EXHIBIT 10.7
 
EXECUTION COPY

 

 

 
MASTER POOL PURCHASE AGREEMENT
 

 
dated as of August 29, 2002
 
Amended and Restated as of November 14, 2005
 
by and between
 

 
SIERRA DEPOSIT COMPANY, LLC
 
as Depositor
 

 
and
 

 
CENDANT TIMESHARE CONDUIT RECEIVABLES FUNDING, LLC
 
as Issuer
 

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TABLE OF CONTENTS

       Page    
Section 1
 
Definitions
 
1
 
   
Section 2.
 
Purchase and Sale
 
6
 
     
(a) Agreement
 
6
 
     
(b) Purchase of Series 2002-1 Additional Pool Loans
 
7
 
     
(c) [Reserved]
 
9
 
     
(d) No Assumption
 
9
 
     
(e) No Recourse
 
9
 
     
(f) True Sales
 
9
 
     
(g) Servicing of Pool Assets
 
9
 
     
(h) Financing Statements
 
9
 
     
(i) Recharacterization
 
10
 
     
(j) Transfer of Pool Loans
 
10
 
   
Section 3.
 
Pool Loan Purchase Price
 
10
 
   
Section 4.
 
Payment of Purchase Price
 
10
 
     
(a) Closing Dates
 
10
 
     
(b) Manner of Payment of Additional Pool Loan Purchase Price
 
11
 
     
(c) Payment of Adjustments
 
11
 
     
(d) Payment
 
11
 
   
Section 5.
 
Conditions Precedent to Sale of Pool Loans
 
11
 
   
Section 6.
 
Representations and Warranties of the Depositor
 
11
 
   
Section 7.
 
Affirmative Covenants of the Depositor
 
13
 
     
(a) Separate Legal Entity
 
13
 
     
(b) Compliance with Laws, Etc.
 
14
 
     
(c) Preservation of Corporate Existence
 
14
 
     
(d) Keeping of Records and Books of Account
 
14
 
     
(e) Payment of Taxes
 
15
 
     
(f) Turnover of Collections
 
15
 
   
Section 8.
 
Negative Covenants of the Depositor
 
15
 
     
(a) Sales, Liens, Etc
 
15
 
     
(b) No Mergers, Etc
 
15
 
 

 
-i-

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TABLE OF CONTENTS
(continued)
 

     
 Page
     
(c) Change in Name
 
15
 
     
(d) Indebtedness
 
15
 
     
(e) Amendments, Etc
 
15
 
     
(f) Capital Expenditures
 
16
 
     
(g) Limitation on Business
 
16
 
     
(h) Capital Contributions
 
16
 
   
Section 9.
 
Repurchases or Substitutions of Pool Loans for Breach of Representations and
Warranties
 
16
 
     
(a) Repurchase or Substitution Obligation
 
16
 
     
(b) [Reserved.]
 
       
(b) Repurchases and Substitutions
 
17
 
     
(c) Delivery Requirements
 
17
 
   
Section 10.
 
Representations and Warranties of the Issuer
 
18
 
   
Section 11.
 
Affirmative Covenants of the Issuer
 
19
 
   
Section 12.
 
Depositor Repurchases
 
20
 
     
(a) Optional Substitution of Schedule 1-A Pool Loans
 
20
 
     
(c) Substitutions
 
21
 
     
(d) Condition Precedent to Substitution of Pool Loans
 
21
 
     
(e) Repurchases of Series 2002-1 Pool Loans that Become Defaulted Loans
 
21
 
   
Section 13.
 
[Reserved.]
 
21
 
   
Section 14.
 
Indemnities by the Depositor
 
21
 
   
Section 15.
 
Miscellaneous
 
22
 
     
(a) Amendment
 
22
 
     
(b) Assignment
 
22
 
     
(c) Counterparts
 
22
 
     
(d) GOVERNING LAW
 
22
 
     
(e) Notices
 
23
 
     
(f) Severability of Provisions
 
23
 
     
(g) Successors and Assigns
 
23
 
     
(h) No Proceedings
 
23
 
 

 
-ii-

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TABLE OF CONTENTS
(continued)
 
 

       Page      
(i) Recourse to the Depositor
 
23
 
     
(j) Recourse to the Issuer
 
24
 
     
(k) Confidentiality
 
24
 
 

 
Schedule 1
 
Pool Loan Schedule
 
1-1
 
   
Exhibit A
 
Form of Assignment of Additional Pool Loans
 
A-1
 
 

-iii-

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MASTER POOL PURCHASE AGREEMENT
 
THIS MASTER POOL PURCHASE AGREEMENT (the “Agreement”) dated as of August
29, 2002 as amended and restated as of November 14, 2005 is made by and between
SIERRA DEPOSIT COMPANY, LLC, a Delaware limited liability company, as depositor
(the “Depositor”) and CENDANT TIMESHARE CONDUIT RECEIVABLES FUNDING, LLC, a
Delaware limited liability company formerly known as Sierra Receivables Funding
Company, LLC, as issuer (the “Issuer”). This Agreement, as amended and restated,
contains provisions previously contained in the Series 2002-1 Supplement dated
as of August 29, 2002 relating to the Cendant Timeshare Conduit Receivables
Funding, LLC Loan-Backed Variable Funding Notes, Series 2002-1. By execution and
delivery of this Agreement, as amended and restated, the Series 2002-1
Supplement is incorporated into this Agreement and the Series 2002-1 PPA
Supplement as a separate document shall cease to exist.
 

 
RECITALS
 
WHEREAS, the Depositor has purchased certain Pool Loans and related Pool Assets
(including an interest in the Timeshare Properties underlying such Pool Loans)
from CTRG-CF and Trendwest (collectively with other sellers of Pool Loans that
may be named in the future, the “Sellers”) pursuant to the applicable Purchase
Agreements and related PA Supplements and from time to time hereafter will
purchase from the Sellers additional Pool Loans and related Pool Assets; and
 
WHEREAS, the Depositor wishes to sell to the Issuer the Pool Loans and related
Pool Assets that the Depositor now owns and the Pool Loans and related Pool
Assets that the Depositor from time to time hereafter will own, and the Issuer
is willing to purchase such Pool Loans and related Pool Assets from the
Depositor from time to time on the terms and subject to the conditions contained
in this Agreement;
 
WHEREAS, the Issuer intends to grant security interests in the Pool Loans and
related Pool Assets that it purchases from the Depositor to the Collateral Agent
on behalf of the Trustee and the holders of Notes issued pursuant to a Master
Indenture and Servicing Agreement of even date herewith, together with the
Indenture Supplement thereto (collectively, the “Indenture and Servicing
Agreement”), each by and between the Issuer, CTRG-CF as Master Servicer, the
Trustee and the Collateral Agent.
 
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:
 
Section 1.  Definitions.
 
All terms used but not otherwise specifically defined herein shall have the
meanings ascribed to them in the Purchase Agreements. Whenever used in this
Agreement, the following words and phrases shall have the following meanings:
 
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“Addition Cut-Off Date” shall mean any Addition Cut-Off Date under the
applicable Purchase Agreement.
 
“Addition Date” shall mean any Addition Date under the applicable Purchase
Agreement.
 
“Additional Issuer” shall mean an entity which is a subsidiary of the Depositor,
other than the Issuer, which purchases Loans from the Depositor with the
proceeds of a Series of Notes issued by such entity and pledges such Loans to
secure such Series of Notes.
 
“Additional Pool Loan” shall mean a Loan (including Trendwest Timeshare Upgrades
purchased by the Depositor from an Additional Issuer) constituting one of the
Pool Loans purchased from the Depositor on an Addition Date and listed on
Schedule 1 to the related Assignment.
 
“Additional Pool Loan Purchase Price” shall have the meaning set forth in
Section 3.
 
“Agreement” shall have the meaning set forth in the preamble.
 
“Assignment” shall have the meaning set forth in Section 2(b).
 
“Cendant” shall mean Cendant Corporation or any successor thereof.
 
“Closing Date” shall mean August 30, 2002.
 
“CTRG-CF” shall mean Cendant Timeshare Resort Group - Consumer Finance, Inc., a
Delaware corporation formerly known as Fairfield Acceptance Corporation -
Nevada, domiciled in Nevada and a wholly-owned indirect Subsidiary of FRI.
 
“Cut-Off Date” shall mean August 27, 2002.
 
“Cut-Off Date Pool Principal Balance” shall have the meaning set forth in
Section 3.
 
“Deal Agent” shall mean Bank of America, N.A. as Deal Agent under the note
purchase agreement, dated as of August 29, 2002 relating to the Series 2002-1
Notes, among the Issuer, CTRG-CF, the Purchaser, the Conduits and Alternate
Investors named therein and the Class Agents named therein.
 
“Defective Loan” shall mean any Defective Loan under the applicable Purchase
Agreement.
 
“Depositor” shall have the meaning set forth in the preamble.
 
“Depositor Indemnified Amounts” shall have the meaning set forth in Section 14.
 
“Depositor Indemnified Party” shall have the meaning set forth in Section 14.
 
“Due Date” shall mean, with respect to any Pool Loan, the date on which an
Obligor is required to make a Scheduled Payment thereon.
 
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“Eligible Pool Loan” shall mean any Pool Loan that is an Eligible Loan as
defined in the applicable PA Supplement.
 
