Certificates, Class M Certificates, Class B Certificates and Class R-II
Certificates, and all ownership interests of the Class A Certificates, Class M
Certificates, Class B Certificates and Class R-II Certificateholders in such
distributions, shall be as set forth in this Agreement.

                                       49

<PAGE>

                  SECTION 2.07.             Issuance of Certificates Evidencing
                                            Interest in REMIC II.

                  The Trustee acknowledges the assignment to it of the
Uncertificated REMIC I Regular Interests and, concurrently therewith and in
exchange therefor, pursuant to the written request of the Company executed by an
officer of the Company, the Trustee has executed and caused to be authenticated
and delivered to or upon the order of the Company, the Class A Certificates,
Class M Certificates, Class B Certificates and Class R-II Certificates in
authorized denominations evidencing ownership of the entire REMIC II.

                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                                OF THE TRUST FUND

                  SECTION 3.01.             Master Servicer to Act as Master
                                            Servicer.

                  The Master Servicer shall supervise, or take such actions as
are necessary to ensure, the servicing and administration of the Mortgage Loans
and any REO Property in accordance with this Agreement and its normal servicing
practices, which generally shall conform to the standards (i) of the Servicing
Guide, if Impac Funding Corporation is Master Servicer, or (ii) if Impac Funding
Corporation is not the Master Servicer, 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,
and any Sub-Servicer acting on its behalf, shall include, without limitation,
the power to (i) consult with and advise any Sub-Servicer regarding
administration of a related Mortgage Loan, (ii) approve any recommendation by a
Sub-Servicer to foreclose on a related 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 related
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 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 transfer 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 and any
Sub-Servicer acting on its behalf may, and is hereby authorized, and empowered
by the Trustee to, execute and deliver, on behalf of itself, the
Certificateholders or the Trustee or any of them, any instruments of
satisfaction, cancellation, partial

                                       50

<PAGE>

or full release, discharge and all other comparable instruments, with respect to
the related 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.

                  In accordance with the standards of the preceding paragraph,
the Master Servicer shall advance or cause to be advanced funds as necessary for
the purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which advances shall be reimbursable in the first instance from
related collections from the Mortgagors pursuant to Section 3.09, and further as
provided in Section 3.11; provided that the Master Servicer shall not be
obligated to make such advance if, in its good faith judgment, the Master
Servicer determines that such advance to be a Nonrecoverable Advance.

                  Notwithstanding anything in this Agreement to the contrary,
the Master Servicer shall not (unless the Mortgagor is in default with respect
to the Mortgage Loan or such default is, in the judgment of the Master Servicer,
reasonably foreseeable) make or permit any modification, waiver or amendment of
any term of any Mortgage Loan that would both (i) effect an exchange or
reissuance of such Mortgage Loan under Section 1001 of the Code (or Treasury
regulations promulgated thereunder) and (ii) cause either REMIC I or REMIC II 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.

                  The relationship of the Master Servicer (and of any successor
to the Master Servicer under this Agreement) to the Trustee under this Agreement
is intended by the parties to be that of an independent contractor and not that
of a joint venturer, partner or agent.

                  SECTION 3.02.    Sub-Servicing Agreements Between 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; provided, however, that such agreements would not
result in a withdrawal or a downgrading by Standard & Poor's of its rating on
any Class of Certificates. 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 comparable to
the 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 any
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, each Sub-Servicing Agreement shall provide for servicing of the
Mortgage Loans consistent with the terms of this Agreement. With the consent of
the Trustee, the Master Servicer

                                       51

<PAGE>

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 providing for, among other things, the delegation by
the Master Servicer to a Sub-Servicer of additional duties regarding the
administration of the Mortgage Loans; 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 Voting Rights. The
parties hereto acknowledge that the initial Sub-Servicer shall be Wendover.

         The Master Servicer has entered into a Sub-Servicing Agreement with
Wendover for the servicing and administration of the Mortgage Loans and may
enter into additional Sub-Servicing Agreements with Sub-Servicers acceptable to
the Trustee for the servicing and administration of certain of the Mortgage
Loans.

                  (b) As part of its servicing activities hereunder, the Master
Servicer, for the benefit of the Trustee and the Certificateholders, shall
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 Loan or (ii) from a specific
recovery of costs, expenses or attorneys' fees against the party against whom
such enforcement is directed.

                  (c) The Master Servicer represents that it has entered into a
contract regarding the sale of sub-servicing rights with respect to at least 90%
of the Mortgage Loans with Countrywide Home Loans, Inc. ("Countrywide") and
shall transfer the subservicing of such Mortgage Loans from Wendover to
Countrywide on or about October 1, 2000. The Trustee hereby consents to such
transfer.

                  SECTION 3.03.             Successor Sub-Servicers.

                  The Master Servicer shall be entitled to terminate any
Sub-Servicing Agreement and the rights and obligations of any Sub-Servicer
pursuant to any Sub-Servicing Agreement in accordance with the terms and
conditions of such Sub-Servicing Agreement. In the event of termination of any
Sub-Servicer, all servicing obligations of such Sub-Servicer shall be assumed
simultaneously by the Master Servicer without any act or deed on the part of
such Sub-Servicer or the Master Servicer, and the Master Servicer either shall
service directly the related Mortgage Loans or shall enter into a Sub-Servicing
Agreement with a successor Sub-Servicer which qualifies under Section 3.02.

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<PAGE>

                  SECTION 3.04.             Liability of the Master Servicer.

                  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 Certificateholders for
the servicing and administering of the Mortgage Loans and any REO Property in
accordance with the provisions of Article III without diminution of such
obligation or liability by virtue of such Sub- Servicing Agreements or
arrangements or by virtue of indemnification from the Sub-Servicer and to the
same extent and under the same terms and conditions as if the Master Servicer
alone were servicing and administering the Mortgage Loans. For purposes of this
Agreement, the Master Servicer shall be deemed to have received payments on
Mortgage Loans when the Sub-Servicer has received such payments. The Master
Servicer shall be entitled to enter into any agreement with a Sub-Servicer for
indemnification of the Master Servicer by such Sub-Servicer and nothing
contained in this Agreement shall be deemed to limit or modify such
indemnification.

                  SECTION 3.05.             No Contractual Relationship Between
                                            Sub-Servicers and Trustee or
                                            Certificateholders.

                  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 3.06. The Master Servicer (or Sub-Servicer) shall
be liable for the payment of any franchise taxes which may be assessed by the
California Franchise Tax Board in connection with the activities of the Trust
under this Agreement.

                  SECTION 3.06.             Assumption or Termination 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 7.02
below, the Trustee, to the extent necessary to permit the Trustee to carry out
the provisions of Section 7.02 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 (other than
the obligation to make any Advances hereunder) and the Master Servicer shall not
thereby be relieved of any liability or obligations under such Sub-Servicing
Agreements

                                       53

<PAGE>

arising prior to such assumption. Nothing in the foregoing shall be deemed to
entitle the Trustee or its designee as a successor master servicer at any time
to receive any portion of the servicing compensation provided under Section 3.17
except for such portion as the Master Servicer would be entitled to receive.

                  (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 7.02, 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, files 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 efforts to
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 3.07.             Collection of Certain Mortgage Loan
                                            Payments.

                  (a) The Master Servicer will coordinate and monitor
remittances by Sub-Servicers to the Master Servicer with respect to the Mortgage
Loans in accordance with this Agreement.

                  (b) The Master Servicer shall make its reasonable 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 reasonable
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 reduce or permit to be
suspended or 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 Mortgage Note, the Master
Servicer shall nonetheless make an 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 or related Sub-Servicer to make an Advance shall apply only to the
extent that the Master Servicer believes, in good faith, that such advances are
not Nonrecoverable Advances.

                  (c) Within five Business Days after the Master Servicer has
determined that all amounts which it expects to recover from or on account of a
Mortgage Loan have been recovered and that no further Liquidation Proceeds will
be received in connection therewith, the Master Servicer shall provide to the
Trustee a certificate of a Servicing Officer that such Mortgage Loan became a
Liquidated Mortgage Loan in a Cash Liquidation or REO Disposition as of the date
of such determination.

                                       54

<PAGE>

                  The Master Servicer shall make reasonable efforts to collect
all payments called for under the terms and provisions of the Mortgage Loans,
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Insurance Policy, follow such
collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for its own account. The Master
Servicer shall not be required to institute or join in litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage Note, Primary
Hazard Insurance Policy or otherwise or against any public or governmental
authority with respect to a taking or condemnation) if it reasonably believes
that it is prohibited by applicable law from enforcing the provision of the
Mortgage or other instrument pursuant to which such payment is required. The
Master Servicer shall be responsible for preparing and distributing all
information statements relating to payments on the Mortgage Loans, in accordance
with all applicable federal and state tax laws and regulations.

                  SECTION 3.08.             Sub-Servicing Accounts.

                  In those cases where a Sub-Servicer is servicing a Mortgage
Loan pursuant to a Sub- Servicing Agreement, the Sub-Servicer will be required
to establish and maintain one or more accounts (collectively, the "Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible Account and shall
otherwise be acceptable to the Master Servicer. All amounts held in a
Sub-Servicing Account shall be held in trust for the Trustee for the benefit of
the Certificateholders. Any investment of funds held in such an account shall be
in Permitted Investments maturing not later than the Business Day immediately
preceding the next Sub-Servicer Remittance Date. The Sub- Servicer will be
required to deposit into the Sub-Servicing Account no later than the first
Business Day after receipt all proceeds of Mortgage Loans received by the
Sub-Servicer, less its servicing compensation and any unreimbursed expenses and
advances, to the extent permitted by the Sub- Servicing Agreement. On each
Sub-Servicer Remittance Date the Sub-Servicer will be required to remit to the
Master Servicer for deposit in the Custodial Account all funds held in the
Sub-Servicing Account with respect to any Mortgage Loan as of the Sub-Servicer
Remittance Date, after deducting from such remittance an amount equal to the
servicing compensation (including interest on Permitted Investments) and
unreimbursed expenses and advances to which it is then entitled pursuant to the
related Sub-Servicing Agreement, to the extent not previously paid to or
retained by it. In addition, on each Sub-Servicer Remittance Date the
Sub-Servicer will be required to remit to the Master Servicer any amounts
required to be advanced pursuant to the related Sub-Servicing Agreement. The
Sub-Servicer will also be required to remit to the Master Servicer, within one
Business Day of receipt, the proceeds of any Principal Prepayment made by the
Mortgagor and any Insurance Proceeds or Liquidation Proceeds.

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

                  The Master Servicer and the Sub-Servicers shall establish and
maintain one or more accounts (the "Servicing Accounts"), and shall deposit and
retain therein all collections from the Mortgagors (or related advances from
Sub-Servicers) for the payment of taxes, assessments, Primary Hazard Insurance
Policy premiums, and comparable items for the account of the Mortgagors, to the

                                       55

<PAGE>

extent that the Master Servicer customarily escrows for such amounts.
Withdrawals of amounts so collected from a Servicing Account may be made only to
(i) effect payment of taxes, assessments, Primary Hazard Insurance Policy
premiums and comparable items; (ii) reimburse the Master Servicer (or a
Sub-Servicer to the extent provided in the related Sub-Servicing Agreement) out
of related collections for any payments made pursuant to Sections 3.01 (with
respect to taxes and assessments), and 3.13 (with respect to Primary Hazard
Insurance Policies); (iii) refund to Mortgagors any sums as may be determined to
be overages; or (iv) clear and terminate the Servicing Account at the
termination of this Agreement pursuant to Section 9.01. As part of its servicing
duties, the Master Servicer or Sub-Servicers shall, if and to the extent
required by law, pay to the Mortgagors interest on funds in Servicing Accounts
from its or their own funds, without any reimbursement therefor.

                  SECTION 3.10.             Custodial Account.

                  (a) The Master Servicer shall establish and maintain one or
more accounts (collectively, the "Custodial Account") in which the Master
Servicer shall deposit or cause to be deposited on a daily basis, or as and when
received from the Sub-Servicers, the following payments and collections received
or made by or on behalf of it subsequent to the Cut-off Date, or received by it
prior to the Cut-off Date but allocable to a period subsequent thereto (other
than in respect of principal and interest on the Mortgage Loans due on or before
the Cut-off Date):

                (i) all payments (including advances by a Sub-Servicer) on
         account of principal, including Principal Prepayments, on the Mortgage
         Loans;

               (ii) all payments (including advances by a Sub-Servicer) on
         account of interest on the Mortgage Loans, net of any portion thereof
         retained by the Master Servicer or any Sub-Servicer as Servicing Fees;

              (iii) all Insurance Proceeds, other than proceeds that represent
         reimbursement of costs and expenses incurred by the Master Servicer or
         any Sub-Servicer in connection with presenting claims under the related
         Insurance Policies, Liquidation Proceeds and REO Proceeds;

               (iv) all proceeds of any Mortgage Loan or REO Property
         repurchased or purchased in accordance with Sections 2.02, 2.04 , 3.14,
         3.24 or 9.01; and all amounts required to be deposited in connection
         with the substitution of a Qualified Substitute Mortgage Loan pursuant
         to Section 2.04; and

                (v) any amounts required to be deposited pursuant to Section
         3.12, 3.13, 3.15 or 3.22.

                  The foregoing requirements for deposit in the Custodial
Account shall be exclusive. In the event the Master Servicer shall deposit in
the Custodial Account any amount not required to be deposited therein, it may
withdraw such amount from the Custodial Account, any provision herein to the
contrary notwithstanding. The Custodial Account shall be maintained as a
segregated account,

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<PAGE>

separate and apart from trust funds created for mortgage pass-through
certificates of other series, and the other accounts of the Master Servicer.

                  (b) Funds in the Custodial Account may be invested in
Permitted Investments in accordance with the provisions set forth in Section
3.12. The Master Servicer shall give notice to the Trustee and the Company of
the location of the Custodial Account after any change thereof.

                  SECTION 3.11.             Permitted Withdrawals From the
                                            Custodial Account.

                  The Master Servicer may, from time to time as provided herein,
make withdrawals from the Custodial Account of amounts on deposit therein
pursuant to Section 3.10 that are attributable to the Mortgage Loans for the
following purposes:

                         (i) to make deposits into the Certificate Account in
         the amounts and in the manner provided for in Section 4.01;

                        (ii) to pay to itself, the Company, the Seller or any
         other appropriate person, as the case may be, with respect to each
         Mortgage Loan that has previously been purchased or repurchased
         pursuant to Sections 2.02, 2.04, 3.14, 3.24 or 9.01 all amounts
         received thereon and not yet distributed as of the date of purchase or
         repurchase;

                       (iii) to reimburse itself or any Sub-Servicer for
         Advances not previously reimbursed, the Master Servicer's or any
         Sub-Servicer's right to reimbursement pursuant to this clause (iii)
         being limited to amounts received which represent Late Collections (net
         of the related Servicing Fees) of Monthly Payments on Mortgage Loans
         with respect to which such Advances were made and as further provided
         in Section 3.15;

                        (iv) to reimburse or pay itself, the Trustee or the
         Company for expenses incurred by or reimbursable to the Master
         Servicer, the Trustee or the Company pursuant to Sections 3.22, 6.03,
         8.05 or 10.01(g), except as otherwise provided in such Sections hereof;

                         (v) to reimburse itself or any Sub-Servicer for costs
         and expenses incurred by or reimbursable to it relating to the
         prosecution of any claims pursuant to Section 3.13 that are in excess
         of the amounts so recovered;

                        (vi) to reimburse itself or any Sub-Servicer for unpaid
         Servicing Fees and unreimbursed Servicing Advances, the Master
         Servicer's or any Sub-Servicer's right to reimbursement pursuant to
         this clause (vi) with respect to any Mortgage Loan being limited to
         late recoveries of the payments for which such advances were made
         pursuant to Section 3.01 or Section 3.09 and any other related Late
         Collections;

                       (vii) to pay itself as servicing compensation (in
         addition to the Servicing Fee), on or after each Distribution Date, any
         interest or investment income earned on funds deposited in the
         Custodial Account for the period ending on such Distribution Date;

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                      (viii) to reimburse itself or any Sub-Servicer for any
         Advance or Servicing Advance previously made, after a Realized Loss has
         been allocated with respect to the related Mortgage Loan if the Advance
         or Servicing Advance was not reimbursed pursuant to clauses (iii) and
         (vi);

                         (ix) to pay Radian the premium under the Radian PMI
         Pool Policies and the Radian Lender-Paid PMI Policies; and

                         (x) to clear and terminate the Custodial Account at the
         termination of this Agreement pursuant to Section 9.01.

                  The Master Servicer shall keep and maintain separate
accounting records on a Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any withdrawal from the Custodial Account pursuant to such subclauses
(ii) through (ix).

                  SECTION 3.12.             Permitted Investments.

                  Any institution maintaining the Custodial Account shall at the
direction of the Master Servicer invest the funds in such account in Permitted
Investments, each of which shall mature not later than (i) the Business Day
immediately preceding the date on which such funds are required to be withdrawn
from such account pursuant to this Agreement, if a Person other than the Trustee
is the obligor thereon, and (ii) no later than the date on which such funds are
required to be withdrawn from such account pursuant to this Agreement, if the
Trustee is the obligor thereon and shall not be sold or disposed of prior to its
maturity. All income and gain realized from any such investment as well as any
interest earned on deposits in the Custodial Account shall be for the benefit of
the Master Servicer. The Master Servicer shall deposit in the Custodial Account
an amount equal to the amount of any loss incurred in respect of any such
investment immediately upon realization of such loss without right of
reimbursement.

                  SECTION 3.13.             Maintenance of Primary Hazard
                                            Insurance.

                  (a) The Master Servicer shall cause to be maintained for each
Mortgage Loan primary hazard insurance by a Qualified Insurer or other insurer
satisfactory to the Rating Agencies with extended coverage on the related
Mortgaged Property in an amount equal to the lesser of (i) 100% of the
replacement value of the improvements, as determined by the insurance company,
on such Mortgaged Property or (ii) the unpaid principal balance of the Mortgage
Loan. The Master Servicer shall also cause to be maintained on property acquired
upon foreclosure, or deed in lieu of foreclosure, of any Mortgage Loan, fire
insurance with extended coverage in an amount equal to the replacement value of
the improvements thereon. Any costs incurred in maintaining any insurance
described in this Section 3.13 (other than any deductible described in the last
paragraph hereof) shall be recoverable as a Servicing Advance. The Master
Servicer shall not be obligated to advance any amounts pursuant to this Section
3.13 if, in its good faith judgment, the Master Servicer determines that such
advance would be a Nonrecoverable Advance. Pursuant to Section 3.10, any amounts
collected by the Master Servicer under any such policies (other than amounts to
be applied to the

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restoration or repair of the related Mortgaged Property or property thus
acquired or amounts released to the Mortgagor in accordance with the Master
Servicer's normal servicing procedures) shall be deposited in the Custodial
Account, subject to withdrawal pursuant to Section 3.11. Any cost incurred by
the Master Servicer in maintaining any such insurance shall not, for the purpose
of calculating monthly distributions to Certificateholders, be added to the
amount owing under the Mortgage Loan, notwithstanding that the terms of the
Mortgage Loan so permit. It is understood and agreed that no earthquake or other
additional insurance is to be required of any Mortgagor or maintained on
property acquired in respect of a Mortgage Loan other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance.

                  The Master Servicer shall, or shall cause the related
Sub-Servicer to, exercise its best reasonable efforts to maintain and keep in
full force and effect each Primary Insurance Policy by a Qualified Insurer, or
other insurer satisfactory to the Rating Agencies, with respect to each first
lien Mortgage Loan as to which as of the Cut-Off Date such a Primary Insurance
Policy was in effect (or, in the case of a Qualified Substitute Mortgage Loan,
the date of substitution) and the original principal amount of the related
Mortgage Note exceeded 80% of the Collateral Value in an amount at least equal
to the excess of such original principal amount over 75% of such Collateral
Value until the principal amount of any such first lien Mortgage Loan is reduced
below 80% of the Collateral Value or, based upon a new appraisal, the principal
amount of such first lien 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
Insurance Policy. The Master Servicer and the related Sub-Servicer shall have
the power to substitute for any Primary Insurance Policy another substantially
equivalent policy issued by another Qualified Insurer, provided, that, such
substitution shall be subject to the condition that it will not cause the
ratings on the Certificates to be downgraded or withdrawn, as evidenced in
writing from each Rating Agency.

         The Master Servicer shall take all such actions on behalf of the Trust
Fund as are necessary to service, maintain and administer each Radian PMI Pool
Policy and to enforce the Trust Fund's rights under each Radian PMI Pool Policy.
The Master Servicer shall effect the timely payment of the premium on the Radian
PMI Pool Policies from amounts on deposit in the Custodial Account.
To the extent the Mortgagor with respect to a Radian PMI Insured Loan is
delinquent, the Master Servicer shall advance the related premium as a Servicing
Advance. Except as expressly set forth herein, the Master Servicer shall have
full authority on behalf of the Trust Fund to do anything it reasonably deems
appropriate or desirable in connection with the servicing, maintenance and
administration of the Radian PMI Pool Policies. The Master Servicer shall make
its best reasonable efforts to file all insured claims under the Radian PMI Pool
Policies and collect from Radian all Insurance Proceeds due to the Trust Fund
under the Radian PMI Pool Policies. The Master Servicer shall not take, or
permit any subservicer to take, any action which would result in non-coverage
under the Radian PMI Pool Policies of any loss which, but for the actions of the
Master Servicer or any Subservicer, would have been covered thereunder. To the
extent coverage is available, the Master Servicer shall keep or cause to be kept
in full force and effect each Radian PMI Pool Policy for the life of the
Mortgage Loan. Neither the Master Servicer nor the Trustee shall terminate the
Radian PMI Pool Policies with respect to any Mortgage Loan, except in accordance
with the terms

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thereof. The Master Servicer shall cooperate with Radian and shall use its best
efforts to furnish all reasonable aid, evidence and information in the
possession of the Master Servicer or to which the Master Servicer has access
with respect to any Radian PMI Loan.

         With respect to the Radian PMI Insured Loans covered by a Radian
Lender-Paid PMI Policy, the Master Servicer will confirm with Radian, and Radian
will certify to the Trustee, on or before August 15, 2000, that the Mortgage
Loans indicated on the Mortgage Loan Schedule as being covered by Radian
Lender-Paid PMI Policy are so covered.

         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. When, at
the time of origination of the Mortgage Loan or at any subsequent time, the
Mortgaged Property is located in a federally designated special flood hazard
area, the Master Servicer shall cause with respect to the 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 Mortgaged Property, including all items taken into
account in arriving at the Collateral Value on which the Mortgage Loan was
based, and shall be in an amount equal to the lesser of (i) the Stated Principal
Balance of the related Mortgage Loan and (ii) the minimum amount required under
the terms of coverage to compensate for any damage or loss on a replacement cost
basis, 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.

                  In the event that the Master Servicer shall obtain and
maintain a blanket fire insurance policy with extended coverage insuring against
hazard losses on all of the Mortgage Loans, it shall conclusively be deemed to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Master Servicer shall, in the event that
there shall not have been maintained on the related Mortgaged Property a policy
complying with the first two sentences of this Section 3.13 and there shall have
been a loss which would have been covered by such policy, deposit in the
Certificate Account from its own funds the amount not otherwise payable under
the blanket policy because of such deductible clause. Any such deposit by the
Master Servicer shall be made on the Certificate Account Deposit Date next
preceding the Distribution Date which occurs in the month following the month in
which payments under any such policy would have been deposited in the Custodial
Account. Any such deposit shall not be deemed Servicing Advances and the Master
Servicer shall not be entitled to reimbursement therefor. In connection with its
activities as administrator and servicer of the Mortgage Loans, the Master
Servicer agrees to present, on behalf of itself, the Trustee and
Certificateholders, claims under any such blanket policy.

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                  SECTION 3.14.             Enforcement of Due-on-Sale Clauses;
                                            Assumption Agreements.

                  The Master Servicer will, to the extent it has knowledge of
any conveyance or prospective conveyance by any Mortgagor of the Mortgaged
Property (whether by absolute conveyance or by contract of sale, and whether or
not the Mortgagor remains or is to remain liable under the Mortgage Note or the
Mortgage), exercise or cause to be exercised its rights to accelerate the
maturity of such Mortgage Loan under any "due-on-sale" clause applicable
thereto; provided, however, that the Master Servicer shall not exercise any such
rights if it reasonably believes that it is prohibited by law from doing so. The
Master Servicer or the related Sub-Servicer may repurchase a Mortgage Loan at
the Purchase Price when the Master Servicer requires acceleration of the
Mortgage Loan, but only if the Master Servicer is satisfied, as evidenced by an
Officer's Certificate delivered to the Trustee, that either (i) such Mortgage
Loan is in default or default is reasonably foreseeable or (ii) if such Mortgage
Loan is not in default or default is not reasonably foreseeable, such repurchase
will have no adverse tax consequences for the Trust Fund or any
Certificateholder.
If the Master Servicer is unable to enforce such "due-on-sale" clause (as
provided in the second preceding sentence) or if no "due-on-sale" clause is
applicable, the Master Servicer or the Sub-Servi cer is authorized to enter into
an assumption and modification agreement with the Person to whom such property
has been conveyed or is proposed to be conveyed, pursuant to which such Person
becomes liable under the Mortgage Note and, to the extent permitted by
applicable state law, the Mortgagor remains liable thereon; provided, however,
that the Master Servicer shall not enter into any assumption and modification
agreement if the coverage provided under the Primary Insurance Policy, if any,
would be impaired by doing so. 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 unless such material alteration would not cause
either REMIC I or REMIC II to fail to qualify as a REMIC for federal income tax
purposes, as evidenced by an Opinion of Counsel. The Master Servicer is also
authorized to enter into a substitution of liability agreement with such Person,
pursuant to which the original Mortgagor is released from liability and such
Person is substituted as the Mortgagor and becomes liable under the Mortgage
Note. Any fee collected by or on behalf of the Master Servicer for entering into
an assumption or substitution of liability agreement will be retained by or on
behalf of the Master Servicer as additional servicing compensation. In
connection with any such assumption, no material term of the Mortgage Note
(including but not limited to the Mortgage Rate, the amount of the Monthly
Payment and any other term affecting the amount or timing of payment on the
Mortgage Loan) may be changed. The Master Servicer shall not enter into any
substitution or assumption if such substitution or assumption shall (i) both
constitute a "significant modification" effecting an exchange or reissuance of
such Mortgage Loan under the Code (or Treasury regulations promulgated
thereunder) and cause either REMIC I or REMIC II to fail to qualify as a REMIC
under the REMIC Provisions or (ii) cause the imposition of any tax on
"prohibited transactions" or

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"contributions" after the Startup Day under the REMIC Provisions. The Master
Servicer shall notify the Trustee that any such substitution or assumption
agreement has been completed by forwarding to the Trustee the original copy of
such substitution or assumption agreement, which copy shall be added to the
related Mortgage File and shall, for all purposes, be considered a part of such
Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. A portion equal to up to 2% of the Collateral Value
of the related Mortgage Loan, of any fee or additional interest collected by the
related Sub-Servicer for consenting in any such conveyance or entering into any
such assumption agreement may be retained by the related Sub-Servicer as
additional servicing compensation.

                  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 assumption that the
Master Servicer may be restricted by law from preventing, for any reason
whatsoever. For purposes of this Section 3.14, the term "assumption" is deemed
to also include a sale of a Mortgaged Property that is not accompanied by an
assumption or substitution of liability agreement.

                  SECTION 3.15.             Realization Upon Defaulted Mortgage
                                            Loans.

                  The Master Servicer shall exercise reasonable efforts,
consistent with the procedures that the Master Servicer would use in servicing
loans for its own account, to foreclose upon or other wise comparably convert
(which may include an REO Acquisition) the ownership of properties securing such
of the Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 3.07, and which are not released from the Trust Fund
pursuant to any other provision hereof. The Master Servicer shall use reasonable
efforts to realize proceeds from such defaulted Mortgage Loans in such manner
(including short sales) as will maximize the receipt of principal and interest
by Certificateholders, taking into account, among other things, the timing of
foreclosure proceedings.
The foregoing is subject to the provisions that, in any case in which Mortgaged
Property shall have suffered damage from an Uninsured Cause, the Master Servicer
shall not be required to expend its own funds toward the restoration of such
property unless it shall determine in its sole discretion (i) that such
restoration will increase the net 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 by the Master Servicer
through Insurance Proceeds or Liquidation Proceeds from the related Mortgaged
Property, as contemplated in Section 3.11. 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 from the related property, as contemplated in Section 3.11.

                  The proceeds of any Cash Liquidation or REO Disposition, as
well as any recovery resulting from a partial collection of Insurance Proceeds
or Liquidation Proceeds or any income from an REO Property, will be deposited
into the Custodial Account and applied in the following order of priority:
first, to reimburse the Master Servicer or any Sub-Servicer for any related
unreimbursed

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Servicing Advances, pursuant to Section 3.11(vi) or 3.22; second, to accrued and
unpaid interest on the Mortgage Loan or REO Imputed Interest, at the Mortgage
Rate, to the date of the Cash Liquidation or REO Disposition, or to the Due Date
prior to the Distribution Date on which such amounts are to be distributed if
not in connection with a Cash Liquidation or REO Disposition; and third, as a
recovery of principal of the Mortgage Loan. If the amount of the recovery so
allocated to interest is less than a full recovery thereof, that amount will be
allocated as follows: first, to unpaid Servicing Fees; and second, to interest
at the Net Mortgage Rate. The portion of the recovery so allocated to unpaid
Servicing Fees shall be reimbursed to the Master Servicer or any Sub-Servicer
pursuant to Section 3.11(vi). The portions of the recovery so allocated to
interest at the Net Mortgage Rate and to principal of the Mortgage Loan shall be
applied as follows: first, to reimburse the Master Servicer or any Sub-Servicer
for any related unreimbursed Advances in accordance with Section 3.11(iii) or
3.22, and second, for distribution in accordance with the provisions of Section
4.01, subject to Section 3.22 with respect to certain recoveries from an REO
Disposition constituting Excess Proceeds.