“Facility Documents” shall mean, collectively, this Agreement, the Purchase
Agreements, the Series 2002-1 PA Supplement, the Indenture and Servicing
Agreement, each Indenture Supplement, the Custodial Agreement, the Lockbox
Agreements, the Collateral Agency Agreement, the Title Clearing Agreements, the
Loan Conveyance Documents, the Depositor Administrative Services Agreement, the
Issuer Administrative Services Agreement, the Financing Statements, each
Subordinated Note and all other agreements, documents and instruments delivered
pursuant thereto or in connection therewith.
 
“FRI” shall mean Fairfield Resorts, Inc., a Delaware corporation and the parent
corporation of CTRG-CF.
 
“Guarantee” shall mean the performance guarantee dated as of the date hereof,
executed by the Performance Guarantor in favor of the Depositor, the Issuer and
the Trustee.
 
“Indenture and Servicing Agreement” shall have the meaning set forth in the
recitals.
 
“Indenture Supplement” shall mean the supplement to the Indenture and Servicing
Agreement setting forth the terms of the Series 2002-1 Notes, and all amendments
thereof and supplements thereto.
 
“Independent Director” shall mean an individual who is an Independent Director
as defined in the Limited Liability Company Agreement of the Depositor or the
Issuer, as applicable, as in effect on the date of this Agreement.
 
“Initial Pool Loans” shall mean the Pool Loans listed on the Pool Loan Schedule
on the Closing Date.
 
“Installment Contract” shall mean any Installment Contract under the applicable
Purchase Agreement.
 
“Issuer” shall have the meaning set forth in the preamble.
 
“Issuer Administrative Services Agreement” shall mean the Administrative
Services Agreement dated as of August 29, 2002 by and between CTRG-CF as
administrator and the Issuer, as amended from time to time.
 
“Loan” shall have the meaning assigned to that term in the applicable Purchase
Agreement.
 
“Mortgage” shall have the meaning assigned to that term in the applicable
Purchase Agreement.
 
“Notes” shall mean the Series 2002-1 Notes issued by the Issuer pursuant to the
Indenture and Servicing Agreement and the Indenture Supplement.

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“Obligor” shall have the meaning assigned to that term in the applicable
Purchase Agreement.
 
“Originator” shall have the meaning assigned to that term in the applicable
Purchase Agreement.
 
“PA Supplement” shall mean any supplement to a Purchase Agreement relating to
Loans constituting collateral for a particular Series of Notes.
 
“Performance Guarantor” shall mean Cendant.
 
“Permitted Encumbrance” shall have the meaning assigned to that term in the
applicable Purchase Agreement.
 
“Pool Assets” shall mean any and all right, title, and interest of the Depositor
in, to and under (a) the Pool Loans from time to time and the related
Transferred Assets and all of the Depositor’s rights under the Purchase
Agreements and the Guarantee, (b) the Pool Collections and (c) the proceeds of
any of the foregoing.
 
“Pool Collections” shall mean all funds that are received on account of or
otherwise in connection with the Pool Loans, including without limitation (a)
all Collections in respect of any Pool Loans, (b) all amounts received from any
Seller in respect of amounts relating to Repurchase Prices and Substitution
Adjustment Amounts under the applicable PA Supplement or from Cendant in respect
of any payments made by Cendant as guarantor of the obligations of the Seller or
the Master Servicer under the Guarantee.
 
“Pool Loan” shall mean each Loan that is listed on the Pool Loan Schedule on the
Closing Date and Additional Pool Loans that are listed from time to time on such
Pool Loan Schedule.
 
“Pool Loan Conveyance Documents” shall mean, with respect to any Pool Loan,
(a) the Assignment of Additional Pool Loans in the form of Exhibit A, if
applicable, and (b) any such other releases, documents, instruments or
agreements as may be required by the Depositor, the Issuer or the Trustee in
order to more fully effect the sale (including any prior assignments) of such
Pool Loan and any other related Pool Assets.
 
“Pool Loan Purchase Price,” for the Pool Assets shall have the meaning set forth
in Section 3.
 
“Pool Loan Schedule” shall mean the list of Loans attached as Schedule 1, as
amended from time to time on each Addition Date and Repurchase Date as provided
in Section 8(b) of this Agreement, which list shall set forth the same
information with respect to each Pool Loan as required in the Loan Schedules for
the applicable Purchase Agreement.
 
“Purchase” shall mean the sale of Loans and related Transferred Assets from the
Depositor to the Issuer.
 
“Purchase Agreement” shall mean each of the Master Loan Purchase Agreement dated
as
 
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of August 29, 2002 by and between CTRG-CF as seller, the Depositor as purchaser
and the other parties named in such agreement; or the Master Loan Purchase
Agreement dated as of August 29, 2002 by and between Trendwest as Seller and the
Depositor as purchaser, in each case as such agreements may be amended, modified
or supplemented from time to time in accordance with the terms thereof, and any
other purchase agreement relating to the purchase of Loans from a Seller by the
Depositor.
 
“Repurchase Date,” shall have the meaning set forth in Section 9(b).
 
“Repurchase Price,” for each Series, shall have the meaning set forth in Section
9(a)
 
“Schedule 1-A Pool Loan” shall have the meaning set forth in Section 12.
 
“Schedule 1-B Pool Loan” shall have the meaning set forth in Section 12.
 
“Seller” shall have the meaning set forth in the recitals to this Agreement.
 
“Seller Subsidiary” shall mean any Subsidiary of a Seller, other than the
Depositor or the Issuer.
 
“Series 2002-1 Additional Pool Loan” shall mean each Loan constituting one of
the Series 2002-1 Pool Loans Purchased from the Depositor on an Addition Date
and listed on Schedule 1 to the related Assignment.
 
“Series 2002-1 Indenture Supplement” shall mean the supplement to the Master
Indenture and Servicing Agreement executed and delivered in connection with the
original issuance of the Series 2002-1 Notes and all amendments thereof and
supplements thereto.
 
“Series 2002-1 Notes” shall mean the Cendant Timeshare Conduit Receivables
Funding, LLC Loan-Backed Variable Funding Notes, Series 2002-1 issued under the
Indenture and Servicing Agreement and the Series 2002-1 Indenture Supplement.
 

“Series 2002-1 Pool Loan” means each Loan listed from time to time on the Series
2002-1 Pool Loan Schedule.

“Series 2002-1 Pool Loan Schedule” shall mean the Pool Loan Schedule for the
Series 2002-1 Pool Loans.

“Series 2002-1 PA Supplement” shall mean each PA Supplement relating to the
Series 2002-1 Loans.

“Series 2002-1 Purchase Agreement” shall mean each Purchase Agreement relating
to the Series 2002-1 Loans, in each case as amended by the Series 2002-1 PA
Supplement thereto.
 
“Series 2002-1 Supplement” shall mean the PPA Supplement dated as of August 29,
2002 entered into in connection with the issuance of the Series 2002-1 Notes and
subsequently incorporated into this Agreement. On and after November 14, 2005,
references to the Series
 
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2002-1 Supplement to this Agreement shall refer to this Agreement.
 
“Subordinated Note” shall mean the CTRG-CF Subordinated Note, the Trendwest
Subordinated Note and any other subordinated note delivered by a Seller to the
Issuer pursuant to a Series 2002-1 PA Supplement.
 
“Substitution Adjustment Amount” shall have the meaning set forth in Section
9(c).
 
“Term Purchase Agreement” shall mean a purchase agreement between the Depositor
and an Additional Issuer pursuant to which the Depositor sells Loans to the
Additional Issuer and the Additional Issuer purchases such Loans for the purpose
of pledging the Loans to secure a Series of Notes.
 
“Timeshare Property” shall have the meaning set forth in the applicable Purchase
Agreement.
 
“Trendwest” shall mean Trendwest Resorts, Inc., a wholly-owned indirect
Subsidiary of Cendant.
 
“Trendwest Timeshare Upgrade” shall mean a Loan which was sold to the Depositor
by Trendwest and with respect to which the Obligor purchases a Timeshare
Upgrade.
 
“Trustee” shall have the meaning set forth in the recitals.
 
“WorldMark” shall mean WorldMark, The Club, a California not-for-profit mutual
benefit corporation.
 
Section 2.  Purchase and Sale.
 
(a)  Agreement. Upon the terms and subject to the conditions hereof, the Issuer
hereby Purchases from the Depositor, and the Depositor hereby sells and assigns
to the Issuer without recourse except as specifically set forth herein, all of
the Depositor’s right, title and interest in, to and under the Initial Pool
Loans listed on the Series 2002-1 Pool Loan Schedule delivered on the Closing
Date, together with all other Pool Assets relating thereto.
 
The Series 2002-1 Pool Loan Schedule sets forth a list of all Series 2002-1 Pool
Loans as of the Closing Date and indicates whether each such Loan shall be
designated a Schedule 1-A Pool Loan or a Schedule 1-B Pool Loan. The Series
2002-1 Additional Pool Loans existing at the close of business on each Addition
Cut-Off Date and all other Pool Assets relating thereto shall be sold by the
Depositor and purchased by the Issuer on the related Addition Date. In
connection with the sale and conveyance hereunder, the Depositor agrees on or
prior to the Closing Date and on or prior to each Addition Date (in the case of
Series 2002-1 Additional Pool Loans) to indicate or cause to be indicated
clearly and unambiguously in its accounting, computer and other records that the
Series 2002-1 Pool Loans and the related Pool Assets have been sold to the
Issuer pursuant to this PPA Supplement. In addition, in connection with the sale
and conveyance hereunder, the Depositor agrees on or prior to the Closing Date
and on or prior to each Addition Date (in the case of Series 2002-1 Additional
Pool Loans) to deliver to the Issuer a Series 2002-1 Pool Loan Schedule for such
Series 2002-1 Pool Loans and Series 2002-1
 
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Additional Pool Loans.
 
(b)  Purchase of Series 2002-1 Additional Pool Loans.
 
(i) [Reserved].
 
(ii) The Depositor may agree with the Issuer that Eligible Loans will be sold by
the Depositor to the Issuer as Series 2002-1 Additional Pool Loans.
 
(iii) On the Addition Date with respect to any Series 2002-1 Additional Pool
Loans, such Series 2002-1 Additional Pool Loans shall become Series 2002-1
Loans, and the Issuer shall Purchase the Series 2002-1 Additional Pool Loans and
the related Pool Assets as provided in the Assignment, subject to the
satisfaction of the following conditions on such Addition Date:
 
(A) The Depositor shall have delivered to the Issuer copies of UCC financing
statements covering such Series 2002-1 Additional Pool Loans, if necessary to
perfect the Issuer’s first priority interest in such Series 2002-1 Additional
Pool Loans and the related Pool Assets;
 
(B) On each of the Addition Cut-Off Date and the Addition Date, the sale of such
Series 2002-1 Additional Pool Loans and the related Pool Assets to the Issuer
shall not have caused the Depositor’s insolvency or have been made in
contemplation of the Depositor’s insolvency;
 
(C) No selection procedure shall have been utilized by the Depositor that would
result in a selection of such Series 2002-1 Additional Pool Loans (from the
Eligible Loans available to the Depositor) that would be materially adverse to
the interests of the Issuer as of the Addition Date;
 
(D) The Depositor shall have indicated in its accounting, computer and other
records that the Series 2002-1 Additional Pool Loans and the related Pool Assets
have been sold to the Issuer and shall have delivered to the Issuer the required
Series 2002-1 Pool Loan Schedule;
 
(E) The Depositor and the Issuer shall have entered into a duly executed,
written assignment substantially in the form of Exhibit A to this Agreement (an
“Assignment”);
 
(F) The Depositor shall have delivered to the Issuer an Officer’s Certificate of
the Depositor dated the Addition Date, confirming, to the extent applicable, the
items set forth in Section 2(b)(iii) (A) through (E); and
 
(G) The Issuer shall have paid the Additional Pool Loan Purchase Price as
provided in Section 3 hereof.
 
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(iv) On the initial Addition Date with respect to any Series 2002-1 Additional
Pool Loans acquired by the Depositor from Trendwest, as a Seller under a
Purchase Agreement, the Issuer shall Purchase the Series 2002-1 Additional Pool
Loans and the related Pool Assets as provided in the Agreement only upon receipt
by the Issuer of each of the following on such Addition Date in form and
substance acceptable to the Issuer and counsel to the Deal Agent:
 
(A) Copies of search reports certified by parties acceptable to the Issuer dated
a date reasonably prior to such Addition Date (x) listing all effective
financing statements which name the applicable Seller and the Depositor (under
their present name and any previous names) as debtor or seller and which are
filed with respect to the applicable Seller and the Depositor in each relevant
jurisdiction, together with copies of such financing statements (none of which
shall cover any portion of the Series 2002-1 Additional Pool Loans that are
being purchased from Trendwest and related Pool Assets except as contemplated by
the Facility Documents) and (y) listing all effective financing statements which
name the Issuer (under its present name and any previous names) as debtor or
seller and which are filed with respect to the Issuer in each relevant
jurisdiction, together with copies of such financing statements (none of which
shall cover any portion of Series 2002-1 Additional Pool Loans that are being
purchased from Trendwest and related Pool Assets except as contemplated by the
Facility Documents);
 
(B) Copies of proper UCC Financing Statement Amendments (Form UCC3), if any,
necessary to terminate all security interests and other rights of any Person in
the Series 2002-1 Additional Pool Loans that are being purchased from Trendwest
and related Pool Assets previously granted by the applicable Seller, the
Depositor or the Issuer (except as contemplated by the Facility Documents);
 
(C) Copies of (x) proper UCC Financing Statements (Form UCC1) naming the
Depositor as debtor or seller of the Series 2002-1 Additional Pool Loans that
are being purchased from Trendwest and related Pool Assets, the Trustee as total
assignee and the Issuer as assignor secured party, (y) proper UCC Financing
Statements (Form UCC1) naming the Issuer as debtor or seller of the Series
2002-1 Additional Pool Loans that are being purchased from Trendwest and related
Pool Assets and the Trustee as secured party or purchaser and (z) such other
similar instruments or documents with respect to the applicable Seller as may be
necessary or in the opinion of the Purchaser desirable under the UCC of all
appropriate jurisdictions or any comparable law to evidence the perfection of
the Trustee’s interest in the Series 2002-1 Additional Pool Loans that are being
purchased from Trendwest and related Pool Assets; and
 
(D) An opinion or opinions of counsel to the Depositor, in the
 
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form required by the Issuer, with respect to the following: (x) certain security
interest matters, and (y) “true sale” and substantive consolidation matters.
 
(c)  [Reserved] .
 
(d)  No Assumption. The sales and purchases of Pool Assets do not constitute and
are not intended to result in a creation or an assumption by the Issuer or its
successors and assigns of any obligation of any Seller, the Depositor or any
other Person in connection with the Pool Assets (other than such obligations as
may arise from the ownership of the Pool Assets) or under the related Series
2002-1 Pool Loans or any other agreement or instrument relating thereto,
including without limitation any obligation to any Obligors. None of the Issuer
or the Issuer’s assignees shall have any obligation or liability to any Obligor
or other customer or client of any Seller (including without limitation any
obligation to perform any of the obligations of any Seller under any Loan or
related Timeshare Property or any other agreement or any obligation of any
Seller), except such obligations as may arise from the ownership of the Pool
Assets.
 
(e)  No Recourse. Except as specifically provided in this Agreement, the sale
and Purchase of the Pool Assets under this Agreement shall be without recourse
to the Depositor; provided, however, that the Depositor shall be liable to the
Issuer and its successors and assigns for all representations, warranties,
covenants and indemnities made by it pursuant to the terms of this Agreement (it
being understood that such obligations of the Depositor will not arise solely on
account of the credit related inability of an Obligor to make a required
Scheduled Payment).
 
(f)  True Sales. The Depositor and the Issuer intend the transfers of Pool
Assets hereunder to be true sales by the Depositor to the Issuer that are
absolute and irrevocable and to provide the Issuer with the full benefits of
ownership of the Pool Assets, and neither the Depositor nor the Issuer intends
the transactions contemplated hereunder to be loans from the Issuer to the
Depositor secured by the Pool Assets.
 
(g)  Servicing of Pool Assets. Consistent with the Issuer’s ownership of all
Pool Assets and subject to the terms of the Series 2002-1 Pool Loans, as between
the parties to this Agreement, the Issuer shall have the sole right to service,
administer and collect all Pool Assets, to assign such right and to delegate
such right to others. In consideration of the Issuer’s Purchase of the Pool
Assets, the Depositor hereby acknowledges and agrees that the Issuer intends to
assign to the Collateral Agent for the benefit of the Trustee for the benefit of
the Noteholders the rights and interests conveyed by the Depositor to the Issuer
hereunder, and agrees to cooperate fully with the Issuer and its successors and
assigns in the exercise of such rights.
 
(h)  Financing Statements. In connection with the foregoing sale, the Depositor
agrees to record and file a financing statement or statements (and continuation
statements or other amendments with respect to such financing statements) with
respect to the Pool Assets sold by the Depositor hereunder meeting the
requirements of applicable state law in such manner and in such jurisdictions as
are necessary to perfect the interests of the Issuer created hereby under the
applicable UCC and to deliver a file-stamped copy of each such
 
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financing statement and continuation statement (or other amendment) or other
evidence of such filings to the Issuer.
 
(i)  Recharacterization. Without prejudice to the provisions of Section 2(f)
providing for the absolute transfer of the Depositor’s interest in the Pool
Assets and the proceeds thereof to the Issuer, in order to secure the prompt
payment and performance of all obligations of the Depositor to the Issuer and
the Issuer’s assignees arising in connection with this Agreement, whether now or
hereafter existing, due or to become due, direct or indirect, or absolute or
contingent, the Depositor hereby assigns and grants to the Issuer a first
priority perfected security interest in all of the Depositor’s right, title and
interest, whether now owned or hereafter acquired, if any, in, to and under all
of the Series 2002-1 Pool Loans and the other related Pool Assets and the
proceeds thereof.
 
(j)  Transfer of Pool Loans. All Series 2002-1 Pool Loans conveyed to the Issuer
hereunder shall be held by the Custodians pursuant to the terms of the
applicable Custodial Agreements.
 