                  SECTION 3.16.             Trustee to Cooperate; Release of
                                            Mortgage Files.

                  Upon the payment in full of any Mortgage Loan, or the receipt
by the Master Servicer of a notification that payment in full shall be escrowed
in a manner customary for such purposes, the Master Servicer will immediately
notify the Trustee by a certification (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 Custodial
Account pursuant to Section 3.10 have been or will be so deposited) of a
Servicing Officer and shall request delivery to it of the Mortgage File in the
form of the Request for Release attached hereto as Exhibit F-2. Upon receipt of
such certification and request, the Trustee shall promptly release the related
Mortgage File to the Master Servicer. Subject to the receipt by the Master
Servicer of the proceeds of such payment in full and the payment of all related
fees and expenses, the Master Servicer shall arrange for the release to the
Mortgagor of the original cancelled Mortgage Note. All other documents in the
Mortgage File shall be retained by the Master Servicer to the extent required by
applicable law. The Master Servicer shall provide for preparation of the
appropriate instrument of satisfaction covering any Mortgage Loan which pays in
full and the Trustee shall cooperate in the execution and return of such
instrument to provide for its delivery or recording as may be required. No
expenses incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Custodial Account or the Certificate
Account.

                  From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any insurance policy relating to the Mortgage Loan, the Trustee shall, upon
request of the Master Servicer and delivery to the Trustee of a Request for
Release in the form attached hereto as Exhibit F-1, release the related Mortgage
File to the Master Servicer and the Trustee shall execute such documents as the
Master Servicer shall prepare and request as being necessary to the prosecution
of any such proceedings. Such Request for Release shall obligate the Master
Servicer to return each document previously requested from the Mortgage File to
the Trustee when the need therefor by the Master Servicer no longer exists; and
in any event within 21 days of the Master Servicer's receipt thereof, unless the
Mortgage Loan has been

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liquidated and the Liquidation Proceeds relating to the Mortgage Loan have been
deposited in the Custodial Account or the Mortgage File or such document has
been delivered to an attorney, or to a public trustee or other public official
as required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non- judicially, and the 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. Upon receipt of a Request for Release
stating that such Mortgage Loan was liquidated and that all amounts received or
to be received in connection with such liquidation which are required to be
deposited into the Custodial Account have been or will be so deposited, or that
such Mortgage Loan has become an REO Property, a copy of the Request for Release
shall be released by the Trustee to the Master Servicer.

                  Upon written request of a Servicing Officer, the Trustee shall
execute and deliver to the Master Servicer any court pleadings, requests for
trustee's sale or other documents prepared by the Master Servicer that are
necessary to the foreclosure or trustee's sale in respect of a Mortgaged
Property or to any legal action brought to obtain judgment against any Mortgagor
on the Mortgage Note or Mortgage or to obtain a deficiency judgment, or to
enforce any other remedies or rights provided by the Mortgage Note or Mortgage
or otherwise available at law or in equity. Each such request that such
pleadings or documents be executed by the Trustee shall include a certification
signed by a Servicing Officer as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.

                  SECTION 3.17.             Servicing Compensation.

                  As compensation for its activities hereunder, the Master
Servicer shall be entitled to withhold and retain, from deposits to the
Custodial Account of amounts representing payments or recoveries of interest,
the Servicing Fees with respect to each Mortgage Loan (less any portion of such
amounts retained by any Sub-Servicer). In addition, the Master Servicer shall be
entitled to recover unpaid Servicing Fees out of related Late Collections to the
extent permitted in Section 3.11.

                  The Master Servicer also shall be entitled pursuant to Section
3.11 to receive from the Custodial Account as additional servicing compensation
interest or other income earned on deposits therein, subject to Section 3.23, as
well as any prepayment charges, assumption fees, late payment charges and
reconveyance fees. The Master Servicer shall be required to pay all expenses
incurred by it in connection with its servicing activities hereunder (including
payment of the premiums for any blanket policy insuring against hazard losses
pursuant to Section 3.13 and servicing compensation of the Sub-Servicer to the
extent not retained by it), and shall not be entitled to reimbursement therefor
except as specifically provided in Section 3.11. The Servicing Fee may not be
transferred in whole or in part except in connection with the transfer of all of
the Master Servicer's responsibilities and obligations under this Agreement.

                  SECTION 3.18.             Maintenance of Certain Servicing
                                            Policies.

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<PAGE>

         The Master Servicer shall obtain and maintain at its own expense and
shall cause each Sub- Servicer to obtain and maintain for the duration of this
Agreement a blanket fidelity bond and an errors and omissions insurance policy
covering the Master Servicer's and 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 or Sub-Servicer in order to be 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 reasonable best efforts to obtain
a comparable replacement bond or policy, as the case may be.

                  SECTION 3.19.             Annual Statement as to Compliance.

                  Within 120 days after December 31 of each year, commencing on
the first December 31 following the first anniversary of the Closing Date, the
Master Servicer at its own expense shall deliver to the Trustee, with a copy to
the Rating Agencies, a certificate signed by a Servicing Officer stating, as to
the signers thereof, that (i) a review of the activities of the Master Servicer
during the preceding calendar year and of performance under this Agreement has
been made under such officers' supervision, (ii) to the best of such officers'
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 during the Sub-Servicer's most recently ended fiscal year
on or prior to such December 31 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 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 3.20.             Annual Independent Public
                                            Accountants' Servicing Statement.

                  (a) Within 120 days after December 31 of each year, commencing
on the first December 31 following the first anniversary of the Closing Date,
the Master Servicer, at its expense, shall cause a firm of independent public
accountants who are members of the American Institute of

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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
financial statements as of the end of such calendar year, nothing came to their
attention that indicated that the Master Servicer was not in compliance with the
provisions of this Agreement except for (i) such exceptions as such firm
believes to be immaterial and (ii) such other exceptions as are set forth in
such statement.

                  (b) Within 120 days after December 31 of each year, commencing
December 2001, the Master Servicer, at its expense, shall or shall cause each
Sub-Servicer to cause a nationally recognized firm of independent certified
public accountants to furnish to the Master Servicer or such Sub-Servicer a
report stating that (i) it has obtained a letter of representation regarding
certain matters from the management of the Master Servicer or such Sub-Servicer
which includes an assertion that the Master Servicer or such Sub-Servicer has
complied with certain minimum mortgage loan servicing standards (to the extent
applicable to commercial and multifamily mortgage loans) identified in the
Uniform Single Attestation Program for Mortgage Bankers established by the
Mortgage Bankers Association of America with respect to the servicing of first
and second lien conventional single family mortgage loans during the most
recently completed calendar year and (ii) on the basis of an examination
conducted by such firm in accordance with standards established by the American
Institute of Certified Public Accountants, such representation is fairly stated
in all material respects, subject to such exceptions and other qualifications
that may be appropriate. Immediately upon receipt of such report, the Master
Servicer shall or shall cause each Sub-Servicer to furnish a copy of such report
to the Trustee and the Rating Agencies.

                  SECTION 3.21.             Access to Certain Documentation.

                  The Master Servicer shall provide, and shall cause any
Sub-Servicer to provide, to the Trustee, access to the documentation in their
possession regarding the related Mortgage Loans and REO Properties and to the
Certificateholders, the FDIC, and the supervisory agents and examiners of the
FDIC (to which the Trustee shall also provide) access to the documentation
regarding the related Mortgage Loans required by applicable regulations, such
access being afforded without charge but only upon reasonable request and during
normal business hours at the offices of the Master Servicer or the Sub-Servicers
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 documentation if the provision thereof
would violate the legal right to privacy of any Mortgagor; provided, further,
however, that the Trustee shall coordinate its requests for such access so as
not to impose an unreasonable burden on, or cause an unreasonable 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 documentation and shall provide equipment
for that purpose at a charge that covers their own actual out-of-pocket costs.

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                  SECTION 3.22.             Title, Conservation and Disposition
                                            of REO Property.

                  This Section shall apply only to REO Properties acquired for
the account of REMIC I and shall not apply to any REO Property relating to a
Mortgage Loan which was purchased or repurchased from REMIC I pursuant to
Sections 2.02, 2.04, 3.14 or 3.24. In the event that title to any such REO
Property is acquired, the deed or certificate of sale shall be issued to the
Trustee, or to its nominee, on behalf of the Certificateholders. The Master
Servicer, on behalf of REMIC I, shall either sell any REO Property before the
close of the third taxable year following the taxable year in which REMIC I
acquires ownership of such REO Property for purposes of Section 860G(a)(8) of
the Code or, at the expense of REMIC I, request, more than 60 days before the
day on which the three-year grace period would otherwise expire an extension of
the three-year grace period, unless the Master Servicer has delivered to the
Trustee an Opinion of Counsel (which shall not be at the expense of the
Trustee), addressed to the Trustee and the Master Servicer, to the effect that
the holding by REMIC I of such REO Property subsequent to the close of the third
taxable year following the taxable year in which REMIC I acquires ownership of
such REO Property will not result in the imposition on REMIC I of taxes on
"prohibited transactions" thereof, as defined in Section 860F of the Code, or
cause either REMIC I or REMIC II to fail to qualify as a REMIC under the REMIC
Provisions or comparable provisions of the laws of the State of California at
any time that any Certificates are outstanding. The Master Servicer shall
manage, conserve, protect and operate each REO Property for the
Certificateholders solely for the purpose of its prompt disposition and sale in
a manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) or result in the
receipt by either REMIC I or REMIC II of any "income from non-permitted assets"
within the meaning of Section 860F(a)(2)(B) of the Code or any "net income from
foreclosure property" which is subject to taxation under the REMIC Provisions.
Pursuant to its efforts to sell such REO Property, the Master Servicer shall
either itself or through an agent selected by the Master Servicer protect and
conserve such REO Property in the same manner and to such extent as is customary
in the locality where such REO Property is located and may, incident to its
conservation and protection of the interests of the Certificateholders, rent the
same, or any part thereof, as the Master Servicer deems to be in the best
interest of the Certificateholders for the period prior to the sale of such REO
Property.

                  Any REO Disposition shall be for cash only (unless changes in
the REMIC Provisions made subsequent to the Startup Day allow a sale for other
consideration).

                  The Master Servicer shall segregate and hold all funds
collected and received in connection with the operation of any REO Property
separate and apart from its own funds and general assets. The Master Servicer
shall deposit, or cause to be deposited, on a daily basis in the Custodial
Account all revenues received with respect to the REO Properties, net of any
directly related expenses incurred or withdraw therefrom funds necessary for the
proper operation, management and maintenance of the REO Property.

                  If as of the date of acquisition of title to any REO Property
there remain outstanding unreimbursed Servicing Advances with respect to such
REO Property or any outstanding Advances allocated thereto the Master Servicer,
upon an REO Disposition, shall be entitled to reimbursement

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for any related unreimbursed Servicing Advances and any unreimbursed related
Advances as well as any unpaid Servicing Fees from proceeds received in
connection with the REO Disposition, as further provided in Section 3.15. The
Master Servicer shall not be obligated to advance any amounts with respect to an
REO Property if, in its good faith judgment, the Master Servicer determines that
such advance would constitute a Nonrecoverable Advance.

                  The REO Disposition shall be carried out by the Master
Servicer at such price and upon such terms and conditions as the Master Servicer
shall determine.

                  The Master Servicer shall deposit the proceeds from the REO
Disposition, net of any payment to the Master Servicer as provided above, in the
Custodial Account upon receipt thereof for distribution in accordance with
Section 4.01; provided, that any such net proceeds received by the Master
Servicer which are in excess of the applicable Stated Principal Balance plus all
unpaid REO Imputed Interest thereon through the last day of the month in which
the REO Disposition occurred ("Excess Proceeds") shall be retained by the Master
Servicer as additional servicing compensation.

                  With respect to any Mortgage Loan as to which the Master
Servicer has received notice of, or has actual knowledge of, the presence of any
toxic or hazardous substance on the Mortgaged Property, the Master Servicer
shall not, on behalf of the Trustee, either (i) obtain title to the related
Mortgaged Property as a result of or in lieu of foreclosure or otherwise, or
(ii) otherwise acquire possession of, the related Mortgaged Property, unless the
Master Servicer has, at least 30 days prior to taking such action, obtained and
delivered to the Trustee an environmental audit report prepared by a Person who
regularly conducts environmental audits using customary industry standards. The
Master Servicer shall take such action as it deems to be in the best economic
interest of the Trust Fund (other than proceeding against the Mortgaged
Property) and is hereby authorized at such time as it deems appropriate to
release such Mortgaged Property from the lien of the related Mortgage.

                  The cost of the environmental audit report contemplated by
this Section 3.22 shall be advanced by the Master Servicer as an expense of the
Trust Fund, and the Master Servicer shall be reimbursed therefor from the
Custodial Account as provided in Section 3.11, any such right of reimbursement
being prior to the rights of the Certificateholders to receive any amount in the
Custodial Account.

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

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therefor from the Custodial Account as provided in Section 3.11, any such right
of reimbursement being prior to the rights of the Certificateholders to receive
any amount in the Custodial Account.

                  SECTION 3.23.             Additional Obligations of the Master
                                            Servicer.

                  On each Certificate Account Deposit Date, the Master Servicer
shall deliver to the Trustee for deposit in the Certificate Account from its own
funds and without any right of reimburse

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ment therefor, a total amount equal to the amount of Compensating Interest for
the related Distribution Date.

                  SECTION 3.24              Optional Purchase of Defaulted
                                            Mortgage Loans.

         The Master Servicer or any affiliate of the Master Servicer, in its
sole discretion, shall have the right to elect (by written notice sent to the
Master Servicer, and the Trustee), but shall not be obligated, to purchase for
its own account from the Trust Fund any Mortgage Loan which is 90 days or more
delinquent in the manner and at the price specified in Section 2.04. The
purchase price for any Mortgage Loan purchased hereunder shall be deposited in
the Certificate Account and the Trustee, upon receipt of such deposit, shall
release or cause to be released to the purchaser of such Mortgage Loan the
related Mortgage File and shall execute and deliver such instruments of transfer
or assignment prepared by the purchaser of such Mortgage Loan, in each case
without recourse, as shall be necessary to vest in the purchaser of such
Mortgage Loan any Mortgage Loan released pursuant hereto and the purchaser of
such Mortgage Loan shall succeed to all the Trustee's right, title and interest
in and to such Mortgage Loan and all security and documents related thereto.
Such assignment shall be an assignment outright and not for security. The
purchaser of such Mortgage Loan shall thereupon own such Mortgage Loan, and all
security and documents, free of any further obligation to the Trustee or the
Certificateholders with respect thereto. Notwithstanding the foregoing, the
Trustee, whether acting as Trustee or in the capacity of successor Master
Servicer, shall have no obligation to repurchase any Mortgage Loan.

                  SECTION 3.25.             Additional Obligations of the
                                            Company.

                  The Company agrees that on or prior to the tenth day after the
Closing Date, the Company shall provide the Trustee with a written notification,
substantially in the form of Exhibit J attached hereto, relating to each Class
of Certificates, setting forth (i) in the case of each Class of such
Certificates, (a) if less than 10% of the aggregate Certificate Principal
Balance or Notional Amount of such Class of Certificates has been sold as of
such date, the value calculated pursuant to clause (b)(iii) of Exhibit J hereto,
or, (b) if 10% or more of such Class of Certificates has been sold as of such
date but no single price is paid for at least 10% of the aggregate Certificate
Principal Balance or Notional Amount of such Class of Certificates, then the
weighted average price at which the Certificates of such Class were sold and the
aggregate percentage of Certificates of such Class sold, (c) the first single
price at which at least 10% of the aggregate Certificate Principal Balance or
Notional Amount of such Class of Certificates was sold, or (d) if any
Certificates of each Class of Certificates are retained by the Company or an
affiliate corporation, or are delivered to the Seller, the fair market value of
such Certificates as of the Closing Date, (ii) the Prepayment Assumption used in
pricing the Certificates, and (iii) such other information as to matters of fact
as the Trustee may reasonably request to enable it to comply with its reporting
requirements with respect to each Class of such Certificates to the extent such
information can in the good faith judgment of the Company be determined by it.

                  SECTION 3.26.             Periodic Filings with the Securities
                                            and Exchange Commission; Additional
                                            Information.

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                  The Trustee shall prepare or cause to be prepared for filing
with the Commission any and all reports, statements and information respecting
the Trust Fund and/or the Certificates required to be filed with the Commission
pursuant to the Securities Exchange Act of 1934, as amended, and shall solicit
any and all proxies of the Certificateholders whenever such proxies are required
to be solicited, pursuant to the Securities Exchange Act of 1934, as amended.
The Company shall promptly file, and exercise its reasonable best efforts to
obtain a favorable response to, no-action requests with, or other appropriate
exemptive relief from, the Commission seeking the usual and customary exemption
from such reporting requirements granted to issuers of securities similar to the
Certificates. Fees and expenses incurred by the Trustee in connection with this
Section shall not be reimbursable from the Trust Fund.

                  The Master Servicer and the Company each agree to promptly
furnish to the Trustee, from time to time upon request, such further
information, reports and financial statements within their respective control
related to this Agreement and the Mortgage Loans as the Trustee reasonably deems
appropriate to prepare and file all necessary reports with the Commission.

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                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS

                  SECTION 4.01.             Certificate Account; Distributions.

                  (a) The Trustee shall establish and maintain a Certificate
Account, in which the Master Servicer shall cause to be deposited on behalf of
the Trustee on or before 5:00 P.M. New York time on each Certificate Account
Deposit Date by wire transfer of immediately available funds an amount equal to
the sum of (i) any Advance for the immediately succeeding Distribution Date,
(ii) any amount required to be deposited in the Certificate Account pursuant to
Sections 3.11, 3.13, 3.22 or 3.23 and (iii) all other amounts constituting the
Available Distribution Amount for the immediately succeeding Distribution Date.

                  (b) On each Distribution Date, prior to making any other
distributions referred to in Section 4.01, the Trustee shall withdraw from the
Certificate Account and pay itself the Trustee's Fee for such Distribution Date.

                  (c) On each Distribution Date the Trustee shall distribute to
each Certificateholder of record as of the next preceding Record Date (other
than as provided in Section 9.01 respecting the final distribution) either in
immediately available funds (by wire transfer or otherwise) to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder has so notified the Trustee at least 5
Business Days prior to the related Record Date, or otherwise by check mailed to
such Certificateholder at the address of such Holder appearing in the
Certificate Register, such Certificateholder's share (based on the aggregate of
the Percentage Interests represented by Certificates of the applicable Class
held by such Holder) of the following amounts, in the following order of
priority, in each case to the extent of the remaining Available Distribution
Amount:

                           (i) to the Class A Certificateholders (other than the
                  Principal Only Certificateholders, and, with respect to the
                  Accrual Certificateholders, net of the Accrual Distribution
                  Amount) and the Class R Certificateholders, on a pro rata
                  basis based on Accrued Certificate Interest payable on such
                  Certificates with respect to such Distribution Date, Accrued
                  Certificate Interest on such Classes of Certificates, as
                  applicable, for such Distribution Date, plus any Accrued
                  Certificate Interest thereon remaining unpaid from any
                  previous Distribution Date (the "Senior Interest Distribution
                  Amount");

                           (ii) (X) to the Principal Only Certificateholders,
                  the Principal Only Distribution Amount; and

                                    (Y) to the Class A Certificateholders (other
                  than the Interest Only and Principal Only Certificateholders)
                  and Class R Certificateholders, in the priorities and amounts
                  set forth in Section 4.01(d)(ii) and Sections 4.01(e), the sum

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                  of the following (applied to reduce the Certificate Principal
                  Balances of such Class A Certificates or Class R Certificates,
                  as applicable):

                                    (A) the Senior Percentage for such
                           Distribution Date times the sum of the following:

                                            (1) the principal portion of each
                                    Monthly Payment due during the related Due
                                    Period on each Outstanding Mortgage Loan
                                    (other than the related Discount Fraction of
                                    the principal portion of such payment with
                                    respect to a Discount Mortgage Loan),
                                    whether or not received on or prior to the
                                    related Determination Date, minus the
                                    principal portion of any Debt Service
                                    Reduction (other than the related Discount
                                    Fraction of the principal portion of such
                                    Debt Service Reductions with respect to each
                                    Discount Mortgage Loan) which together with
                                    other Bankruptcy Losses exceeds the
                                    Bankruptcy Amount;

                                            (2) the Stated Principal Balance of
                                    any Mortgage Loan repurchased during the
                                    related Prepayment Period pursuant to
                                    Section 2.02, 2.04, 3.14 or 3.24 and the
                                    amount of any shortfall deposited in the
                                    Custodial Account in connection with the
                                    substitution of a Deleted Mortgage Loan
                                    pursuant to Section 2.04 during the related
                                    Prepayment Period (other than the related
                                    Discount Fraction of such Stated Principal
                                    Balance or shortfall with respect to a
                                    Discount Mortgage Loan); and

                                            (3) the principal portion of all
                                    other unscheduled collections (other than
                                    Principal Prepayments in Full and
                                    Curtailments and amounts received in
                                    connection with a Cash Liquidation or REO
                                    Disposition of a Mortgage Loan described in
                                    Section 4.01(c)(ii)(Y)(B), including without
                                    limitation Insurance Proceeds, Liquidation
                                    Proceeds and REO Proceeds) received during
                                    the related Prepayment Period to the extent
                                    applied by the Master Servicer as recoveries
                                    of principal of the related Mortgage Loan
                                    pursuant to Section 3.15 (other than the
                                    related Discount Fraction of the principal
                                    portion of such unscheduled collections with
                                    respect to a Discount Mortgage Loan);

                                    (B) with respect to each Mortgage Loan for
                           which a Cash Liquidation or a REO Disposition
                           occurred during the related Prepayment Period and did
                           not result in any Excess Special Hazard Losses,
                           Excess Fraud Losses, Excess Bankruptcy Losses or
                           Extraordinary Losses, an amount equal to the lesser
                           of (a) the Senior Percentage for such Distribution
                           Date times the Stated Principal Balance of such
                           Mortgage Loan (other than the related

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                           Discount Fraction of such Stated Principal Balance,
                           with respect to a Discount Mortgage Loan) and (b) the
                           Senior Accelerated Distribution Percentage for such
                           Distribution Date times the related unscheduled
                           collections (including without limitation Insurance
                           Proceeds, Liquidation Proceeds and REO Proceeds) to
                           the extent applied by the Master Servicer as
                           recoveries of principal of the related Mortgage Loan
                           pursuant to Section 3.15 (in each case other than the
                           portion of such unscheduled collections, with respect
                           to a Discount Mortgage Loan included in Section
                           4.01(d)(i)(C)));

                                    (C) the Senior Accelerated Distribution
                           Percentage for such Distribution Date times the
                           aggregate of all Principal Prepayments in Full and
                           Curtailments received in the related Prepayment
                           Period (other than the related Discount Fraction of
                           such Principal Prepayments in Full and Curtailments,
                           with respect to a Discount Mortgage Loan); and

                                    (D) any amounts described in subsection
                           (ii)(Y), clauses (A), (B) or (C) of this Section
                           4.01(c), as determined for any previous Distribution
                           Date, which remain unpaid after application of
                           amounts previously distributed pursuant to this
                           clause (D) to the extent that such amounts are not
                           attributable to Realized Losses which have been
                           allocated to the Class M Certificates or Class B
                           Certificates;

                           (iii) to the Holders of the Class M-1 Certificates
                  based on Accrued Certificate Interest payable to such
                  Certificate with respect to such Distribution Date, the
                  Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (iv) to the Holders of the Class M-1 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount for such Class of Certificates for such Distribution
                  Date, minus (y) the amount of any Principal Only Collection
                  Shortfalls for such Distribution Date or remaining unpaid for
                  all previous Distribution Dates, to the extent the amounts
                  available pursuant to clause (x) of Sections 4.01(c)(vi),
                  (viii), (x), (xii), (xiii) and (xiv) are insufficient
                  therefor, applied in reduction of the Certificate Principal
                  Balance of the Class M-1 Certificates;

                           (v) to the Holders of the Class M-2 Certificates
                  based on Accrued Certificate Interest payable to such
                  Certificate with respect to such Distribution Date, the
                  Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (vi) to the Holders of the Class M-2 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount for such Class of Certificates for such

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                  Distribution Date, minus (y) the amount of any Principal Only
                  Collection Shortfalls for such Distribution Date or remaining
                  unpaid for all previous Distribution Dates, to the extent the
                  amounts available pursuant to clause (x) of Sections
                  4.01(c)(viii), (x), (xii), (xiii) and (xiv) are insufficient
                  therefor, applied in reduction of the Certificate Principal
                  Balance of the Class M-2 Certificates;

                           (vii) to the Holders of the Class M-3 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (viii) to the Holders of the Class M-3 Certificates,
                  an amount equal to (x) the Subordinate Principal Distribution
                  Amount for such Class of Certificates for such Distribution
                  Date minus (y) the amount of any Principal Only Collection
                  Shortfalls for such Distribution Date or remaining unpaid for
                  all previous Distribution Dates, to the extent the amounts
                  available pursuant to clause (x) of Sections 4.01(c)(x),
                  (xii), (xiii) and (xiv) are insufficient therefor, applied in
                  reduction of the Certificate Principal Balance of the Class
                  M-3 Certificates;

                           (ix) to the Holders of the Class B-1 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (x) to the Holders of the Class B-1 Certificates, an
                  amount equal to (x) the Subordinate Principal Distribution
                  Amount for such Class of Certificates for such Distribution
                  Date minus (y) the amount of any Principal Only Collection
                  Shortfalls for such Distribution Date or remaining unpaid for
                  all previous Distribution Dates, to the extent the amounts
                  available pursuant to clause (x) of Sections 4.01(c)(xii),
                  (xiii) and (xiv) are insufficient therefor, applied in
                  reduction of the Certificate Principal Balance of the Class
                  B-1 Certificates;

                           (xi) to the Holders of the Class B-2 Certificates,
                  the Accrued Certificate Interest thereon for such Distribution
                  Date, plus any Accrued Certificate Interest thereon remaining
                  unpaid from any previous Distribution Date, except as provided
                  below;

                           (xii) to the Holders of the Class B-2 Certificates,
                  an amount equal to (x) the Subordinate Principal Distribution
                  Amount for such Class of Certificates for such Distribution
                  Date minus (y) the amount of any Principal Only Collection
                  Shortfalls for such Distribution Date or remaining unpaid for
                  all previous Distribution Dates, to the extent the amounts
                  available pursuant to clause (x) of Sections 4.01(c)(xiii) and
                  (xiv) are insufficient therefor, applied in reduction of the
                  Certificate Principal Balance of the Class B-2 Certificates;

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                           (xiii) to the Holders of the Class B-3 Certificates,
                  an amount equal to (x) the Accrued Certificate Interest
                  thereon for such Distribution Date, plus any Accrued
                  Certificate Interest thereon remaining unpaid from any
                  previous Distribution Date, except as provided below minus (y)
                  the amount of any Principal Only Collection Shortfalls for
                  such Distribution Date or remaining unpaid for all previous
                  Distribution Dates to the extent the amounts available
                  pursuant to clause (x) of Section 4.01(c)(xiv) are
                  insufficient therefor;

                           (xiv) to the Holders of the Class B-3 Certificates,
                  an amount equal to (x) the Subordinate Principal Distribution
                  Amount for such Class of Certificates for such Distribution
                  Date minus (y) the amount of any Principal Only Collection
                  Shortfalls for such Distribution Date or remaining unpaid for
                  all previous Distribution Dates applied in reduction of the
                  Certificate Principal Balance of the Class B-3 Certificates;

                           (xv) to the Class A Certificateholders and Class R
                  Certificateholders in the priority set forth in Section
                  4.01(d), the portion, if any, of the Available Distribution
                  Amount remaining after the foregoing distributions, applied to
                  reduce the Certificate Principal Balances of such Class A
                  Certificates and Class R Certificates, but in no event more
                  than the aggregate of the outstanding Certificate Principal
                  Balances of each such Class of Class A Certificates and Class
                  R Certificates, and thereafter, to each Class of Class M
                  Certificates then outstanding beginning with such Class with
                  the lowest numerical designation, any portion of the Available
                  Distribution Amount remaining after the Class A Certificates
                  and Class R Certificates have been retired, applied to reduce
                  the Certificate Principal Balance of each such Class of Class
                  M Certificates, but in no event more than the outstanding
                  Certificate Principal Balance of each such Class of Class M
                  Certificates; and thereafter to each such Class of Class B
                  Certificates then outstanding beginning with such Class with
                  the lowest numerical designation, any portion of the Available
                  Distribution Amount remaining after the Class M Certificates
                  have been retired, applied to reduce the Certificate Principal
                  Balance of each such Class of Class B Certificates, but in no
                  event more than the outstanding Certificate Principal Balance
                  of each such Class of Class B Certificates; and

                           (xvi) to the Class R-II Certificateholders, the
                  balance, if any, of the Available Distribution Amount.