The Depositor acknowledges that the Issuer will grant a security interest in the
Series 2002-1 Pool Loans and other related Pool Assets to the Collateral Agent
pursuant to the Indenture and Servicing Agreement. The Depositor agrees that,
upon such grant, the Collateral Agent or the Trustee may enforce all of
Depositor’s obligations hereunder and under the Pool Purchase Agreement
directly, including without limitation the repurchase obligations of the
Depositor set forth in Section 9.
 
Section 3.  Pool Loan Purchase Price.
 
The Series 2002-1 Pool Loans had an aggregate unpaid principal balance of
$280,127,904.13 at the Cut-Off Date (such aggregate unpaid principal balance at
the Cut-Off Date being referred to herein as the “Cut-Off Date Pool Principal
Balance”). The purchase price (the “Pool Loan Purchase Price”) for the Series
2002-1 Pool Loans sold on the Closing Date shall be $280,127,904.13.
 
The Depositor shall have no obligation to sell any Series 2002-1 Additional Pool
Loan to the Issuer if it has not been paid the Additional Pool Loan Purchase
Price therefor.
 
The purchase price for any Additional Pool Loans and the related Pool Assets
(the “Additional Pool Loan Purchase Price”) conveyed to the Issuer under this
Agreement on each Addition Date shall be a dollar amount equal to the aggregate
outstanding principal balance of such Additional Pool Loans sold on such
Addition Date, adjusted to reflect the fair market value thereof.
 
Section 4.  Payment of Purchase Price.
 
(a)  Closing Dates. On the terms and subject to the conditions of this
Agreement, payment of the Pool Loan Purchase Price for the Pool Loans and the
related Pool Assets transferred on each Closing Date shall be made by the Issuer
on such Closing Date in immediately available funds to the Depositor to such
accounts at such banks as the Depositor shall designate to the Issuer not less
than one Business Day prior to such Closing Date.
 
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(b)  Manner of Payment of Additional Pool Loan Purchase Price. On the terms and
subject to the conditions of this Agreement, the Issuer shall pay to the
Depositor, on each other Business Day on which any Pool Assets are purchased
from the Depositor by the Issuer pursuant to this Agreement, the Additional Pool
Loan Purchase Price for such Pool Assets by paying such Additional Pool Loan
Purchase Price to the Depositor in cash.
 
(c)  Payment of Adjustments. The Depositor shall pay to the Issuer in cash, on
the date of receipt by the Depositor, any payment in respect of Repurchase
Prices or Substitution Adjustment Amounts relating to the Pool Assets made by
any Seller to the Depositor pursuant to any Purchase Agreement. The Depositor
shall instruct the Sellers to deposit all payments in respect of such Repurchase
Prices and Substitution Adjustment Amounts directly in the Collection Account.
 
(d)  Payment. Payment for and delivery of the Series 2002-1 Pool Loans being
purchased by the Issuer on the Closing Date shall take place at a closing at the
offices of Orrick, Herrington & Sutcliffe LLP, Washington Harbour, 3050 K
Street, NW, Washington, D.C. 20007, at 10:00 A.M. local time on the Closing
Date, or such other time and place as shall be mutually agreed upon among the
parties hereto.
 
Section 5.  Conditions Precedent to Sale of Pool Loans.
 
The Issuer’s obligations hereunder to purchase and pay for the Pool Assets on
the Closing Date are subject to the fulfillment of the following conditions on
or before the Closing Date:
 
(a)  (i) The Issuer shall have received the Series 2002-1 Purchase Agreement
relating to each Series 2002-1 Pool Loan and the Indenture and Servicing
Agreement executed by all parties thereto and (ii) all conditions precedent to
the sale of the Series 2002-1 Loans under each Series 2002-1 Purchase Agreement
shall have been fulfilled to the extent they are capable of being fulfilled
prior to the performance by the Issuer of its obligations under this Agreement.
 
(b)  The representations and warranties of each Seller, each Seller Subsidiary
and the Depositor made in the Series 2002-1 Purchase Agreements and the
representations and warranties of the Depositor in this Agreement shall be true
and correct in all material respects on the Closing Date.
 
Section 6.  Representations and Warranties of the Depositor.
 
The Depositor represents and warrants as of the Closing Date and as of each
Addition Date, or as of such other date specified in such representation and
warranty, that:
 
(a)  The Depositor is a limited liability company duly formed, validly existing
and in good standing under the laws of the State of Delaware and has full
limited liability company power, authority and legal right to own its properties
and conduct its business as such properties are presently owned and as such
business is presently conducted, and to execute, deliver and perform its
obligations under this Agreement. The Depositor is duly qualified to do business
and is in good standing as a foreign entity, and has obtained all necessary
licenses and
 
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approvals in each jurisdiction necessary to carry on its business as presently
conducted and to perform its obligations under this Agreement.
 
(b)  The execution, delivery and performance by the Depositor of each of the
Facility Documents to which it is a party and the consummation by the Depositor
of the transactions provided for in this Agreement and each other Facility
Document to which it is a party have been duly authorized by the Depositor by
all necessary limited liability company action.
 
(c)  This Agreement and each other Facility Document to which it is a party has
been duly and validly executed and delivered by the Depositor and constitutes
the legal, valid and binding obligation of the Depositor, enforceable against it
in accordance with its respective terms, except as such enforceability may be
subject to or limited by Debtor Relief Laws or by general principles of equity
(whether considered in a suit at law or in equity).
 
(d)  The execution, delivery and performance by the Depositor of this Agreement
and each other Facility Document to which it is a party and the consummation by
the Depositor of the transactions contemplated hereby and thereby do not
contravene (i) the Depositor’s limited liability company agreement, (ii) any
law, rule or regulation applicable to the Depositor, (iii) any contractual
restriction contained in any material indenture, loan or credit agreement,
lease, mortgage, deed of trust, security agreement, bond, note, or other
material agreement or instrument binding on the Depositor or (iv) any order,
writ, judgment, award, injunction or decree binding on or affecting the
Depositor or its properties (except where such contravention would not have a
Material Adverse Effect with respect to the Depositor or its properties), and do
not result in (except as provided in the Facility Documents) or require the
creation of any Lien upon or with respect to any of its properties; and no
transaction contemplated hereby requires compliance with any bulk sales act or
similar law. To the extent that this representation is being made with respect
to Title I of ERISA or Section 4975 of the Code, it is made subject to the
assumption that none of the assets being used to purchase the Pool Loans and
Pool Assets constitute assets of any Benefit Plan or Plan with respect to which
the Depositor is a party in interest or disqualified person.
 
(e)  There are no proceedings or investigations pending, or to the best
knowledge of the Depositor threatened, against the Depositor before any court,
regulatory body, administrative agency or other tribunal or governmental
instrumentality (A) asserting the invalidity of this Agreement or any other
Facility Document to which it is a party, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement or any
other Facility Document to which it is a party, (C) seeking any determination or
ruling that would adversely affect the validity or enforceability of this
Agreement or any other Facility Document to which it is a party or (D) seeking
any determination or ruling that would, if adversely determined, be reasonably
likely to have a Material Adverse Effect with respect to the Depositor.
 
(f)  All approvals, authorizations, consents or orders of any court or
governmental agency or body required in connection with the execution and
delivery by the Depositor of this Agreement or any other Facility Document to
which it is a party, the consummation by it of the transactions contemplated
hereby or thereby and the performance by it
 
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of, and the compliance by it with, the terms hereof or thereof, have been
obtained, except where the failure to do so would not have a Material Adverse
Effect with respect to the Depositor.
 
(g)  The Depositor, both prior to and immediately after giving effect to the
sale of Pool Loans to the Issuer on such date, (A) is not insolvent (as such
term is defined in the Bankruptcy Code), (B) is able to pay its debts as they
become due and (C) does not have unreasonably small capital for the business in
which it is engaged or for any business or transaction in which it is about to
engage.
 
(h)  The Depositor has observed the applicable legal requirements on its part
for the recognition of the Depositor as a legal entity separate and apart from
each of the Seller, the Seller Subsidiaries and any of their respective
Affiliates.
 
It is understood and agreed that the representations and warranties contained in
this Section 6 shall remain operative and in full force and effect, shall
survive the transfer and conveyance of the Pool Loans by the Depositor to the
Issuer and the grant of a security interest in the Pool Assets by the Issuer to
the Collateral Agent and shall inure to the benefit of the Issuer, the Trustee,
the Collateral Agent and the Noteholders and their respective designees,
successors and assigns.
 
The Depositor hereby assigns to the Issuer its rights relating to the Series
2002-1 Pool Loans under the related Purchase Agreements, including without
limitation any rights the Depositor may have to payments due from the related
Seller for repurchases of Defective Loans (as such term is defined in such
Purchase Agreement) resulting from the breach of representations and warranties
made under such Purchase Agreement.
 
Section 7.  Affirmative Covenants of the Depositor.
 
From and after the date hereof until the termination of this Agreement, the
Depositor shall:
 
(a)  Separate Legal Entity. Take such actions as shall be required on its part
in order that the identity of the Depositor as a legal entity separate from each
of the Sellers, the Seller Subsidiaries and any of their respective Affiliates
will be recognized, including:
 
(i) The Depositor will conduct its business in office space allocated to it and
for which it pays an appropriate rent and overhead allocation;
 
(ii) The Depositor will maintain corporate records and books of account separate
from those of the Sellers, the Seller Subsidiaries, their respective Affiliates
and the Issuer and telephone numbers and stationery that are separate and
distinct from those of the Seller, the Seller Subsidiaries, their respective
Affiliates and the Issuer;
 
(iii) The Depositor’s assets will be maintained in a manner that facilitates
their identification and segregation from those of any of the Sellers, the
Seller Subsidiaries, their respective Affiliates and the Issuer;
 
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(iv) The Depositor will strictly observe corporate formalities in its dealings
with the public and with the Sellers, the Seller Subsidiaries, their respective
Affiliates and the Issuer and, except as contemplated by the Facility Documents,
funds or other assets of the Depositor will not be commingled with those of any
of the Sellers, the Seller Subsidiaries, their respective Affiliates and the
Issuer. The Depositor will at all times, in its dealings with the public and
with the Sellers, the Seller Subsidiaries, their respective Affiliates and the
Issuer, hold itself out and conduct itself as a legal entity separate and
distinct from the Sellers, the Seller Subsidiaries, their respective Affiliates
and the Issuer. The Depositor will not maintain joint bank accounts or other
depository accounts to which any of the Sellers, the Seller Subsidiaries or
their respective Affiliates (other than the Master Servicer) has independent
access;
 
(v) The duly elected board of directors of the Depositor and duly appointed
officers of the Depositor will at all times have sole authority to control
decisions and actions with respect to the daily business affairs of the
Depositor;
 
(vi) Not less than one member of the Depositor’s board of directors will be an
Independent Director. The Depositor will observe those provisions in its limited
liability agreement that provide that the Depositor’s board of directors will
not approve, or take any other action to cause the filing of, a voluntary
bankruptcy petition with respect to the Depositor unless the Independent
Director and all other members of the Depositor’s board of directors unanimously
approve the taking of such action in writing prior to the taking of such action;
 
(vii) The Depositor will compensate each of its employees, consultants and
agents from the Depositor’s own funds for services provided to the Depositor;
and
 
(viii) The Depositor will not hold itself out to be responsible for the debts of
any of the Sellers, the Seller Subsidiaries or their respective Affiliates.
 
(b)  Compliance with Laws, Etc. Comply in all material respects with all
applicable laws, rules, regulations, judgments, decrees and orders (including
without limitation those relating to the Loans and related Timeshare
Properties), in each case to the extent that any such failure to comply,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect with respect to the Depositor.
 
(c)  Preservation of Corporate Existence. Preserve and maintain its limited
liability company existence, rights, franchises and privileges in the
jurisdiction of its formation and qualify and remain qualified in good standing
as a foreign entity in each jurisdiction in which the failure to preserve and
maintain such qualification as a foreign corporation could reasonably be
expected to have a Material Adverse Effect with respect to the Depositor.
 
(d)  Keeping of Records and Books of Account. Mark its computer files, books and
records to indicate the sale of all Pool Assets to the Issuer hereunder.
 
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(e)  Payment of Taxes. To the extent required by applicable law, file (or cause
to be filed on its behalf as a member of a consolidated group) all tax returns
and reports required by law to be filed by it and pay all taxes, assessments and
governmental charges thereby shown to be owing by it, except for any such taxes,
assessments or charges (i) that are being diligently contested in good faith by
appropriate proceedings, for which adequate reserves in accordance with GAAP
have been set aside on its books and that have not given rise to any Liens
(other than Permitted Encumbrances) or (ii) the amount of which, either singly
or in the aggregate, would not have a Material Adverse Effect with respect to
the Depositor.
 
(f)  Turnover of Collections. If the Depositor or any of its agents or
representatives at any time receives any cash, checks or other instruments
constituting Pool Collections, segregate and hold such payments in trust for,
and in a manner acceptable to, the Master Servicer and promptly upon receipt
(and in any event within two Business Days following receipt) remit all such
cash, checks and instruments, duly endorsed or with duly executed instruments of
transfer, to the applicable Collection Account.
 
Section 8.  Negative Covenants of the Depositor.
 
From and after the date hereof until the final Series Termination Date, the
Depositor agrees that it will not:
 
(a)  Sales, Liens, Etc. Sell, assign (by operation of law or otherwise) or
otherwise dispose of, or create or suffer to exist any Lien (other than
Permitted Encumbrances) of anyone claiming by or through it on or with respect
to, any Pool Asset or any interest therein, other than sales of Pool Assets
pursuant to this Agreement.
 
(b)  No Mergers, Etc. Consolidate with or merge with or into any other Person or
convey, transfer or sell (other than to the Issuer) all or substantially all of
its properties and assets to any Person.
 
(c)  Change in Name. Change its name or its type or jurisdiction of organization
unless the Depositor has given the Issuer and its assignees and the rating
agencies then rating the Series 2002-1 Notes at least 30 days’ prior written
notice thereof and taken all action necessary or reasonably requested by the
Trustee to amend its existing financing statements and file additional financing
statements in all applicable jurisdictions in order to perfect and maintain the
perfection of the ownership interest or security interest of the Issuer in the
Pool Loans and the related Pool Assets.
 
(d)  Indebtedness. Create, incur or permit to exist, or give any guarantee or
indemnity in respect of, any indebtedness except for (A) liabilities created or
incurred by the Depositor pursuant to the Facility Documents or contemplated by
such Facility Documents and (B) other reasonable and customary operating
expenses; provided that the Depositor shall not incur any indebtedness for
borrowed money in excess of $9,500 unless the related creditor shall agree in
writing to a non-petition covenant substantially similar to Section 15(h)(ii)
hereof for the benefit of the Depositor.
 
(e)  Amendments, Etc. Permit the validity or effectiveness of any Facility
Document to which it is a party or the rights and obligations created thereby or
pursuant thereto
 
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to be amended, terminated, postponed or discharged, or permit any amendment to
any Facility Document to which it is a party without the consent of the Issuer
and the Deal Agent, or permit any Person whose obligations form part of the Pool
Assets to be released from such obligations, except in accordance with the terms
of such Facility Document.
 
(f)  Capital Expenditures. Incur or make any expenditure (by long-term or
operating lease or otherwise) for capital assets (either realty or personalty).
 
(g)  Limitation on Business. Engage in any business other than financing,
purchasing, owning and selling and managing the Pool Assets in the manner
contemplated by the Facility Documents and any Term Purchase Agreement and all
activities incidental thereto, or enter into or be a party to any agreement or
instrument other than any Facility Document, any Term Purchase Agreement or
documents and agreements incidental thereto.
 
(h)  Capital Contributions. Except as contemplated by the Facility Documents or
a Term Purchase Agreement, or in connection with the creation of an Additional
Issuer, make any loan or advance or credit to, or guarantee (directly or
indirectly or by an instrument having the effect of assuring another’s payment
or performance on any obligation or capability of so doing or otherwise),
endorse or otherwise become contingently liable, directly or indirectly, in
connection with the obligations, stocks or dividends of, or own, purchase,
repurchase or acquire (or agree contingently to do so) any stock, obligations,
assets or securities of, or any other interest in, or make any capital
contribution to, any other Person without the consent of the holders of a
majority of the outstanding principal amount of the Notes.
 
Section 9.  Repurchases or Substitutions of Pool Loans for Breach of
Representations and Warranties.
 
(a)  Repurchase or Substitution Obligation. Subject to Section 9(b), upon
discovery by the Depositor or the related Seller or upon written notice from the
Issuer or the Trustee that any Series 2002-1 Pool Loan is a Defective Loan, the
Depositor shall, or shall cause the applicable Seller to, within 90 days after
the earlier of the discovery or receipt of notice thereof, cure such Defective
Loan in all material respects or either (i) repurchase such Defective Loan from
the Issuer or its assignee at the Repurchase Price or (ii) substitute one or
more Qualified Substitute Loans for such Defective Loan. For purposes of this
Agreement, the term “Repurchase Price” shall mean an amount equal to the
outstanding Principal Balance of such Defective Loan as of the close of business
on the Due Date immediately preceding the Payment Date on which the repurchase
is to be made, plus accrued but unpaid interest thereon to the date of such
repurchase. The Issuer hereby directs the Depositor, for so long as the
Indenture and Servicing Agreement is in effect, to make such payment on its
behalf to the Collection Account pursuant to Section 9(b). The following defects
with respect to documents in any Loan File, solely to the extent they do not
impair the validity or enforceability of the subject document under applicable
law, shall not be deemed to constitute a breach of the representations and
warranties contained in Section 6(b) of the related Purchase Agreement:
misspellings of or omissions of initials in names; name changes from divorce or
marriage; discrepancies as to payment dates in a Series 2002-1 Pool Loan of no
more than 30 days; discrepancies as to Scheduled Payments of no more than $5.00;
discrepancies as to origination dates of not more than 30 days; inclusion of
additional parties other than the primary Obligor not listed in the
 
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Master Servicer’s records or in the Series 2002-1 Pool Loan Schedule and
non-substantive typographical errors and other non-substantive minor errors of a
clerical or administrative nature.
 