                  (d) Distributions of principal on the Class A Certificates
(other than the Interest Only Certificates) and Class R Certificates on each
Distribution Date occurring prior to the occurrence of the Credit Support
Depletion Date will be made as follows:

                           (i) first, to the Principal Only Certificates, until
                  the Certificate Principal Balance thereof is reduced to zero,
                  an amount (the "Principal Only Distribution Amount") equal to
                  the aggregate of:

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                                    (A) the related Discount Fraction of the
                           principal portion of each Monthly Payment on each
                           Discount Mortgage Loan due during the related Due
                           Period, whether or not received on or prior to the
                           related Determination Date, minus the Discount
                           Fraction of the principal portion of any related Debt
                           Service Reduction which together with other
                           Bankruptcy Losses exceeds the Bankruptcy Amount;

                                    (B) the related Discount Fraction of the
                           principal portion of all unscheduled collections on
                           each Discount Mortgage Loan received during the
                           preceding calendar month (other than amounts received
                           in connection with the Cash Liquidation or REO
                           Disposition of a Discount Mortgage Loan described in
                           clause (C) below), including Principal Prepayments in
                           Full, Curtailments and repurchases of Discount
                           Mortgage Loans (or, in the case of a substitution of
                           a Deleted Mortgage Loan, the Discount Fraction of the
                           amount of any shortfall deposited in the Custodial
                           Account in connection with such substitution);

                                    (C) in connection with the Cash Liquidation
                           or REO Disposition of a Discount Mortgage Loan that
                           did not result in any Excess Special Hazard Losses,
                           Excess Fraud Losses, Excess Bankruptcy Losses or
                           Extraordinary Losses, an amount equal to the lesser
                           of (1) the applicable Discount Fraction of the Stated
                           Principal Balance of such Discount Mortgage Loan
                           immediately prior to such Distribution Date and (2)
                           the aggregate amount of the collections on such
                           Discount Mortgage Loan to the extent applied as
                           recoveries of principal;

                                    (D) any amounts allocable to principal for
                           any previous Distribution Date (calculated pursuant
                           to clauses (A) through (C) above) that remain
                           undistributed; and

                                    (E) the amount of any Principal Only
                           Collection Shortfalls for such Distribution Date and
                           the amount of any Principal Only Collection
                           Shortfalls remaining unpaid for all previous
                           Distribution Dates, but only to the extent of the
                           Eligible Funds for such Distribution Date;

                           (ii) second, the balance of the Senior Principal
                  Distribution Amount, if any, remaining after the distribution
                  described in clause (i) above shall be distributed as follows:

                                    (A) first, an amount equal to the Accrual
                           Distribution Amount shall be distributed to the Class
                           A-1 Certificates and Class A-2 Certificates on a pro
                           rata basis, based on the Certificate Principal
                           Balances thereof, in reduction of the Certificate
                           Principal Balances thereof, until the Certificate
                           Principal Balances thereof have been reduced to zero;

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                                    (B) second, to the to the Class R-I and
                           Class R-II Certificates on a pro rata basis, based on
                           the Certificate Principal Balances thereof, in
                           reduction of the Certificate Principal Balances
                           thereof, until the Certificate Principal Balances
                           thereof have been reduced to zero;

                                    (C) third, to the Lockout Certificates, an
                           amount equal to the Lockout Distribution Percentage
                           of the Senior Principal Distribution Amount remaining
                           after clause (B) above for such Distribution Date, in
                           reduction of the Certificate Principal Balance
                           thereof, until the Certificate Principal Balance
                           thereof has been reduced to zero;

                                    (D) fourth, to the Class A-1 Certificates
                           and Class A-2 Certificates on a pro rata basis, based
                           on the Certificate Principal Balances thereof, in
                           reduction of the Certificate Principal Balances
                           thereof, until the Certificate Principal Balances
                           thereof have been reduced to zero;

                                    (E) fifth, to the Class A-4 Certificates, in
                           reduction of the Certificate Principal Balance
                           thereof, until the Certificate Principal Balances
                           thereof have been reduced to zero; and

                                    (F) sixth, to the Lockout Certificates, in
                           reduction of the Certificate Principal Balance
                           thereof, until the Certificate Principal Balance
                           thereof has been reduced to zero.

                  (e) 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 Principal Only
Certificates) will be disregarded, an amount equal to the Discount Fraction of
the principal portion of scheduled payments and unscheduled collections received
or advanced in respect of Discount Mortgage Loans will be distributed to the
Principal Only Certificates, and the Senior Principal Distribution Amount will
be distributed to all classes of Senior Certificates (other than the Principal
Only Certificates) pro rata in accordance with their respective outstanding
Certificate Principal Balances and the Senior Interest Distribution Amount will
be distributed as set forth in Section 4.01(c)(i) above.

                  (f) On each Distribution Date prior to the Accretion
Termination Date, an amount equal to the Accrued Certificate Interest that would
otherwise be distributed on the Class A-4 Certificates shall be added to the
Certificate Principal Balance of such Certificates. On or after the Accretion
Termination Date, the entire amount of Accrued Certificate Interest on the Class
A-4 Certificates for such Distribution Date shall be payable to the Class A-4
Certificateholders pursuant to Section 4.01(c)(i) to the extent not required to
reduce the Certificate Principal Balance of the Class A-1 Certificates and Class
A-2 Certificates to zero on such Accretion Termination Date; provided that if
the Accretion Termination Date is the Credit Support Depletion Date, the entire
amount of Accrued Certificate Interest on the Class A-4 Certificates for such
Distribution Date will be paid to the Class A-4 Certificateholders. Any such
Accrued Certificate Interest on the Class A-4 Certificates

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which is required to be paid to the holders of the Class A-1 Certificates and
Class A-2 Certificates on the Accretion Termination Date will be added to the
Certificate Principal Balance of the Class A-4 Certificates in the manner
described in the first sentence of this Section 4.01(f).

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

                  (h) The Trustee may invest or cause the institution
maintaining the Certificate Account to invest the funds in the Certificate
Account in Permitted Investments designated in the name of the Trustee for the
benefit of the Certificateholders, which shall mature not later than the
Business Day next preceding the Distribution Date next following the date of
such investment (except that (i) any investment in the institution with which
the Certificate Account is maintained may mature on such Distribution Date and
(ii) any other investment may mature on such Distribution Date if the Trustee
shall advance funds on such Distribution Date to the Certificate Account in the
amount payable on such investment on such Distribution Date, pending receipt
thereof to the extent necessary to make distributions on the Certificates) and
shall not be sold or disposed of prior to maturity. All income and gain realized
from any such investment shall be for the benefit of the Trustee and shall be
subject to its withdrawal or order from time to time. The amount of any losses
incurred in respect of any such investments shall be deposited in the
Certificate Account by the Trustee out of its own funds immediately as realized
without any right of reimbursement.

                  (i) Except as otherwise provided in Section 9.01, if the
Master Servicer anticipates that a final distribution with respect to any Class
of Certificates will be made on the next Distribution Date, the Master Servicer
shall, no later than the Determination Date in the month of such final
distribution, notify the Trustee and the Trustee shall, no later than two (2)
Business Days after such Determination Date, mail on such date to each Holder of
such Class of Certificates a notice to the effect that: (i) the Trustee
anticipates that the final distribution with respect to such Class of
Certificates will be made on such Distribution Date but only upon presentation
and surrender of such Certificates at the office of the Trustee or as otherwise
specified therein, and (ii) no interest shall accrue on such Certificates from
and after the end of the prior calendar month.

                  Any funds not distributed to any Holder or Holders of
Certificates of such Class on such Distribution Date because of the failure of
such Holder or Holders to tender their Certificates shall, on such date, be set
aside and held in trust and credited to the account of the appropriate non-
tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(i) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non-tendering

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Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within six months after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee shall take reasonable steps as directed by the
Company, or appoint an agent to take reasonable steps, to contact the remaining
non-tendering Certificateholders concerning surrender of their Certificates. The
costs and expenses of maintaining the funds in trust and of contacting such
Certificateholders shall be paid out of the assets remaining in the Trust Fund.
If within nine months after the second notice any such Certificates shall not
have been surrendered for cancellation, the Class R Certificateholders shall be
entitled to all unclaimed funds and other assets which remain subject hereto. No
interest shall accrue or be payable to any Certificateholder on any amount held
in trust as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with this Section
4.01(i).

                  SECTION 4.02.             Statements to Certificateholders.

                  On each Distribution Date the Trustee shall make available to
each Holder of a Certificate and to the Company, the Master Servicer and the
Rating Agencies, a statement based on information provided by the Master
Servicer as to such distribution setting forth:

                  (i) (a) the amount of such distribution to the
         Certificateholders of each Class applied to reduce the Certificate
         Principal Balance thereof, and (b) the aggregate amount included
         therein representing Principal Prepayments;

                  (ii) the amount of such distribution to Holders of each Class
         of Certificates allocable to interest and the Pass-Through Rate on each
         Class of Certificates for such Distribution Date;

                  (iii) if the distribution to the Holders of any Class of
         Certificates is less than the full amount that would be distributable
         to such Holders if there were sufficient funds available therefor, the
         amount of the shortfall;

                  (iv) the aggregate amount of Advances for such Distribution
         Date;

                  (v) the number and aggregate Stated Principal Balance of the
         Mortgage Loans as of the end of the related Due Period;

                  (vi) the aggregate Certificate Principal Balance or Notional
         Amount, as applicable, of each Class of Certificates, the Senior
         Accelerated Distribution Percentage and each of the Senior, Class M and
         Class B Percentages, after giving effect to the amounts distributed on
         such Distribution Date, separately identifying any reduction thereof
         due to Realized Losses other than pursuant to an actual distribution of
         principal;

                  (vii) the related Subordinate Principal Distribution Amount
         and Prepayment Distribution Percentage, if applicable;

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                  (viii) the number and aggregate Stated Principal Balance of
         Mortgage Loans (a) delinquent 31 to 60 days, (b) delinquent 61 to 90
         days, (c) delinquent 91 days or more, in each case as of the end of the
         calendar month prior to such Distribution Date;

                  (ix) the number, aggregate principal balance and book value of
         any REO Properties;

                  (x) the aggregate Accrued Certificate Interest remaining
         unpaid, if any, for each Class of Certificates, after giving effect to
         the distribution made on such Distribution Date;

                  (xi) the Special Hazard Amount, Fraud Loss Amount and
         Bankruptcy Amount as of the close of business on such Distribution Date
         and a description of any change in the calculation of such amounts;

                  (xii) the weighted average Net Mortgage Rate for such
         Distribution Date;

                  (xiii) the occurrence of the Credit Support Depletion Date;

                  (xiv) the Senior Accelerated Distribution Percentage
         applicable to such distribution;

                  (xv) the Senior Percentage and Lockout Priority Percentage for
         such Distribution Date;

                  (xvi) the aggregate amount of Realized Losses for such
         Distribution Date;

                  (xvii) the weighted average remaining term to maturity of the
         Mortgage Loans prior to giving effect to the amounts distributed on
         such Distribution Date; and

                  (xviii) the weighted average Mortgage Rates of the Mortgage
         Loans prior to giving effect to the amounts distributed on such
         Distribution Date.

                  In the case of information furnished pursuant to subclauses
(i) - (iii) above, the amounts shall also be expressed as a dollar amount per
Single Certificate.

                  On each Distribution Date the Trustee shall provide Bloomberg
Financial Markets, L.P. ("Bloomberg") CUSIP level factors for each Class of
Certificates as of such Distribution Date, using a format and media mutually
acceptable to the Trustee and Bloomberg.

                  Within a reasonable period of time after the end of each
calendar year, the Trustee shall prepare and forward, to each Person who at any
time during the calendar year was a Holder of a Certificate, a statement
containing the information set forth in subclauses (i) - (iii) above, aggregated
for such calendar year or applicable portion thereof during which such person
was a Certificateholder. Such obligation of the Trustee shall be deemed to have
been satisfied to the extent

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that substantially comparable information shall be provided by the Trustee
pursuant to any require ments of the Code and regulations thereunder as from
time to time are in force.

                  On each Distribution Date the Trustee shall prepare and
forward, to each Holder of a Residual Certificate a copy of the reports
forwarded to the other Certificateholders on such Distribution Date.

                  Within a reasonable period of time after the end of each
calendar year, the Trustee shall prepare and forward, to each Person who at any
time during the calendar year was a Holder of a Residual Certificate a statement
containing the information provided pursuant to the previous paragraph
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of the
Code as from time to time are in force.

                  SECTION 4.03.             Remittance Reports; Advances by the
                                            Master Servicer.

                  (a) On the Business Day following each Determination Date, the
Master Servicer shall deliver to the Trustee a report, prepared as of the close
of business on the Determination Date (the "Remittance Report"), in the form of
an electromagnetic tape or disk. The Remittance Report and any written
information supplemental thereto shall include such information with respect to
the Mortgage Loans that is required by the Trustee for purposes of making the
calculations and preparing the statement described in Sections 4.01 and 4.02, as
set forth in written specifications or guidelines issued by the Trustee from
time to time. The Trustee shall have no obligation to recompute, recalculate or
verify any information provided to it by the Master Servicer.

                  (b) The Master Servicer shall determine the aggregate amount
of Advances required to be made for the related Distribution Date, which shall
be in an aggregate amount equal to the sum of (1) the aggregate amount of
Monthly Payments (with each interest portion thereof adjusted to the Mortgage
Rate less the Servicing Fee Rate), other than Balloon Payments, less the amount
of any related Debt Service Reductions or reductions in the amount of interest
collectable from the Mortgagor pursuant to the Relief Act, on the Outstanding
Mortgage Loans as of the related Due Date, which Monthly Payments were
delinquent as of the close of business as of the related Determination Date plus
(2) with respect to each Balloon Loan delinquent in respect of its Balloon
Payment as of the close of business on the related Determination Date, an amount
equal to the assumed Monthly Payment (net of the related Servicing Fees) that
would have been due on the related Due Date based on the original principal
amortization scheduled for such Balloon Loan until such Balloon Loan is finally
liquidated; provided that no Advance shall be made if it would be a
Nonrecoverable Advance. On or before 4:00 P.M. New York time on each Certificate
Account Deposit Date, the Master Servicer shall either (i) deposit in the
Certificate Account from its own funds, or funds received therefor from the
Sub-Servicers, an amount equal to the Advances to be made by the Master Servicer
in respect of the related Distribution Date, (ii) withdraw from amounts on
deposit in the Custodial Account and deposit in the Certificate Account all or a
portion of the amounts held for future distribution in discharge of any such
Advance, or (iii) make advances in the

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form of any combination of (i) and (ii) aggregating the amount of such Advance.
Any portion of the amounts held for future distribution so used shall be
replaced by the Master Servicer by deposit in the Certificate Account on or
before 1:00 P.M. New York time on any future Certificate Account Deposit Date to
the extent that funds attributable to the Mortgage Loans that are available in
the Custodial Account for deposit in the Certificate Account on such Certificate
Account Deposit Date shall be less than payments to Certificateholders required
to be made on the following Distribution Date. The amount of any reimbursement
pursuant to Section 3.11 in respect of outstanding Advances on any Distribution
Date shall be allocated to specific Monthly Payments due but delinquent for
previous Due Periods, which allocation shall be made, to the extent practicable,
to Monthly Payments which have been delinquent for the longest period of time.
Such allocations shall be conclusive for purposes of reimbursement to the Master
Servicer from recoveries on related Mortgage Loans pursuant to Section 3.11. The
determination by the Master Servicer that it has made a Nonrecoverable Advance
or that any proposed Advance, if made, would constitute a Nonrecoverable
Advance, shall be evidenced by a certificate of a Servicing Officer delivered to
the Seller and the Trustee with the Remittance Report. The Trustee shall deposit
all funds it receives pursuant to this Section 4.03 into the Certificate
Account.

                  (c) In the event that the Master Servicer determines as of any
Certificate Account Deposit Date that it will be unable to deposit in the
Certificate Account an amount equal to the Advance required to be made for the
immediately succeeding Distribution Date in the amount determined by the Master
Servicer pursuant to paragraph (b) above, it shall give notice to the Trustee of
its inability to Advance (such notice may be given by telecopy), not later than
4:00 P.M., New York time, on such date, specifying the portion of such amount
that it will be unable to deposit. Not later than 4:00 P.M., New York time, on
the earlier of (x) two Business Days following such Certificate Account Deposit
Date or (y) the Business Day preceding the related Distribution Date, unless by
such time the Master Servicer shall have directly or indirectly deposited in the
Certificate Account the entire amount of the Advances required to be made for
the related Distribution Date, pursuant to Section 7.01, the Trustee shall (a)
terminate all of the rights and obligations of the Master Servicer under this
Agreement in accordance with Section 7.01 and (b) assume the rights and
obligations of the Master Servicer hereunder, including the obligation to
deposit in the Certificate Account an amount equal to the Advance for the
immediately succeeding Distribution Date.

                  SECTION 4.04.             Allocation of Realized Losses.

                  Prior to each Distribution Date, the Master Servicer shall
determine the total amount of Realized Losses, if any, that resulted from any
Cash Liquidation, Debt Service Reduction, Deficient Valuation or REO Disposition
that occurred during the related Prepayment Period. The amount of each Realized
Loss shall be evidenced by an Officers' Certificate. All Realized Losses, other
than Excess Special Hazard Losses, Extraordinary Losses, Excess Bankruptcy
Losses or Excess Fraud Losses, shall be allocated as follows: first, to the
Class B-3 Certificates until the Certificate Principal Balance thereof has been
reduced to zero; second, to the Class B-2 Certificates until the Certificate
Principal Balance thereof has been reduced to zero; third, to the Class B-1
Certificates until the Certificate Principal Balance thereof has been reduced to
zero; fourth, to the Class M-3 Certificates until the Certificate Principal
Balance thereof has been reduced to zero; fifth, to the

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Class M-2 Certificates until the Certificate Principal Balance thereof has been
reduced to zero; sixth, to the Class M-1 Certificates until the Certificate
Principal Balance thereof has been reduced to zero; and, thereafter, if such
Realized Losses are on a Discount Mortgage Loan, to the Principal Only
Certificates, in an amount equal to the Discount Fraction of the principal
portion thereof, and the remainder of such Realized Losses and the entire amount
of such Realized Losses on Non-Discount Mortgage Loans among all the Class A
Certificates (other than the Principal Only Certificates) and Class R
Certificates, on a pro rata basis, as described below. Any Excess Special Hazard
Losses, Excess Bankruptcy Losses, Excess Fraud Losses and Extraordinary Losses
on Non-Discount Mortgage Loans will be allocated among the Class A (other than
the Principal Only Certificates), Class M, Class B and Class R Certificates, on
a pro rata basis, as described below. The principal portion of such losses on
Discount Mortgage Loans will be allocated to the Principal Only Certificates in
an amount equal to the related Discount Fraction thereof, and the remainder of
such losses on Discount Mortgage Loans will be allocated among the Class A
Certificates (other than the Principal Only Certificates), Class M, Class B and
Class R Certificates on a pro rata basis, as described below.

         As used herein, an allocation of a Realized Loss on a "pro rata basis"
among two or more specified Classes of Certificates means an allocation on a pro
rata basis, among the various Classes so specified, to each such Class of
Certificates on the basis of their then outstanding Certificate Principal
Balances prior to giving effect to distributions to be made on such Distribution
Date in the case of the principal portion of a Realized Loss or based on the
Accrued Certificate Interest thereon payable on such Distribution Date (without
regard to any Compensating Interest for such Distribution Date) in the case of
an interest portion of a Realized Loss; provided that, in determining the
Certificate Principal Balance of the Accrual Certificates for the purpose of
allocating any portion of a Realized Loss thereto, the Certificate Principal
Balance of the Accrual Certificates shall be deemed to be equal to the lesser of
(a) the original Certificate Principal Balance of such Certificate and (b) the
Certificate Principal Balance of such Certificate prior to giving effect to
distributions made on such Distribution Date. Any allocation of the principal
portion of Realized Losses (other than Debt Service Reductions) to the Class B
Certificates or, after the Certificate Principal Balances of the Class B
Certificates have been reduced to zero, to the Class of Class M Certificates
then outstanding with the highest numerical designation shall be made by
operation of the definition of "Certificate Principal Balance" and by operation
of the provisions of Section 4.01. Allocations of the interest portions of
Realized Losses shall be made by operation of the definition of "Accrued
Certificate Interest" and by operation of the provisions of Section 4.01.
Allocations of the principal portion of Debt Service Reductions shall be made by
operation of the provisions of Section 4.01.
All Realized Losses and all other losses allocated to a Class of Certificates
hereunder will be allocated among the Certificates of such Class in proportion
to the Percentage Interests evidenced thereby.

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                  SECTION 4.05.             Information Reports to Be Filed by
                                            the Master Servicer.

                  The Master Servicer or the Sub-Servicers shall file
information reports with respect to the receipt of mortgage interest received in
a trade or business, foreclosures and abandonments of any Mortgaged Property and
the information returns relating to cancellation of indebtedness income with
respect to any Mortgaged Property required by Sections 6050H, 6050J and 6050P of
the Code, respectively, and deliver to the Trustee an Officers' Certificate
stating that such reports have been filed. Such reports shall be in form and
substance sufficient to meet the reporting requirements imposed by such Sections
6050H, 6050J and 6050P of the Code.

                  SECTION 4.06.             Compliance with Withholding
                                            Requirements.

                  Notwithstanding any other provision of this Agreement, the
Trustee shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or original issue discount on the
Mortgage Loans, that the Trustee reasonably believes are applicable under the
Code. The consent of Certificateholders shall not be required for such
withholding. In the event the Trustee withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee shall, together with
its monthly report to such Certificateholders pursuant to Section 4.02 hereof,
indicate such amount withheld.

                  SECTION 4.07.             Distributions on the Uncertificated
                                            REMIC I Regular Interests.

         (a) On each Distribution Date the Trustee shall be deemed to distribute
to itself, as the holder of the Uncertificated REMIC I Regular Interests, the
Uncertificated REMIC I Regular Interest Distribution Amounts in the following
order of priority to the extent of the Available Distribution Amount (less the
Trustee's Fees for such Distribution Date) reduced by distributions made to the
Class R-I Certificates pursuant to Section 4.01(a):

                (i) Uncertificated REMIC I Accrued Interest on the
         Uncertificated REMIC I Regular Interests for such Distribution Date,
         plus any Uncertificated REMIC I Accrued Interest thereon remaining
         unpaid from any previous Distribution Date; and

               (ii) In accordance with the priority set forth in Section
         4.07(b), an amount equal to the sum of the amounts in respect of
         principal distributable on the Class A-1, Class A-2, Class A-4, Class
         A-5, Class A-7, Class M-1, Class M-2, Class M-3, Class B-1, Class B-2,
         Class B-3 and Class R-II Certificates under Section 4.01(c), as
         allocated thereto.

         (b) The amount described in Section 4.07(a)(ii) shall be deemed
distributed to (i) Uncertificated REMIC I Regular Interest T, (ii)
Uncertificated REMIC I Regular Interest U, (iii) Uncertificated REMIC I Regular
Interest V, (iv) Uncertificated REMIC I Regular Interest W, (v) Uncertificated
REMIC I Regular Interest X and (vi) Uncertificated REMIC I Regular Interest Y
with the amount to be distributed allocated among such interests in accordance
with the priority assigned

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to the (i) Class A-1 Certificates, (ii) Class A-2 Certificates, (iii) Class A-4
Certificates, (iv) Class A- 5 Certificates, (v) Class M-1 Certificates, Class
M-2 Certificates, Class M-3 Certificates, Class B-1 Certificates, Class B-2
Certificates, Class B-3 Certificates and Class R-II Certificates, and (vi) Class
A-7 Certificates, respectively, under Section 4.01(c) and (d) until the
Uncertificated Principal Balance of each such interest is reduced to zero.

         (c) The portion of the Uncertificated REMIC I Regular Interest
Distribution Amounts described in Section 4.07(a)(ii) shall be deemed
distributed by REMIC I to REMIC II in accordance with the priority assigned to
the REMIC II Certificates relative to that assigned to the REMIC I Certificates
under Section 4.01(c).

         (d) In determining from time to time the Uncertificated REMIC I Regular
Interest T Distribution Amount, Uncertificated REMIC I Regular Interest U
Distribution Amount, Uncertificated REMIC I Regular Interest V Distribution
Amount, Uncertificated REMIC I Regular Interest W Distribution Amount,
Uncertificated REMIC I Regular Interest X Distribution Amount, Uncertificated
REMIC I Regular Interest Y Distribution Amount and Uncertificated REMIC I IO
Regular Interest Distribution Amount, Realized Losses allocated to the
Certificates under Section 4.04 shall be allocated to the Uncertificated REMIC I
Regular Interests in the same amounts and priorities as allocated to the
Certificates in the corresponding numercial designation in 4.07(b) above.

         (e) On each Distribution Date the Trustee shall be deemed to distribute
from REMIC II, in the priority set forth in Sections 4.01(a) and (b), to the
Class A-1, Class A-2, Class A-3, Class A-4, Class A-5, Class A-6, Class A-7,
Class A-8, Class M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and
Class R-II Certificates the amounts distributable thereon, from the
Uncertificated REMIC I Regular Interest Distribution Amounts deemed to have been
received by REMIC II from REMIC I under this Section 4.07.

         (f) Notwithstanding the deemed distributions on the Uncertificated
REMIC I Regular Interests described in this Section 4.07, distributions of funds
from the Certificate Account shall be made only in accordance with Section 4.01.

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                                    ARTICLE V

                                THE CERTIFICATES

                  SECTION 5.01.             The Certificates.

                  (a) The Certificates will be substantially in the respective
forms annexed hereto as Exhibits A, B-1, B-2 and B-3. The Certificates will be
issuable in registered form only. The Class A and Class M-1 Certificates will be
issued in minimum denominations of $25,000 and integral multiples of $1 in
excess thereof. The Class M-2 and Class M-3 Certificates of each Class will be
offered in registered, certificated form in minimum denominations of $250,000
and integral multiples of $1 in excess thereof. The Class B Certificates of each
Class will be offered in registered, certificated form in minimum denominations
of $250,000 and integral multiples of $1 in excess thereof, with one Certificate
of each such Class evidencing the remainder of the aggregate initial Certificate
Principal Balance of such Class. The Residual Certificates will each be issuable
in minimum denominations of any Percentage Interest representing 20.00% and
multiples of 0.01% in excess thereof.

                  Upon original issue, the Certificates shall, upon the written
request of the Company executed by an officer of the Company, be executed and
delivered by the Trustee, authenticated by the Trustee and delivered to or upon
the order of the Company upon receipt by the Trustee of the documents specified
in Section 2.01. The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee in its capacity as trustee hereunder by a
Responsible Officer. Certificates bearing the manual or facsimile signatures of
individuals who were at the time they signed the proper officers of the Trustee
shall bind the Trustee, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of
such Certificates or did not hold such offices at the date of such Certificates.
No Certificate shall be entitled to any benefit under this Agreement, or be
valid for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Trustee by manual signature, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates issued on the Closing
Date shall be dated the Closing Date and any Certificates delivered thereafter
shall be dated the date of their authentication.

                  (b) The Class A Certificates and the Class M Certificates
shall initially be issued as one or more Certificates registered in the name of
the Depository or its nominee and, except as provided below, registration of
such Certificates may not be transferred by the Trustee except to another
Depository that agrees to hold such Certificates for the respective Certificate
Owners with Ownership Interests therein. The Certificate Owners shall hold their
respective Ownership Interests in and to each of such Class A Certificates and
Class M Certificates through the book-entry facilities of the Depository and,
except as provided below, shall not be entitled to Definitive Certificates in
respect of such Ownership Interests. All transfers by Certificate Owners of
their respective Ownership Interests in the Book-Entry Certificates shall be
made in accordance with the procedures

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established by the Depository Participant or brokerage firm representing such
Certificate Owner. Each Depository Participant shall transfer the Ownership
Interests only in the Book-Entry Certificates of Certificate Owners it
represents or of brokerage firms for which it acts as agent in accordance with
the Depository's normal procedures. The Trustee shall not be required to
monitor, determine or inquire as to compliance with the transfer restrictions
with respect to the Class M Certificates (so long as they are Book-Entry
Certificates), and the Trustee shall have no liability for transfers of Class M
Certificates made through the book-entry facilities of the Depositary or between
or among Depositary Participants or Certificate Owners, made in violation of the
applicable restrictions.

                  The Trustee, the Master Servicer and the Company may for all
purposes (including the making of payments due on the respective Classes of
Book-Entry Certificates) deal with the Depository as the authorized
representative of the Certificate Owners with respect to the respective Classes
of Book-Entry Certificates for the purposes of exercising the rights of
Certificateholders hereunder. The rights of Certificate Owners with respect to
the respective Classes of Book-Entry Certificates shall be limited to those
established by law and agreements between such Certificate Owners and the
Depository Participants and brokerage firms representing such Certificate
Owners. Multiple requests and directions from, and votes of, the Depository as
Holder of any Class of Book- Entry Certificates with respect to any particular
matter shall not be deemed inconsistent if they are made with respect to
different Certificate Owners. The Trustee may establish a reasonable record date
in connection with solicitations of consents from or voting by
Certificateholders and shall give notice to the Depository of such record date.

                  If (i)(A) the Company advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Company is unable to locate a
qualified successor or (ii) the Company at its option advises the Trustee in
writing that it elects to terminate the book-entry system through the
Depository, the Trustee shall notify all Certificate Owners, through the
Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Trustee of the Book-Entry Certificates by the Depository,
accompanied by registration instructions from the Depository for registration of
transfer, the Trustee shall, at the expense of the Company, issue the Definitive
Certificates. Neither the Company, the Master Servicer nor the Trustee shall be
liable for any actions taken by the Depository or its nominee, including,
without limitation, any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates the Trustee and the Master Servicer
shall recognize the Holders of the Definitive Certificates as Certificateholders
hereunder.

                  (c) Each Certificate is intended to be a "security" governed
by Article 8 of the Uniform Commercial Code as in effect in the State of New
York and any other applicable jurisdiction, to the extent that any of such laws
may be applicable.

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                  SECTION 5.02.             Registration of Transfer and
                                            Exchange of Certificates.

                  (a) The Trustee shall maintain a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certif icates and of transfers and
exchanges of Certificates as herein provided.