(b)  Repurchases and Substitutions. The Depositor shall provide written notice
to the Issuer of any repurchase pursuant to Section 9(a) not less than two
Business Days prior to the date on which such repurchase is to be effected,
specifying the Defective Loan and the Repurchase Price therefor. Upon the
repurchase of a Defective Loan pursuant to Section 9(a), the Depositor shall
deposit, or shall cause the applicable Seller to deposit, the Repurchase Price
in the Collection Account on behalf of the Issuer no later than 12:00 noon, New
York time, on the Payment Date on which such repurchase is made (the “Repurchase
Date”).
 
(c)  Delivery Requirements. If the applicable Seller elects to substitute a
Qualified Substitute Loan or Loans for a Defective Loan pursuant to the
applicable PA Supplement, the Depositor shall deliver, or shall cause the
applicable Seller to deliver, such Qualified Substitute Loan in the same manner
as the other Series 2002-1 Pool Loans sold hereunder, including delivery of the
applicable Loan Documents as required pursuant to the applicable Custodial
Agreement and satisfaction of the same conditions with respect to such Qualified
Substitute Loan as to the Purchase of Additional Pool Loans set forth in Section
2(b)(iii). No Qualified Substitute Loan shall be selected in a manner adverse to
the Issuer or its assignees. Payments due with respect to Qualified Substitute
Loans prior to the last day of the Due Period next preceding the date of
substitution shall not be property of the Issuer, but will be retained by the
Master Servicer and remitted by the Master Servicer to the Depositor for payment
to the applicable Seller on the next succeeding Payment Date. Scheduled Payments
due on a Defective Loan prior to the last day of the Due Period next preceding
the date of substitution shall be property of the Issuer, and from and after
such last day of the Due Period next preceding the date of substitution all
Scheduled Payments due and other amounts received in respect of such Defective
Loan shall be the property of the Depositor or the applicable Seller. The
Depositor shall cause the Master Servicer to deliver a schedule of any Defective
Loans so removed and Qualified Substitute Loans so substituted to the Issuer.
Upon each such substitution, the Qualified Substitute Loan or Loans shall be
subject to the terms of this PPA Supplement in all respects, and the
representations and warranties of the applicable Seller under the related
Purchase Agreement and PA Supplement with respect to each Qualified Substitute
Loan shall be assigned to the Issuer hereunder. The Depositor shall be obligated
to repurchase or substitute, or to cause the applicable Seller to repurchase or
substitute, for any Qualified Substitute Loan as to which such Seller has
breached such Seller’s representations and warranties in Section 6(b) of the
related Purchase Agreement or applicable PA Supplement to the same extent as for
any other Series 2002-1 Pool Loan, as provided herein or therein. In connection
with the substitution of one or more Qualified Substitute Loans for one or more
Defective Loans, the Depositor shall deposit, or shall cause the applicable
Seller to deposit, an amount equal to the related Substitution Adjustment Amount
(as defined in the related Purchase Agreement), if any (the “Substitution
Adjustment Amount”), into the applicable Collection Account on the date of
substitution, without any reimbursement therefor.
 
Upon each repurchase or substitution, the Issuer shall automatically and without
further action sell, transfer, assign, set over and otherwise convey to the
Depositor or to the related Seller, if applicable, without recourse,
representation or warranty, all of the Issuer’s right, title and interest in and
to such Defective Loan, the related Timeshare Property, the Loan File relating
 
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thereto and any other related Pool Assets, all monies due or to become due with
respect thereto and all Pool Collections with respect thereto (including
payments received from Obligors from and including the last day of the Due
Period next preceding the date of transfer, subject to the payment of any
Substitution Adjustment Amount). The Issuer shall execute such documents,
releases and instruments of transfer or assignment and take such other actions
as shall reasonably be requested by the Depositor or the Seller to effect the
conveyance of such Defective Loan, the related Timeshare Property and related
Loan File pursuant to this Section 9(c).
 
Promptly after the occurrence of a Repurchase Date and after the repurchase of
or substitution for Defective Loans in respect of which the Repurchase Price has
been paid or one or more Qualified Substitute Loans has been substituted
therefor on such date, the Depositor shall direct the Master Servicer to delete
such Defective Loans from the Series 2002-1 Pool Loan Schedule.
 
The obligation of the Depositor to repurchase or substitute for any Defective
Loan shall constitute the sole remedy against the Depositor, the Sellers or
their Affiliates with respect to any breach of the representations and
warranties set forth in Section 6(b) of the applicable Purchase Agreement
available hereunder to the Issuer or its successors or assigns.
 
Section 10.  Representations and Warranties of the Issuer.
 
The Issuer represents and warrants as of each Closing Date and as of each
Addition Date, or as of such other date specified in such representation and
warranty, that:
 
(a)  The Issuer is a limited liability company duly formed, validly existing and
in good standing under the laws of the State of Delaware and has full limited
liability company power, authority, and legal right to own its properties and
conduct its business as such properties are presently owned and as such business
is presently conducted, and to execute, deliver and perform its obligations
under this Agreement. The Issuer is duly qualified to do business and is in good
standing as a foreign entity, and has obtained all necessary licenses and
approvals in each jurisdiction necessary to carry on its business as presently
conducted and to perform its obligations under this Agreement.
 
(b)  The execution, delivery and performance by the Issuer of each of the
Facility Documents to which it is a party and the consummation by the Issuer of
the transactions provided for in this Agreement and each other Facility Document
to which it is a party have been duly authorized by the Issuer by all necessary
limited liability company action.
 
(c)  This Agreement and each other Facility Document to which it is a party
constitutes the legal, valid and binding obligation of the Issuer, enforceable
against it in accordance with its respective terms, except as such
enforceability may be subject to or limited by Debtor Relief Laws or by general
principles of equity (whether considered in a suit at law or in equity).
 
(d)  The execution, delivery and performance by the Issuer of this Agreement and
each other Facility Document to which it is a party and the consummation by the
Issuer of the transactions contemplated hereby and thereby do not contravene (i)
the Issuer’s limited liability company agreement, (ii) any law, rule or
regulation applicable to the Issuer, (iii) any
 
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contractual restriction contained in any material indenture, loan or credit
agreement, lease, mortgage, deed of trust, security agreement, bond, note, or
other material agreement or instrument binding on the Issuer or (iv) any order,
writ, judgment, award, injunction or decree binding on or affecting the Issuer
or its properties (except where such contravention would not have a Material
Adverse Effect with respect to the Issuer or its properties), and do not result
in (except as provided in the Facility Documents) or require the creation of any
Lien upon or with respect to any of its properties; and no transaction
contemplated hereby requires compliance with any bulk sales act or similar law.
To the extent that this representation is being made with respect to Title I of
ERISA or Section 4975 of the Code, it is made subject to the assumption that
none of the assets being used to purchase the Pool Loans and Pool Assets
constitute assets of any Benefit Plan or Plan with respect to which the Issuer
is a party in interest or disqualified person.
 
(e)  There are no proceedings or investigations pending, or to the best
knowledge of the Issuer threatened, against the Issuer before any court,
regulatory body, administrative agency or other tribunal or governmental
instrumentality (A) asserting the invalidity of this Agreement or any other
Facility Document to which it is a party, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement or any
other Facility Document to which it is a party, (C) seeking any determination or
ruling that would adversely affect the validity or enforceability of this
Agreement or any other Facility Document to which it is a party or (D) seeking
any determination or ruling that would, if adversely determined, be reasonably
likely to have a Material Adverse Effect with respect to the Issuer.
 
(f)  All approvals, authorizations, consents or orders of any court or
governmental agency or body required in connection with the execution and
delivery by the Issuer of this Agreement or any other Facility Document to which
it is a party, the consummation by it of the transactions contemplated hereby or
thereby and the performance by it of, and the compliance by it with, the terms
hereof or thereof, have been obtained, except where the failure to do so would
not have a Material Adverse Effect with respect to the Issuer.
 
(g)  The Issuer (A) is not insolvent (as such term is defined in the Bankruptcy
Code), (B) is able to pay its debts as they become due and (C) does not have
unreasonably small capital for the business in which it is engaged or for any
business or transaction in which it is about to engage.
 
(h)  The Issuer has observed the applicable legal requirements on its part for
the recognition of the Issuer as a legal entity separate and apart from each of
the Seller, the Seller Subsidiaries and any of their respective Affiliates.
 
Section 11.  Affirmative Covenants of the Issuer.
 
From and after the date hereof until the termination of this Agreement, the
Issuer shall take such actions as shall be required on its part in order that
the identity of the Issuer as a legal entity separate from the Depositor, the
Sellers, the Seller Subsidiaries and any of their respective Affiliates will be
recognized, including:
 
(i) The Issuer will conduct its business in office space allocated to it
 
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 and for which it pays an appropriate rent and overhead allocation;
 
(ii) The Issuer will maintain corporate records and books of account separate
from those of the Depositor, the Sellers, the Seller Subsidiaries and their
respective Affiliates and telephone numbers and stationery that are separate and
distinct from those of the Sellers, the Seller Subsidiaries and their respective
Affiliates;
 
(iii) The Issuer’s assets will be maintained in a manner that facilitates their
identification and segregation from those of any of the Depositor, the Sellers,
the Seller Subsidiaries and their respective Affiliates;
 
(iv) The Issuer will strictly observe corporate formalities in its dealings with
the public and with the Depositor, the Sellers, the Seller Subsidiaries and
their respective Affiliates and, except as contemplated by the Facility
Documents, funds or other assets of the Issuer will not be commingled with those
of any the Depositor, the Sellers, the Seller Subsidiaries and their respective
Affiliates. The Issuer will at all times, in its dealings with the public and
with any of the Depositor, the Sellers, the Seller Subsidiaries and their
respective Affiliates, hold itself out and conduct itself as a legal entity
separate and distinct from the Depositor, the Sellers and their respective
Affiliates. The Issuer will not maintain joint bank accounts or other depository
accounts to which any of the Depositor, the Sellers, the Seller Subsidiaries and
their respective Affiliates (other than the Master Servicer) has independent
access;
 
(v) The duly elected board of directors of the Issuer and duly appointed
officers of the Issuer will at all times have sole authority to control
decisions and actions with respect to the daily business affairs of the Issuer;
 
(vi) Not less than one member of the Issuer’s board of directors will be an
Independent Director. The Issuer will observe those provisions in its limited
liability company agreement that provide that the Issuer’s board of directors
will not approve, or take any other action to cause the filing of, a voluntary
bankruptcy petition with respect to the Issuer unless the Independent Director
and all other members of the Issuer’s board of directors unanimously approve the
taking of such action in writing prior to the taking of such action;
 
(vii) The Issuer will compensate each of its employees, consultants and agents
from the Issuer’s own funds for services provided to the Issuer; and
 
(viii) The Issuer will not hold itself out to be responsible for the debts of
any of the Depositor, the Sellers, the Seller Subsidiaries and their respective
Affiliates.
 
Section 12.  Depositor Repurchases.
 
(a)  Optional Substitution of Schedule 1-A Pool Loans. On each Closing Date and
each Addition Date, the Depositor shall designate the Pool Loans, if any,
Purchased on such
 
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date that will be subject to optional substitution in whole or in part by the
Depositor (such Pool Loans, the “Schedule 1-A Pool Loans”), and such Pool Loans
shall be listed as Schedule 1-A Pool Loans in the Pool Loan Schedule. All other
Pool Loans Purchased by the Issuer from the Depositor on any Closing Date or
Addition Cut-Off Date (the “Schedule 1-B Pool Loans”) shall be listed as
Schedule 1-B Pool Loans in the Pool Loan Schedule and shall not be subject to
optional substitution pursuant to this Section 12. The Depositor may not change
the designation of any Pool Loan from a Schedule 1-B Pool Loan to a Schedule 1-A
Pool Loan.
 
(b)  [Reserved.]
 
(c)  Substitutions. Schedule 1-A Pool Loans and any other Pool Loans subject to
substitution pursuant to this Section 12 shall be removed from the Schedule 1-A
Pool Loans and another Pool Loan substituted therefore by the Depositor subject
to the notice and re-conveyance provisions applicable to Defective Loans
substitution provisions of the related PPA Supplement.
 
(d)  Condition Precedent to Substitution of Pool Loans. No removal and
substitution of any Pool Loans shall be made under Section 12 of this Agreement
on any date unless the Depositor provides a Pool Loan in substitution for the
Pool Loan released in accordance with the provisions applicable to substitution
for Defective Loans.
 
(e)  Repurchases of Series 2002-1 Pool Loans that Become Defaulted Loans. The
Depositor hereby acknowledges the Sellers’ option to repurchase certain
Defaulted Loans directly from the Issuer on the terms and subject to the terms
and conditions set forth in the applicable Series 2002-1 PA Supplements.
 
Section 13.  [Reserved.]
 
Section 14.  Indemnities by the Depositor.
 
Without limiting any other rights that any Depositor Indemnified Party may have
hereunder or under applicable law, the Depositor agrees to indemnify the Issuer
and each of its successors, permitted transferees and assigns (including the
Trustee for the benefit of Noteholders), and all officers, directors,
shareholders, controlling Persons, employees and agents of any of the foregoing
(each of the foregoing Persons, a “Depositor Indemnified Party”), from and
against any and all damages, losses, claims (whether on account of settlements
or otherwise), actions, suits, demands, judgments, liabilities (including
penalties), obligations or disbursements of any kind or nature and related costs
and expenses (including reasonable attorneys’ fees and disbursements) awarded
against or incurred by any of them, arising out of or as a result of any of the
following (all of the foregoing, collectively, “Depositor Indemnified Losses”):
 
(a)  any representation or warranty made by the Depositor under any of the
Facility Documents having been untrue or incorrect in any respect when made or
deemed to have been made; provided, however, that the Depositor’s obligation to
repurchase Defective Loans pursuant to Section 9 with respect to any
representation assigned to the Issuer pursuant to this Agreement having been
incorrect when made shall be the only remedy available to the Issuer or its
assignees relating to such incorrect representation;
 
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(b)  the failure to vest and maintain in the Issuer a first priority perfected
ownership or security interest in the Pool Assets, free and clear of any Lien
arising through the Depositor or anyone claiming through or under the Depositor;
or
 
(c)  any failure of the Depositor to perform its duties or obligations in
accordance with the provisions of any Facility Documents to which it is a party.
 
Notwithstanding the foregoing, no indemnification payments shall be payable by
the Depositor pursuant to this Section 14 except to the extent of funds
available to the Depositor for such purpose.
 
Notwithstanding the foregoing (and with respect to clause (ii) below, without
prejudice to the rights that the Issuer may have pursuant to the other
provisions of this Agreement or the provisions of any of the other Facility
Documents), in no event shall any Depositor Indemnified Party be indemnified for
any Depositor Indemnified Losses (i) resulting from negligence or willful
misconduct on the part of such Depositor Indemnified Party, (ii) to the extent
the same includes losses in respect of Pool Assets and reimbursement therefor
that would constitute credit recourse to the Depositor for the amount of any
Pool Asset not paid by the related Obligor or (iii) resulting from the action or
omission of the Master Servicer.
 
If for any reason the indemnification provided in this Section 14 is unavailable
to a Depositor Indemnified Party or is insufficient to hold a Depositor
Indemnified Party harmless, then the Depositor shall contribute to the maximum
amount payable or paid to such Depositor Indemnified Party as a result of such
loss, claim, damage or liability in such proportion as is appropriate to reflect
not only the relative benefits received by such Depositor Indemnified Party on
the one hand and the Depositor on the other hand, but also the relative fault of
such Depositor Indemnified Party and the Depositor, and any other relevant
equitable considerations.
 
Section 15.  Miscellaneous.
 
(a)  Amendment. This Agreement may be amended from time to time or the
provisions hereof may be waived or otherwise modified by the parties hereto or
thereto by written agreement signed by the parties hereto or thereto.
 
(b)  Assignment. The Issuer has the right to assign its interest under this
Agreement as may be required to effect the purposes of the Indenture and
Servicing Agreement without the consent of the Depositor, and the assignee shall
succeed to the rights hereunder of the Issuer. In addition, but only to the
extent allowed by the Indenture and Servicing Agreement, each of the Collateral
Agent and the Trustee has the right to assign its interest hereunder without the
written consent of the Depositor and the assignee shall succeed to the rights
hereunder or thereunder of Collateral Agent or Trustee.
 
(c)  Counterparts. This Agreement may be executed in any number of counterparts,
each of which counterparts shall be deemed to be an original, and such
counterparts shall constitute but one and the same instrument.
 
(d)  GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
 
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YORK, INCLUDING § 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT OTHERWISE
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.
 
(e)  Notices. All demands and notices hereunder shall be in writing and shall be
deemed to have been duly given, if personally delivered at or mailed by
registered mail, postage prepaid, or by express delivery service, to (i) in the
case of Depositor, Sierra Deposit Company, LLC, 10750 West Charleston Blvd.,
Suite 130, Mailstop 2067, Las Vegas, Nevada 89135, Attention: President, or such
other address as may hereafter be furnished to the Issuer and (ii) in the case
of the Issuer, Cendant Timeshare Conduit Receivables Funding, LLC, 10750 West
Charleston Blvd., Suite 130, Mailstop 2046, Las Vegas, Nevada 89135, Attention:
President, or such other address an may be furnished to the Depositor.
 
(f)  Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
 
(g)  Successors and Assigns. This Agreement shall be binding upon the Depositor
and the Issuer and their respective successors and assigns, as may be permitted
hereunder, and shall inure to the benefit of, and be enforceable by, the
Depositor and the Issuer and each of the Collateral Agent, the Trustee and the
Noteholders.
 
(h)  No Proceedings.
 
(i)  The Depositor hereby agrees that it will not institute against the Issuer
or join any other Person in instituting against the Issuer any proceeding under
any Debtor Relief Law so long as the Termination Date shall not have occurred or
there shall not have elapsed one year plus one day since the Termination Date.
The foregoing shall not limit the right of the Depositor to file any claim in or
otherwise take any action with respect to any proceeding under any Debtor Relief
Law that was instituted against the Issuer by any Person other than the
Depositor.
 
(ii)  The Issuer hereby agrees that it will not institute against the Depositor
or WorldMark or join any other Person in instituting against the Depositor or
WorldMark any proceeding under any Debtor Relief Law so long as the Termination
Date shall not have occurred or there shall not have elapsed one year plus one
day since the Termination Date. The foregoing shall not limit the right of the
Issuer to file any claim in or otherwise take any action with respect to any
proceeding under any Debtor Relief Law that was instituted against the Depositor
or WorldMark by any Person other than the Issuer.
 