                  (b) Except as provided in Section 5.02(c), no transfer, sale,
pledge or other disposition of a Class B Certificate shall be made unless such
transfer, sale, pledge or other disposition is exempt from the registration
requirements of the Securities Act of 1933, as amended (the "Act"), and any
applicable state securities laws or is made in accordance with said Act and
laws. In the event that a transfer of a Class B Certificate is to be made under
this Section 5.02(b), (i) the Trustee shall require an Opinion of Counsel
acceptable to and in form and substance satisfactory to the Trustee that such
transfer shall be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from said Act and laws or is being made
pursuant to said Act and laws, which Opinion of Counsel shall not be an expense
of the Trustee, the Company or the Master Servicer, provided that such Opinion
of Counsel will not be required in connection with the initial transfer of any
such Certificate by the Company or any affiliate thereof, to a non-affiliate of
the Company and (ii) the Trustee shall require the transferee to execute a
representation letter, substantially in the form of Exhibit G-1 hereto, and the
Trustee shall require the transferor to execute a representation letter,
substantially in the form of Exhibit G-2 hereto, each acceptable to and in form
and substance satisfactory to the Trustee certifying to the Company and the
Trustee the facts surrounding such transfer, which representation letters shall
not be an expense of the Trustee, the Company or the Master Servicer; provided
however that such representation letters will not be required in connection with
any transfer of any such Certificate by the Company to an affiliate of the
Company and the Trustee shall be entitled to conclusively rely upon a
representation (which, upon the request of the Trustee, shall be a written
representation) from the Company of the status of such transferee as an
affiliate of the Company. Any such Certificateholder desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Company and
the Master Servicer against any liability that may result if the transfer is not
so exempt or is not made in accordance with such applicable federal and state
laws.

                  (c) Notwithstanding the requirements of Section 5.02(b),
transfers of Class B Certificates may be made in accordance with this Section
5.02(c) if the prospective transferee of a Certificate provides the Trustee and
the Company with an investment letter substantially in the form of Exhibit G-3
attached hereto, which investment letter shall not be an expense of the Trustee,
the Company or the Master Servicer, and which investment letter states that,
among other things, such transferee is a "qualified institutional buyer" as
defined under Rule 144A. Such transfers shall be deemed to have complied with
the requirements of Section 5.02(b) hereof; provided, however, that no Transfer
of any of the Class B Certificates may be made pursuant to this Section 5.02(c)
by the Company. Any such Certificateholder desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Company and the
Master Servicer against any liability that may result if the transfer is not so
exempt or is not made in accordance with such applicable federal and state laws.

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                  (d) The Trustee shall require an Opinion of Counsel from a
prospective transferee prior to the transfer of any Residual Certificate, Class
M Certificate or Class B Certificate to any employee benefit plan or other
retirement arrangement, including individual retirement accounts and Keogh
plans, that is subject to Section 406 of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") or Section 4975 of the Code (any of the
foregoing, a "Plan"), to a trustee or other Person acting on behalf of any Plan,
or to any other person who is using "plan assets" of any Plan to effect such
acquisition (including any insurance company using funds in its general or
separate accounts that may constitute "plan assets"). Such Opinion of Counsel
must establish to the satisfaction of the Trustee that such transfer is
permissible under applicable law, will not violate the prohibited transaction
provisions of Section 406 of ERISA and Section 4975 of the Code, will not cause
the assets of the Trust Fund to constitute "plan assets" within the meaning of
29 C.F.R. ss.2510.3-101, and will not subject the Trustee, the Master Servicer
or the Company to any obligation in addition to those undertaken in this
Agreement. Neither the Company, the Master Servicer nor the Trustee will be
required to obtain such Opinion of Counsel on behalf of any prospective
transferee.

         In the case of the Class B Certificates, in lieu of such Opinion of
Counsel, the Trustee shall require a certification in the form of Exhibit G-6
(or in a form substantially similar to such Exhibit G-6 as shall be agreed upon
by the Trustee), in the case of the transfer of any of the foregoing Class B
Certificates to a person capable of providing such certification, substantially
to the effect that the purchase of such Certificate is permissible under
applicable law, will not constitute or result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code, will not subject the
Company, the Trustee or the Master Servicer to any obligation or liability
(including obligations or liabilities under ERISA or Section 4975 of the Code)
in addition to those undertaken in this Agreement and the following conditions
are satisfied: (i) the transferee is an insurance company and the source of
funds used to purchase such Certificates is an "insurance company general
account" (as such term is defined in Prohibited Transaction Class Exemption
("PTCE") 95-60), (ii) the conditions set forth in Sections I and III of PTCE
95-60 have been satisfied and (iii) there is no Plan with respect to which the
amount of such general account's reserves and liabilities for contracts held by
or on behalf of such Plan and all other Plans maintained by the same employer
(or any "affiliate" thereof, as defined in PTCE 95-60) or by the same employee
organization exceeds 10% of the total of all reserves and liabilities of such
general account (as determined under PTCE 95-60) as of the date of the
acquisition of such Certificates; provided however that such certification will
not be required in connection with any transfer of any such Class B Certificate
by the Company to an affiliate of the Company and the Trustee shall be entitled
to conclusively rely upon a representation (which, upon the request of the
Trustee, shall be a written representation) from the Company of the status of
such transferee as an affiliate of the Company. The permission of any transfer
in violation of the restriction on transfer set forth in this paragraph shall
not constitute a default or an Event of Default.

         In the case of the Class M Certificates, in lieu of the Opinion of
Counsel described above, any person purchasing a Class M Certificate shall be
deemed to have represented that either: (i) such person is not a Plan subject to
ERISA or the Code (or comparable provisions of any subsequent enactments) and is
not acting, directly or indirectly, on behalf of any such Plan or acquiring such

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Certificate with Plan Assets; or (ii) the purchase of such Certificate is
permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Company, the Trustee or the Master Servicer to any obligation or
liability (including obligations or liabilities under ERISA or Section 4975 of
the Code) in addition to those undertaken in this Agreement and the following
conditions are satisfied: (i) the transferee is an insurance company and the
source of funds used to purchase such Certificates is an "insurance company
general account" (as such term is defined in Prohibited Transaction Class
Exemption ("PTCE") 95-60), (ii) the conditions set forth in Sections I and III
of PTCE 95-60 have been satisfied and (iii) there is no Plan with respect to
which the amount of such general account's reserves and liabilities for
contracts held by or on behalf of such Plan and all other Plans maintained by
the same employer (or any "affiliate" thereof, as defined in PTCE 95-60) or by
the same employee organization exceeds 10% of the total of all reserves and
liabilities of such general account (as determined under PTCE 95-60) as of the
date of the acquisition of such Certificates.

                  (e) (i) Each Person who has or who acquires any Ownership
Interest in a Residual Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest to have agreed to be bound by the
following provisions and to have irrevocably authorized the Trustee or its
designee under clause (iii)(A) below to deliver payments to a Person other than
such Person and to negotiate the terms of any mandatory sale under clause
(iii)(B) below and to execute all instruments of transfer and to do all other
things necessary in connection with any such sale. The rights of each Person
acquiring any Ownership Interest in a Residual Certificate are expressly subject
to the following provisions:

                  (A) Each Person holding or acquiring any Ownership Interest in
         a Residual Certificate shall be a Permitted Transferee and shall
         promptly notify the Trustee of any change or impending change in its
         status as a Permitted Transferee.

                  (B) In connection with any proposed Transfer of any Ownership
         Interest in a Residual Certificate, the Trustee shall require delivery
         to it, and shall not register the Transfer of any Residual Certificate
         until its receipt of (I) an affidavit and agreement (a "Transfer
         Affidavit and Agreement" in the form attached hereto as Exhibit G-5)
         from the proposed Transferee, in form and substance satisfactory to the
         Trustee representing and warranting, among other things, that it is a
         Permitted Transferee, that it is not acquiring its Ownership Interest
         in the Residual Certificate that is the subject of the proposed
         Transfer as a nominee, trustee or agent for any Person who is not a
         Permitted Transferee, that for so long as it retains its Ownership
         Interest in a Residual Certificate, it will endeavor to remain a
         Permitted Transferee, and that it has reviewed the provisions of this
         Section 5.02 and agrees to be bound by them, and (II) a certificate, in
         the form attached hereto as Exhibit G-4, from the Holder wishing to
         transfer the Residual Certificate, in form and substance satisfactory
         to the Trustee representing and warranting, among other things, that no
         purpose of the proposed Transfer is to impede the assessment or
         collection of tax.

                  (C) Notwithstanding the delivery of a Transfer Affidavit and
         Agreement by a proposed Transferee under clause (B) above, if a
         Responsible Officer of the Trustee assigned

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         to this transaction has actual knowledge that the proposed Transferee
         is not a Permitted Transferee, no Transfer of an Ownership Interest in
         a Residual Certificate to such proposed Transferee shall be effected.

                  (D) Each Person holding or acquiring any Ownership Interest in
         a Residual Certificate shall agree (x) to require a Transfer Affidavit
         and Agreement from any other Person to whom such Person attempts to
         transfer its Ownership Interest in a Residual Certificate and (y) not
         to transfer its Ownership Interest unless it provides a certificate to
         the Trustee in the form attached hereto as Exhibit G-4.

                  (E) Each Person holding or acquiring an Ownership Interest in
         a Residual Certificate, by purchasing an Ownership Interest in such
         Certificate, agrees to give the Trustee written notice that it is a
         "pass-through interest holder" within the meaning of Temporary Treasury
         Regulations Section 1.67-3T(a)(2)(i)(A) immediately upon acquiring an
         Ownership Interest in a Residual Certificate, if it is "a pass-through
         interest holder", or is holding an Ownership Interest in a Residual
         Certificate on behalf of a "pass-through interest holder."

                  (ii) The Trustee will register the Transfer of any Residual
Certificate only if it shall have received the Transfer Affidavit and Agreement
in the form attached hereto as Exhibit G-5, a certificate of the Holder
requesting such transfer in the form attached hereto as Exhibit G-4 and all of
such other documents as shall have been reasonably required by the Trustee as a
condition to such registration. Transfers of the Residual Certificates other
than to Permitted Transferees are prohibited.

                  (iii) (A) If any Person other than a Permitted Transferee
shall become a Holder of a Residual Certificate, then the last preceding
Permitted Transferee shall be restored, to the extent permitted by law, to all
rights and obligations as Holder thereof retroactive to the date of registration
of such Transfer of such Residual Certificate. If a Non-United States Person
shall become a Holder of a Residual Certificate, then the last preceding
Permitted Transferee shall be restored, to the extent permitted by law, to all
rights and obligations as Holder thereof retroactive to the date of registration
of such Transfer of such Residual Certificate. If a transfer of a Residual
Certificate is disregarded pursuant to the provisions of Treasury Regulations
Section 1.860E-1 or Section 1.860G-3, then the last preceding Permitted
Transferee shall be restored, to the extent permitted by law, to all rights and
obligations as Holder thereof retroactive to the date of registration of such
transfer of such Residual Certificate. 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 Section 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 clause (b) and to any amendment of this
Agreement deemed necessary (whether as a result of new legislation or otherwise)
by counsel of the Company 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 any such REMIC to fail to qualify as a REMIC. The
Trustee shall be under no liability to any Person for any

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registration of Transfer of a Residual Certificate that is in fact not permitted
by this Section 5.02 or for making any payments due on such Certificate to the
holder thereof or for taking any other action with respect to such holder under
the provisions of this Agreement.

                           (B) If any purported Transferee shall become a Holder
of a Residual Certificate in violation of the restrictions in this Section 5.02
and to the extent that the retroactive restoration of the rights of the Holder
of such Residual Certificate as described in clause (iii)(A) above shall be
invalid, illegal or unenforceable, then the Trustee shall have the right,
without notice to the holder or any prior holder of such Residual Certificate,
to sell such Residual Certificate to a purchaser selected by the Trustee on such
terms as the Trustee may choose. Such purported Transferee shall promptly
endorse and deliver each Residual Certificate in accordance with the
instructions of the Trustee. Such purchaser may be the Trustee itself. The
proceeds of such sale, net of the commissions (which may include commissions
payable to the Trustee), expenses and taxes due, if any, will be remitted by the
Trustee to such purported Transferee. The terms and conditions of any sale under
this clause (iii)(B) shall be determined in the sole discretion of the Trustee,
and the Trustee shall not be liable to any Person having an Ownership Interest
in a Residual Certificate as a result of its exercise of such discretion.

                  (iv) The Trustee shall make available to the Internal Revenue
Service and those Persons specified by the REMIC Provisions, all information
necessary to compute any tax imposed (A) as a result of the transfer of an
ownership interest in a Residual Certificate to any Person who is a Disqualified
Organization, including the information regarding "excess inclusions" of such
Residual Certificates required to be provided to the Internal Revenue Service
and certain Persons as described in Treasury Regulations Sections 1.860D-1(b)(5)
and 1.860E-2(a)(5), and (B) as a result of any regulated investment company,
real estate investment trust, common trust fund, partnership, trust, estate or
organization described in Section 1381 of the Code that holds an Ownership
Interest in a Residual Certificate having as among its record holders at any
time any Person who is a Disqualified Organization. The Trustee may charge and
shall be entitled to reasonable compensation for providing such information as
may be required from those Persons which may have had a tax imposed upon them as
specified in clauses (A) and (B) of this paragraph for providing such
information.

                  (f) Subject to the preceding paragraphs, upon surrender for
registration of transfer of any Certificate at the office of the Trustee
maintained for such purpose, the Trustee shall execute and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Class of a like aggregate
Percentage Interest. Every Certificate surrendered for transfer shall be
accompanied by notification of the account of the designated transferee or
transferees for the purpose of receiving distributions pursuant to Section 4.01
by wire transfer, if any such transferee desires and is eligible for
distribution by wire transfer.

                  (g) At the option of the Certificateholders, Certificates may
be exchanged for other Certificates of authorized denominations of the same
Class of a like aggregate Percentage Interest, upon surrender of the
Certificates to be exchanged at the office of the Trustee. Whenever any
Certificates are so surrendered for exchange the Trustee shall execute,
authenticate and deliver

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the Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for transfer or exchange
shall (if so required by the Trustee) be duly endorsed by, or be accompanied by
a written instrument of transfer in the form satisfactory to the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing.

                  (h) No service charge shall be made to the Certificateholders
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 Certi ficates.

                  (i) All Certificates surrendered for transfer and exchange
shall be cancelled and retained by the Trustee in accordance with the Trustee's
standard procedures.

                  SECTION 5.03.             Mutilated, Destroyed, Lost or Stolen
                                            Certificates.

                  If (i) any mutilated Certificate is surrendered to the Trustee
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Certificate, and (ii) there is delivered to the Trustee such
security or indemnity as may be required by it to save it harmless, then, in the
absence of notice to the Trustee that such Certificate has been acquired by a
bona fide purchaser, the Trustee shall execute, authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of the same Class and Percentage Interest. Upon
the issuance of any new Certificate under this Section, the Trustee may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Trustee) connected therewith. Any replacement
Certificate issued pursuant to this Section shall constitute complete and
indefeasible evidence of ownership in the 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.

                  The Company, the Master Servicer, the Trustee and any agent of
any of them 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 4.01 and for all other purposes whatsoever, and neither the
Company, the Master Servicer, the Trustee nor any agent of any of them shall be
affected by notice to the contrary.

                  SECTION 5.05.             Rule 144A Information.

                  For so long as any Class B Certificates are outstanding and
are "restricted securities" within the meaning of Rule 144(a)(3) of the
Securities Act, (1) the Company 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 Company shall update such
information from time to time in order to prevent such

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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 Company and furnish the Company such
information in the Master Servicer's possession as the Company may reasonably
request.

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                                   ARTICLE VI

                       THE COMPANY AND THE MASTER SERVICER

                  SECTION 6.01.             Liability of the Company and the
                                            Master Servicer.

                  The Company and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by the Company and the Master Servicer herein. Only the
Master Servicer, any successor Master Servicer or the Trustee acting as Master
Servicer shall be liable with respect to the servicing of the Mortgage Loans and
the REO Property for actions taken by any such Person in contravention of the
Master Servicer's duties hereunder.

                  SECTION 6.02.             Merger, Consolidation or Conversion
                                            of the Company or the Master
                                            Servicer.

                  The Company and the Master Servicer each will keep in full
effect its existence, rights and franchises as a corporation under the laws of
the state of its incorporation, and each will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.

                  Any Person into which the Company or the Master Servicer may
be merged, consol idated or converted, or any corporation resulting from any
merger or consolidation to which the Company or the Master Servicer shall be a
party, or any Person succeeding to the business of the Company or the Master
Servicer, shall be the successor of the Company or the Master Servicer, as the
case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding; provided, however, that the successor or surviving
Person to the Master Servicer shall be qualified to sell mortgage loans to and
service mortgage loans for Fannie Mae or Freddie Mac.

                  SECTION 6.03.             Limitation on Liability of the
                                            Company, the Master Servicer and
                                            Others.

                  Neither the Company, the Master Servicer nor any of the
directors, officers, employees or agents of the Company or the Master Servicer
shall be under any liability to the Trust Fund or the Certificateholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Company or the Master Servicer (but this
provision shall protect the above described persons) against any breach of
warranties or representations made herein, or against any specific liability
imposed on the Master Servicer pursuant to Section 3.01 or any other Section
hereof; and provided further that this provision shall not protect the Company,
the Master Servicer or any such person, against any liability which would
otherwise be imposed by reason of willful

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misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The Company,
the Master Servicer and any director, officer, employee or agent of the Company
or 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. The Company, the Master Servicer and any director, officer,
employee or agent of the Company or the Master Servicer shall be indemnified and
held harmless by the Trust Fund against any loss, liability or expense incurred
in connection with any legal action relating to this Agreement or the
Certificates (including reasonable legal fees and disbursements of counsel),
other than (a) any loss, liability or expense related to Master Servicer's
servicing obligations with respect to any specific Mortgage Loan or Mortgage
Loans (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement) or related to the Master Servicer's
obligations under Section 3.01, or (b) any loss, liability or expense incurred
by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. Neither the Company nor the Master Servicer
shall be under any obligation to appear in, prosecute or defend any legal action
which is not incidental to its respective duties under this Agreement and which
in its opinion may involve it in any expense or liability; provided, however,
that the Company or the Master Servicer may in its sole discretion undertake any
such action which it may deem necessary or desirable with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any lia bility resulting therefrom (except any action or
liability related to the Master Servicer's obligations under Section 3.01) shall
be expenses, costs and liabilities of the Trust Fund, and the Company and the
Master Servicer shall be entitled to be reimbursed therefor from the Certificate
Account as provided in Section 3.11, any such right of reimbursement being prior
to the rights of Certificateholders to receive any amount in the Certificate
Account.

                  SECTION 6.04.             Limitation on Resignation of the
                                            Master Servicer.

                  The Master Servicer shall not resign from the obligations and
duties hereby imposed on it except (a) upon appointment of a successor servicer
reasonably acceptable to the Trustee upon receipt by the Trustee of a letter
from each Rating Agency (obtained by the Master Servicer and at its expense)
that such a resignation and appointment will not, in and of itself, result in a
downgrading of the Certificates or (b) upon determination that its duties
hereunder are no longer permissible under applicable law. Any such determination
permitting the resignation of the Master Servicer shall be evidenced by an
Opinion of Counsel (at the expense of the resigning Master Servicer) to such
effect delivered to the Trustee. No such resignation shall become effective
until the Trustee or a successor servicer shall have assumed the Master
Servicer's responsibilities, duties, liabilities and obligations hereunder.

                  SECTION 6.05.             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

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shall be qualified to service mortgage loans for Fannie Mae or Freddie Mac; (b)
shall, in the case of successor master servicers only, 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) as having a comparable servicing
ability to that of the Master Servicer on the Closing Date; (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 or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect obtained by the Master
Servicer at its expense and delivered to the Trustee; and (iii) the Master
Servicer assigning and selling the master servicing shall deliver to the Trustee
an Officer's Certificate and an Opinion of Counsel (at the expense of the Master
Servicer), 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 VII

                                     DEFAULT

                  SECTION 7.01.             Events of Default.

                  "Event of Default", wherever used herein, means any one of the
following events:

                (i) any failure by the Master Servicer to deposit into the
         Certificate Account on each Certificate Account Deposit Date the
         amounts required to be deposited therein (other than an Advance) under
         the terms of this Agreement which continues unremedied for two (2)
         Business Days after such amount was required to be remitted; or

               (ii) any failure on the part of the Master Servicer duly to
         observe or perform in any material respect any other of the covenants
         or agreements on the part of the Master Servicer contained in the
         Certificates or in this Agreement (including any breach of the Master
         Servicer's representations and warranties pursuant to Section 2.03(a)
         which materially and adversely affects the interests of the
         Certificateholders) which continues unremedied for a period of 60 days
         after the date on which written notice of such failure, 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 entitled to at least 25% of the Voting Rights; or

              (iii) a decree or order of a court or agency or supervisory
         authority having jurisdiction in an involuntary case under any present
         or future federal or state bankruptcy, insolvency or similar law or the
         appointment of a conservator or receiver or liquidator in any
         insolvency, readjustment of debt, marshaling of assets and liabilities
         or similar proceedings, or for the winding-up or liquidation of its
         affairs, shall have been entered against the Master Servicer and such
         decree or order shall have remained in force undischarged or unstayed
         for a period of 60 consecutive days; or

               (iv) the Master Servicer shall consent 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 of or relating to all or
         substantially all of its property; or

                (v) the Master Servicer shall admit in writing its inability to
         pay its debts generally as they become due, file a petition to take
         advantage of or otherwise voluntarily commence a case or proceeding
         under any applicable bankruptcy, insolvency, reorganization or other
         similar statute, make an assignment for the benefit of its creditors,
         or voluntarily suspend payment of its obligations; or

               (vi) the Master Servicer shall fail to deposit in the Certificate
         Account on any Certificate Account Deposit Date an amount equal to any
         required Advance which continues

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         unremedied for the earlier of (a) a period of two (2) Business Days or
         (b) the Business Day immediately preceding the Distribution Date.

If an Event of Default described in clauses (i) - (v) of this Section shall
occur, then, and in each and every such case, so long as such Event of Default
shall not have been remedied, the Trustee or the Holders of Certificates
entitled to at least 51% of the Voting Rights, by notice in writing to the
Master Servicer (and to the Trustee if given by such Holders of Certificates),
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 Trust Fund, other than its rights as a
Certificateholder hereunder; provided, however, that the successor to the Master
Servicer appointed pursuant to Section 7.02 shall have accepted the duties of
Master Servicer effective upon the resignation or termination of the Master
Servicer. If an Event of Default described in clause (vi) hereof shall occur,
the Trustee shall, by notice to the Master Servicer, and the Company, terminate
all of the rights and obligations of the Master Servicer under this Agreement
and in and to the Trust Fund, other than its rights as a Certificateholder
hereunder; provided, however, that if the Trustee determines (in its sole
discretion) that the failure by the Master Servicer to make any required Advance
was due to circumstances beyond its control, and the required Advance was
otherwise made, the Trustee shall not terminate the Master Servicer. On or after
the receipt by the Master Servicer of such notice, all authority and power of
the Master Servicer under this Agreement, whether with respect to the
Certificates (other than as a holder thereof) or the Mortgage Loans or
otherwise, shall pass to and be vested in the Trustee pursuant to and under this
Section, and, without limitation, the Trustee is hereby authorized and empowered
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 at the
expense of the Master Servicer. The Master Servicer agrees to cooperate with
(and pay any related costs and expenses of) the Trustee in effecting the
termination of the Master Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to the Trustee or the successor
Master Servicer for administration by it of (i) the property and amounts which
are then or should be part of the Trust Fund or which thereafter become part of
the Trust Fund; (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; (iii) the rights and obligations of the Master Servicer under
the Sub-Servicing Agreements with respect to the Mortgage Loans; and (iv) all
cash amounts which shall at the time be deposited by the Master Servicer or
should have been deposited to the Custodial or the Certificate Account or
thereafter be received with respect to the Mortgage Loans. The Trustee shall not
be deemed to have breached any obligation hereunder as a result of a failure to
make or delay in making any distribution as and when required hereunder caused
by the failure of the Master Servicer to remit any amounts received by it or to
deliver any documents held by it with respect to the Mortgage Loans. For
purposes of this Section 7.01, the Trustee shall not be deemed to have knowledge
of an Event of Default unless a Responsible Officer of the Trustee assigned to
and working in the Trustee's corporate trust division has actual knowledge
thereof or unless notice of any event which is in fact such an Event of Default
is received by the Trustee and such notice references the Certificates, the
Trust Fund or this Agreement.

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                  SECTION 7.02.             Trustee to Act; Appointment of
                                            Successor.

                  Within 90 days of the time the Master Servicer receives a
notice of termination pursuant to Section 7.01(i) - (v), the Trustee or its
appointed agent shall be the successor in all respects to the Master Servicer in
its capacity as Master Servicer under this Agreement and the transactions set
forth or provided for herein and shall be subject thereafter to all the
responsibilities, duties and liabilities relating thereto placed on the Master
Servicer including the obligation to make Advances which have been or will be
required to be made (except for the responsibilities, duties and liabilities
contained in Section 2.03 and its obligations to deposit amounts in respect of
losses pursuant to Section 3.12 and 4.01(g)) by the terms and provisions hereof;
and provided further, that any failure to perform such duties or
responsibilities caused by the Master Servicer's failure to provide information
required by Section 4.03 shall not be considered a default by the Trustee
hereunder. As compensation therefor, the Trustee shall be entitled to all funds
relating to the Mortgage Loans which the Master Servicer would have been
entitled to charge to the Custodial Account and the Certificate Account if the
Master Servicer had continued to act hereunder. If the Trustee has become the
successor to the Master Servicer in accordance with Section 6.04 or Section
7.02, then notwithstanding the above, if the Trustee shall be unwilling to so
act, or shall be unable to so act, the Trustee may appoint, or petition a court
of competent jurisdiction or appoint, any established housing and home finance
institution, which is also a Fannie Mae- or Freddie Mac- approved mortgage
servicing institution, 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 herein above provided. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans as it and such
successor shall agree; provided, however, that no such compensation shall be in
excess of that permitted the Master Servicer hereunder. Each of the Seller, the
Trustee and such successor shall take such action, con sistent with this
Agreement, as shall be necessary to effectuate any such succession.

                  Any successor, including the Trustee, to the Master Servicer
shall maintain in force during its term as master servicer hereunder policies
and fidelity bonds to the same extent as the Master Servicer is so required
pursuant to Section 3.18.

                  SECTION 7.03.             Notification to Certificateholders.

                  (a) Upon any such termination or appointment of a successor to
the Master Servicer, the Trustee shall give prompt notice thereof to
Certificateholders and to the Rating Agencies.

                  (b) Within 60 days after the occurrence of any Event of
Default, the Trustee shall transmit by mail to all Holders of Certificates
notice of each such Event of Default hereunder known to the Trustee, unless such
Event of Default shall have been cured or waived.

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                  SECTION 7.04.             Waiver of Events of Default.

                  The Holders representing at least 51% of the Voting Rights of
Certificates affected by a default or Event of Default hereunder, may waive such
default or Event of Default (other than an Event of Default set forth in Section
7.01(vi)); PROVIDED, HOWEVER, that (a) a default or Event of Default under
clause (i) of Section 7.01 may be waived only by all of the Holders of
Certificates affected by such default or Event of Default and (b) no waiver
pursuant to this Section 7.04 shall affect the Holders of Certificates in the
manner set forth in the second paragraph of Section 11.01 or materially
adversely affect any non-consenting Certificateholder. Upon any such waiver of a
default or Event of Default by the Holders representing the requisite percentage
of Voting Rights of Certificates affected by such default or Event of Default,
such default or Event of Default shall cease to exist and shall be deemed to
have been remedied for every purpose hereunder. No such waiver shall extend to
any subsequent or other default or Event of 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 7.05.             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 VIII

                             CONCERNING THE TRUSTEE

                  SECTION 8.01.             Duties of Trustee.

                  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. If an Event of Default occurs, is continuing and has
not been waived, the Trustee shall exercise such of the rights and powers vested
in it by this Agreement, and use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs. Any permissive right of the Trustee enumerated in
this Agreement shall not be construed as a duty.

                  The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them in accordance with the
requirements of this Agreement. If any such instrument is found not to conform
to the requirements of this Agreement in a material manner, the Trustee shall
take such action as it deems appropriate to have the instrument corrected, and
if the instrument is not corrected to the Trustee's satisfaction, the Trustee
will provide notice thereof to the Certificateholders. Notwithstanding the
foregoing, 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 or any Opinion of
Counsel required hereunder.

                  The Trustee shall prepare and file or cause to be filed on
behalf of the Trust Fund any tax return that is required with respect to both
REMIC I and REMIC II pursuant to applicable federal, state or local tax laws.

                  The Trustee covenants and agrees that it shall perform its
obligations hereunder in a manner so as to maintain the status of both REMIC I
and REMIC II under the REMIC Provisions and to prevent the imposition of any
federal, state or local income, prohibited transaction, contribution or other
tax on either REMIC I or REMIC II to the extent that maintaining such status and
avoiding such taxes are within the control of the Trustee and are reasonably
within the scope of its duties under this Agreement.

                  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 obliga tions 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

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                  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 for an error of
                  judgment made in good faith by a Responsible Officer or
                  Responsible Officers of the Trustee, unless it shall be proved
                  that the Trustee was negligent in ascertaining the pertinent
                  facts; and

                       (iii) The Trustee shall not be liable with respect to any
                  action taken, suffered or omitted to be taken by it in good
                  faith in accordance with the direction of the Holders of
                  Certificates entitled to at least 25% of the Voting Rights
                  relating to the time, method and place of conducting any
                  proceeding for any remedy available to the Trustee, or
                  exercising any trust or power conferred upon the Trustee,
                  under this Agreement.

                  SECTION 8.02.             Certain Matters Affecting the
                                            Trustee.

                           Except as otherwise provided in Section 8.01:

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

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

                (c) 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 notice pursuant to this Agreement, or to institute,
         conduct or defend any litigation hereunder or in relation hereto at the
         request, order or direction of any of the Certificateholders, pursuant
         to the provisions of this Agreement, unless such Certificateholders
         shall have offered to the Trustee 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 Office of the Trustee's corporate trust
         department has actual knowledge (which has not been waived or cured),
         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 man would exercise or use under the circumstances
         in the conduct of his own affairs;

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<PAGE>

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

                (e) 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, state ment,
         instrument, opinion, report, notice, request, consent, order, approval,
         bond or other paper or document, unless requested in writing to do so
         by the Holders of Certificates entitled to at least 25% of the Voting
         Rights; provided, however, that if the payment within a reasonable time
         to the Trustee of the costs, expenses or liabilities likely to be
         incurred by it in the making of such investigation is, in the opinion
         of the Trustee, reasonably assured to the Trustee by the security
         afforded to it by the terms of this Agreement reasonable expense of
         every such examination shall be paid by the Certificateholders
         requesting the investigation;

                (f) The Trustee may execute any of the trusts or powers
         hereunder or perform any duties hereunder either directly or by or
         through agents or attorneys; and

                (g) 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.

                  SECTION 8.03.             Trustee Not Liable for Certificates
                                            or Mortgage Loans.

                  The recitals contained herein and in the Certificates (other
than the signature of the Trustee, the authentication of the Trustee on the
Certificates, the acknowledgments of the Trustee contained in Article II and the
representations and warranties of the Trustee in Section 8.12) shall be taken as
the statements of the Company and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations or warranties as to the
validity or sufficiency of this Agreement (other than as specifically set forth
in Section 8.12) or of the Certificates (other than the signature and
authentication of the Trustee on the Certificates) or of any Mortgage Loan or
related document. The Trustee shall not be accountable for the use or
application by the Company of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Company or
the Master Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Custodial Account by the Master Servicer.

                  SECTION 8.04.             Trustee May Own Certificates.

                  The Trustee in its individual or any other capacity (other
than as Trustee hereunder) may become the owner or pledgee of Certificates with
the same rights it would have if it were not Trustee and may otherwise deal with
the parties hereto.

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                  SECTION 8.05.             Trustee's Fees.

                  On each Distribution Date, the Trustee shall be entitled to
withdraw from the Certificate Account as compensation hereunder the Trustee
Fees. Such compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) shall be paid for
all services rendered by it (except as otherwise reimbursed by the Seller
pursuant to a separate fee letter between the Seller and the Trustee) in the
execution of the trusts hereby created and in the exercise and performance of
any of the powers and duties hereunder or of the Trustee. Except as otherwise
provided in this Agreement, the Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified and held harmless by the Trust Fund
against any claim, loss, liability, fee or expense incurred in connection with
any Event of Default, any breach of this Agreement or any claim or legal action
(including any pending or threatened claim or legal action) relating to the
acceptance or administration of its trusts hereunder or the Certificates, other
than any claim, loss, liability or expense (i) sustained in connection with this
Agreement related to the willful misfeasance, bad faith or negligence of the
Master Servicer in the performance of its duties hereunder or (ii) incurred in
connection with a breach constituting willful misfeasance, bad faith or
negligence of the Trustee in the performance of its duties hereunder or by
reason of reckless disregard of its obligations and duties hereunder.

                  The Master Servicer shall indemnify the Trustee and any
director, officer, employee or agent of the Trustee against any such claim or
legal action (including any pending or threatened claim or legal action), loss,
liability, fee or expense that may be sustained in connection with this
Agreement related to the willful misfeasance, bad faith, or negligence in the
performance of the Master Servicer's duties hereunder.

                  The provisions of this Section 8.05 shall survive the
resignation or removal of the Trustee or the termination of this Agreement.

                  SECTION 8.06.             Eligibility Requirements for
                                            Trustee.

                  The Trustee hereunder shall at all times be a corporation or a
national banking association organized and doing business under the laws of any
state or the United States of America or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least $50,000,000 and subject to supervision or examination by
federal or state authority. In addition, the Trustee shall at all times be
acceptable to the Rating Agency rating the Certificates. If such corporation
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 the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published.
In case at any time the Trustee shall cease to be eligible in accordance with
the provisions of this Section, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.07. The corporation or
national banking association serving as Trustee may have normal banking and
trust relationships with the Seller and their affiliates or the Master Servicer
and its affiliates;

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<PAGE>

provided, however, that such corporation cannot be an affiliate of the Master
Servicer other than the Trustee in its role as successor to the Master Servicer.

                  SECTION 8.07.             Resignation and Removal of the
                                            Trustee.

                  The Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Master Servicer;
with a copy to the Rating Agencies; provided, that such resignation shall not be
effective until a successor trustee is appointed and accepts appointment in
accordance with the following provisions. Upon receiving such notice of
resignation, the Master Servicer shall promptly appoint a successor trustee who
meets the eligibility requirements of Section 8.06 by written instrument, in
triplicate, one copy of which instrument shall be delivered to each of the
resigning Trustee and to 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;
provided, however, that the resigning Trustee shall not resign and be discharged
from the trusts hereby created until such time as the Rating Agency rating the
Certificates approves the successor trustee.

                  If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Master Servicer, or if at any time the Trustee
shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or
a receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, the
Master Servicer may remove the Trustee and appoint a successor trustee who meets
the eligibility requirements of Section 8.06 by written instrument, in
triplicate, which instrument shall be delivered to the Trustee so removed and to
the successor trustee.

                  The Holders of Certificates entitled to at least 51% of the
Voting Rights, may at any time remove the Trustee and appoint a successor
trustee by written instrument or instruments, in triplicate, signed by such
Holders or their attorneys-in-fact duly authorized, one complete set of which
instruments shall be delivered to the Master Servicer, one complete set to the
Trustee so removed and one complete set to the successor so appointed. A copy of
such instrument shall be delivered to the Certificateholders and the Company by
the Master Servicer.

                  Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.

                  SECTION 8.08.             Successor Trustee.

                  Any successor trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Master Servicer and to its
predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or

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<PAGE>

conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as trustee herein. The predecessor trustee shall after payment of its
outstanding fees and expenses, promptly deliver to the successor trustee all
assets and records of the Trust Fund held by it hereunder, and the Master
Servicer and the predecessor trustee shall execute and deliver all such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties and obligations.

                  No successor trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.06.

                  Upon acceptance of appointment by a successor trustee as
provided in this Section, the Master Servicer shall mail notice of the
succession of such trustee hereunder to all Holders of Certificates at their
addresses as shown in the Certificate Register. If the Master Servicer fails to
mail such notice within ten days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Master Servicer.

                  SECTION 8.09.             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 8.06 without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.

                  SECTION 8.10.             Appointment of Co-Trustee or
                                            Separate Trustee.

                  Notwithstanding any other provisions hereof, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing 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 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 Fund, and to vest in such Person or Persons, in such capacity, such title
to the Trust Fund, or any part thereof, and, subject to the other provisions of
this Section 8.10, such powers, duties, obligations, rights and trusts as the
Master Servicer and the Trustee may consider necessary or desirable. If the
Master Servicer shall not have joined in such appointment within 15 days after
the receipt by it of a request so to do, or in case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to make
such appointment without the Master Servicer. No co-trustee or separate trustee
hereunder shall be required to meet

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<PAGE>

the terms of eligibility as a successor trustee under Section 8.06 hereunder and
no notice to Holders of Certificates of the appointment of co-trustee(s) or
separate trustee(s) shall be required under Section 8.08 hereof.

                  In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred or 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 Fund or any portion thereof in any
such jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee.

                  Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VIII. Each separate trustee and co-trustee, upon
its acceptance of the 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.

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

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                                   ARTICLE IX

                                   TERMINATION

                  SECTION 9.01.             Termination Upon Repurchase or
                                            Liquidation of All Mortgage Loans or
                                            upon Purchase of Certificates.

         (a) Subject to Section 9.03, the respective obligations and
responsibilities of the Company, the Master Servicer and the Trustee created
hereby (other than the obligations of the Master Servicer to the Trustee
pursuant to Section 8.05 and of the Master Servicer to provide for and the
Trustee to make payments to Certificateholders as hereafter set forth) shall
terminate upon payment to the Certificateholders of all amounts held by or on
behalf of the Trustee and required to be paid to them hereunder following the
earlier to occur of (i) the repurchase by the Master Servicer or its designee of
all Mortgage Loans and each REO Property in respect thereof remaining in the
Trust Fund at a price equal to (a) 100% of the unpaid principal balance of each
Mortgage Loan (other than one as to which a REO Property was acquired) on the
day of repurchase together with accrued interest on such unpaid principal
balance at the Net Mortgage Rate to the first day of the month in which the
proceeds of such repurchase are to be distributed, plus (b) the appraised value
of any REO Property (but not more than the unpaid principal balance of the
related Mortgage Loan, together with accrued interest on that balance at the Net
Mortgage Rate to the first day of the month such repurchase price is
distributed), less the good faith estimate of the Master Servicer of liquidation
expenses to be incurred in connection with its disposal thereof, such appraisal
to be conducted by an appraiser mutually agreed upon by the Master Servicer and
the Trustee at the expense of the Master Servicer, and (ii) 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 REO Property in
respect thereof); provided, however, that in no event shall the trust created
hereby continue beyond the earlier of (i) the Distribution Date occurring in
July 2033 and (ii) the expiration of 21 years from the death of the last
survivor of the descendants of Joseph P. Kennedy, the late ambassador of the
United States to the Court of St. James, living on the date hereof, and provided
further that the purchase price set forth above shall be increased as is
necessary, as determined by the Master Servicer, to avoid disqualification of
either REMIC I or REMIC II as a REMIC. In the case of any repurchase by the
Master Servicer pursuant to clause (i), the Master Servicer shall include in
such repurchase price the amount of any Advances that will be reimbursed to the
Master Servicer pursuant to Section 3.11(iii) and the Master Servicer shall
exercise reasonable efforts to cooperate fully with the Trustee in effecting
such repurchase and the transfer of the Mortgage Loans and related Mortgage
Files and related records to the Master Servicer.

                  The right of the Master Servicer or its designee to repurchase
all Mortgage Loans pursuant to (i) above shall be conditioned upon the aggregate
Stated Principal Balance of such Mortgage Loans at the time of any such
repurchase aggregating an amount equal to or less than 10% of the aggregate
Stated Principal Balance of the Mortgage Loans at the Cut-off Date. If such
right is exercised, the Master Servicer upon such repurchase shall provide to
the Trustee, notice of such exercise prior to the Determination Date in the
month preceding the month of purchase and the certification required by Section
3.16.

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<PAGE>

                  Notice of any termination, specifying the Distribution Date
upon which the Certificateholders may surrender their Certificates to the
Trustee for payment of the final distribution and cancellation, shall be given
promptly by the Trustee by letter to the Certificateholders mailed (a) in the
event such notice is given in connection with the Master Servicer's election to
repurchase, not earlier than the 15th day and not later than the 25th day of the
month next preceding the month of such final distribution or (b) otherwise
during the month of such final distribution on or before the Determination Date
in such month, in each case specifying (i) the Distribution Date upon which
final payment of the Certificates will be made upon presentation and surrender
of 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 the Certificates at the office of the Trustee
therein specified.
In the event such notice is given in connection with the Master Servicer or its
designee's election to repurchase, the Master Servicer or its designee shall
deliver to the Trustee for deposit in the Certificate Account on the Business
Day immediately preceding the Distribution Date specified in such notice an
amount equal to the above-described repurchase price payable out of its own
funds.
Upon presentation and surrender of the Certificates by the Certificateholders,
the Trustee shall first, pay itself the Trustee's Fees for such Distribution
Date and any other amounts owing to the Trustee under this Agreement, and
second, distribute to the Certificateholders (i) the amount otherwise
distributable on such Distribution Date, if not in connection with the Master
Servicer's election to repurchase, or (ii) if the Master Servicer elected to so
repurchase, an amount determined as follows:
with respect to each Class A Certificate and Subordinate Certificate, the
outstanding Certificate Principal Balance thereof, plus one month's interest
thereon at the applicable Pass-Through Rate and any previously unpaid Accrued
Certificate Interest; and with respect to the Residual Certificates, the
Percentage Interest evidenced thereby multiplied by the difference, if any,
between the above de scribed repurchase price and the aggregate amount to be
distributed to the Holders of the Class A Certificates and Subordinate
Certificates, subject to the priorities set forth in Section 4.01(c). Upon
certification to the Trustee by a Servicing Officer, following such final
deposit, the Trustee shall promptly release the Mortgage Files as directed by
the Master Servicer for the remaining Mortgage Loans, and the Trustee shall
execute all assignments, endorsements and other instruments required by the
Master Servicer as being necessary to effectuate such transfer.

                  In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the time
specified in the above-mentioned notice, the Trustee shall give a second 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 all of the Certificates shall not have been
surrendered for cancellation, the Trustee shall take reasonable steps as
directed by the Company, or appoint an agent to take reasonable 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 hereto. If within nine months after the second
notice all the Certificates shall not have been surrendered for cancellation,
the Residual Certificateholders shall be entitled to all unclaimed funds and
other assets which remain subject hereto.

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         (b) On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to ten percent of the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off Date,
either the Master Servicer or the Company, whichever gives notice first, shall
have the right, at its option, to purchase the Certificates in whole, but not in
part, at a price equal to the outstanding Certificate Principal Balance of such
Certificates plus the sum of one month's Accrued Certificate Interest thereon
and any previously unpaid Accrued Certificate Interest.

                  The Master Servicer or the Company, as applicable, shall give
the Trustee not less than 60 days' prior notice of the Distribution Date on
which the Master Servicer or the Company, as applicable, anticipates that it
will purchase the Certificates pursuant to Section 9.01(b). Notice of any such
purchase, specifying the Distribution Date upon which the Holders may surrender
their Certificates to the Trustee for payment in accordance with this Section
9.01(b), shall be given promptly by the Master Servicer or the Company, as
applicable, by letter to Certificateholders (with a copy to the Trustee and each
Rating Agency) 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,
specifying:

                  (i) the Distribution Date upon which purchase of the
         Certificates is anticipated to be made upon presentation and surrender
         of such Certificates at the office or agency of the Trustee therein
         designated,

                  (ii) the purchase price therefor, and

                  (iii) that the Record Date otherwise applicable to such
         Distribution Date is not applicable, payments being made only upon
         presentation and surrender of the Certificates at the office or agency
         of the Trustee therein specified.

If either the Master Servicer or the Company gives the notice specified above,
the Master Servicer or the Company, as applicable, shall deposit in the
Certificate Account before the Distribution Date on which the purchase pursuant
to Section 9.01(b) is to be made, in immediately available funds, an amount
equal to the purchase price for the Certificates computed as provided above.

                  Upon presentation and surrender of the Certificates to be
purchased pursuant to Section 9.01(b) by the Holders thereof, the Trustee shall
first, pay itself the Trustee's Fees for such Distribution Date and any other
amounts owing to the Trustee under this Agreement, and second, distribute to
such Holders an amount equal to the outstanding Certificate Principal Balance
thereof plus the sum of one month's Accrued Certificate Interest thereon and any
previously unpaid Accrued Certificate Interest with respect thereto.

                  In the event that any Certificateholders do not surrender
their Certificates on or before the Distribution Date on which a purchase
pursuant to this Section 9.01(b) is to be made, the Trustee shall on such date
cause all funds in the Certificate Account deposited therein by the Master
Servicer or the Company, as applicable, pursuant to this Section 9.01(b) to be
withdrawn therefrom and deposited in a separate escrow account for the benefit
of such Certificateholders, and the Master

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Servicer or the Company, as applicable, shall give a second written notice to
such Certificateholders to surrender their Certificates for payment of the
purchase price therefor. If within six months after the second notice any
Certificate shall not have been surrendered for cancellation, the Trustee shall
take appropriate steps as directed by the Master Servicer or the Company, as
applicable, to contact the Holders of such Certificates concerning surrender of
their Certificates. The costs and expenses of maintaining the escrow account and
of contacting Certificateholders shall be paid out of the assets which remain in
the escrow account. No interest shall accrue or be payable to any
Certificateholder on any amount held in the escrow account or by the Master
Servicer or the Company, as applicable, as a result of such Certificateholder's
failure to surrender its Certificate(s) for payment in accordance with this
Section 9.01. Any Certificate that is not surrendered on the Distribution Date
on which a purchase pursuant to this Section 9.01 occurs as provided above will
be deemed to have been purchased and the Holder as of such date will have no
rights with respect thereto except to receive the purchase price therefor minus
any costs and expenses associated with such escrow account and notices allocated
thereto. Any Certificates so purchased or deemed to have been purchased on such
Distribution Date shall remain outstanding hereunder. The Master Servicer or the
Company, as applicable, shall be for all purposes the Holder thereof as of such
date.

                  SECTION 9.02.             Termination of REMIC II.

                  REMIC II shall be terminated on the earlier of the Final
Distribution Date and the date on which it is deemed to receive the last deemed
distributions on the Uncertificated REMIC I Regular Interests and the last
distribution due on the Class A, Class M, Class B and Class R-II Certificates is
made.

                  SECTION 9.03.             Additional Termination Requirements.

                  (a) In the event the Master Servicer repurchases the Mortgage
Loans as provided in Section 9.01, the Trust Fund shall be terminated in
accordance with the following additional re quirements, unless the Master
Servicer, at its own expense, obtains for the Trustee an Opinion of Counsel to
the effect that the failure of the Trust Fund to comply with the requirements of
this Section 9.03 will not (i) result in the imposition on the Trust of taxes on
"prohibited transactions," as described in Section 860F of the Code, or (ii)
cause either REMIC I or REMIC II to fail to qualify as a REMIC at any time that
any Certificate is outstanding:

                  (i) The Master Servicer shall establish a 90-day liquidation
         period for REMIC I and REMIC II, as the case may be, and specify the
         first day of such period in a statement attached to the Trust Fund's
         final Tax Return pursuant to Treasury regulations Section 1.860F-1. The
         Master Servicer also shall satisfy all of the requirements of a
         qualified liquidation for REMIC I and REMIC II, as the case may be,
         under Section 860F of the Code and regulations thereunder;

                  (ii) The Master Servicer shall notify the Trustee at the
         commencement of such 90-day liquidation period and, at or prior to the
         time of making of the final payment on the

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         Certificates, the Trustee shall sell or otherwise dispose of all of the
         remaining assets of the Trust Fund in accordance with the terms hereof;
         and

                  (iii) If the Master Servicer or the Company is exercising its
         right to purchase the assets of the Trust Fund, the Master Servicer
         shall, during the 90-day liquidation period and at or prior to the
         Final Distribution Date, purchase all of the assets of the Trust Fund
         for cash; provided, however, that in the event that a calendar quarter
         ends after the commencement of the 90-day liquidation period but prior
         to the Final Distribution Date, the Master Servicer or the Company
         shall not purchase any of the assets of the Trust Fund prior to the
         close of that calendar quarter.

         (b) Each Holder of a Certificate and the Trustee hereby irrevocably
approves and appoints the Master Servicer as its attorney-in-fact to adopt a
plan of complete liquidation for REMIC I and REMIC II at the expense of the
Trust Fund in accordance with the terms and conditions of this Agreement.

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                                    ARTICLE X

                                REMIC PROVISIONS

                  SECTION 10.01.            REMIC Administration.

         (a) The Trustee shall make an election to treat the Trust Fund as two
REMICs under the Code and, if necessary, under applicable state law. Each such
election will be made on Form 1066 or other appropriate federal tax or
information return (including Form 8811) or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the
Certificates are issued. For the purposes of the REMIC elections in respect of
the Trust Fund, (i) the Class R-I Certificates will constitute the sole class of
"residual interest" in REMIC I, and (ii) the Class R-II Certificates will
constitute the sole class of "residual interest" in REMIC II, and the
Certificates (other than the Class R Certificates) shall be designated as the
"regular interests" in REMIC II. The Master Servicer and the Trustee shall not
permit the creation of any "interests" (within the meaning of Section 860G of
the Code) in REMIC I or REMIC II other than the Uncertificated REMIC I Regular
Interests and the Class R-I Certificates and the REMIC II Certificates,
respectively. The Trustee will apply for an Employee Identification Number from
the IRS via form SS-4 or any other acceptable method for each of REMIC I and
REMIC II.

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

         (c) The Trustee shall pay out of its own funds, without any right of
reimbursement, any and all expenses relating to any tax audit of the REMICs
(including, but not limited to, any professional fees or any administrative or
judicial proceedings with respect to the REMICs that involve the Internal
Revenue Service or state tax authorities), other than the expense of obtaining
any tax related Opinion of Counsel except as specified herein. The Trustee, as
agent for the REMICs' tax matters person, shall (i) act on behalf of the REMICs
in relation to any tax matter or controversy involving the Trust Fund and (ii)
represent the Trust Fund in any administrative or judicial proceeding relating
to an examination or audit by any governmental taxing authority with respect
thereto. By their acceptance thereof, the holder of the largest Percentage
Interest of the Residual Certificates hereby agrees to irrevocably appoint the
Trustee or an Affiliate as its agent to perform all of the duties of the tax
matters person for the REMICs.

                  (d) The Trustee shall prepare, sign and file all of the Tax
Returns in respect of the REMICs created hereunder. The expenses of preparing
and filing such returns shall be borne by the Trustee without any right of
reimbursement therefor. The Master Servicer shall provide on a timely basis to
the Trustee or its designee such information with respect to the assets of the
REMICs as is in its possession and reasonably required by the Trustee to enable
it to perform its obligations under this Article X.

                  (e) The Trustee shall perform on behalf of the REMICs all
reporting and other tax compliance duties that are the responsibility of the
REMICs under the Code, the REMIC

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Provisions or other compliance guidance issued by the Internal Revenue Service
or any state or local taxing authority. Among its other duties, as required by
the Code, the REMIC Provisions or other such compliance guidance, the Trustee
shall provide (i) to any Transferor of a Residual Certificate such information
as is necessary for the application of any tax relating to the transfer of a
Residual Certificate to any Person who is not a Permitted Transferee, (ii) to
the Certificateholders such information or reports as are required by the Code
or the REMIC Provisions including reports relating to interest, original issue
discount and market discount or premium (using the Prepayment Assumption as
required) and (iii) to the Internal Revenue Service the name, title, address and
telephone number of the person who will serve as the representative of the
REMICs. The Master Servicer shall provide on a timely basis to the Trustee such
information with respect to the assets of the REMICs, including, without
limitation, the Mortgage Loans, as is in its possession and reasonably required
by the Trustee to enable it to perform its obligations under this subsection. In
addition, the Company shall provide or cause to be provided to the Trustee,
within ten (10) days after the Closing Date, all information or data that the
Trustee reasonably determines to be relevant for tax purposes as to the
valuations and issue prices of the Certificates, including, without limitation,
the price, yield, prepayment assumption and projected cash flow of the
Certificates.

                  (f) The Trustee shall take such action and shall cause the
REMICs created hereunder to take such action as shall be necessary to create or
maintain the status thereof as REMICs under the REMIC Provisions (and the Master
Servicer shall assist it, to the extent reasonably requested by it). The Trustee
shall not take any action, cause the Trust Fund to take any action or fail to
take (or fail to cause to be taken) any action that, under the REMIC Provisions,
if taken or not taken, as the case may be, could (i) endanger the status of the
REMIC I or REMIC II as REMICs or (ii) result in the imposition of a tax upon the
REMICs (including but not limited to the tax on prohibited transactions as
defined in Section 860F(a)(2) of the Code and the tax on contributions to a
REMIC set forth in Section 860G(d) of the Code) (either such event, an "Adverse
REMIC Event") unless the Trustee has received an Opinion of Counsel, addressed
to the Trustee (at the expense of the party seeking to take such action but in
no event at the expense of the Trustee) to the effect that the contemplated
action will not, with respect to the REMICs created hereunder, endanger such
status or result in the imposition of such a tax, nor shall the Master Servicer
take or fail to take any action (whether or not authorized hereunder) as to
which the Trustee has advised it in writing that it has received an Opinion of
Counsel to the effect that an Adverse REMIC Event could occur with respect to
such action. In addition, prior to taking any action with respect to the REMICs
or the assets of the REMICs, or causing the REMICs to take any action, which is
not contemplated under the terms of this Agreement, the Master Servicer will
consult with the Trustee or its designee, in writing, with respect to whether
such action could cause an Adverse REMIC Event to occur with respect to the
Trust Fund, and the Master Servicer shall not take any such action or cause the
Trust Fund to take any such action as to which the Trustee has advised it in
writing that an Adverse REMIC Event could occur. The Trustee may consult with
counsel to make such written advice, and the cost of same shall be borne by the
party seeking to take the action not permitted by this Agreement, but in no
event shall such cost be an expense of the Trustee. At all times as may be
required by the Code, the Trustee will ensure that substantially all of the
assets of the REMICs created hereunder will consist of "qualified mortgages" as
defined in Section 860G(a)(3) of the Code and "permitted investments" as defined
in Section 860G(a)(5) of the Code.

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                  (g) In the event that any tax is imposed on "prohibited
transactions" of the REMICs created hereunder as defined in Section 860F(a)(2)
of the Code, on the "net income from foreclosure property" of the REMICs as
defined in Section 860G(c) of the Code, on any contributions to the REMICs after
the Startup Day therefor pursuant to Section 860G(d) of the Code, or any other
tax is imposed by the Code or any applicable provisions of state or local tax
laws, such tax shall be charged (i) to the Trustee pursuant to Section 10.03
hereof, if such tax arises out of or results from a breach by the Trustee of any
of its obligations under this Article X, (ii) to the Master Servicer pursuant to
Section 10.03 hereof, if such tax arises out of or results from a breach by the
Master Servicer of any of its obligations under Article III or this Article X,
or otherwise, (iii) to the Master Servicer as provided in Section 3.05 and (iv)
against amounts on deposit in the Certificate Account and shall be paid by
withdrawal therefrom to the extent not required to be paid by the Master
Servicer or the Trustee pursuant to another provision of this Agreement.

                  (h) On or before April 15 of each calendar year, commencing
April 15, 2001, the Trustee shall deliver to the Master Servicer and the Rating
Agency a Certificate from a Responsible Officer of the Trustee stating the
Trustee's compliance with this Article X.

                  (i) The Trustee shall, for federal income tax purposes,
maintain books and records with respect to the REMICs on a calendar year and on
an accrual basis.

                  (j) Following the Startup Day, the Trustee shall not accept
any contributions of assets to the REMICs other than in connection with any
Qualified Substitute Mortgage Loan delivered in accordance with Section 2.04
unless it shall have received an Opinion of Counsel to the effect that the
inclusion of such assets in the REMICs will not cause the REMIC I or REMIC II to
fail to qualify as REMICs at any time that any Certificates are outstanding or
subject either REMIC I or REMIC II to any tax under the REMIC Provisions or
other applicable provisions of federal, state and local law or ordinances.

                  (k) Neither the Trustee nor the Master Servicer shall enter
into any arrangement by which the REMICs will receive a fee or other
compensation for services nor permit the REMICs to receive any income from
assets other than "qualified mortgages" as defined in Section 860G(a)(3) of the
Code or "permitted investments" as defined in Section 860G(a)(5) of the Code.

                  SECTION 10.02.            Prohibited Transactions and
                                            Activities.

                  None of the Company, the Master Servicer or the Trustee shall
sell, dispose of or substitute for any of the Mortgage Loans (except in
connection with (i) the foreclosure of a Mortgage Loan, including but not
limited to, the acquisition or sale of a Mortgaged Property acquired by deed in
lieu of foreclosure, (ii) the bankruptcy of the Trust Fund, (iii) the
termination of REMIC I or REMIC II pursuant to Article IX of this Agreement,
(iv) a substitution pursuant to Article II of this Agreement or (v) a purchase
of Mortgage Loans pursuant to Article II or III of this Agreement), nor acquire
any assets for the Trust Fund (other than REO Property acquired in respect of a
defaulted Mortgage Loan), nor sell or dispose of any investments in the
Custodial Account or the Certificate Account for gain, nor accept any
contributions to the REMICs after the Closing Date (other than a

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Qualified Substitute Mortgage Loan delivered in accordance with Section 2.03),
unless it has received an Opinion of Counsel, addressed to the Trustee (at the
expense of the party seeking to cause such sale, disposition, substitution,
acquisition or contribution but in no event at the expense of the Trustee) that
such sale, disposition, substitution, acquisition or contribution will not (a)
affect adversely the status of REMIC I or REMIC II as REMICs or (b) cause the
Trust Fund to be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions.

                  SECTION 10.03.            Master Servicer and Trustee
                                            Indemnification.

                  (a) The Trustee agrees to indemnify the Trust Fund, the
Company, and the Master Servicer for any taxes and costs including, without
limitation, any reasonable attorneys fees imposed on or incurred by the Trust
Fund, the Company or the Master Servicer, as a result of a breach of the
Trustee's covenants set forth in this Article X.

                  (b) The Master Servicer agrees to indemnify the Trust Fund,
the Company and the Trustee for any taxes and costs including, without
limitation, any reasonable attorneys' fees imposed on or incurred by the Trust
Fund, the Company or the Trustee, as a result of a breach of the Master
Servicer's covenants set forth in Article III or this Article X, in each case
with respect to compliance with the REMIC Provisions.

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                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

                  SECTION 11.01.            Amendment.

                  This Agreement may be amended from time to time by the
Company, the Master Servicer and the Trustee, without the consent of any of the
Certificateholders, (i) to cure any ambigu ity, (ii) to correct or supplement
any provisions herein which may be defective or inconsistent with any other
provisions herein or to correct any error, (iii) to amend this Agreement in any
respect subject to the provisions in clauses (A) and (B) below, or (iv) if such
amendment, as evidenced by an Opinion of Counsel (provided by the Person
requesting such amendment) delivered to the Trustee, is reasonably necessary to
comply with any requirements imposed by the Code or any successor or amendatory
statute or any temporary or final regulation, revenue ruling, revenue procedure
or other written official announcement or interpretation relating to federal
income tax laws or any proposed such action which, if made effective, would
apply retroactively to the Trust Fund at least from the effective date of such
amendment; provided that such action (except any amendment described in (iv)
above) shall not adversely affect in any material respect the interests of any
Certificateholder (other than Certificateholders who shall consent to such
amendment), as evidenced by (A) an Opinion of Counsel (provided by the Person
requesting such amendment) delivered to the Trustee, and (B) a letter from each
Rating Agency, confirming that such amendment shall not cause it to lower its
rating on any of the Certificates.

                  This Agreement may also be amended from time to time by the
Company, the Master Servicer and the Trustee and Holders of Certificates
entitled to at least 66-2/3% of the Voting Rights for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in any
manner the amount of, or delay the timing of, payments received on Mortgage
Loans which are required to be distributed on any Certificate without the
consent of the Holder of such Certificate, (ii) adversely affect in any material
respect the interests of the Holders of any Class of Certificates in a manner
other than as described in (i), without the consent of the Holders of
Certificates of such Class evidencing at least 66-2/3% of the Voting Rights of
such Class, or (iii) 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. Notwithstanding any other
provision of this Agreement, for purposes of the giving or withholding of
consents pursuant to this Section 11.01, Certificates registered in the name of
the Seller or the Master Servicer or any affiliate thereof shall be entitled to
Voting Rights with respect to matters described in (i), (ii) and (iii) of this
paragraph.

                  Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel (provided by the Person requesting
such amendment) to the effect that such amendment will not result in the
imposition of any tax on either REMIC I or REMIC II pursuant to the REMIC

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Provisions or cause either REMIC I or REMIC II to fail to qualify as a REMIC at
any time that any Certificates are outstanding.

                  Promptly after the execution of any such amendment the Trustee
shall furnish a copy of such amendment or a written statement describing the
amendment to each Certificateholder, with a copy to the Rating Agencies.

                  It shall not be necessary for the consent of
Certificateholders under this Section 11.01 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable regulations as the Trustee may prescribe.

                  Prior to executing any amendment pursuant to this Section, the
Trustee shall be entitled to receive an Opinion of Counsel (provided by the
Person requesting such amendment) to the effect that such amendment is
authorized or permitted by this Agreement. The cost of any Opinion of Counsel
delivered pursuant to this Section 11.01 shall be an expense of the party
requesting such amendment, but in any case shall not be an expense of the
Trustee.

                  The Trustee may, but shall not be obligated to enter into any
amendment pursuant to this Section that affects its rights, duties and
immunities under this Agreement or otherwise.

                  SECTION 11.02.            Recordation of Agreement;
                                            Counterparts.

                  To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer at the expense of the Certificateholders, but
only upon direction of the Company accompanied by an Opinion of Counsel to the
effect that such recordation materially and beneficially affects the interests
of the Certificateholders.

                  For the purpose of facilitating the recordation of this
Agreement as herein provided and for other purposes, this Agreement may be
executed simultaneously in any number of counter parts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
constitute but one and the same instrument.

                  SECTION 11.03.            Limitation on Rights of
                                            Certificateholders.

                  The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.

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                  No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.

                  No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a notice of an Event of
Default, or of a default by the Seller or the Trustee in the performance of any
obligation hereunder, and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of Certificates entitled to at least 51% of the
Voting Rights shall have made written request upon the Trustee to institute such
action, suit or proceeding in its own name as Trustee hereunder and shall have
offered to the Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee, for 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. It is understood and intended, and expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner whatever
by virtue of any provision of this Agreement to affect, disturb or prejudice the
rights of the Holders of any other of such Certificates, or to obtain or seek to
obtain priority over or preference to any other such Holder, or to enforce any
right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.

                  SECTION 11.04.            Governing Law.

                  This Agreement and the Certificates shall be construed in
accordance with the laws of the State of New York and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.

                  SECTION 11.05.            Notices.

                  All demands, notices and direction hereunder shall be in
writing and shall be deemed effective upon receipt when delivered to (a) in the
case of the Company, Impac Funding, 1401 Dove Avenue, Newport Beach, California
92660, Attention: General Counsel, or such other address as may hereafter be
furnished to the other parties hereto in writing; (b) in the case of Impac
Funding, 1401 Dove Avenue, Newport Beach, California 92660, Attention: General
Counsel, or such other address as may hereafter be furnished to the other
parties hereto in writing; (c) in the case of the Trustee, to its Corporate
Trust Office, or such other address as may hereafter be furnished to the other
parties hereto in writing; or (d) in the case of the Rating Agencies, Standard &
Poor's, 55 Water Street, 41st Floor, New York, NY 10041 Attention: Residential
Mortgage Surveillance Group

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and Fitch, Fitch, Inc., One State Street, 30th Floor, New York, New York 10004,
Attention: Mortgage Backed Securities Department, Impac 2000-2. Any notice
required or permitted to be mailed to a Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or not
the Certificateholder receives such notice.

                  SECTION 11.06.            Severability of Provisions.

                  If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever held invalid, then
such covenants, agreements, provi sions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.

                  SECTION 11.07.            Successors and Assigns; Third Party
                                            Beneficiary.

                  The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the parties
hereto, and all such provisions shall inure to the benefit of the Trustee and
the Certificateholders.

                  SECTION 11.08.            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 11.09.            Notice to Rating Agencies.

                  The Trustee shall use its best efforts to promptly provide
notice to each Rating Agency referred to below 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 pursuant
to Section 2.03;

                  5. The final payment to Certificateholders; and

                  6. Any change in the location of the Custodial Account or the
Certificate Account.

                  In addition, the Trustee shall promptly furnish to the Rating
Agency copies of each

                                       122

<PAGE>

report to Certificateholders described in Section 4.02; and the Master Servicer
shall promptly furnish to the Rating Agency copies of each annual independent
public accountants' servicing report received as described in Section 3.20.

                  Any such notice pursuant to this Section 11.09 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
(i) in the case of Fitch, Fitch, Inc., One State Street, 30th Floor, New
York,
New York 10004, Attention: Mortgage Backed Securities Department, Impac 2000-2,
(ii) in the case of Standard & Poor's, 55 Water Street, 41st Floor, New York,
New York 10041 or, in each case, such other address as either such Rating Agency
may designate in writing to the parties thereto.

                                       123

<PAGE>

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

                                         IMPAC SECURED ASSETS CORP.,
                                                  Company

                                         By:      /s/ Richard J. Johnson
                                            ----------------------------
                                         Name:         Richard J. Johnson
                                         Title:        Chief Financial Officer

                                         IMPAC FUNDING CORPORATION,
                                                  Master Servicer

                                         By:      /s/ Lisa A. Duehring
                                            --------------------------
                                         Name:         Lisa A. Duehring
                                         Title:        Vice President

                                         BANKERS TRUST COMPANY OF
                                         CALIFORNIA, N.A.
                                                  Trustee

                                         By:      /s/ Katherine M. Wannenmacher
                                            -----------------------------------
                                         Name:        Katherine M. Wannenmacher
                                         Title:       Vice President

<PAGE>

STATE OF CALIFORNIA      )
                         )  ss.:
COUNTY OF ORANGE         )

                  On the 29th day of June, 2000 before me, a notary public in
and for said State, personally appeared Richard J. Johnson, known to me to be
the Chief Financial Officer of Impac Secured Assets Corp., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                          ------------------------------
                                                      Notary Public

[Notarial Seal]

<PAGE>

STATE OF CALIFORNIA    )
                       )  ss.:
COUNTY OF ORANGE       )

                  On the 29th day of June, 2000 before me, a notary public in
and for said State, personally appeared Lisa A. Duehring, known to me to be a
Vice President of Impac Funding Corporation, one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

                  IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.

                                            ------------------------------
                                                        Notary Public

[Notarial Seal]

<PAGE>

STATE OF CALIFORNIA    )
                       )  ss.:
COUNTY OF ORANGE       )

                  On the 29th day of June, 2000, before me, a notary public in
and for said State, personally appeared Katherine Wannemacher, known to me to be
an Assistant Vice President of Bankers Trust Company of California, N.A., 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

                           FORM OF CLASS A 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").

                                       A-1

<PAGE>

Certificate No. __             [_____%] [Adjustable] Pass-Through Rate
Class A-__ Senior

Date of Pooling and Servicing  Percentage Interest: ____%
Agreement and Cut-off Date:
June 1, 2000

First Distribution Date:       Aggregate Initial [Certificate Principal Balance]
July 25, 2000                  [Notional Amount] of the Class A-__ Certificates:
                               $___________________

Master Servicer:               Initial [Certificate Principal
Impac Funding Corporation      Balance] [Notional Amount] of this Certificate:
                               $___________________

Assumed Final                  CUSIP _________
Distribution Date:
July 25, 2030

                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2000-2

         evidencing a percentage interest in the distributions allocable to the
         Class A-__ Certificates with respect to a Trust Fund consisting
         primarily of a pool of conforming one- to four-family fixed-rate first
         lien mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, 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 Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Initial [Certificate Principal Balance] [Notional Amount] of this Certificate by
the aggregate Initial [Certificate Principal Balance] [Notional Amount] of all
Class A-___ Certificates, both as specified above) in certain distributions with
respect to the Trust Fund consisting primarily of an interest in a pool of
conventional one- to four-family fixed-rate first lien mortgage loans (the
"Mortgage Loans"), formed and sold by Impac Secured Assets Corp. (hereinafter
called the "Company," which term includes any successor entity under the
Agreement

                                       A-2

<PAGE>

referred to below). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as specified above (the "Agreement") among the
Company, the Master Servicer and Bankers Trust Company of California, N.A., as
trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned 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 the
acceptance hereof assents and by which such Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in 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 Holders of Class A-__
Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or 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 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 in the City and State of New York. The Initial
[Certificate Principal Balance] [Notional Amount] of this Certificate is set
forth above. The [Certificate Principal Balance] [Notional Amount] hereof will
be reduced to the extent of [distributions allocable to principal and] any
Realized Losses allocable hereto.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer

                                       A-3

<PAGE>

from time to time for purposes other than distributions to Certificateholders,
such purposes including without limitation reimbursement to the Trustee, the
Company and the Master Servicer of advances made, or certain expenses incurred,
by either of them.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. 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 exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee, duly endorsed by, or accompanied
by an assignment in the form below or other written instrument of transfer in
form satisfactory to the Trustee and the Certificate Registrar duly executed by
the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of authorized denominations evidencing
the same Class and aggregate Percentage Interest will be issued to the
designated transferee or transferees.

         The Certificates are issuable only as registered Certificates without
coupons in Classes and in denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

         No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

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

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

                                       A-4

<PAGE>

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Master Servicer or the Company from the Trust Fund of
all remaining Mortgage Loans and each REO Property in respect thereof remaining
in the Trust Fund, thereby effecting early retirement of the Certificates and
(ii) 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 REO Property in respect thereof). The Agreement permits, but
does not require, the Master Servicer or the Company to (i) purchase at a price
determined as provided in the Agreement all remaining Mortgage Loans and all
property acquired in respect of any Mortgage Loan or (ii) purchase in whole, but
not in part, all of the Certificates from the Holders thereof; provided, that
any such option may only be exercised if the aggregate Stated Principal Balance
of the Mortgage Loans as of the Distribution Date upon which the proceeds of any
such purchase are distributed is less than ten percent of the aggregate Stated
Principal Balance of the Mortgage Loans at the Cut-off Date.

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

                                       A-5

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  June 29, 2000                BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class A-__ Certificates referred to in the
within-mentioned Agreement.

                                     BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                                       A-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-7

<PAGE>

                                   EXHIBIT B-1

                           FORM OF CLASS M CERTIFICATE

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES, [THE CLASS M-1 CERTIFICATES] [AND THE CLASS M-2 CERTIFICATES] AS
DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

         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").

         ANY PERSON PURCHASING A CLASS M CERTIFICATE SHALL BE DEEMED TO HAVE
REPRESENTED THAT EITHER: (I) SUCH PERSON IS NOT A PLAN SUBJECT TO ERISA OR THE
CODE (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) AND IS NOT ACTING,
DIRECTLY OR INDIRECTLY, ON BEHALF OF ANY SUCH PLAN OR ACQUIRING SUCH CERTIFICATE
WITH PLAN ASSETS; OR (II) THE PURCHASE OF SUCH CERTIFICATE IS PERMISSIBLE UNDER
APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN ANY NON-EXEMPT PROHIBITED
TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE, WILL NOT SUBJECT THE
COMPANY, THE TRUSTEE OR THE MASTER SERVICER TO ANY OBLIGATION OR LIABILITY
(INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE)
IN ADDITION TO THOSE UNDERTAKEN IN THIS AGREEMENT AND THE EXEMPTIVE RELIEF
GRANTED BY THE DOL PURSUANT TO PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 IS
AVAILABLE WITH RESPECT TO THE PURCHASE, SALE AND HOLDING OF SUCH CERTIFICATE.

                                      B-1-1

<PAGE>

Certificate No. __                    ______% Pass-Through Rate

Class M-__ Subordinate                Aggregate Initial Certificate Principal
                                      Balance of the Class M-__ Certificates:
                                      $_______________

Date of Pooling and Servicing         Initial [Certificate Principal Balance]
Agreement and Cut-off Date:           [Notional Amount] of this Certificate:
June 1, 2000                          $_______________

First Distribution Date:              CUSIP: ______________
July 25, 2000

Master Servicer:
Impac Funding Corporation

Assumed Final Distribution Date:
July 25, 2030

                       MORTGAGE PASS-THROUGH CERTIFICATE,
                                  Series 2000-2

         evidencing a percentage interest in any distributions allocable to the
         Class M-__ Certificates with respect to the Trust Fund consisting
         primarily of a pool of conforming one- to four-family fixed-rate first
         lien mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, 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 Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Initial Certificate Principal Balance of this Certificate by the aggregate
Initial Certificate Principal Balance of all Class M-__ Certificates, both as
specified above) in certain distributions with respect to a Trust Fund
consisting primarily of a pool of conforming one- to four-family fixed-rate
first lien mortgage loans (the "Mortgage Loans"), formed and sold by Impac
Secured Assets Corp. (hereinafter called the "Company," which term includes any
successor entity under the Agreement referred to below). The Trust Fund was
created pursuant to a Pooling and Servicing Agreement dated as specified above
(the "Agreement") among the Company, the Master Servicer and Bankers Trust
Company of California, N.A., as trustee (the

                                      B-1-2

<PAGE>

"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned 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 the acceptance
hereof assents and by which such Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in 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 Holders of Class M-__
Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or 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 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 in the City and State of New York. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of the
distributions allocable to principal and any Realized Losses allocable hereto.

                  Any person purchasing a Class M Certificate shall be deemed to
have represented that either: (i) such person is not a Plan subject to ERISA or
the Code (or comparable provisions of any subsequent enactments) and is not
acting, directly or indirectly, on behalf of any such Plan or acquiring such
Certificate with Plan Assets; or (ii) the purchase of such Certificate is
permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Company, the Trustee or the Master Servicer to any obligation or
liability (including obligations or liabilities under ERISA or Section 4975 of
the Code) in addition to those undertaken in this Agreement and the exemptive
relief granted by the DOL pursuant to Prohibited Transaction Class Exemption
95-60 is available with respect to the purchase, sale and holding of such
Certificate.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

                                      B-1-3

<PAGE>

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. 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 exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee, duly endorsed by, or accompanied
by an assignment in the form below or other written instrument of transfer in
form satisfactory to the Trustee and the Certificate Registrar duly executed by
the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of authorized denominations evidencing
the same Class and aggregate Percentage Interest will be issued to the
designated transferee or transferees.

         The Certificates are issuable only as registered Certificates without
coupons in Classes and in denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

         No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

                                      B-1-4

<PAGE>

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

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Master Servicer or the Company from the Trust Fund of
all remaining Mortgage Loans and each REO Property in respect thereof remaining
in the Trust Fund, thereby effecting early retirement of the Certificates and
(ii) 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 REO Property in respect thereof). The Agreement permits, but
does not require, the Master Servicer or the Company to (i) purchase at a price
determined as provided in the Agreement all remaining Mortgage Loans and all
property acquired in respect of any Mortgage Loan or (ii) purchase in whole, but
not in part, all of the Certificates from the Holders thereof; provided, that
any such option may only be exercised if the aggregate Stated Principal Balance
of the Mortgage Loans as of the Distribution Date upon which the proceeds of any
such purchase are distributed is less than ten percent of the aggregate Stated
Principal Balance of the Mortgage Loans at the Cut-off Date.

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

                                      B-1-5

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  June 29, 2000                BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class M-__ Certificates referred to in the
within-mentioned Agreement.

                                     BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                                      B-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 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.

                                      B-1-7

<PAGE>

                                   EXHIBIT B-2

                           FORM OF CLASS B CERTIFICATE

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES [AND] THE CLASS M CERTIFICATES [,] [AND] [THE CLASS B-1
CERTIFICATES], [AND THE CLASS B-2 CERTIFICATES] AS DESCRIBED IN THE AGREEMENT
(AS DEFINED HEREIN).

         THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.

         NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 5.02(D) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE
OF THIS CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE
MASTER SERVICER, THE COMPANY OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN
ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT.

                                      B-2-1

<PAGE>

Certificate No. __                      _____ % Pass-Through Rate

Class B-__ Subordinate                  Aggregate Certificate Principal Balance
                                        of the Class B-__ Certificates as of
Date of Pooling and Servicing           the Cut-off Date:
Agreement and Cut-off Date:             $_______________
June 1, 2000
                                        Initial Certificate Principal
                                        Balance of this Certificate:
First Distribution Date:                $_______________
July 25, 2000

Master Servicer:
Impac Funding Corporation

Assumed Final Distribution Date:
July 25, 2030

                       MORTGAGE PASS-THROUGH CERTIFICATE,
                                  Series 2000-2

         evidencing a percentage interest in any distributions allocable to the
         Class B-__ Certificates with respect to the Trust Fund consisting
         primarily of a pool of conforming one- to four-family fixed-rate first
         lien mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, 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 by this Certificate (obtained by dividing the
Certificate Principal Balance of this Certificate by the aggregate Certificate
Principal Balance of all Class B-__ Certificates, both as specified above) in
certain distributions with respect to a Trust Fund consisting primarily of a
pool of conforming one- to four-family fixed-rate first lien mortgage loans (the
"Mortgage Loans"), formed and sold by Impac Secured Assets Corp. (hereinafter
called the "Company," which term includes any successor entity under the
Agreement referred to below). The Trust Fund was created pursuant to a Pooling
and Servicing Agreement dated as specified above (the "Agreement") among the
Company, the Master Servicer and Bankers Trust Company of California, N.A., as
trustee (the

                                      B-2-2

<PAGE>

"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned 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 the acceptance
hereof assents and by which such Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "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 of
the month next preceding the month of such Distribution Date (the "Record
Date"), from the Available Distribution Amount in 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 Holders of Class
B-__ Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or 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 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 in the City and State of New York. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of the
distributions allocable to principal and any Realized Losses allocable hereto.

         No transfer of this Class B-__ Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made in
accordance with said Act and laws. In the event that such a transfer is to be
made, (i) the Trustee shall require an opinion of counsel acceptable to and in
form and substance satisfactory to the Trustee that such transfer is exempt
(describing the applicable exemption and the basis therefor) from or is being
made pursuant to the registration requirements of the Securities Act of 1933, as
amended, and of any applicable statute of any state and (ii) the transferee and
transferor shall execute a representation letter in the form described by the
Agreement. The Holder hereof desiring to effect such transfer shall, and does
hereby agree to, indemnify the Trustee, the Company, the Master Servicer and the
Certificate Registrar acting on behalf of the Trustee against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such Federal and state laws. In connection with any such transfer, the Trustee
will also require either (i) an opinion of counsel acceptable to and in form and
substance satisfactory to the Trustee with respect to the permissibility of such
transfer under the Employee Retirement Income

                                      B-2-3

<PAGE>

Security Act of 1974, as amended ("ERISA") and Section 4975 of the Internal
Revenue Code (the "Code") and stating, among other things, that the transferee's
acquisition of a Class B Certificate will not constitute or result in a
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of
the Code or (ii) a representation letter, in the form as described by the
Agreement, either stating that the transferee is not an employee benefit or
other plan subject to the prohibited transaction provisions of ERISA or Section
4975 of the Code (a "Plan"), or any other person (including an investment
manager, a named fiduciary or a trustee of any Plan) acting, directly or
indirectly, on behalf of or purchasing any Certificate with "plan assets" of any
Plan, or stating that the transferee is an insurance company, the source of
funds to be used by it to purchase the Certificate is an "insurance company
general account" (within the meaning of Department of Labor Prohibited
Transaction Class Exemption ("PTCE") 95-60), and the purchase is being made in
reliance upon the availability of the exemptive relief afforded under Section
III of PTCE 95-60.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. 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 exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for

                                      B-2-4

<PAGE>

registration of transfer at the offices or agencies appointed by the Trustee,
duly endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of authorized denominations evidencing the same Class and aggregate Percentage
Interest will be issued to the designated transferee or transferees.

         The Certificates are issuable only as registered Certificates without
coupons in Classes and in denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

         No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

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

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Master Servicer or the Company from the Trust Fund of
all remaining Mortgage Loans and each REO Property in respect thereof remaining
in the Trust Fund, thereby effecting early retirement of the Certificates and
(ii) 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 REO Property in respect thereof). The Agreement permits, but
does not require, the Master Servicer or the Company to (i) purchase at a price
determined as provided in the Agreement all remaining Mortgage Loans and all
property acquired in respect of any Mortgage Loan or (ii) purchase in whole, but
not in part, all of the Certificates from the Holders thereof; provided, that
any such option may only be exercised if the aggregate Stated Principal Balance
of the Mortgage Loans as of the Distribution Date upon which the proceeds of any
such purchase are distributed is less than ten percent of the aggregate Stated
Principal Balance of the Mortgage Loans at the Cut-off Date.

                                      B-2-5

<PAGE>

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

                                      B-2-6

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  June 29, 2000                BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class B-__ Certificates referred to in the
within-mentioned Agreement.

                                     BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                                      B-2-7

<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 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.

                                      B-2-1

<PAGE>

                                   EXHIBIT B-3

                           FORM OF CLASS R CERTIFICATE

         THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED
STATES PERSON 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").

         NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 5.02(E) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE MASTER SERVICER, THE
COMPANY AND THE TRUSTEE THAT THE PURCHASE OF THIS CERTIFICATE IS PERMISSIBLE
UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE
MASTER SERVICER, THE COMPANY OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN
ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND SERVICING AGREEMENT (THE
"AGREEMENT").

         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 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 FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE, (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C) 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

                                      B-3-1

<PAGE>

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.

                                      B-3-2

<PAGE>

Certificate No. __               ____% Pass-Through Rate

Class R Senior                   Aggregate Initial Certificate Principal Balance
                                 of the Class R Certificates:  $______________

Date of Pooling and Servicing
Agreement and Cut-off Date:
June 1, 2000                     Percentage Interest: _______%

First Distribution Date:
July 25, 2000                    Initial Certificate Principal Balance
                                 of this Certificate:  $____________

Master Servicer:
Impac Funding Corporation        CUSIP: _____________________

Assumed Final Distribution Date:
July 25, 2030

                       MORTGAGE PASS-THROUGH CERTIFICATE,
                                  SERIES 2000-2

         evidencing a percentage interest in any distributions allocable to the
         Class R Certificates with respect to a Trust Fund consisting primarily
         of a pool of conforming one- to four-family fixed-rate first lien
         mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, 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 by this Certificate (obtained by dividing the
Initial Certificate Principal Balance of this Certificate by the aggregate
Initial Certificate Principal Balance of all Class R Certificates, both as
specified above) in certain distributions with respect to a Trust Fund,
consisting primarily of a pool of conforming one- to four-family fixed-rate
first lien mortgage loans (the "Mortgage Loans"), formed and sold by Impac
Secured Assets Corp. (hereinafter called the "Company," which term includes any
successor entity under the Agreement referred to below). The Trust Fund was
created

                                      B-3-3

<PAGE>

pursuant to a Pooling and Servicing Agreement dated as specified above (the
"Agreement") among the Company, the Master Servicer and Bankers Trust Company of
California, N.A., as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, the capitalized terms used herein have the meanings assigned 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 the acceptance hereof assents and by which such
Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in 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 Holders of Class R Certificates
on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or 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 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 in the City and State of New York. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of
distributions allocable to principal and any Realized Losses allocable hereto.
Notwithstanding the reduction of the Certificate Principal Balance hereof to
zero, this Certificate will remain outstanding under the Agreement and the
Holder hereof may have additional obligations with respect to this Certificate,
including tax liabilities, and may be entitled to certain additional
distributions hereon, in accordance with the terms and provisions of the
Agreement.

         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

                                      B-3-4

<PAGE>

acquires any Ownership Interest in this Certificate in violation of such
restrictions, then the Company 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 Company, which purchaser may be the Company, or any
affiliate of the Company, on such terms and conditions as the Company may
choose.

         In connection with any transfer of this Certificate, the Trustee will
also require either (i) an opinion of counsel acceptable to and in form and
substance satisfactory to the Trustee with respect to the permissibility of such
transfer under the Employee Retirement Income Security Act of 1974, as amended
("ERISA") and Section 4975 of the Internal Revenue Code (the "Code") and
stating, among other things, that the transferee's acquisition of a Class R
Certificate will not constitute or result in a non-exempt prohibited transaction
under Section 406 of ERISA or Section 4975 of the Code or (ii) a representation
letter, in the form as described by the Agreement, stating that the transferee
is not an employee benefit or other plan subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code (a "Plan"), or any other person
(including an investment manager, a named fiduciary or a trustee of any Plan)
acting, directly or indirectly, on behalf of or purchasing any Certificate with
"plan assets" of any Plan.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. 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 exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in

                                      B-3-5

<PAGE>

certain circumstances without the consent of the Holders of any of the
Certificates and, in certain additional circumstances, without the consent of
the Holders of certain Classes of Certificates.

         As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee, duly endorsed by, or accompanied
by an assignment in the form below or other written instrument of transfer in
form satisfactory to the Trustee and the Certificate Registrar duly executed by
the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of authorized denominations evidencing
the same Class and aggregate Percentage Interest will be issued to the
designated transferee or transferees.

         The Certificates are issuable only as registered Certificates without
coupons in Classes and in denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth,
Certificates are exchangeable for new Certificates of authorized denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

         No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

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

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Master Servicer or the Company from the Trust Fund of
all remaining Mortgage Loans and each REO Property in respect thereof remaining
in the Trust Fund, thereby effecting early retirement of the Certificates and
(ii) 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 REO Property in respect thereof). The Agreement permits, but
does not require, the Master Servicer or the Company to (i) purchase at a price
determined as provided in the Agreement all remaining Mortgage Loans and all
property acquired in respect of any Mortgage Loan or (ii) purchase in whole, but
not in part, all of the Certificates from the Holders thereof; provided, that
any such option may only be exercised if the aggregate Stated Principal Balance
of the Mortgage

                                      B-3-6

<PAGE>

Loans as of the Distribution Date upon which the proceeds of any such purchase
are distributed is less than ten percent of the aggregate Stated Principal
Balance of the Mortgage Loans at the Cut-off Date.

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

                                      B-3-7

<PAGE>

         IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  June 29, 2000                BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

         This is one of the Class R-__ Certificates referred to in the
within-mentioned Agreement.

                                     BANKERS TRUST COMPANY OF
                                     CALIFORNIA, N.A.,
                                     as Trustee

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

                                                       B-3-8

<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.

                                      B-3-9

<PAGE>

                                    EXHIBIT C

                     FORM OF TRUSTEE'S INITIAL CERTIFICATION

                                       June ___, 2000

Impac Funding Corporation
1401 Dove Street
Newport Beach, California 92660

         Re:      Pooling and Servicing Agreement, dated as of June 1, 2000
                  among Impac Secured Assets Corp., Impac Funding Corporation,
                  and Bankers Trust Company of California, N.A., Mortgage
                  Pass-Through Certificates, Series 2000-2

Ladies and Gentlemen:

                  In accordance with Section 2.02 of the above-captioned Pooling
and Servicing Agreement, the undersigned, as Trustee, hereby certifies that as
to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or listed on the attachment hereto) it has reviewed
the Mortgage File and the Mortgage Loan Schedule and has determined that: (i)
all documents required to be included in the Mortgage File are in its
possession; (ii) such documents have been reviewed by it and appear regular on
their face and relate to such Mortgage Loan; and (iii) based on examination by
it, and only as to such documents, the information set forth in items (i), (ii),
(iii) and (iv) of the definition or description of "Mortgage Loan Schedule" is
correct.

                  The Trustee 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 Trustee
makes no representation that any documents specified in clause (vi) of Section
2.01 should be included in any Mortgage File. The Trustee makes no
representations as to and shall not be responsible to verify: (i) the validity,
legality, sufficiency, enforceability, due authorization, recordability or
genuineness of any of the documents contained in each Mortgage File of any of
the Mortgage Loans identified on the Mortgage Loan Schedule, (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan, or (iii) the existence of any assumption, modification, written assurance
or substitution agreement with respect to any Mortgage File if no such documents
appear in the Mortgage File delivered to the Trustee.

                                       C-1

<PAGE>

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Pooling and
Servicing Agreement.

                                          BANKERS TRUST COMPANY OF
                                          CALIFORNIA, N.A.

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

                                       C-2

<PAGE>

                                    EXHIBIT D

                       FORM OF TRUSTEE FINAL CERTIFICATION

                                        __________ ____, 2000

Impac Funding Corporation
1401 Dove Street
Newport Beach, California 92660

         Re:      Pooling and Servicing Agreement, dated as of June 1, 2000
                  among Impac Secured Assets Corp., Impac Funding Corporation,
                  and Bankers Trust Company of California, N.A., Mortgage
                  Pass-Through Certificates, Series 2000-2
                  -----------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.02 of the above-captioned Pooling
and Servicing Agreement, the undersigned, as Trustee, hereby certifies that as
to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or listed on the attachment hereto) it has received
the documents set forth in Section 2.01.

                  The Trustee 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 Trustee
makes no representation that any documents specified in clause (vi) of Section
2.01 should be included in any Mortgage File. The Trustee makes no
representations as to and shall not be responsible to verify: (i) the validity,
legality, sufficiency, enforceability, due authorization, recordability or
genuineness of any of the documents contained in each Mortgage File of any of
the Mortgage Loans identified on the Mortgage Loan Schedule, (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan or (iii) the existence of any assumption, modification, written assurance
or substitution agreement with respect to any Mortgage File if no such documents
appear in the Mortgage File delivered to the Trustee.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Pooling and
Servicing Agreement.

                                          BANKERS TRUST COMPANY OF
                                          CALIFORNIA, N.A.

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

                                       D-1

<PAGE>

                                    EXHIBIT E

                            FORM OF REMITTANCE REPORT

                             (Provided Upon Request)

<PAGE>

                                   EXHIBIT F-1

                               REQUEST FOR RELEASE
                                  (for Trustee)

Loan Information

              Name of Mortgagor:                -----------------------------

              Master Servicer
              Loan No.:                         -----------------------------
Trustee

              Name:                             -----------------------------
              Address:                          -----------------------------
                                                -----------------------------

              Trustee
              Mortgage File No.:                -----------------------------

Request for Requesting Documents (check one):

1.            Mortgage Loan Liquidated.
                       (The Master Servicer hereby certifies that all proceeds
                       of foreclosure, insurance or other liquidation have been
                       finally received and deposited into the Custodial Account
                       to the extent required pursuant to the Pooling and
                       Servicing Agreement.)

2.            Mortgage Loan in Foreclosure.

3.            Mortgage Loan Repurchased Pursuant to Section 9.01 of the Pooling
              and Servicing Agreement.

4.            Mortgage Loan Repurchased Pursuant to Article II of the Pooling
              and Servicing Agreement.
                       (The Master Servicer hereby certifies that the repurchase
                       price has been deposited into the Custodial Account
                       pursuant to the Pooling and Servicing Agreement.)

                                      F-1-1

<PAGE>

5.            Other (explain).

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

              The undersigned Master Servicer hereby acknowledges that it has
received from the Trustee for the Holders of Mortgage Pass-Through Certificates,
Series 2000-2, the documents referred to below (the "Documents"). All
capitalized terms not otherwise defined in this Request for Release shall have
the meanings given them in the Pooling and Servicing Agreement, dated as of June
1, 2000 (the "Pooling and Servicing Agreement"), among Impac Secured Assets
Corp., Impac Funding Corporation and the Trustee.

( )           Promissory Note dated _______________, 200__, in the original
              principal sum of $__________, made by _____________________,
              payable to, or endorsed to the order of, the Trustee.

( )           Mortgage recorded on _____________________ as instrument no.
              ____________________ in the County Recorder's Office of the
              County of _________________, State of __________________ in
              book/reel/docket _________________ of official records at
              page/image _____________.

( )           Deed of Trust recorded on ___________________ as instrument no.
              ________________ in the County Recorder's Office of the County of
              _________________, State of __________________ in book/reel/docket
              _________________ of official records at page/image _____________.

( )           Assignment of Mortgage or Deed of Trust to the Trustee, recorded
              on ___________________ as instrument no. _________ in the County
              Recorder's Office of the County of __________, State of
              _______________ in book/reel/docket ____________ of official
              records at page/image ____________.

( )           Other documents, including any amendments, assignments or other
              assumptions of the Mortgage Note or Mortgage.

              ( )      ---------------------------------------------

              ( )      ---------------------------------------------

              ( )      ---------------------------------------------

                                      F-1-2

<PAGE>

              ( )      ---------------------------------------------

              The undersigned Master Servicer hereby acknowledges and agrees as
follows:

                       (1) The Master Servicer shall hold and retain possession
              of the Documents in trust for the benefit of the Trustee, solely
              for the purposes provided in the Agreement.

                       (2) The Master Servicer shall not cause or knowingly
              permit the Documents to become subject to, or encumbered by, any
              claim, liens, security interest, charges, writs of attachment or
              other impositions nor shall the Master Servicer assert or seek to
              assert any claims or rights of setoff to or against the Documents
              or any proceeds thereof.

                       (3) The Master Servicer shall return each and every
              Document previously requested from the Mortgage File to the
              Custodian when the need therefor no longer exists, unless the
              Mortgage Loan relating to the Documents has been liquidated and
              the proceeds thereof have been remitted to the Custodial Account
              and except as expressly provided in the Agreement.

                       (4) The Documents and any proceeds thereof, including any
              proceeds of proceeds, coming into the possession or control of the
              Master Servicer shall at all times be earmarked for the account of
              the Trustee, and the Master Servicer shall keep the Documents and
              any proceeds separate and distinct from all other property in the
              Master Servicer's possession, custody or control.

                                            IMPAC FUNDING CORPORATION

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

Date: _____________________, 200__

                                      F-1-3

<PAGE>

                                   EXHIBIT F-2

                               REQUEST FOR RELEASE
                          [Mortgage Loans Paid in Full]

                     OFFICER'S CERTIFICATE AND TRUST RECEIPT
                       MORTGAGE PASS-THROUGH CERTIFICATES
                                  SERIES 2000-2

______________________________________ HEREBY CERTIFIES THAT HE/SHE IS AN
OFFICER OF THE MASTER SERVICER, HOLDING THE OFFICE SET FORTH BENEATH HIS/HER
SIGNATURE, AND HEREBY FURTHER CERTIFIES AS FOLLOWS:

WITH RESPECT TO THE MORTGAGE LOANS, AS THE TERM IS DEFINED IN THE POOLING AND
SERVICING AGREEMENT DESCRIBED IN THE ATTACHED SCHEDULE:

ALL PAYMENTS OF PRINCIPAL, PREMIUM (IF ANY), AND INTEREST HAVE BEEN
MADE.

LOAN NUMBER:  _______________          BORROWER'S NAME:_____________

COUNTY:_____________________

WE HEREBY CERTIFY THAT ALL AMOUNTS RECEIVED IN CONNECTION WITH SUCH PAYMENTS,
WHICH ARE REQUIRED TO BE DEPOSITED IN THE CUSTODIAL ACCOUNT PURSUANT TO SECTION
3.10 OF THE POOLING AND SERVICING AGREEMENT, HAVE BEEN OR WILL BE CREDITED.

___________       ______________________         DATED:______________

/ /      VICE PRESIDENT

/ /      ASSISTANT VICE PRESIDENT

                                      F-2-1

<PAGE>

                                   EXHIBIT G-1

                     FORM OF INVESTOR REPRESENTATION LETTER

                                            __________, 200___

Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2000-2

           Re:   Impac Secured Assets Corp.
                 Mortgage Pass-Through Certificates, Series 2000-2, Class ___

Ladies and Gentlemen:

         __________ (the "Purchaser") intends to purchase from __________ (the
"Seller") $__________ Initial Certificate Principal Balance of Mortgage
Pass-Through Certificates, Series 2000-1, Class ____ (the "Certificates"),
issued pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of June 1, 2000 among Impac Secured Assets
Corp., as company (the "Company"), Impac Funding Corporation, as master servicer
and Bankers Trust Company of California, N.A., as trustee (the "Trustee"). All
terms used herein and not otherwise defined shall have the meanings set forth in
the Pooling and Servicing Agreement. The Purchaser hereby certifies, represents
and warrants to, and covenants with, the Company and the Trustee that:

                           1. The Purchaser understands that (a) the
                  Certificates have not been and will not be registered or
                  qualified under the Securities Act of 1933, as amended (the
                  "Act") or any state securities law, (b) the Company is not
                  required to so register or qualify the Certificates, (c) the
                  Certificates may be resold only if registered and qualified
                  pursuant to the provisions of the Act or any state securities
                  law, or if an exemption from such registration and
                  qualification is available, (d) the Pooling and Servicing
                  Agreement contains restrictions regarding the transfer of the
                  Certificates and (e) the Certificates will bear a legend to
                  the foregoing effect.

                                      G-1-1

<PAGE>

                           2. The Purchaser is acquiring the Certificates for
                  its own account for investment only and not with a view to or
                  for sale in connection with any distribution thereof in any
                  manner that would violate the Act or any applicable state
                  securities laws.

                           3. The Purchaser is (a) a substantial, sophisticated
                  institutional investor having such knowledge and experience in
                  financial and business matters, and, in particular, in such
                  matters related to securities similar to the Certificates,
                  such that it is capable of evaluating the merits and risks of
                  investment in the Certificates, (b) able to bear the economic
                  risks of such an investment and (c) an "accredited investor"
                  within the meaning of Rule 501(a) promulgated pursuant to the
                  Act.

                           4. The Purchaser has been furnished with, and has had
                  an opportunity to review (a) [a copy of the Private Placement
                  Memorandum, dated June 29, 2000, relating to the Certificates
                  (b)] a copy of the Pooling and Servicing Agreement and [(b)]
                  [(c)] such other information concerning the Certificates, the
                  Mortgage Loans and the Company as has been requested by the
                  Purchaser from the Company or the Seller and is relevant to
                  the Purchaser's decision to purchase the Certificates. The
                  Purchaser has had any questions arising from such review
                  answered by the Company or the Seller to the satisfaction of
                  the Purchaser. [If the Purchaser did not purchase the
                  Certificates from the Seller in connection with the initial
                  distribution of the Certificates and was provided with a copy
                  of the Private Placement Memorandum (the "Memorandum")
                  relating to the original sale (the "Original Sale") of the
                  Certificates by the Company, the Purchaser acknowledges that
                  such Memorandum was provided to it by the Seller, that the
                  Memorandum was prepared by the Company solely for use in
                  connection with the Original Sale and the Company did not
                  participate in or facilitate in any way the purchase of the
                  Certificates by the Purchaser from the Seller, and the
                  Purchaser agrees that it will look solely to the Seller and
                  not to the Company with respect to any damage, liability,
                  claim or expense arising out of, resulting from or in
                  connection with (a) error or omission, or alleged error or
                  omission, contained in the Memorandum, or (b) any information,
                  development or event arising after the date of the
                  Memorandum.]

                           5. The Purchaser has not and will not nor has it
                  authorized or will it authorize any person to (a) offer,
                  pledge, sell, dispose of or otherwise transfer any
                  Certificate, any interest in any Certificate or any other
                  similar security to any person in any manner, (b) solicit any
                  offer to buy or to accept a pledge, disposition of other
                  transfer of any Certificate, any interest in any Certificate
                  or any other similar security from any person in any manner,
                  (c) otherwise approach or negotiate with respect to any
                  Certificate, any interest in any Certificate or any other
                  similar security with any person in any manner, (d) make any
                  general solicitation by means of general advertising or in any
                  other manner or (e) take any other action, that (as to any of
                  (a) through (e) above) would constitute a distribution of any
                  Certificate under the Act,

                                      G-1-2

<PAGE>

                  that would render the disposition of any Certificate a
                  violation of Section 5 of the Act or any state securities law,
                  or that would require registration or qualification pursuant
                  thereto. The Purchaser will not sell or otherwise transfer any
                  of the Certificates, except in compliance with the provisions
                  of the Pooling and Servicing Agreement.

                           [6.      The Purchaser

                                    (a) is not an employee benefit or other plan
                  subject to the prohibited transaction provisions of the
                  Employee Retirement Income Security Act of 1974, as amended
                  ("ERISA"), or Section 4975 of the Internal Revenue Code of
                  1986, as amended (the "Code") (a "Plan"), or any other person
                  (including an investment manager, a named fiduciary or a
                  trustee of any Plan) acting, directly or indirectly, on behalf
                  of or purchasing any Certificate with "plan assets" of any
                  Plan within the meaning of the Department of Labor ("DOL")
                  regulation at 29 C.F.R. ss.2510.3-101; or

                                    (b) is an insurance company, the source of
                  funds to be used by it to purchase the Certificates is an
                  "insurance company general account" (within the meaning of DOL
                  Prohibited Transaction Class Exemption ("PTCE") 95-60), and
                  the purchase is being made in reliance upon the availability
                  of the exemptive relief afforded under Sections I and III of
                  PTCE 95-60; or

                                    (c) has provided the Trustee, the Company
                  and the Master Servicer with an opinion of counsel acceptable
                  to and in form and substance satisfactory to the Trustee, the
                  Company and the Master Servicer to the effect that the
                  purchase of Certificates is permissible under applicable law,
                  will not constitute or result in any non-exempt prohibited
                  transaction under ERISA or Section 4975 of the Code and will
                  not subject the Trustee, the Company or the Master Servicer to
                  any obligation or liability (including obligations or
                  liabilities under ERISA or Section 4975 of the Code) in
                  addition to those undertaken in the Pooling and Servicing
                  Agreement.

                  In addition, the Purchaser hereby certifies, represents and
warrants to, and covenants with, the Company, the Trustee and the Master
Servicer that the Purchaser will not transfer such Certificates to any Plan or
person unless either such Plan or person meets the requirements set forth in
either (a), (b) or (c) above.

                                       Very truly yours,

                                       -------------------------------------
                                       (Purchaser)

                                       By:
                                          ----------------------------------

                                      G-1-3

<PAGE>

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

                                      G-1-4

<PAGE>

                                   EXHIBIT G-2

                    FORM OF TRANSFEROR REPRESENTATION LETTER

                                         __________, 200___

Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2000-2

            Re:    Impac Secured Assets Corp.
                   Mortgage Pass-Through Certificates, Series 2000-2, Class ___

Ladies and Gentlemen:

         In connection with the sale by __________ (the "Seller") to __________
(the "Purchaser") of $__________ Initial Certificate Principal Balance of
Mortgage Pass-Through Certificates, Series 2000-2, Class ____ (the
"Certificates"), issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of June 1, 2000 among Impac Secured
Assets Corp., as company (the "Company"), Impac Funding Corporation, as master
servicer and Bankers Trust Company of California, N.A., as trustee (the
"Trustee"). The Seller hereby certifies, represents and warrants to, and
covenants with, the Company and the Trustee that:

         Neither the Seller nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) has solicited any offer to buy or to accept a pledge, disposition or
other transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner, or
(e) has taken any other action, that (as to any of (a) through (e) above) would
constitute a distribution of the Certificates under the Securities Act of 1933
(the "Act"), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not act in any
manner set forth in the

                                      G-2-1

<PAGE>

foregoing sentence with respect to any Certificate. The Seller has not and will
not sell or otherwise transfer any of the Certificates, except in compliance
with the provisions of the Pooling and Servicing Agreement.

                                     Very truly yours,

                                     ----------------------------------
                                     (Seller)

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

                                      G-2-2

<PAGE>

                                   EXHIBIT G-3

                   FORM OF RULE 144A INVESTMENT REPRESENTATION

             Description of Rule 144A Securities, including numbers:

                           Impac Secured Assets Corp.
                       Mortgage Pass-Through Certificates
                        Series 2000-2, Class ___, No. ___

                  The undersigned seller, as registered holder (the
"Transferor"), intends to transfer the Rule 144A Securities described above to
the undersigned buyer (the "Buyer").

                  1. In connection with such transfer and in accordance with the
agreements pursuant to which the Rule 144A Securities were issued, the
Transferor hereby certifies the following facts: Neither the Transferor nor
anyone acting on its behalf has offered, transferred, pledged, sold or otherwise
disposed of the Rule 144A Securities, any interest in the Rule 144A Securities
or any other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Rule 144A Securities, or otherwise
approached or negotiated with respect to the Rule 144A Securities, any interest
in the Rule 144A Securities or any other similar security with, any person in
any manner, or made any general solicitation by means of general advertising or
in any other manner, or taken any other action, which would constitute a
distribution of the Rule 144A Securities under the Securities Act of 1933, as
amended (the "1933 Act"), or which would render the disposition of the Rule 144A
Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, and that the Transferor has not offered the Rule 144A
Securities to any person other than the Buyer or another "qualified
institutional buyer" as defined in Rule 144A under the 1933 Act.

                  2. The Buyer warrants and represents to, and covenants with,
the Transferor, the Trustee and the Master Servicer pursuant to Section 5.02 of
the Pooling and Servicing Agreement as follows:

                           a. The Buyer understands that the Rule 144A
         Securities have not been registered under the 1933 Act or the
         securities laws of any state.

                           b. The Buyer considers itself a substantial,
         sophisticated institutional investor having such knowledge and
         experience in financial and business matters that it is capable of
         evaluating the merits and risks of investment in the Rule 144A
         Securities.

                           c. The Buyer has been furnished with all information
         regarding the Rule 144A Securities that it has requested from the
         Transferor, the Trustee or the Master Servicer.

                                      G-3-1

<PAGE>

                           d. Neither the Buyer nor anyone acting on its behalf
         has offered, transferred, pledged, sold or otherwise disposed of the
         Rule 144A Securities, any interest in the Rule 144A Securities or any
         other similar security to, or solicited any offer to buy or accept a
         transfer, pledge or other disposition of the Rule 144A Securities, any
         interest in the Rule 144A Securities or any other similar security
         from, or otherwise approached or negotiated with respect to the Rule
         144A Securities, any interest in the Rule 144A Securities or any other
         similar security with, any person in any manner, or made any general
         solicitation by means of general advertising or in any other manner, or
         taken any other action, that would constitute a distribution of the
         Rule 144A Securities under the 1933 Act or that would render the
         disposition of the Rule 144A Securities a violation of Section 5 of the
         1933 Act or require registration pursuant thereto, nor will it act, nor
         has it authorized or will it authorize any person to act, in such
         manner with respect to the Rule 144A Securities.

                           e. The Buyer is a "qualified institutional buyer" as
         that term is defined in Rule 144A under the 1933 Act and has completed
         either of the forms of certification to that effect attached hereto as
         Annex 1 or Annex 2. The Buyer is aware that the sale to it is being
         made in reliance on Rule 144A. The Buyer is acquiring the Rule 144A
         Securities for its own account or the account of other qualified
         institutional buyers, understands that such Rule 144A Securities may be
         resold, pledged or transferred only (i) to 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 on Rule 144A, or (ii) pursuant to another exemption from
         registration under the 1933 Act.

                  3. The Buyer warrants and represents to, and covenants with,
the Transferor, the Servicer and the Company that either (1) the Buyer is not an
employee benefit plan within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") ("Plan"), or a plan
within the meaning of Section 4975(e)(1) of the Internal Revenue Code of 1986
(the "Code") (also a "Plan"), and the Buyer is not directly or indirectly
purchasing the Rule 144A Securities on behalf of, as investment manager of, as
named fiduciary of, as trustee of, or with assets of a Plan, or (2) the Buyer's
purchase of the Rule 144A Securities will not result in a prohibited transaction
under Section 406 of ERISA or Section 4975 of the Code.

                  4. This document may be executed in one or more counterparts
and by the different parties hereto on separate counterparts, each of which,
when so executed, shall be deemed to be an original; such counterparts,
together, shall constitute one and the same document.

                                      G-3-2

<PAGE>

                  IN WITNESS WHEREOF, each of the parties has executed this
document as of the date set forth below.

------------------------                   ------------------------------
Print Name of Transferor                   Print Name of Buyer

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

Taxpayer Identification:                             Taxpayer Identification:

No.                                        No.
  -----------------------                    -----------------------------

Date:                                      Date:
     --------------------                       --------------------------

                                      G-3-3

<PAGE>

                             ANNEX 1 TO EXHIBIT G-3

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

             [For Buyers Other Than Registered Investment Companies]

                            The undersigned hereby certifies as follows in
connection with the Rule 144A Investment Representation to which this
Certification is attached:

             1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.

             2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or invested
on a discretionary basis $______________________1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A) and (ii)
the Buyer satisfies the criteria in the category marked below.

     ___     CORPORATION, ETC. The Buyer is a corporation (other than a bank,
             savings and loan association or similar institution), Massachusetts
             or similar business trust, partnership, or charitable organization
             described in Section 501(c)(3) of the Internal Revenue Code.

     ___     BANK. The Buyer (a) is a national bank or banking institution
             organized under the laws of any State, territory or the District of
             Columbia, the business of which is substantially confined to
             banking and is supervised by the State or territorial banking
             commission or similar official or is a foreign bank or equivalent
             institution, and (b) has an audited net worth of at least
             $25,000,000 as demonstrated in its latest annual financial
             statement, a copy of which is attached hereto.

     ___     SAVINGS AND LOAN. The Buyer (a) is a savings and loan association,
             building and loan association, cooperative bank, homestead
             association or similar institution, which is supervised and
             examined by a State or Federal authority having supervision over
             any such institutions or is a foreign savings and loan association
             or equivalent institution and (b) has an audited net worth of at
             least $25,000,000 as demonstrated in its latest annual financial
             statements.

--------
1 Buyer must own and/or invest on a discretionary basis at least $100,000,000 in
securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $10,000,000 in securities.

                                      G-3-4

<PAGE>

     ___     BROKER-DEALER.  The Buyer is a dealer registered pursuant to
             Section 15 of the Securities Exchange Act of 1934.

     ___     INSURANCE COMPANY. The Buyer is an insurance company whose primary
             and predominant business activity is the writing of insurance or
             the reinsuring of risks underwritten by insurance companies and
             which is subject to supervision by the insurance commissioner or a
             similar official or agency of a State, territory or the District of
             Columbia.

     ___     STATE OR LOCAL PLAN.  The Buyer is a plan established and
             maintained by a State, its political subdivisions, or any agency
             or instrumentality of the State or its political subdivisions,
             for the benefit of its employees.

     ___     ERISA PLAN. The Buyer is an employee benefit plan within the
             meaning of Title I of the Employee Retirement Income Security Act
             of 1974.

     ___     INVESTMENT ADVISER.  The Buyer is an investment adviser registered
             under the Investment Advisers Act of 1940.

     ___     SBIC.  The Buyer is 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.

     ___     BUSINESS DEVELOPMENT COMPANY.  The Buyer is a business development
             company as defined in Section 202(a)(22) of the Investment Advisers
             Act of 1940.

     ___     TRUST FUND. The Buyer is a trust fund whose trustee is a bank or
             trust company and whose participants are exclusively (a) plans
             established and maintained by a State, its political subdivisions,
             or any agency or instrumentality of the State or its political
             subdivisions, for the benefit of its employees, or (b) employee
             benefit plans within the meaning of Title I of the Employee
             Retirement Income Security Act of 1974, but is not a trust fund
             that includes as participants individual retirement accounts or
             H.R. 10 plans.

             3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject to
a repurchase agreement and (vii) currency, interest rate and commodity swaps.

             4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries

                                      G-3-5

<PAGE>

of the Buyer, but only if such subsidiaries are consolidated with the Buyer in
its financial statements prepared in accordance with generally accepted
accounting principles and if the investments of such subsidiaries are managed
under the Buyer's direction. However, such securities were not included if the
Buyer is a majority-owned, consolidated subsidiary of another enterprise and the
Buyer is not itself a reporting company under the Securities Exchange Act of
1934.

             5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.

  ___        ___  Will the Buyer be purchasing the Rule 144A
  Yes        No            Securities only for the Buyer's own account?

             6. If the answer to the foregoing question is "no", the Buyer
agrees that, in connection with any purchase of securities sold to the Buyer for
the account of a third party (including any separate account) in reliance on
Rule 144A, the Buyer will only purchase for the account of a third party that at
the time is a "qualified institutional buyer" within the meaning of Rule 144A.
In addition, the Buyer agrees that the Buyer will not purchase securities for a
third party unless the Buyer has obtained a current representation letter from
such third party or taken other appropriate steps contemplated by Rule 144A to
conclude that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.

             7. The Buyer will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of Rule 144A Securities will
constitute a reaffirmation of this certification as of the date of such
purchase.

                                       ------------------------------
                                       Print Name of Buyer

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

                                       Date:
                                            --------------------------

                                      G-3-6

<PAGE>

                             ANNEX 2 TO EXHIBIT G-3

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

              [For Buyers That Are Registered Investment Companies]

             The undersigned hereby certifies as follows in connection with the
Rule 144A Investment Representation to which this Certification is attached:

              1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.

             2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and (ii)
as marked below, the Buyer alone, or the Buyer's Family of Investment Companies,
owned at least $100,000,000 in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year. For
purposes of determining the amount of securities owned by the Buyer or the
Buyer's Family of Investment Companies, the cost of such securities was used.

____              The Buyer owned $___________________ in securities (other than
                  the excluded securities referred to below) as of the end of
                  the Buyer's most recent fiscal year (such amount being
                  calculated in accordance with Rule 144A).

____              The Buyer is part of a Family of Investment Companies which
                  owned in the aggregate $______________ in securities (other
                  than the excluded securities referred to below) as of the
                  end of the Buyer's most recent fiscal year (such amount
                  being calculated in accordance with Rule 144A).

             3. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).

             4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) bank deposit notes and certificates
of deposit, (iii) loan participations, (iv) repurchase agreements, (v)
securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps.

                                      G-3-7

<PAGE>

             5. The Buyer is familiar with Rule 144A and understands that each
of the parties to which this certification is made are relying and will continue
to rely on the statements made herein because one or more sales to the Buyer
will be in reliance on Rule 144A. In addition, the Buyer will only purchase for
the Buyer's own account.

             6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.

                                       ------------------------------
                                       Print Name of Buyer

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

                                       Date:
                                            --------------------------

                                      G-3-8

<PAGE>

                                   EXHIBIT G-4

                         FORM OF TRANSFEROR CERTIFICATE

                                    ___________________, 200__

Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2000-2

             Re: Impac Secured Assets Corp.
                 Mortgage Pass-Through Certificates
                 Series 2000-2, Class __
                 ----------------------------------

Ladies and Gentlemen:

             This letter is delivered to you in connection with the sale by
___________________________ (the "Seller") to _____________________________ (the
"Purchaser") of a ___% Percentage Interest in the Mortgage Pass-Through
Certificates, Series 2000-2, Class R-I and Class R-II (the "Certificates"),
issued pursuant to Section 5.02 of the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of June 1, 2000, among Impac
Secured Assets Corp., as company (the "Company"), Impac Funding Corporation, as
master servicer and Bankers Trust Company of California, N.A., as trustee (the
"Trustee"). All terms used herein and not otherwise defined shall have the
meaning set forth in the Pooling and Servicing Agreement. The Seller hereby
certifies, represents and warrants to, and covenants with, the Company and the
Trustee that:

             1. No purpose of the Seller relating to the sale of the
Certificates by the Seller to the Purchaser is or will be to impede the
assessment or collection of any tax.

             2. The Seller understands that the Purchaser has delivered to the
Trustee and the Master Servicer a transfer affidavit and agreement in the form
attached to the Pooling and Servicing Agreement as Exhibit G-5. The Seller does
not know or believe that any representation contained therein is false.

             3. The Seller has at the time of the transfer conducted a
reasonable investigation of the financial condition of the Purchaser as
contemplated by Treasury Regulations Section 1.860E- 1(c)(4)(i) and, as a result
of that investigation, the Seller has determined that the Purchaser has
historically paid its debts as they have become due and has found no significant
evidence to indicate that the Purchaser will not continue to pay its debts as
they become due in the future. The Seller understands that the transfer of the
Certificates may not be respected for United States income tax purposes (and the
Seller may continue to be liable for United States income taxes associated
therewith) unless the Seller has conducted such an investigation.

             4. The Seller has no actual knowledge that the proposed Transferee
is a Disqualified Organization, an agent of a Disqualified Organization or a
Non-United States Person.

                                       Very truly yours,

                                       --------------------------------
                                       (Seller)

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

                                      G-4-1

<PAGE>

                                   EXHIBIT G-5

                    FORM OF TRANSFER AFFIDAVIT AND AGREEMENT

STATE OF                            )
                                    : ss.:
COUNTY OF                           )

             ___________________, being first duly sworn, deposes, represents
and warrants:

             1. That he/she is [Title of Officer] of [Name of Owner], a [savings
institution] [corporation] duly organized and existing under the laws of [the
State of ___________] [the United States], (the "Owner"), (record or beneficial
owner of the Class R-I and Class R-II Certificates on behalf of which he/she
makes this affidavit and agreement). This Class R and Class R-II Certificate was
issued pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement") dated as of June 1, 2000 among Impac Secured Assets Corp.,
as company, Impac Funding Corporation, as master servicer (the "Master
Servicer"), and Bankers Trust Company of California, N.A., as trustee (the
"Trustee").

             2. That the Owner (i) is not and will not be a "disqualified
organization" as of _______________[date of transfer] within the meaning of
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the
"Code"), (ii) will endeavor to remain other than a disqualified organization for
so long as it retains its ownership interest in the Class R Certificates, and
(iii) is acquiring the Class R Certificates for its own account or for the
account of another Owner from which it has received an affidavit and agreement
in substantially the same form as this affidavit and agreement. (For this
purpose, a "disqualified organization" means the United States, any state or
political subdivision thereof, any agency or instrumentality of any of the
foregoing (other than an instrumentality all of the activities of which are
subject to tax and, except for Freddie Mac, a majority of whose board of
directors is not selected by any such governmental entity) or any foreign
government, international organization or any agency or instrumentality of such
foreign government or organization, any rural electric or telephone cooperative,
or any organization (other than certain farmers' cooperatives) that is generally
exempt from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).

             3. That the Owner is aware (i) of the tax that would be imposed on
transfers of Class R Certificates to disqualified organizations under the Code,
that applies to all transfers of Class R Certificates after March 31, 1988; (ii)
that such tax would be on the transferor, or, if such transfer is through an
agent (which person includes a broker, nominee or middleman) for a disqualified
organization, on the agent; (iii) that the person otherwise liable for the tax
shall be relieved of liability for the tax if the transferee furnishes to such
person an affidavit that the transferee is not a

                                      G-5-1

<PAGE>

disqualified organization and, at the time of transfer, such person does not
have actual knowledge that the affidavit is false; and (iv) that the Class R
Certificates may be "noneconomic residual interests" within the meaning of
Treasury regulations promulgated pursuant to the Code and that the transferor of
a noneconomic residual interest will remain liable for any taxes due with
respect to the income on such residual interest, unless no significant purpose
of the transfer was to impede the assessment or collection of tax.

             4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding Class R Certificates if at any time during the taxable year of
the pass-through entity a disqualified organization is the record holder of an
interest in such entity. (For this purpose, a "pass through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives.)

             5. That the Owner is aware that the Trustee will not register the
transfer of any Class R Certificates unless the transferee, or the transferee's
agent, delivers to it an affidavit and agreement, among other things, in
substantially the same form as this affidavit and agreement. The Owner expressly
agrees that it will not consummate any such transfer if it knows or believes
that any of the representations contained in such affidavit and agreement are
false.

             6. That the Owner has reviewed the restrictions set forth on the
face of the Class R Certificates and the provisions of Section 5.02(f) of the
Pooling and Servicing Agreement under which the Class R Certificates were issued
(in particular, clause (iii)(A) and (iii)(B) of Section 5.02(f) which authorize
the Trustee to deliver payments to a person other than the Owner and negotiate a
mandatory sale by the Trustee in the event the Owner holds such Certificates in
violation of Section 5.02(f)). The Owner expressly agrees to be bound by and to
comply with such restrictions and provisions.

             7. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to constitute
a reasonable arrangement to ensure that the Class R Certificates will only be
owned, directly or indirectly, by an Owner that is not a disqualified
organization.

             8. The Owner's Taxpayer Identification Number is ______________.

             9. This affidavit and agreement relates only to the Class R
Certificates held by the Owner and not to any other holder of the Class R
Certificates. The Owner understands that the liabilities described herein relate
only to the Class R Certificates.

             10. That no purpose of the Owner relating to the transfer of any of
the Class R Certificates by the Owner is or will be to impede the assessment or
collection of any tax.

             11.  That the Owner has no present knowledge or expectation that it
will be unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding. In this

                                      G-5-2

<PAGE>

regard, the Owner hereby represents to and for the benefit of the person from
whom it acquired the Class R Certificate that the Owner intends to pay taxes
associated with holding such Class R Certificate as they become due, fully
understanding that it may incur tax liabilities in excess of any cash flows
generated by the Class R Certificate.

             12. That the Owner has no present knowledge or expectation that it
will become insolvent or subject to a bankruptcy proceeding for so long as any
of the Class R Certificates remain outstanding.

             13. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate or
trust whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States.

             14. (a) The Certificates (i) are not being acquired by, and will
not be transferred to, any employee benefit plan within the meaning of section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or other retirement arrangement, including individual retirement
accounts and annuities, Keogh plans and bank collective investment funds and
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that is subject to Section 406 of ERISA or Section
4975 of the Internal Revenue Code of 1986 (the "Code") (any of the foregoing, a
"Plan"), (ii) are not being acquired with "plan assets" of a Plan within the
meaning of the Department of Labor ("DOL") regulation, 29 C.F.R. ss. 2510.3-101
or otherwise under ERISA, and (iii) will not be transferred to any entity that
is deemed to be investing in plan assets within the meaning of the DOL
regulation, 29 C.F.R. ss. 2510.3-101 or otherwise under ERISA; or

             (b) The Owner will provide the Trustee, the Company and the Master
Servicer with an opinion of counsel acceptable to and in form and substance
satisfactory to the Trustee, the Company and the Master Servicer to the effect
that the purchase of Certificates is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code and will not subject the Trustee, the Company or the
Master Servicer to any obligation or liability (including obligations or
liabilities under ERISA or Section 4975 of the Code) in addition to those
undertaken in the Pooling and Servicing Agreement.

             In addition, the Owner hereby certifies, represents and warrants
to, and covenants with, the Company, the Trustee and the Master Servicer that
the Owner will not transfer such Certificates to any Plan or person unless
either such Plan or person meets the requirements set forth in either (a) or (b)
above.

             Capitalized terms used but not defined herein shall have the
meanings assigned in the Pooling and Servicing Agreement.

                                      G-5-3

<PAGE>

             IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, by its [Title of Officer] and its corporate seal to be
hereunto attached, attested by its [Assistant] Secretary, this ____ day of
____________, ____.

                                               [NAME OF OWNER]

                                      By:
                                          --------------------------------
                                               [Name of Officer]
                                               [Title of Officer]

[Corporate Seal]

ATTEST:

--------------------------------
[Assistant] Secretary

             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 Owner, and acknowledged to me
that such person executed the same as such person's free act and deed and the
free act and deed of the Owner.

             Subscribed and sworn before me this ___ day of _____________,
200__.

                                       --------------------------------
                                               NOTARY PUBLIC

                                    COUNTY OF ------------------------
                                    STATE OF ------------------------
                                    My Commission expires the ____ day
                                    of _______, 200__.

                                      G-5-4

<PAGE>

                                   EXHIBIT G-6

         FORM OF INVESTOR REPRESENTATION LETTER FOR INSURANCE COMPANIES

                                                  ________, 200__

Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2000-2

             Re: Impac Secured Assets Corp.
                 Mortgage Pass-Through Certificates, Series 2000-2, Class ___
                 ------------------------------------------------------------

Ladies and Gentlemen:

             _______________ (the "Purchaser") intends to purchase from
__________ (the "Seller") $____________ Initial Certificate Principal Balance of
Mortgage Pass-Through Certificates, Series 2000-2, Class __ (the "Certificate"),
issued pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of June 1, 2000, among Impac Secured Assets
Corp., as company (the "Company"), Impac Funding Corporation, as master servicer
and Bankers Trust Company of California, N.A., as trustee (the "Trustee"). All
terms used herein and not otherwise defined shall have the meanings set forth in
the Pooling and Servicing Agreement. The Purchaser hereby certifies, represents
and warrants to, and covenants with, the Company and the Trustee that:

                  1. The Certificates purchased pursuant hereto will not be
             transferred to any employee benefit plan or other retirement
             arrangement including individual retirement accounts and Keogh
             plans that is subject to Section 406 of the Employee Retirement
             Income Security Act of 1974, as amended ("ERISA") or Section 4975
             of the Internal Revenue Code of 1986 (the "Code") (any of the
             foregoing, a "Plan").

                                      G-6-1

<PAGE>

                  2. The Purchaser is an insurance company and the source of
             funds used to purchase the Certificates is an "insurance company
             general account" (as such term is defined in Prohibited Transaction
             Class Exemption 95-60 issued by the U.S. Department of Labor ("PTCE
             95-60") and there is no plan with respect to which the amount of
             such general account's reserves and liabilities for the contract(s)
             held by or on behalf of such Plan and all other plans maintained by
             the same employer (or affiliate thereof as defined in PTCE 95-60)
             or by the same employee organization, exceed 10% of the total of
             all reserves and liabilities of such general account (as such
             amounts are determined under PTCE 95-60) as of the date of
             acquisition of such Certificates.

                                    Very truly yours,

                                    ------------------------
                                    (Purchaser)

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

                                      G-6-2

<PAGE>

                                    EXHIBIT H

                             MORTGAGE LOAN SCHEDULE

                             (Provided Upon Request)

<PAGE>

                                    EXHIBIT I

                      SELLER REPRESENTATIONS AND WARRANTIES

Seller's Representations Assigned by Company to Trustee

             Representations and Warranties. Pursuant to the Mortgage Loan
Purchase Agreement, the Seller has made certain representations and warranties
to the Company. The Seller shall confirm such representations and warranties and
shall deliver a Seller's Warranty Certificate and an Officers' Certificate on
the Closing Date (i) reaffirming such representations and warranties and (ii)
specifically restating and reaffirming the following representations and
warranties as of such date. The following representations are, pursuant to the
Pooling and Servicing Agreement, assigned by the Company to the Trustee for the
benefit of the Certificateholders, together with the related repurchase rights
specified in the Mortgage Loan Purchase Agreement. Pursuant to the Mortgage Loan
Purchase Agreement, the Seller's Warranty Certificate and related Officer's
Certificate, the Seller affirms each such representation and warranty and
agrees, consents to and acknowledges the assignment thereof to the Trustee. All
capitalized terms herein shall have the meanings assigned in the Pooling and
Servicing Agreement and the Seller's Warranty Certificate, as applicable.

             The Seller hereby represents and warrants to the Company and
Trustee, as to each Mortgage Loan, that as of the Closing Date or as of such
other date specifically provided herein:

               (i) the information set forth in the Mortgage Loan Schedule
             hereto is true and correct in all material respects;

               (ii) the terms of the Mortgage Note and the Mortgage have not
             been impaired, waived, altered or modified in any respect, except
             by written instruments, (i) if required by law in the jurisdiction
             where the Mortgaged Property is located, or (ii) to protect the
             interests of the Trustee on behalf of the Certificateholders;

              (iii) the Mortgage File for each Mortgage Loan contains a true and
             complete copy of each of the documents contained in such Mortgage
             File, including all amendments, modifications and, if applicable,
             waivers and assumptions that have been executed in connection with
             such Mortgage Loan;

               (iv) immediately prior to the transfer to the Purchaser, the
             Seller was the sole owner of beneficial title and holder of each
             Mortgage and Mortgage Note relating to the Mortgage Loans and is
             conveying the same free and clear of any and all liens, claims,
             encumbrances, participation interests, equities, pledges, charges
             or security interests of any nature and the Seller has full right
             and authority to sell or assign the same pursuant to this
             Agreement;

                                       I-1

<PAGE>

                (v) each Mortgage is a valid and enforceable first lien on the
             property securing the related Mortgage Note and each Mortgaged
             Property is owned by the Mortgagor in fee simple (except with
             respect to common areas in the case of condominiums, PUDs and de
             minimis PUDs) or by leasehold for a term longer than the term of
             the related Mortgage, subject only to (i) the lien of current real
             property taxes and assessments, (ii) covenants, conditions and
             restrictions, rights of way, easements and other matters of public
             record as of the date of recording of such Mortgage, such
             exceptions being acceptable to mortgage lending institutions
             generally or specifically reflected in the appraisal obtained in
             connection with the origination of the related Mortgage Loan or
             referred to in the lender's title insurance policy delivered to the
             originator of the related Mortgage Loan and (iii) other matters to
             which like properties are commonly subject which do not materially
             interfere with the benefits of the security intended to be provided
             by such Mortgage;

               (vi) no payment of principal of or interest on or in respect of
             any Mortgage Loan is 30 or more days past due;

              (vii) there is no mechanics' lien or claim for work, labor or
             material affecting the premises subject to any Mortgage which is or
             may be a lien prior to, or equal with, the lien of such Mortgage
             except those which are insured against by the title insurance
             policy referred to in (xii) below;

             (viii) as of the Cut-off Date, (i) no Mortgage Loan had been 30
             days or more delinquent more than once during the preceding 12
             months, (ii) no Mortgage Loan had been delinquent for 60 days or
             more during the preceding 12 months and (iii) to Seller's
             knowledge, there was no delinquent tax or assessment lien against
             the property subject to any Mortgage, except where such lien was
             being contested in good faith and a stay had been granted against
             levying on the property;

               (ix) there is no valid offset, defense or counterclaim to any
             Mortgage Note or Mortgage, including the obligation of the
             Mortgagor to pay the unpaid principal and interest on such Mortgage
             Note;

                (x) to Seller's knowledge, except to the extent insurance is in
             place which will cover such damage, the physical property subject
             to any Mortgage is free of material damage and is in good repair
             and there is no proceeding pending or threatened for the total or
             partial condemnation of any Mortgaged Property;

               (xi) to the best of Seller's knowledge, each Mortgage Loan at the
             time it was made complied in all material respects with applicable
             state and federal laws, including, without limitation, usury, equal
             credit opportunity and disclosure laws; and each Mortgage Loan is
             being serviced in all material respects in accordance with
             applicable

                                       I-2

<PAGE>

             state and federal laws, including, without limitation, usury,
             equal credit opportunity and disclosure laws;

              (xii) a lender's title insurance policy (on an ALTA or CLTA form)
             or binder, or other assurance of title customary in the relevant
             jurisdiction therefor in a form acceptable to Fannie Mae or Freddie
             Mac, was issued on the date that each Mortgage Loan was created by
             a title insurance company which, to the best of Seller's knowledge,
             was qualified to do business in the jurisdiction where the related
             Mortgaged Property is located, insuring the Seller and its
             successors and assigns that the Mortgage is a first priority lien
             on the related Mortgaged Property in the original principal amount
             of the Mortgage Loan. Seller is the sole insured under such
             lender's title insurance policy, and such policy, binder or
             assurance is valid and remains in full force and effect, and each
             such policy, binder or assurance shall contain all applicable
             endorsements including a negative amortization endorsement, if
             applicable;

             (xiii) in the event the Mortgage constitutes a deed of trust,
             either a trustee, duly qualified under applicable law to serve as
             such, has been properly designated and currently so serves and is
             named in the Mortgage or if no duly qualified trustee has been
             properly designated and so serves, the Mortgage contains
             satisfactory provisions for the appointment of such trustee by the
             holder of the Mortgage at no cost or expense to such holder, and no
             fees or expenses are or will become payable by Purchaser to the
             trustee under the deed of trust, except in connection with a
             trustee's sale after default by the mortgagor;

              (xiv) (i) the Loan-to-Value Ratio of each Mortgage Loan at
             origination was not more than 97.00%; (ii) except with respect to
             approximately 18.86% of the Mortgage Loans (by aggregate
             outstanding principal balance as of the Cut-off Date), each
             Mortgage Loan with a Loan-to-Value Ratio at origination in excess
             of 80.00% will be insured by either (i) a Primary Insurance Policy
             issued by a private mortgage insurer or (ii) by a Radian PMI Pool
             Policy. Each Primary Insurance Policy will insure against default
             under each insured Mortgage Note as follows: (i) for which the
             outstanding principal balance at origination of such Mortgage Loan
             is greater than or equal to 80.01% and up to and including 90.00%
             of the lesser of the Appraised Value and the sales price, such
             Mortgage Loan is covered by a Primary Insurance Policy in an amount
             equal to at least 20.00% of the Allowable Claim and (ii) for which
             the outstanding principal balance at origination of such Mortgage
             Loan exceeded 90.00% of the lesser of the Appraised Value and the
             sales price, such Mortgage Loan is covered by a Primary Insurance
             Policy in an amount equal to at least 25.00% of the Allowable
             Claim. One of the Radian PMI Pool Policies will insure against
             default under each insured Mortgage Note related to a covered
             Mortgage Loan originated pursuant to the Seller's "Progressive
             Express(TM)" program as follows: (A) for which the outstanding
             principal balance at origination of such Mortgage Loan is at least
             80.01% and up to and including 89.99% of the lesser of the
             Appraised Value and the sales price, such Mortgage Loan is covered
             by such Radian PMI Pool

                                       I-3

<PAGE>

             Policy in an amount equal to at least 22.00% of the Allowable Claim
             and (B) for which the outstanding principal balance at origination
             of such Mortgage Loan equaled or exceeded 90.00% of the lesser of
             the Appraised Value and the sales price, such Mortgage Loan is
             covered by such Radian PMI Pool Policy in an amount equal to at
             least 30.00% of the Allowable Claim. The other Radian PMI Pool
             Policy will insure against default under each insured Mortgage Note
             related to a covered Mortgage Loan originated pursuant to the
             Seller's "Express Priority Refi(TM)" program as follows: (A) for
             which the outstanding principal balance at origination of such
             Mortgage Loan is at least 80.01% and up to and including 90.00% of
             the lesser of the Appraised Value and the sales price, such
             Mortgage Loan is covered by such Radian PMI Pool Policy in an
             amount equal to at least 25.00% of the Allowable Claim and (B) for
             which the outstanding principal balance at origination of such
             Mortgage Loan exceeded 90.00% of the lesser of the Appraised Value
             and the sales price, such Mortgage Loan is covered by such Radian
             PMI Pool Policy in an amount equal to at least 30.00% of the
             Allowable Claim. The "Appraised Value" is the appraised value of
             the related Mortgaged Property at the time of origination of such
             Mortgage Loan. The "Allowable Claim" for any Mortgage Loan covered
             by a Primary Insurance Policy or a Radian PMI Pool Policy is the
             current principal balance of such Mortgage Loan plus accrued
             interest and allowable expenses at the time of the claim;

               (xv) at the time of origination, each Mortgaged Property was the
             subject of an appraisal which conforms to the Seller's underwriting
             requirements, and a complete copy of such appraisal is contained in
             the Mortgage File;

              (xvi) on the basis of a representation by the borrower at the time
             of origination of the Mortgage Loans, at least 95.90% of the
             Mortgage Loans (by aggregate principal balance) will be secured by
             Mortgages on owner-occupied primary residence properties;

             (xvii) neither the Seller nor any servicer of the related Mortgage
             Loans has advanced funds or knowingly received any advance of funds
             by a party other than the Mortgagor, directly or indirectly, for
             the payment of any amount required by the Mortgage, except for (i)
             interest accruing from the date of the related Mortgage Note or
             date of disbursement of the Mortgage Loan proceeds, whichever is
             later, to the date which precedes by 30 days the first Due Date
             under the related Mortgage Note, and (ii) customary advances for
             insurance and taxes;

             (xviii) each Mortgage Note, the related Mortgage and other
             agreements executed in connection therewith are genuine, and each
             is the legal, valid and binding obligation of the maker thereof,
             enforceable in accordance with its terms except as such enforcement
             may be limited by bankruptcy, insolvency, reorganization or other
             similar laws affecting the enforcement of creditors' rights
             generally and by general equity principles (regardless of whether
             such enforcement is considered in a proceeding in equity or at
             law); and, to the best of Seller's knowledge, all parties to each
             Mortgage Note and the Mortgage had

                                       I-4

<PAGE>

             legal capacity to execute the Mortgage Note and the Mortgage and
             each Mortgage Note and Mortgage has been duly and properly executed
             by the Mortgagor;

              (xix) to the extent required under applicable law, each conduit
             seller and subsequent mortgagee or servicer of the Mortgage Loans
             was authorized to transact and do business in the jurisdiction in
             which the related Mortgaged Property is located at all times when
             it held or serviced the Mortgage Loan; and any obligations of the
             holder of the related Mortgage Note, Mortgage and other loan
             documents have been complied with in all material respects;
             servicing of each Mortgage Loan has been in accordance with the
             servicing standard set forth in Section 3.01 of the Pooling and
             Servicing Agreement and the terms of the Mortgage Notes, the
             Mortgage and other loan documents, whether the creation of such
             Mortgage Loan and servicing was done by the Seller, its affiliates,
             or any third party which created the Mortgage Loan on behalf of, or
             sold the Mortgage Loan to, any of them, or any servicing agent of
             any of the foregoing;

               (xx) the related Mortgage Note and Mortgage contain customary and
             enforceable provisions such as to render the rights and remedies of
             the holder adequate for the realization against the Mortgaged
             Property of the benefits of the security, including realization by
             judicial, or, if applicable, non-judicial foreclosure, and, to
             Seller's knowledge, there is no homestead or other exemption
             available to the Mortgagor which would interfere with such right to
             foreclosure;

              (xxi) except with respect to holdbacks required by certain
             Mortgage Loans which holdbacks create a fund for (i) the repair of
             Mortgaged Property due to damage from adverse weather conditions,
             or (ii) the completion of new construction, or both, the proceeds
             of the Mortgage Loans have been fully disbursed, there is no
             requirement for future advances thereunder and any and all
             requirements as to completion of any on-site or off-site
             improvements and as to disbursements of any escrow funds therefor
             have been complied with; and all costs, fees and expenses incurred
             in making, closing or recording the Mortgage Loan have been paid,
             except recording fees with respect to Mortgages not recorded as of
             the Closing Date;

             (xxii) as of the Closing Date, the improvements on each Mortgaged
             Property securing a Mortgage Loan is insured (by an insurer which
             is acceptable to the Seller) against loss by fire and such hazards
             as are covered under a standard extended coverage endorsement in
             the locale in which the Mortgaged Property is located, in an amount
             which is not less than the lesser of the maximum insurable value of
             the improvements securing such Mortgage Loan or the outstanding
             principal balance of the Mortgage Loan, but in no event in an
             amount less than an amount that is required to prevent the
             Mortgagor from being deemed to be a co-insurer thereunder; if the
             improvement on the Mortgaged Property is a condominium unit, it is
             included under the coverage afforded by a blanket policy for the
             condominium project; if upon origination of the related Mortgage
             Loan, the improvements on the Mortgaged Property were in an area
             identified as a

                                       I-5

<PAGE>

             federally designated flood area, a flood insurance policy is in
             effect in an amount representing coverage not less than the least
             of (i) the outstanding principal balance of the Mortgage Loan, (ii)
             the restorable cost of improvements located on such Mortgaged
             Property or (iii) the maximum coverage available under federal law;
             and each Mortgage obligates the Mortgagor thereunder to maintain
             the insurance referred to above at the Mortgagor's cost and
             expense;

             (xxiii) there is no monetary default existing under any Mortgage or
             the related Mortgage Note and there is no material event which,
             with the passage of time or with notice and the expiration of any
             grace or cure period, would constitute a default, breach or event
             of acceleration; and neither the Seller, any of its affiliates nor
             any servicer of any related Mortgage Loan has taken any action to
             waive any default, breach or event of acceleration; no foreclosure
             action is threatened or has been commenced with respect to the
             Mortgage Loan;

               (xxiv) to Seller's knowledge, no Mortgagor, at the time of
             origination of the applicable Mortgage, was a debtor in any state
             or federal bankruptcy or insolvency proceeding;

              (xxv) Each Mortgage Loan was originated or funded by (a) a savings
             and loan association, savings bank, commercial bank, credit union,
             insurance company or similar institution which is supervised and
             examined by a federal or state authority (or originated by (i) a
             subsidiary of any of the foregoing institutions which subsidiary is
             actually supervised and examined by applicable regulatory
             authorities or (ii) a mortgage loan correspondent of any of the
             foregoing and that was originated pursuant to the criteria
             established by any of the foregoing) or (b) a mortgagee approved by
             the Secretary of Housing and Urban Development pursuant to sections
             203 and 211 of the National Housing Act, as amended;

             (xxvi) all inspections, licenses and certificates required to be
             made or issued with respect to all occupied portions of the
             Mortgaged Property and, with respect to the use and occupancy of
             the same, including, but not limited to, certificates of occupancy
             and fire underwriting certificates, have been made or obtained from
             the appropriate authorities;

               (xxvii) to Seller's knowledge, the Mortgaged Property and all
             improvements thereon comply with all requirements of any
             applicable zoning and subdivision laws and ordinances;

             (xxviii) no instrument of release or waiver has been executed in
             connection with the Mortgage Loans, and no Mortgagor has been
             released, in whole or in part, except in connection with an
             assumption agreement which has been approved by the primary
             mortgage guaranty insurer, if any, and which has been delivered to
             the Trustee;

                                       I-6

<PAGE>

             (xxix) except with respect to 1.62% of the Mortgage Loans (by
             aggregate principal balance) which provide for a balloon payment,
             each Mortgage Note contains provisions providing for its full
             amortization by the end of its original term and is payable on the
             first day of each month in monthly installments of principal and
             interest, with interest payable in arrears, over an original term
             of not more than 30 years;

              (xxx) no Mortgage Loan was originated based on an appraisal of the
             related Mortgaged Property made prior to completion of construction
             of the improvements thereon unless a certificate of completion was
             obtained prior to closing of the Mortgage Loan;

             (xxxi) each of the Mortgaged Properties consists of a single parcel
             of real property with a detached single-family residence erected
             thereon, or a two- to four-family dwelling, or an individual
             condominium unit in a condominium project or a townhouse, a
             condohotel, an individual unit in a PUD or an individual unit in a
             de minimis PUD;

             (xxxii) no Mortgaged Property consists of a single parcel of real
             property with a cooperative housing development erected thereon.
             Any condominium unit, PUD or de minimis PUD conforms with
             Progressive Loan Series Program requirements regarding such
             dwellings or is covered by a waiver confirming that such
             condominium unit, PUD or de minimis PUD is acceptable to the
             Seller;

             (xxxiii) as of the Cut-off Date, the Mortgage Rate of each Mortgage
             Loan was not less than 8.500% per annum and not more than 13.500%
             per annum, and the weighted average Mortgage Rate of the Mortgage
             Loans was approximately 10.236% per annum;

             (xxxiv) measured by principal balance, no more than 6.54% of the
             Mortgage Loans are secured by an individual unit in a condominium
             project or hi-rise, and at least 88.53% of the Mortgage Loans are
             secured by real property with a detached single-family residence
             erected thereon, including de minimis PUDs;

                  (xxxv) as of the Cut-off Date, the remaining term to scheduled
             maturity of each Mortgage Loan is not less than 174 months and not
             more than 360 months;

               (xxxvi) as of the Cut-off Date, no more than 10.11% (by aggregate
             principal balance) of the Mortgage Loans are cash-out refinances;

                  (xxxvii) as of the Cut-off Date, no more than 5.81% (by
             aggregate principal balance) of the Mortgage Loans are rate and
             term refinances;

               (xxxviii) as of the Cut-off Date, no fewer than 83.81% (by
             aggregate principal balance) of the Mortgage Loans are purchase
             money loans;

                                       I-7

<PAGE>

                  (xxxix) as of the Cut-off Date, no more than 27.60% and 18.11%
             of the Mortgage Loans (by aggregate principal balance) are secured
             by properties located in the states of California and Florida,
             respectively;

                  (xl) as of the Cut-off Date, the principal balances of the
             Mortgage Loans range from approximately $31,050 to approximately
             $649,950, and the average unpaid principal balance is $146,621.

                  (xli) with respect to Mortgaged Properties at the time of
             origination of the related Mortgage Loans, measured by aggregate
             unpaid principal balance as of the Cut-off Date, at least 95.90% of
             the Mortgaged Properties are owner occupied primary residences, no
             more than 1.33% of the Mortgaged Properties are second homes and no
             more than 2.77% of the Mortgaged Properties are investor owned
             properties;

                  (xlii) each Mortgage Loan constitutes a "qualified mortgage"
             under Section 860G(a)(3)(A) of the Code and Treasury Regulation
             Section 1.860G-2(a)(1);

                  (xliii) with respect to each Mortgage Loan directly originated
             by the Seller (and not through a third-party broker or other third
             party) as of the Closing Date, to the best of Seller's knowledge,
             there has been no fraud, misrepresentation or dishonesty with
             respect to the origination of any Mortgage Loan; and

                  (xliv) No selection procedure reasonably believed by the
             Seller to be adverse to the interests of the Certificateholders was
             utilized in selecting the Mortgage Loans.

                                       I-8

<PAGE>

                                    EXHIBIT J

      FORM OF NOTICE UNDER SECTION 3.25 OF POOLING AND SERVICING AGREEMENT

     June 29, 2000

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

                 Re:    Impac Secured Assets Corp.
                        Mortgage Pass-Through Certificates
                        Series 2000-2
                        --------------------------------

                 Pursuant to Section 3.25 of the Pooling and Servicing
Agreement, dated as of June 1, 2000, relating to the Certificates referenced
above, the undersigned does hereby notify you that:

                 (a) The prepayment assumption used in pricing the Certificates
with respect to the Mortgage Loans in Series 2000-2 consisted of a Prepayment
Assumption (the "Prepayment Assumption") of 100% per annum.

                 (b) With respect to each Class of Certificates comprising the
captioned series, set forth below is (i), the first price, as a percentage of
the Certificate Principal Balance or Notional Amount of each Class of
Certificates, at which 10% of the aggregate Certificate Principal Balance or
Notional Amount of each such Class of Certificates was first sold at a single
price, if applicable, or (ii) if more than 10% of a Class of Certificates have
been sold but no single price is paid for at least 10% of the aggregate
Certificate Principal Balance or Notional Amount of such Class of Certificates,
then the weighted average price at which the Certificates of such Class were
sold expressed as a percentage of the Certificate Principal Balance or Notional
Amount of such Class of Certificates, (iii) if less than 10% of the aggregate
Certificate Principal Balance or Notional Amount of a Class of Certificates has
been sold, the purchase price for each such Class of Certificates paid by Credit
Suisse First Boston Corporation (the "Underwriter") expressed as a percentage of
the Certificate Principal Balance or Notional Amount of such Class of
Certificates calculated by: (1) estimating the fair market value of each such
Class of Certificates as of June 29, 2000; (2) adding such estimated fair market
value to the aggregate purchase prices of each Class of Certificates described
in clause (i) or (ii) above; (3) dividing each of the fair market values
determined in clause (1) by the sum obtained in clause (2); (4) multiplying the
quotient obtained for each Class of Certificates in clause (3) by the purchase
price paid by the Underwriter for all the Certificates purchased by it; and (5)
for each Class of Certificates, dividing the product obtained from such Class of
Certificates in clause (4) by the initial Certificate Principal Balance or
Notional Amount of such Class of Certificates or (iv) the fair market value (but
not less than zero) as of the Closing Date of

                                       J-1

<PAGE>

each Certificate of each Class of Certificates retained by the Company or an
affiliate corporation, or delivered to the seller:

Series 2000-2
Class A-1:       ____________________
Class A-2:       ____________________
Class A-3:       ____________________
Class A-4:       ____________________
Class A-5:       ____________________
Class A-6:       ____________________
Class A-7:       ____________________
Class A-8:       ____________________
Class R-I:       ____________________
Class R-II:      ____________________
Class M-1:       ____________________
Class M-2:       ____________________
Class M-3:       ____________________
Class B-1:       ____________________
Class B-2:       ____________________
Class B-3:       ____________________

                 The prices and values set forth above do not include accrued
interest with respect to periods before the closing.

                                      IMPAC SECURED ASSETS CORP.

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

                                       J-2

<PAGE>

                                    EXHIBIT K

                              IMPAC SERVICING GUIDE

                             (Provided Upon Request)

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