(i)  Recourse to the Depositor. Except to the extent expressly provided
otherwise in the Facility Documents, the obligations of the Depositor under the
Facility Documents to which it is a party are solely the obligations of the
Depositor, and no recourse shall be had for payment of any fee payable by or
other obligation of or claim against the Depositor
 
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that arises out of any Facility Document to which the Depositor is a party
against any director, officer or employee of the Depositor. The provisions of
this Section 15(i) shall survive the termination of this Agreement.
 
(j)  Recourse to the Issuer. Except to the extent expressly provided otherwise
in the Facility Documents, the obligations of the Issuer under the Facility
Documents to which it is a party (i) are solely the obligations of the Issuer,
and no recourse shall be had for payment of any fee payable by or other
obligation of or claim against the Issuer that arises out of any Facility
Document to which the Issuer is a party against any director, officer or
employee of the Issuer and (ii) are payable solely from funds available to the
Issuer under the Indenture and Servicing Agreement for such purpose. The
provisions of this Section 15(j) shall survive the termination of this
Agreement.
 
(k)  Confidentiality. The Issuer agrees to maintain the confidentiality of any
information regarding the Sellers, the Seller Subsidiaries, the Depositor and
Cendant obtained in accordance with the terms of this Agreement that is not
publicly available; provided, however, that the Issuer may reveal such
information (i) as necessary or appropriate in connection with the
administration or enforcement of this Agreement or its funding of Purchases
under this Agreement, (ii) as required by law, government regulation, court
proceeding or subpoena and (iii) as necessary or appropriate in connection with
the financing statements filed pursuant to this Agreement.

 

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IN WITNESS WHEREOF, the parties 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.
 

 

     
SIERRA DEPOSIT COMPANY, LLC
as Depositor
     
 
By:

/s/ Mark A. Johnson

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

       
Name: Mark A. Johnson
Title: President
 

 

     
CENDANT TIMESHARE CONDUIT RECEIVABLES FUNDING, LLC
as Issuer
     
 
By:
 
/s/ Mark A. Johnson

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

       
Name: Mark A. Johnson
Title: President
 

 

[Signature page for Amended and Restated Pool Purchase Agreement]
 

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

Schedule 1

Pool Loan Schedule

Schedule 1-A Loans

Schedule 1-B Loans

 

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

EXHIBIT A
 
FORM OF ASSIGNMENT OF ADDITIONAL POOL LOANS
 
ASSIGNMENT NO. __ OF ADDITIONAL POOL LOANS dated as of _______, by and between
SIERRA DEPOSIT COMPANY, LLC, a Delaware limited liability company, as depositor
(the “Depositor”) and CENDANT TIMESHARE CONDUIT RECEIVABLES FUNDING, LLC, a
Delaware limited liability company, as issuer (the “Issuer”), pursuant to the
Agreement referred to below.

WITNESSETH:
 
WHEREAS, the Depositor and the Issuer are parties to the Master Pool Purchase
Agreement dated as of August 29, 2002 (as such agreement may have been, or may
from time to time be, further amended, supplemented or otherwise modified, the
“Agreement”);

WHEREAS, pursuant to the Agreement, the Depositor wishes to designate Additional
Pool Loans to be included as Pool Loans, and the Depositor wishes to sell its
right, title and interest in and to the Additional Pool Loans to the Issuer
pursuant to this Assignment and the Agreement; and

WHEREAS, the Issuer wishes to purchase such Additional Pool Loans subject to the
terms and conditions hereof.

NOW, THEREFORE, the Depositor and the Issuer hereby agree as follows:

1. Defined Terms. All capitalized terms used herein shall have the meanings
ascribed to them in the Agreement unless otherwise defined herein.

“Addition Cut-Off Date” shall mean, with respect to the Additional Pool Loans,
__________.

“Addition Date” shall mean, with respect to the Additional Pool Loans,
__________.

“Additional Pool Assets” shall have the meaning set forth in Section 3(a).

“Additional Pool Loans” shall mean the Additional Pool Loans that are sold
hereby and listed on Schedule 1.

2. Designation of Additional Pool Loans. The Depositor delivers herewith a
Series 2002-1 Pool Loan Schedule containing a true and complete list of the
Additional Pool Loans. Such Series 2002-1 Pool Loan Schedule is incorporated
into and made part of this Assignment, shall be Schedule 1 to this Assignment
and shall supplement Schedule 1 to the Agreement. All Additional Pool Loans
listed as Schedule 1-A Loans or Schedule 1-B Loans on such Pool Loan Schedule
shall be Schedule 1-A Loans or Schedule 1-B Loans, respectively, for all
purposes under the Agreement.
 
A-1

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3. Sale of Additional Pool Loans.

(a) The Depositor does hereby sell, transfer, assign, set over and otherwise
convey to the Issuer, without recourse except as provided in the Agreement, all
of the Depositor’s right, title and interest in, to and under (i) all Additional
Pool Loans and related Pool Assets owned by the Depositor on the Addition Date
and all rights of the Depositor under the Purchase Agreements and the Guarantee
with respect to the Additional Pool Loans, (ii) all Pool Collections with
respect thereto and (iii) all proceeds of any of the foregoing (collectively,
the “Additional Pool Assets”).
 
In connection with the foregoing sale and if necessary, the Depositor agrees to
record and file one or more financing statements (and continuation statements or
other amendments with respect to such financing statements when applicable) with
respect to the Additional Pool Assets meeting the requirements of applicable law
in such manner and in such jurisdictions as are necessary to perfect the sale of
the Additional Pool Assets to the Issuer, and to deliver a file-stamped copy of
such financing statements and continuation statements (or other amendments) or
other evidence of such filing to the Issuer.

In connection with the foregoing sale, the Depositor further agrees, on or prior
to the date of this Assignment, to cause the portions of its computer files
relating to the Additional Pool Loans sold on such date to the Issuer to be
clearly and unambiguously marked to indicate that each such Additional Pool Loan
and the other Additional Pool Assets have been sold on such date to the Issuer
pursuant to the Agreement and this Assignment.

It is the express and specific intent of the parties that the transfer of the
Additional Pool Loans and the other Additional Pool Assets from the Depositor to
the Issuer as provided is and shall be construed for all purposes as a true and
absolute sale of such Additional Pool Loans and Additional Pool Assets, shall be
absolute and irrevocable and provide the Issuer with the full benefits of
ownership of the Additional Pool Loans and the other Additional Pool Assets.
Without prejudice to the preceding sentence providing for the absolute transfer
of the Depositor’s interest in the Additional Pool Loans and other Additional
Pool Assets to the Issuer, in order to secure the prompt payment and performance
of all obligations of the Depositor to the Issuer under the Agreement, whether
now or hereafter existing, due or to become due, direct or indirect, or absolute
or contingent, the Depositor hereby assigns and grants to the Issuer a first
priority security interest in all of the Depositor’s right, title and interest,
whether now owned or hereafter acquired, if any, in, to and under all of the
Additional Pool Loans and the other Additional Pool Assets and the proceeds
thereof. The Depositor acknowledges that the Additional Pool Loans and other
Additional Pool Assets are subject to the Lien of the Indenture and Servicing
Agreement for the benefit of the Collateral Agent on behalf of the Trustee and
the Noteholders.

4. Acceptance by the Issuer. The Issuer hereby acknowledges that, prior to or
simultaneously with the execution and delivery of this Assignment, the Depositor
delivered to the Issuer the Pool Loan Schedule described in Section 2 of this
Assignment with respect to all Additional Pool Loans.

5. Representations and Warranties of the Depositor. The Depositor hereby
represents and warrants to the Issuer on the Addition Date that each
representation and warranty to be made by it on such Addition Date pursuant to
the Agreement is true and correct, and that each such
 
A-2

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

 
representation and warranty is hereby incorporated herein by reference as though
fully set out in this Assignment.

6. Ratification of the Agreement. The Agreement is hereby ratified, and all
references to the Agreement shall be deemed from and after the Addition Date to
be references to the Agreement as supplemented and amended by this Assignment.
Except as expressly amended hereby, all the representations, warranties, terms,
covenants and conditions of the Agreement shall remain unamended and shall
continue to be, and shall remain, in full force and effect in accordance with
its terms and except as expressly provided herein shall not constitute or be
deemed to constitute a waiver of compliance with or consent to non-compliance
with any term or provision of the Agreement.

7. Counterparts. This Assignment may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument.

8. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, INCLUDING § 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW, BUT OTHERWISE WITHOUT REFERENCE TO ITS CONFLICT OF LAW PRINCIPLES.

[The remainder of this page is left blank intentionally.]

 

 

 

A-3

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IN WITNESS WHEREOF, each of the parties hereto has caused this Assignment to be
duly executed by their respective officers as of the day and year first written
above.

     
SIERRA DEPOSIT COMPANY, LLC
as Depositor
     
 
By:
 

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

       
Name:
Title:
 

 

     
SIERRA RECEIVABLES FUNDING COMPANY, LLC
as Issuer
     
 
By:
 

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

       
Name:
Title: