<PAGE>   1
                                                                   EXHIBIT 10.1


                                                                  EXECUTION COPY

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                         RECEIVABLES PURCHASE AGREEMENT
                                      among

                             TRENDWEST RESORTS, INC.

                                  ("Trendwest")

                                       and

                              TW HOLDINGS II, INC.
                                   ("TWH II")

                                       and

                              TW HOLDINGS III, INC.
                                   ("TWH III")

                                       and

                              TRI FUNDING IV, INC.
                                 (the "Issuer")

                          Dated as of November 1, 2000

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<PAGE>   2

                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
SECTION                                                             HEADING                                      PAGE
                                                                                                                 ----

<S>                          <C>                                                                                  <C>
ARTICLE 1                    DEFINITIONS...........................................................................2

         Section 1.01.       Defined Terms.........................................................................2

ARTICLE 2                    ACQUISITION OF ASSETS.................................................................4

         Section 2.01.       [Reserved.]...........................................................................4
         Section 2.02.       Initial Acquisition...................................................................4
         Section 2.03.       Delivery of Contracts; Filing of Financing Statements.................................4
         Section 2.04.       Servicing of Contracts and Related Security...........................................5
         Section 2.05.       Review of Contracts...................................................................5

ARTICLE 3                    REPRESENTATIONS AND WARRANTEES........................................................5

         Section 3.01.       Representations and Warranties of the Sellers.........................................5
         Section 3.02.       Representations and Warranties the Issuer............................................15
         Section 3.03.       Purchase or Substitution Required upon Breach of Certain
                               Representations and Warranties.....................................................16
         Section 3.04.       Requirements for Purchase or Substitution of Contracts; Upgrades.....................17

ARTICLE 4                    SELLER COVENANTS.....................................................................19

         Section 4.01.       Seller Covenants.....................................................................19
         Section 4.02.       Issuer Covenants.....................................................................22
         Section 4.03.       Assignment of Assets.................................................................23

ARTICLE 5                    CONDITIONS PRECEDENT.................................................................23

         Section 5.01.       Conditions to Issuer's Initial Obligations...........................................23
         Section 5.02.       Conditions to the Sellers' Obligations...............................................24

ARTICLE 6                    TERM AND TERMINATION.................................................................25

         Section 6.01.       Term.................................................................................25
         Section 6.02.       Default by Sellers...................................................................25

ARTICLE 7                    MISCELLANEOUS........................................................................25

         Section 7.01.       Amendments...........................................................................25
         Section 7.02.       Governing Law........................................................................25
         Section 7.03.       Notices..............................................................................25
         Section 7.04.       Separability Clause..................................................................26
         Section 7.05.       Assignment...........................................................................26
         Section 7.06.       Further Assurances...................................................................26
         Section 7.07.       No Waivers; Cumulative Remedies......................................................26
</TABLE>


                                      -i-

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<TABLE>
<S>                          <C>                                                                                  <C>
         Section 7.08.       Binding Effect; Third Party Beneficiaries............................................26
         Section 7.09.       Set-Off..............................................................................26
         Section 7.10.       Sellers Will Not Institute Insolvency Proceedings....................................27
         Section 7.11.       Counterparts.........................................................................28

Signature Page....................................................................................................28
</TABLE>



ANNEX A         --      FORM OF SUPPLEMENT FOR SUBSTITUTE CONTRACTS AND UPGRADE
                        CONTRACTS
EXHIBIT A       --      FORMS OF CONTRACT
EXHIBIT B       --      FORM OF ASSET ASSIGNMENT
EXHIBIT C       --      FORM OF SUBORDINATED NOTE

SCHEDULE 1      --      Contracts not Originated by Trendwest



                                      -ii-
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        THIS RECEIVABLES PURCHASE AGREEMENT, dated as of November 1, 2000 (this
"Agreement"), by and among Trendwest Resorts, Inc., an Oregon corporation
(herein, together with its permitted successors and assigns, "Trendwest"), TW
Holdings II, Inc., a Delaware corporation (herein, together with its permitted
successors and assigns, "TWH II"), and TW Holdings III, Inc., a Delaware
corporation (herein, together with its permitted successors and assigns, "TWH
III"), and TRI Funding IV, Inc., a Delaware corporation (herein, together with
its permitted successors and assigns, the "Issuer").

                              PRELIMINARY STATEMENT

        The Issuer has entered into an Indenture, dated as of November 1, 2000
(as amended and supplemented from time to time, the "Indenture"), with Wells
Fargo Bank Minnesota, National Association, as trustee (herein, together with
its permitted successors and assigns, the "Trustee"), and Trendwest, as servicer
(herein, together with its permitted successors and assigns, the "Servicer"),
pursuant to which the Issuer intends to issue its notes, as provided in the
Indenture (the "Notes"), limited as to principal amount.

        In furtherance thereof, Trendwest, TWH II and TWH III (collectively, the
"Sellers") and the Issuer have entered into this Agreement to provide for, among
other things, the acquisition and purchase by the Issuer of all of the right,
title and interest in and to certain Assets. The Issuer will be pledging and
granting to the Trustee a security interest in the Issuer's interest in the
Assets, as security for the Notes. As a precondition to the effectiveness of
this Agreement, the Issuer, the Trustee and the Servicer will enter into the
Servicing Agreement, dated as of November 1, 2000 (as amended and supplemented
from time to time, the "Servicing Agreement"), to provide for the administration
and servicing of the Assets. In connection with the issuance of the Notes and
pursuant to this Agreement, the Sellers on the Closing Date will sell the Assets
to the Issuer. Such sales shall be effected on the Closing Date by this
Agreement and an Asset Assignment (as defined herein) among Trendwest, TWH II,
TWH III and the Issuer, and the list of Contracts so conveyed shall be listed on
Schedule I to the Asset Assignment.

        In order to further secure the Notes, the Issuer simultaneously will
grant to the Trustee pursuant to the Indenture, a security interest in, among
other things, the Issuer's rights derived under this Agreement, and the Sellers
agree that all representations, warranties, covenants and agreements made by
them in this Agreement with respect to the Assets shall also be for the benefit
and security of the Trustee and all holders from time to time of the Notes. In
consideration for the Assets and their representations, warranties, covenants
and other agreements under this Agreement, on the Closing Date, TWH II and TWH
III will receive cash, and Trendwest will receive from the Issuer cash, a
Subordinated Note (as defined herein) and all of the common stock of the Issuer.


<PAGE>   5

                                    ARTICLE 1

                                   DEFINITIONS

        Section 1.01. Defined Terms. For purposes of this Agreement the
following terms shall have the meanings specified herein. Capitalized terms used
herein but not otherwise defined shall have the respective meanings assigned to
such terms in the Indenture.

           "Acquisition Consideration" shall mean, with respect to any Contracts
and the related Receivables, the cash which shall be paid by the Issuer to the
Sellers on the Closing Date, and, with respect to Trendwest, all of the stock of
the Issuer, the Subordinated Note and cash.

           "Asset Assignment" shall mean the Asset Assignment, substantially in
the form attached hereto as Exhibit B, which shall be entered into in connection
with the conveyance of Assets from the Sellers to the Issuer on the Closing
Date.

           "Assets" shall mean all of the Sellers' right, title and interest in
and to (a) the Contracts and the related Receivables, including the proceeds of
the Contracts and the related Receivables and all payments received on or with
respect to the Contracts and the related Receivables and due after the
applicable Cut-Off Date, (b) the Contract Files and the Custodian Files, (c) the
Sellers' rights and interests in the Related Security, (d) the Servicing Charges
with respect to the Contracts and (e) all income and proceeds of the foregoing
or relating thereto.

           "Contingent Obligation" of a Person means any agreement, undertaking
or arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including any comfort letter, operating agreement, take-or-pay
contract or application for a letter of credit.

           "Contract File" shall mean, with respect to each Contract and
Mortgage Loans, the following documents:

               (i) a copy of the Loan Documents, as applicable;

               (ii) notice of assignment; and

               (iii) any other documents or papers relating to servicing the
Receivables.

           "Custodian" shall mean Wells Fargo Bank Minnesota, National
Association and its permitted successors and assigns.

           "Custodian File" shall mean, with respect to each Contract and
Mortgage Loan, the following documents:



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<PAGE>   6


               (i) the originally executed Loan Documents, as applicable;

               (ii) notice of assignment; and

               (iii) if the Contract relates to a Fractional Interest, (a) the
originally executed related Mortgage, (b) the originally executed related
Mortgage Note, (c) Title Policy, and (d) originally executed Assignments of the
Mortgage, executed in blank, assigning the related Mortgage from the Seller to
the Issuer and from the Issuer to the Trustee.

               "Cut-Off Date" shall have the meaning set forth in the Indenture.

               "Electronic Ledgers" shall mean the electronic master records of
all contracts of the Sellers or the Issuer similar to and including the
Contracts.

               "Eligible Contract" shall mean a Contract that satisfies the
representations and warranties set forth in Section 3.01(a) hereof.

               "Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes, together
with all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any governmental
authorities, in each case relating to environmental, health, safety and land use
matters.

               "Indebtedness" of a Person means such Person's (i) obligations
for borrowed money, (ii) obligations representing the deferred purchase price of
property or services (other than accounts payable arising in the ordinary course
of such Person's business payable on terms customary in the trade), (iii)
obligations, whether or not assumed, secured by liens or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) capitalized lease obligations, (vi) net liabilities under
interest rate swap, exchange or cap agreements, (vii) Contingent Obligations,
and (viii) liabilities in respect of unfunded vested benefits under plans
covered by Title IV of the Employee Retirement Income Security Act of 1974, as
amended.

               "Indenture" shall mean the Indenture, dated as of November 1,
2000, by and among the Issuer, the Trustee and the Servicer, as amended and
supplemented from time to time.

               "Issuer Address" shall mean 9805 Willows Road, Redmond,
Washington 98052.

               "Loan Document" shall mean (i) with respect to Receivables
relating to Vacation Credits, the related Contract, and (ii) with respect to
Receivables relating to Fractional Interests, each of the related Contract, the
related Mortgage and the related Mortgage Note.

               "Permitted Encumbrances" means with respect to a Mortgage the
following liens and encumbrances against a Fractional Interest: (i) the interest
therein of the Obligor, (ii) the lien of unbilled and unpaid assessments payable
to the applicable condominium association, (iii) the lien of unpaid real
property taxes and assessments which are not yet delinquent, (iv) covenants,
conditions and restrictions, rights of way, easements and other matters of
public record, such exception



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appearing of record being matters to which properties of the same type as such
Fractional Interest are commonly subject and which do not materially interfere
with the benefits of the security intended to be provided by such Mortgage or
being matters specifically disclosed in the applicable land sales registrations
filed with the applicable regulatory agencies, and (v) other matters to which
timeshare interests are commonly subject and which do not materially interfere
with the benefits of the security intended to be provided by such Mortgage.

           "Seller Address" shall mean (i) with respect to Trendwest, shall mean
9805 Willows Road, Redmond, Washington 98052, (ii) with respect to TWH II shall
mean 9805 Willows Road, Redmond, WA 98052, and (iii) with respect to TWH III
shall mean 9805 Willows Road, Redmond, Washington 98052.

           "Substitute Contract" shall have the meaning set forth in Section
3.04(b) hereof.

           "Substitute Receivable" shall mean the Receivable related to a
Substitute Contract.

           "Substitution Criterion" shall have the meaning set forth in Section
3.04(b) hereof.

                                    ARTICLE 2

                              ACQUISITION OF ASSETS

        Section 2.01. [Reserved.]

        Section 2.02. Initial Acquisition. In return for the Acquisition
Consideration with respect to the Assets transferred on the Closing Date and
other rights created by this Agreement, each of Trendwest, TWH II and TWH III
hereby transfers, assigns, sells and grants to the Issuer, without recourse
except as provided in Section 3.03 of this Agreement, on the Closing Date any
and all of such Seller's respective right, title and interest in and to all of
such Assets relating to the Contracts set forth on Schedule I to the Asset
Assignment. Each of the Sellers hereby acknowledges that its transfer of such
Assets to the Issuer is absolute and irrevocable, without reservation or
retention of any interest whatsoever by such Seller (except as set forth in
Section 3.03 hereof).

        Section 2.03. Delivery of Contracts; Filing of Financing Statements. (a)
In connection with the Issuer's acquisition of the Assets, Trendwest, on behalf
of the Sellers and the Issuer, shall deliver, or cause the delivery of, the
original Loan Documents and Assignments of Mortgage to the Custodian so that the
Custodian may retain possession, as agent of the Trustee thereof as provided in
the Transaction Documents. In addition, the Sellers agree to execute, and
Trendwest agrees to record and file prior to the Closing Date at its own
expense, financing statements (and thereafter timely continuation statements
with respect to such financing statements) with respect to the Assets
transferred on such date, in accordance with Section 3.01(a)(viii) and Section
4.01(c) hereof.



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           (b) In connection with such acquisition, each of the Sellers shall
promptly, at its own expense, cause any Electronic Ledger maintained by it to be
marked to show which Assets have been acquired by the Issuer in accordance with
this Agreement and transferred to the Issuer and pledged by the Issuer to the
Trustee in accordance with the Transaction Documents.

           (c) It is the intention of the Sellers and the Issuer that the Issuer
is acquiring full and absolute title to the Assets. If it is determined,
however, that the Sellers have transferred to the Issuer a security interest in
the Assets, then this Agreement shall constitute a security agreement under
applicable law, and each of the Sellers shall be deemed to have granted to the
Issuer, as of the date hereof, a first priority perfected security interest in
such Seller's right, title and interest in the Assets.

        Section 2.04. Servicing of Contracts and Related Security. The Servicer
shall service the Contracts and the other Assets for the benefit of the Issuer
(and its successors and assigns) in accordance with the terms and conditions of
the Transaction Documents. Notwithstanding the foregoing, Trendwest acknowledges
and agrees that its obligations under this Agreement are independent of any
obligations it may have as Servicer and that its obligations under this
Agreement will continue in full force and effect, whether or not it is acting as
Servicer, until termination of this Agreement in accordance with Section 6.01
hereof, unless otherwise provided herein.

        Section 2.05. Review of Contracts. If any of the Sellers or the
Custodian (who shall thereupon notify the Issuer, Trendwest and the Trustee)
discovers that any Loan Document, Contract File or Custodian File is missing or
defective (that is, mutilated, damaged, defaced, incomplete, improperly dated,
forged or otherwise physically altered) in any material respect, Trendwest shall
correct or cure such omission, defect or other irregularity within 30 days from
the date Trendwest discovered such omission or defect, or from the date
Trendwest is notified by the Custodian or another Seller of such omission or
defect. In the event Trendwest is unable to correct or cure such omission,
defect or irregularity within the 30-day period described in the preceding
sentence, Trendwest shall purchase or replace such Contract from the Issuer in
accordance with Section 3.03 hereof.

                                    ARTICLE 3

                         REPRESENTATIONS AND WARRANTEES

        Section 3.01. Representations and Warranties of the Sellers. Each of
Trendwest, with respect to all of the Contracts and related Receivables and
information with respect to WorldMark, TWH II, with respect to the Contracts and
related Receivables transferred by TWH II, and TWH III, with respect to the
Contracts and related receivables transferred by TWH III, hereby and by the
Asset Assignment, hereby makes the following representations and warranties to
the Issuer and for the benefit of the Issuer, the Trustee and Holders of Notes,
on which the Issuer relies in acquiring the Assets and on which the Holders rely
in purchasing such Notes. Such representations and warranties shall survive any
subsequent transfer, assignment,



                                      -5-
<PAGE>   9

contribution or conveyance of the Contracts and related Receivables and interest
in the related Vacation Credits and any issuance of Notes.

           (a) As to each Contract, as of the Closing Date:

                      (i) The information set forth in the Contract Schedule is
           true and correct as of the Cut-Off Date.

                      (ii) The rights with respect to each Loan Document are
           assignable by the lender thereunder and its successors and assigns
           without the consent of any Person.

                      (iii) The applicable Seller has heretofore provided to the
           Custodian the sole original counterpart of the applicable Loan
           Documents, together with any and all amendments, waivers and
           modifications thereto, except for any original executed counterparts
           which have been marked to show that they have been pledged by the
           Issuer to the Trustee under the Indenture, and the terms of such Loan
           Documents have not been further amended, waived or modified
           subsequent to the above being provided to the Custodian.

                      (iv) The Electronic Ledgers have been marked as provided
           in Section 2.03(b) hereof.

                      (v) The Contract was not originated in, nor is it subject
           to the laws of, any jurisdiction, the laws of which would make
           unlawful the sale, transfer or assignment of such document under any
           of the Transaction Documents, including any repurchase in accordance
           with the Transaction Documents.

                      (vi) Each related Loan Document is in full force and
           effect in accordance with its respective terms, and none of the
           Sellers or any Obligor has or will have suspended or reduced any
           payments or obligations due or to become due thereunder by reason of
           a default by the other party to such Loan Document; as of the
           applicable Cut-Off Date, no Scheduled Payment with respect to such
           Loan Document has not been received and remains unpaid for a period
           of 30 or more days (without regard to advances, if any, made by the
           Servicer), and there are no proceedings pending, or to the best of
           the knowledge of any Seller, threatened asserting insolvency of such
           Obligor; there has been no other default, breach or violation of such
           Loan Document; there are no proceedings pending, or to the best of
           the knowledge of any Seller, threatened, wherein such Obligor or any
           governmental agency has alleged that such Loan Document is illegal or
           unenforceable; and none of the related Scheduled Payments are subject
           to any set-off or credit of any kind.

                      (vii) Each related Loan Document is the valid, binding and
           legally enforceable obligation of the parties thereto, enforceable in
           accordance with its terms, subject, as to enforcement, to applicable
           bankruptcy, insolvency,



                                      -6-
<PAGE>   10

           reorganization and other similar laws of general applicability
           relating to or affecting creditors' rights generally and to general
           principles of equity regardless of whether enforcement is sought in a
           court of law or equity.

                      (viii) All actions, filings (including UCC filings) and
           recordings as are required by the Indenture and that may be necessary
           to perfect, with respect to the Trust Estate, a first priority
           security interest of the Issuer and the Trustee in, and the sale by
           the applicable Seller to the Issuer of, the Loan Documents and the
           related Receivables, being acquired and the transfer of the security
           interest in the Related Security hereunder have been accomplished and
           are in full force and effect.

                      (ix) The Contract is identical to one of the form
           contracts attached as Exhibit A hereto, except for either (i) such
           immaterial modifications or deviations from the form contract which
           appear in such Contract, which immaterial modifications or deviations
           will not have a material adverse effect on the Holders of the Notes
           or (ii) such modifications or deviations as set forth on Schedule I
           to the Asset Assignment related to such Contract.

                      (x) Except for the Contracts originated listed on Schedule
           1 hereto, the Contract was originated by Trendwest in Trendwest's
           ordinary course of business and meets Trendwest's qualifications for
           originating vacation credit installment contracts. The origination
           and collection practices used by Trendwest and the applicable Seller
           with respect to such Contract have been in all respects legal,
           proper, prudent and customary in the vacation credit financing and
           servicing business.

                      (xi) The related Receivable is owing under a Contract that
           has a term to the last Scheduled Payment Date of (a) not more than 84
           months if the Contract relates to Vacation Credits and not more than
           120 months if the Contract relates to Fractional Interests and (b)
           not less than one month.

                      (xii) The Contract obligates the related Obligor to make
           all Scheduled Payments thereunder in full notwithstanding the
           collection by Trendwest of a security deposit with respect thereto.
           The calculation of the Collateral Value of the related Receivable
           does not include any security deposits or similar payments collected
           by or on behalf of Trendwest which are applied to Scheduled Payments.

                      (xiii) All requirements of applicable federal, State and
           local laws, and regulations thereunder, including, without
           limitation, usury laws, if any, in respect of the Contract have been
           complied with in all material respects, and such Contract complied in
           all material respects at the time it was originated or made and now
           complies in all material respects with all legal requirements of the
           jurisdiction in which it was originated.



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<PAGE>   11

                      (xiv) Each of the Contract and the related Mortgage Note,
           if any, is not and will not be subject to any right of rescission,
           set-off, counterclaim or defense, including the defense of usury,
           whether arising out of transactions concerning such Contract or
           Mortgage Note or otherwise, and the operation of any of the terms of
           such Contract or Mortgage Note or the exercise by the applicable
           Seller or the Obligor of any right under such Contract or Mortgage
           Note will not render such Contract or Mortgage Note unenforceable in
           whole or in part, and no such right of rescission, set-off,
           counterclaim or defense has been asserted with respect thereto,
           except that certain rights or defenses may exist under applicable law
           which, individually or in the aggregate, do not make the remedies
           available to the Seller with respect to such Contract or Mortgage
           Note inadequate for the practical realization of the benefits
           provided thereby.

                      (xv) Each of the Sellers has duly fulfilled all
           obligations on the lender's part to be fulfilled under or in
           connection with the related Loan Documents, including, without
           limitation, giving any notices or consents necessary to effect the
           acquisition of the Assets by the Issuer and has done nothing to
           impair the rights of the Issuer in such Loan Documents or payments
           with respect thereto.

                      (xvi) The related Loan Documents, the related Receivable
           and the related Seller's interest in the Related Security have not
           been sold, transferred, assigned or pledged by such Seller to any
           Person other than the Issuer (except for such interests in the Assets
           which shall be terminated on or prior to the Closing Date), and upon
           execution and delivery hereof and of the Asset Assignment by the
           related Seller and the payment by the Issuer of the related
           Acquisition Consideration, the Issuer will have all of the right,
           title and interest in and to such Seller's interest in the Assets,
           free and clear of all liens and encumbrances, except for the
           interests of the Obligor pursuant to the related Loan Documents.

                      (xvii) The Seller has no specific knowledge that the
           related Loan Documents will not be fully performed in accordance with
           their terms.

                      (xviii) The Obligor has made payments at least equal to
           two Scheduled Payments (which payments may be advance payments under
           such Contract) due under the related Loan Documents within the time
           set forth in such Loan Documents.

                      (xix) The related Obligor is a resident of the United
           States of America or Canada (other than the Province of Quebec), and
           the related Scheduled Payments are payable in U.S. dollars.

                      (xx) The related Scheduled Payments were established at
           the time such Contract was originated.

                      (xxi) There are no unpaid brokerage or other fees owed to
           third parties relating to the origination of the Contract.



                                      -8-
<PAGE>   12

                      (xxii) The Contract cannot be rescinded pursuant to
           applicable consumer finance laws.

                      (xxiii) The contract was originated in compliance with the
           requirements of all federal, state and local laws, rules and
           regulations applicable to the origination of the Contract (including,
           without limitation, the Federal Truth-in-Lending Act, the Equal
           Credit Opportunity Act, the Fair Credit Billing Act, the Fair Credit
           Reporting Act, the Fair Debt Collection Practices Act, the Federal
           Trade Commission Act, the Magnuson-Moss Warranty Act, the Federal
           Reserve Board's Regulations "B" and "Z," the Soldiers' and Sailors'
           Civil Relief Act of 1940, and any other federal, state and local laws
           relating to interest, usury, consumer credit, equal credit
           opportunity, fair credit reporting, privacy, consumer protection,
           false or deceptive trade practices and disclosure, the Mail Fraud
           statute and any timeshare disclosure), non-compliance with which
           could have a material adverse effect on the enforceability or value
           of the Contract.

                      (xxiv) All Scheduled Payments are due and payable on a
           monthly basis, and such Scheduled Payments are level payments
           throughout the terms of the Contract.

                      (xxv) With respect to a Contract relating to Fractional
           Interests:


                                 (A) The related Fractional Interest mortgaged
                      by the related Obligor constitutes a fee simple interest
                      in real property and improvements at the applicable
                      Resort. The related Mortgage has been duly filed and
                      recorded with all appropriate governmental authorities in
                      all jurisdictions in which such Mortgage is required to be
                      filed and recorded to create a legal, valid, binding and
                      enforceable first Lien on the related Fractional Interest,
                      and such Mortgage creates a legal, valid and binding first
                      Lien on the related Fractional Interest, enforceable in
                      accordance with its terms, subject only to Permitted
                      Encumbrances. The Assignments of Mortgage of such related
                      Mortgage from the Seller to the Issuer and each related
                      endorsement of the related Mortgage Note constitutes a
                      duly executed, legal, valid, binding and enforceable sale,
                      assignment or endorsement, as the case may be, of such
                      related Mortgage and related Mortgage Note, and all monies
                      due or to become due thereunder, and all proceeds thereof.
                      The Seller has executed and delivered or within five
                      Business Days of the Closing Date will have executed and
                      delivered each Assignment of Mortgage from the Seller to
                      the Issuer of such related Mortgage, endorsed such related
                      Mortgage Note, and delivered it to the Issuer or, at the
                      Issuer's instruction, the Custodian as required by Section
                      2.03 hereof.


                                 (B) The related Mortgage contains customary and
                      enforceable provisions so as to render the rights and
                      remedies of the holder thereof adequate for the
                      realization against the related Fractional Interest of the
                      benefits of the security interests intended to be provided
                      thereby.



                                      -9-
<PAGE>   13

                                 (C) The related Mortgage Loan is or will be
                      within sixty (60) days of the Cut-Off Date covered by a
                      title policy issued by a title insurer qualified to do
                      business in the jurisdiction where the related Fractional
                      Interest is located in a form generally acceptable to
                      prudent originators of similar mortgage loans, insuring
                      Trendwest and its successors and assigns, as to the first
                      priority mortgage Lien of the related Mortgage in an
                      amount equal to the original principal balance of such
                      Mortgage Loan. Upon issuance of the title policy, such
                      title policy is or will be in full force and effect and is
                      enforceable by the Servicer without the consent of or any
                      notification to the insurer except as set forth in the
                      form of policy. No claims have been made under such title
                      policy, and no prior holder of such Mortgage Loan has done
                      or omitted to do anything which would impair the coverage
                      of such title policy. Full premiums for such title policy,
                      endorsements or all special endorsements have been paid.

                                 (D) The Seller has not taken (or omitted to
                      take), and has no knowledge that the related Obligor has
                      taken (or omitted to take), any action that would impair
                      in any material respect or invalidate the coverage
                      provided by any hazard insurance, title policy or any
                      other insurance policy relating to the related Mortgage
                      Loan or the related Fractional Interest.


                                 (E) All applicable intangible taxes and
                      documentary stamp taxes were paid as to the related
                      Mortgage Note and the related Mortgage.

                                 (F) The proceeds of the related Mortgage Loan
                      have been fully disbursed, there is no obligation to make
                      future advances or to lend additional funds under the
                      mortgagee's commitment or the documents and instruments
                      evidencing or securing such Mortgage Loan and no such
                      advances or loans have been made since the origination of
                      such Mortgage Loan.


                                 (G) Neither the related Mortgagor nor any other
                      Person has the right, by statute, contract or otherwise,
                      to seek the partition of the related Fractional Interest.


                                 (H) The related Mortgage Note conveyed
                      hereunder has been endorsed and assigned in a manner that
                      satisfies all requirements of endorsement and assignment,
                      in order to transfer all right, title and interest of the
                      applicable Seller in such Mortgage Note to the Issuer.

                      (xxvi) The related Loan Documents have not been satisfied,
           subordinated or rescinded.



                                      -10-
<PAGE>   14

                      (xxvii) The related Obligor has paid, in the aggregate, an
           amount not less than 10% of the original purchase price of the
           Vacation Credits or Fractional Interest, as applicable.

           (b) As to the aggregate pool of Contracts and Mortgage Loans
supporting the Notes as of the Closing Date, no Seller used any selection
procedures that identified the Contracts and Mortgage Loans as being less
desirable or valuable than other comparable vacation credit installment
contracts owned by such Seller.

           (c) As to each Seller and WorldMark (to the extent specific reference
to WorldMark is made) as of the Closing Date:

                      (i) Such Seller has been duly organized and is validly
           existing and in good standing as a corporation under the laws of the
           State in which such Seller was organized with corporate power and
           authority to own its properties and to transact the business in which
           it is now engaged, and such Seller is duly qualified to do business
           in and is in good standing under the laws of each State in which its
           business is located or is not required under applicable law to effect
           such qualification, except where failure to so qualify would not have
           a material adverse effect on the ability of such Seller to perform
           its obligations under the Transaction Documents or on any of the Loan
           Documents, the Receivables or the Related Security or on the ability
           of such Seller, the Issuer or the Trustee to realize upon or enforce
           the same.

                      (ii) The performance of the obligations of such Seller
           under this Agreement and the other Transaction Documents and the
           consummation of the transactions herein and therein contemplated will
           not conflict with or result in any breach of any of the terms or
           provisions of, or constitute with or without notice, lapse of time or
           both, a default under the certificate of incorporation, articles of
           incorporation and bylaws, as applicable, of such Seller, or any
           material indenture, agreement, mortgage, deed of trust or other
           instrument to which such Seller is a party or by which it is bound,
           or result in the creation or imposition of any lien, charge or
           encumbrance (except the lien created by the Transaction Documents)
           upon any of the property or assets of such Seller pursuant to the
           terms of such indenture, mortgage, deed of trust, or other agreement
           or instrument to which such Seller is a party or by which such Seller
           is bound or to which any of such Seller's property or assets is
           subject, nor will such action result in any violation of the
           provisions of such Seller's Certificate of Incorporation, Articles of
           Incorporation and By-laws, as applicable, or any statute or any
           order, rule or regulation of any court or any regulatory authority or
           other governmental agency or body having jurisdiction over such
           Seller or any of its properties; and no consent, approval,
           authorization, order, registration or qualification of or with or
           other action of any court, or any such regulatory authority or other
           governmental agency or body is required for consummation of the
           transactions contemplated by this Agreement and the other Transaction
           Documents except such consents, approvals and authorizations which
           have been obtained or such registrations or qualifications which have
           been made.



                                      -11-
<PAGE>   15

                      (iii) This Agreement and any other Transaction Document to
           which such Seller is a party have been duly authorized, executed and
           delivered by such Seller by all necessary corporate action and such
           agreements are the valid and legally binding obligations of such
           Seller, enforceable against such Seller in accordance with their
           respective terms, subject as to enforcement to applicable bankruptcy,
           insolvency, reorganization and other similar laws of general
           applicability relating to or affecting creditors' rights generally
           and to general principles of equity regardless of whether enforcement
           is sought in a court of law or equity.

                      (iv) The relevant Seller Address is the chief executive
           office, principal place of business and the office where such Seller
           keeps its records concerning the Contracts, Receivables and the
           related Vacation Credits. Such Seller has not used any address other
           than its Seller Address, 12301 N.E. 10th Place, Bellevue, Washington
           98005 or 4010 Lake Washington Boulevard, Suite 300, Kirkland,
           Washington 98033, in the previous five-year period. Such Seller's
           legal name is as set forth in this Agreement. Such Seller has not
           used or done business under any other name in the previous six-year
           period.

                      (v) Such Seller does not have knowledge of, nor should it
           reasonably know of, any fact that would render it unable to perform
           each and every covenant contained in this Agreement.

                      (vi) The transactions contemplated by the Transaction
           Documents are being consummated by such Seller in furtherance of its
           ordinary business purposes, with no contemplation of insolvency and
           with no intent to hinder, delay or defraud any of its present or
           future creditors.

                      (vii) The consideration received by such Seller pursuant
           to this Agreement is fair consideration having value reasonably
           equivalent to or in excess of the value of the performance of such
           Seller's obligations hereunder and is reasonably equivalent to amount
           that could be obtained from an unaffiliated third party in an
           arm's-length transaction.

                      (viii) Neither on the date of the transactions
           contemplated by the Transaction Documents or immediately before or
           after such transactions, nor as a result of the transactions, will
           such Seller:


                                 (A) be insolvent such that the sum of its debts
                      is greater than all of its respective property, at a fair
                      valuation;

                                 (B) be engaged in, or about to engage in,
                      business or a transaction for which any property remaining
                      with such Seller will be an



                                      -12-
<PAGE>   16

                      unreasonably small capital or the remaining assets of such
                      Seller will be unreasonably small in relation to its
                      respective business or the transaction; and

                                 (C) have intended to incur, or believed it
                      would incur, debts that would be beyond its respective
                      ability to pay as such debts mature or become due. Such
                      Seller's assets and cash flow enable it to meet its
                      present obligations in the ordinary course of business as
                      they become due.

                      (ix) Both immediately before and after the transactions
           contemplated by the Transaction Documents (a) the present fair
           salable value of such Seller's assets was or will be in excess of the
           amount that will be required to pay its probable liabilities as they
           then exist and as they become absolute and matured; and (b) the sum
           of such Seller's assets was or will be greater than the sum of its
           debts, valuing its assets at a fair salable value.

                      (x) The acquisition of the Assets by the Issuer pursuant
           to this Agreement is not subject to the bulk transfer or any similar
           statutory provisions in effect in any applicable jurisdiction.

                      (xi) There are no proceedings or investigations pending
           or, to the knowledge of such Seller, threatened against or affecting
           such Seller in or before any court, governmental authority or agency
           or arbitration board or tribunal which, individually or in the
           aggregate, involve the possibility of materially and adversely
           affecting the properties, business, prospects, profits or condition
           (financial or otherwise) of such Seller or WorldMark, or the ability
           of such Seller to perform its obligations under this Agreement or the
           other Transaction Documents. Such Seller is not in default with
           respect to any order of any court, governmental authority or agency
           or arbitration board or tribunal.

                      (xii) All tax returns or extensions required to be filed
           by such Seller in any jurisdiction have in fact been filed, and all
           taxes, assessments, fees and other governmental charges upon such
           Seller, or upon any of the respective properties, income or
           franchises shown to be due and payable on such returns have been, or
           will be, paid. All such tax returns are true and correct, and such
           Seller has no knowledge of any proposed additional tax assessment
           against it in any material amount nor of any basis therefor. The
           provisions for taxes on the books of such Seller are in accordance
           with generally accepted accounting principles.

                      (xiii) Such Seller (i) is not in violation of any laws,
           ordinances, governmental rules or regulations to which it is subject,
           (ii) has not failed to obtain any licenses, permits, franchises or
           other governmental authorizations necessary to the ownership of its
           property or to the conduct of its business, and (iii) is not in
           violation in any material respect of any term of any agreement,
           charter instrument, bylaw or instrument to which it is a party or by
           which it may



                                      -13-
<PAGE>   17

           be bound which violation or failure to obtain might materially
           adversely affect the business or condition (financial or otherwise)
           of such Seller.

                      (xiv) It is the intention of such Seller that the Assets
           are being or have been acquired by the Issuer and that the beneficial
           interest in and title to the Assets are not part of such Seller's
           estate in the event of the filing of a bankruptcy petition by or
           against such Seller under any bankruptcy law.

                      (xv) Immediately prior to the transfer of Assets by such
           Seller to the Issuer pursuant to this Agreement, such Seller was the
           sole owner of such Assets at such time and had good and marketable
           title to such Assets, free and clear of all liens, claims and
           encumbrances (except for the Acquisition Consideration and security
           interests in such Assets, if applicable, which shall be terminated on
           or prior to the Closing Date).

                      (xvi) Such Seller will treat the transfer of the Assets as
           a sale to the Issuer for federal, State and local income tax
           reporting and accounting purposes.

                      (xvii) The sale of the Assets pursuant to this Agreement
           constitutes the valid sale by such Seller to the Issuer of all of
           such Seller's right, title and interest in the Assets.

                      (xviii) Such Seller has valid business reasons for selling
           the Assets to the Issuer pursuant to this Agreement rather than
           obtaining a loan secured by the Assets.

                      (xix) Such Seller will be operated generally so as to not
           be substantively consolidated with the Issuer for bankruptcy
           purposes.

                      (xx) No event has occurred that adversely affects such
           Seller's ability to perform the transactions contemplated by the
           Transaction Documents.

                      (xxi) Each pension plan or profit sharing plan to which
           such Sellers is a party has been fully funded in accordance with the
           obligations of such Seller as set forth in such plan.

                      (xxii) Neither the acquisition nor the holding of the
           Contracts and the related Receivables violates any federal or State
           law, rule or regulation the non-compliance with which could have a
           material adverse effect on the value of the Contracts or the related
           Receivables.

           (d) Liabilities of WorldMark. WorldMark:

                      (i) has not voluntarily incurred or at any time become
           voluntarily liable for any Indebtedness;



                                      -14-
<PAGE>   18

                      (ii) has not voluntarily allowed its property to become
           subject to any Liens, nor is any of its property subject to any
           Liens, other than (A) utility or other easements or licenses
           unrelated to any debt of WorldMark or (B) Liens that do not exceed,
           in the aggregate, $100,000; and

                      (iii) has not involuntarily incurred and is not
           involuntarily liable for any debt, nor is any of its property
           involuntarily subject to any Liens (other than utility or similar
           easements or licenses unrelated to any debt of WorldMark) that
           individually or in the aggregate (with respect to all such debt and
           the obligations secured by all such Liens) exceed $1,000,000.

                      (e) Environmental Matters. The Sellers have conducted
           their operations and kept and maintained their property in compliance
           with all Environmental Laws. Trendwest has performed its duties under
           its management agreement with WorldMark in material compliance with
           all Environmental Laws.

        Section 3.02. Representations and Warranties of the Issuer. The Issuer
hereby makes the following representations and warranties for the benefit of the
Trustee and Holders of the Notes, on which the Sellers rely in entering into
this Agreement with the Issuer and on which the Holders of the Notes rely in
purchasing the Notes; such representations and warranties speak as of the
Closing Date unless otherwise indicated, but shall survive any subsequent
transfer, assignment, contribution or conveyance of the Assets or any part
thereof:

                      (a) The Issuer has been duly organized and is validly
           existing in good standing as a corporation under the laws of the
           State of Delaware, with corporate power and authority to own its
           properties, perform its obligations under the Transaction Documents
           and to transact the business in which it is now engaged or in which
           it proposes to engage; the Issuer is duly qualified to do business
           and is in good standing in each State in which the nature of its
           business requires it to be so qualified, except where failure to so
           qualify would not have a material adverse effect on the ability of
           the Issuer to perform its obligations under the Transaction
           Documents.

                      (b) The transfer to and receipt by the Issuer of the
           Sellers' interest in the Loan Documents, the Receivables and the
           Related Security pursuant to this Agreement and the consummation of
           the transactions contemplated herein and in the Transaction Documents
           will not conflict with or result in breach of any of the terms or
           provisions of, or constitute (with or without notice, lapse of time
           or both) a default under the certificate of incorporation or by-laws
           of the Issuer or any material indenture, agreement, mortgage, deed of
           trust or other instrument to which the Issuer is a party or by which
           it is bound, or result in the creation or imposition of any lien,
           charge or encumbrance (except for the lien created by the Indenture)
           upon any of the property or assets of the Issuer pursuant to the
           terms of, such indenture, mortgage, deed of trust, or other agreement
           or instrument to which the Issuer is a party or by which it is bound
           or to which any of the property or assets of the Issuer is subject,
           nor will such action result in any violation of the provisions of the
           certificate of incorporation or by-laws of the Issuer or any statute
           or any order, rule or regulation of any court or regulatory authority
           or other governmental agency or body



                                      -15-
<PAGE>   19

           having jurisdiction over the Issuer or any of its properties; and no
           consent, approval, authorization, order, registration or
           qualification of or with or other action of any court or any such
           regulatory authority or other governmental agency or body is required
           for the acquisition of the Assets hereunder.

                      (c) The Transaction Documents to which the Issuer is a
           party have been duly authorized, executed and delivered by the Issuer
           by all necessary corporate action and constitute valid and legally
           binding obligations of the Issuer enforceable against the Issuer in
           accordance with their terms, subject as to enforcement to bankruptcy,
           insolvency, reorganization and other similar laws of general
           applicability relating to or affecting creditors' rights generally
           and to general principles of equity regardless of whether enforcement
           is sought in a court of equity or law.

                      (d) There are no proceedings or investigations to which
           the Issuer is a party pending or, to the knowledge of the Issuer,
           threatened, before any court, regulatory body, administrative agency
           or other tribunal or governmental instrumentality (a) asserting the
           invalidity of this Agreement, (b) seeking to prevent the issuance of
           the Notes or the consummation of any of the transactions contemplated
           by this Agreement, or (c) seeking any determination or ruling that
           would materially and adversely affect the performance by the Issuer
           of its obligations under, or the validity or enforceability of, this
           Agreement.

                      (e) All approvals, authorizations, consents, orders or
           other actions of any Person or of any court, governmental agency or
           body or official, required in connection with the execution and
           delivery of this Agreement, have been or will be taken or obtained on
           or prior to the Closing Date.

                      (f) The Issuer Address is the principal place of business
           and chief executive office of the Issuer.

        Section 3.03. Purchase or Substitution Required upon Breach of Certain
Representations and Warranties. Upon discovery by the Issuer or any of the
Sellers of the breach of any representations or warranties set forth in Section
3.01 or 3.02 hereof which materially and adversely affects the value of a
Contract, Receivable, the Related Security, or the interests of the Holders of
the Notes, or a breach of any of the representations and warranties set forth in
Sections 3.01(a)(v), 3.01(a)(vi), 3.01(a)(vii), 3.01(a)(xiii), 3.01(a)(xiv),
3.01(a)(xvi), 3.01(a)(xxii) or 3.01(a)(xxiii) hereof, the party discovering such
breach shall give prompt written notice to the other parties. Trendwest shall,
within 30 days from the date it was notified of, or otherwise discovers, such
breach, cure such breach, or, (1) if the breach relates to a particular
Contract, Receivable or Related Security and is not cured, either (a) purchase
the Issuer's interest in such Loan Document and the related Receivable and
Related Security from the Issuer at the Purchase Price or (b) provide a
Substitute Contract or (2) if the breach relates to a representation or warranty
(as set forth in Section 3.01(a) herein) regarding the Contracts as a whole and
is not cured by Trendwest, either (a) purchase the Issuer's interest in such
non-conforming Contract or Contracts and the related Receivables from the Issuer
or (b) provide Substitute Contracts as set forth above, so that the
representations and warranties (as set forth in Section 3.01(a) herein) are
correct, as evidenced by a certificate of an officer of Trendwest to the
Trustee. The Purchase



                                      -16-
<PAGE>   20

Price for a purchased Contract shall be paid, and any Substitute Contract shall
be delivered, by Trendwest to the Issuer in accordance with Section 3.04(c)
hereof. It is understood and agreed that the obligation of Trendwest to cure or
purchase or replace any Contract as to which such a breach has occurred shall
constitute the sole remedy respecting such breach available to the Issuer, the
Holders of Notes or the Trustee on behalf of such Holders (except for any
indemnities provided under Section 4.01(j) hereof or any obligations under the
Indenture) for any losses, claims, damages and liabilities arising from the
Issuer's interest in such Contract or the inclusion of the Issuer's interest in
such Contract in the Trust Estate.

        Section 3.04. Requirements for Purchase or Substitution of Contracts;
Upgrades. (a) If Trendwest is required to purchase the Issuer's interest in any
Contract and the related Receivables, under Section 3.03 hereof or if the Issuer
is required or elects to purchase the Trustee's interest in any Contract and the
related Receivables under Section 3.10 of the Servicing Agreement, such Contract
and related Receivables shall be purchased by Trendwest at the Purchase Price.
All purchases shall be accomplished at the times specified in subsection (c)
below.

        (b) If Trendwest is required to substitute any Contract under Section
3.03 hereof, each such contract (a "Substitute Contract") shall (i) be an
Eligible Contract; (ii) be written on one of the standard forms attached as
Exhibit A to this Agreement; (iii) be accompanied by a supplement to this
Agreement substantially in the form of Annex A hereto subjecting such Contract
to the provisions hereof and providing with respect to such Substitute Contract
the information required in the Contract Schedule; (iv) not have been selected
using procedures that identified the Contracts as being less desirable or
valuable than other comparable vacation credit installment contracts owned by
Trendwest; and (v) not have any Scheduled Payments that are due after the date
that is six months prior to the Stated Maturity of the Notes supported by such
Contract. In addition, (i) such Substitute Contracts shall have an aggregate
Collateral Value at least equal to and not substantially greater than the
aggregate Collateral Value of the Contracts being withdrawn as of the date of
withdrawal (the "Substitution Criterion"), (ii) such Substitute Contract will
have an interest rate that is not 1% less than the original Contract and (iii)
the representations and warranties set forth in Sections 3.01 and 3.02 shall be
true and correct with respect to such Substitute Contract and the aggregate pool
of Contracts as of the date such Substitute Contract is conveyed to the Issuer.

        Upon the substitution of any Substitute Contract pursuant to the
provisions of this Section 3.04(b), Trendwest hereby agrees that such Substitute
Contract will be subject to all the terms and provisions of this Agreement, the
Servicing Agreement, the Custodian Agreement and the Indenture just as if such
Substitute Contract had been one of the original Contracts acquired on the
Closing Date. Upon the substitution of a Substitute Contract pursuant to this
Section 3.04(b), the Issuer and Trendwest shall also comply with the provisions
and limitations set forth in the Indenture. All substitutions shall be
accomplished at the time specified in subsection (c) below.

        (c) Any purchase or substitution of a Contract by Trendwest in
accordance with Section 3.03 hereof or this Section 3.04 shall be made either by
remittance of the Purchase Price to the Servicer for deposit into the Clearing
Account in accordance with Section 3.03(a) of the



                                      -17-
<PAGE>   21

Servicing Agreement or by substitution of a Substitute Contract, as applicable,
within one Business Day following the expiration of the cure period set forth in
Section 3.03 hereof.

        (d) If an Obligor notifies Trendwest of its intent to enter into an
Upgrade Contract, Trendwest, as Servicer, shall inform the Issuer of such fact.
In such event, if the Issuer desires to purchase the receivable related to such
Upgrade and so advises Trendwest, Trendwest will allow the Obligor to upgrade
and transfer the related Upgrade Contract to the Issuer in exchange for the
existing Contract with such Obligor and an amount equal to the difference in the
principal balance between the existing Contract and the Upgrade Contract (which
amount shall be paid to Trendwest out of funds distributed to the Issuer
pursuant to Section 12.02(d) of the Indenture or by increasing the amount owed
by the Issuer under the Subordinated Note); provided, however, that (i) such
Upgrade Contract must have an interest rate that is not more than 1.0% per annum
lower than the interest rate on the Contract that is being replaced, (ii) each
Scheduled Payment under the Upgrade Contract must be the equal to or greater
than the Scheduled Payments on the existing Contract, (iii) such Obligor must
have made all Scheduled Payments within the time periods required by the related
Contract which were due on or before the date of such Upgrade, (iv) such Upgrade
Contract must be written on one of the standard forms attached as Exhibit A to
this Agreement, (v) the Upgrade Contract is an Eligible Contract, (vi)
simultaneous with the execution of the Upgrade Contract, Trendwest shall have
executed a form of assignment to the Issuer attached to such Upgrade Contract
and the Issuer will pledge such Receivable to the Trustee pursuant to the
Indenture, (vii) such Upgrade Contract shall be delivered by Trendwest to the
Custodian immediately after execution of such contract by the Obligor, WorldMark
and Trendwest (and, in any event, prior to the release of the original
Contract), (viii) any applicable rescission period has expired and (ix) clauses
(i)-(viii) above shall be representations and warranties of Trendwest, and
Trendwest shall be obligated to purchase from the Issuer any Upgrade Contract
that does not comply with such representations and warranties. Simultaneous with
the delivery of such Upgrade Contract to the Custodian, Trendwest shall deliver
to the Trustee a supplement to this Agreement substantially in the form of Annex
A hereto subjecting such Contract to the provisions hereof and providing with
respect to such Upgrade Contract the information required on the Contract
Schedule.

        Upon the acquisition by the Issuer of any Upgrade Contract pursuant to
the provisions of this Section 3.04(d) (and the subsequent transfer of the
related Receivable to the Issuer), Trendwest hereby agrees that such Upgrade
Contract and the related Receivable, as applicable, will be subject to all the
terms and provisions of this Agreement and the Indenture just as if such Upgrade
Contract had been one of the original Contracts acquired on the Closing Date.

                                    ARTICLE 4

                                SELLER COVENANTS

        Section 4.01. Seller Covenants. Each Seller hereby covenants and agrees
with the Issuer as follows:



                                      -18-
<PAGE>   22

                (a) Except as hereinafter provided, such Seller will keep in
        full effect its existence, rights and franchises as a corporation and
        will obtain and preserve its qualification to do business as a foreign
        corporation in each jurisdiction in which such qualification is or shall
        be necessary to protect the validity and enforceability of this
        Agreement or any of the Loan Documents and to perform its duties
        hereunder. Any person into which such Seller may be merged or
        consolidated, or to whom such Seller has sold substantially all of its
        assets, or any corporation resulting from any merger, conversion or
        consolidation to which such Seller shall be a party, or any Person
        succeeding to the business of such Seller shall be the successor of such
        Seller 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 (w) immediately
        after giving effect to such transaction, no representation or warranty
        made pursuant to Section 3.01(c) hereof shall have been breached, (x)
        such successor executes an agreement of assumption, in form reasonably
        satisfactory to the Trustee, to perform every obligation under this
        Agreement, (y) such Seller shall have delivered to the Issuer a
        certificate of an officer of such Seller and an Opinion of Counsel each
        stating that such consolidation, merger, or succession and such
        agreement of assumption complies with this Section 4.01 and that all
        conditions precedent, if any, provided for in this Agreement relating to
        such transaction have been complied with, and (z) such Seller shall have
        delivered to the Issuer an Opinion of Counsel either (1) stating that,
        in the opinion of such counsel, all financing statements and
        continuation statements and amendments thereto have been executed and
        filed that are necessary fully to preserve and protect the interest of
        the Issuer in the Contracts and reciting the details of such filings, or
        (2) stating that, in the opinion of such counsel, no such action shall
        be necessary to preserve and protect such interest.

                (b) Neither such Seller nor any of the members, directors,
        officers, employees or agents of such Seller shall be under any
        liability to the Issuer, the Trustee or the Holders of Notes 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 not
        involving recklessness or negligence; provided, however, that this
        provision shall not protect such Seller against any breach of warranties
        or representations made herein, or failure to perform its obligations in
        strict compliance with this Agreement, or any liability which would
        otherwise be imposed by reason of any breach of the terms and conditions
        of this Agreement. Such Seller, and any member, director, officer,
        employee or agent of such Seller, 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. Such Seller shall not be under
        any obligation to appear in, prosecute, or defend any legal action that
        is not incidental to its obligations as the seller of the Assets under
        this Agreement and that in its opinion may involve it in any expense or
        liability.

                (c) Such Seller will from time to time, at its own expense,
        execute and file such additional financing statements (including
        continuation statements) as may be necessary or which the Trustee may
        deem appropriate to preserve the security interests and liens described
        in Section 3.01(a)(viii) hereof and are reasonably satisfactory in form
        and substance to the Issuer.



                                      -19-
<PAGE>   23

                (d) Such Seller will not change its name, identity or corporate
        structure in any manner that would, could, or might make any financing
        statement or continuation statement misleading within the meaning of
        section 9-402(7) of the UCC, unless it shall have given the Issuer and
        the Trustee at least 30 days' prior written notice thereof.

                (e) Such Seller will give the Issuer and the Trustee at least 30
        days' prior written notice of any relocation of its principal executive
        office if, as a result of such relocation, the applicable provisions of
        the UCC would require the filing of any amendment of any previously
        filed financing or continuation statement or of any new financing
        statement.

                (f) Such Seller will duly fulfill all obligations on its part to
        be fulfilled under or in connection with each Loan Document, will not
        change or modify the terms of the Loan Documents (and shall prevent any
        third-party originator that still owns any Loan Document from changing
        or modifying the terms of any such Contract) except as expressly
        permitted by the terms of the Transaction Documents and will do nothing
        to impair the rights of the Issuer or the Trustee in the Assets. In the
        event that the rights of such Seller under any Loan Document or any
        guaranty of the related Obligor's obligations under any Loan Document
        are not assignable to the Issuer, such Seller will enforce such rights
        on behalf of the Issuer; the Seller is not aware of any such inability
        to assign any Loan Documents.

                (g) Such Seller will comply, in all material respects, with all
        material acts, rules, regulations, orders, decrees and directions of any
        governmental authority applicable to the Assets or any part thereof;
        provided, however, that such Seller may contest any act, regulation,
        order, decree or direction in any reasonable manner which shall not
        materially and adversely affect the rights of the Issuer or the Trustee
        in the Assets.

                (h) Such Seller will advise the Issuer and the Trustee promptly,
        in reasonable detail, of the occurrence of any breach by such Seller
        following discovery by such Seller of such breach of any of its
        representations, warranties and covenants contained herein.

                (i) Such Seller will execute or endorse, acknowledge, and
        deliver to the Issuer and the Trustee from time to time such schedules,
        confirmatory assignments, conveyances, and other reassurances or
        instruments and take such further similar actions relating to the
        Assets, and the rights covered by the Transaction Documents, as the
        Issuer or the Trustee may reasonably request to preserve and maintain
        title to the Assets and the rights of the Trustee and the Holders of
        Notes therein against the claims of all persons and parties.

                (j) Trendwest agrees to indemnify, defend and hold the Issuer
        harmless from and against any and all loss, liability, damage, judgment,
        claim, deficiency or expense (including interest, penalties, reasonable
        attorney's fees and amounts paid in settlement) that is caused by (i) a
        material breach at any time by any Seller of the representations,
        warranties and covenants contained in Section 3.01 hereof or this
        Section 4.01 or (ii) any material information furnished by any Seller
        which is set forth in any schedule delivered



                                      -20-
<PAGE>   24

        hereunder, being untrue in any material respect when any such
        representation was made or schedule delivered, provided that Trendwest
        shall not have any liability with respect to a representation or
        warranty as to any specific Loan Document, Receivable or the Related
        Security other than to purchase such Contract or substitute for such
        Contract in accordance with Section 3.03 hereof unless such breach of
        representation or warranty is the result of a Seller's fraud,
        negligence, bad faith or willful misconduct. Trendwest shall also
        indemnify the Issuer, the Trustee and the Servicer for any cost or
        expenses incurred by them in the enforcement of this Agreement. The
        obligations of Trendwest under this Section 4.01(j) shall be considered
        to have been relied upon by the Issuer and shall survive the execution,
        delivery and performance of this Agreement, regardless of any
        investigation made by or on behalf of the Issuer, until termination of
        the Indenture. If Trendwest has made any indemnity payments pursuant to
        this Section 4.01(j) and thereafter the recipient collects any of such
        amounts from others, such party will promptly repay the amount collected
        to Trendwest, without interest.

                (k) Such Seller will do nothing to disturb or impair the
        acquisition hereunder by the Issuer of all of such Seller's right, title
        and interest in the Assets.

                (l) Such Seller (i) will (A) maintain its books and records
        separate from the books and records of the Issuer and (B) maintain bank
        accounts separate from those of the Issuer and (ii) will not (x) take,
        prior to the complete payment of the Notes, any action that would cause
        the dissolution or liquidation of the Issuer, (y) guarantee (directly or
        indirectly), endorse or otherwise become contingently liable (directly
        or indirectly) for the obligations of the Issuer or (z) institute
        against the Issuer, or join any other person in instituting against the
        Issuer, any case, proceeding or other action under any existing or
        future bankruptcy, insolvency or similar laws.

                (m) Such Seller shall notify the Issuer and the Trustee promptly
        after becoming aware of any Lien on any Asset, and Trendwest shall not
        allow to suffer any lien on any asset.

                (n) On each date as of which Trendwest substitutes a Substitute
        Contract in accordance with Section 3.03 hereof, Trendwest shall provide
        to the Issuer a supplement to this Agreement substantially in the form
        of Annex A hereto subjecting such Substitute Contract to the provisions
        hereof and providing with respect to such Substitute Contract the
        information required in the Contract Schedule.

                (o) The annual financial statements of such Seller will disclose
        the effects of the transactions contemplated by the Transaction
        Documents in accordance with generally accepted accounting principles.
        The financial statements of such Seller and the Issuer will also
        disclose that the assets of the Issuer are not available to pay
        creditors of such Seller. The resolutions, agreements and other
        instruments underlying the Transaction Documents will be continuously
        maintained by such Seller as official records.



                                      -21-
<PAGE>   25

                (p) Such Seller will, at its own cost and expense, (i) retain
        the Electronic Ledger as a master record of the Loan Documents and the
        Related Security and copies of all documents relating to each Contract
        (other than the original executed Contracts) as custodian for the Issuer
        and other Persons, if any, with interests in the Loan Documents and the
        Related Security and (ii) mark the Contracts and the Electronic Ledger
        to the effect that the Loan Documents and such Seller's interest in the
        Related Security have been acquired by the Issuer and a security
        interest in the Loan Documents and the Related Security have been
        granted by such Seller to the Issuer and that such security interests
        and rights have been pledged, transferred and assigned to the Trustee by
        the Issuer pursuant to the Indenture.

                (q) Such Seller will perform the transactions contemplated by
        this Agreement in a manner that is consistent with the Issuer's
        ownership interest in the Assets. Such Seller will respond to all third
        party inquiries confirming the transfer of the Assets to the Issuer.

                (r) Such Seller shall immediately transfer to the Servicer for
        deposit in the Clearing Account any payment it receives relating to the
        Assets.

                (s) Environmental Laws. Each Seller shall conduct its operations
        and keep and maintain its property in compliance with all Environmental
        Laws. Trendwest shall perform its duties under its management agreement
        with WorldMark in compliance with all Environmental Laws.

        Section 4.02. Issuer Covenants. The Issuer hereby covenants and agrees
with the Sellers as follows:

                (a) The Issuer hereby acknowledges and agrees that its rights in
        the Related Security are expressly subject to the rights of the related
        Obligors in such Related Security pursuant to the applicable Loan
        Documents.

                (b) On each date as of which any interest in any Contract or
        Mortgage Loan is to be purchased or replaced by Trendwest pursuant to
        Section 3.03 hereof, the Issuer shall submit to Trendwest an instrument
        of assignment assigning the Issuer's interest in such Contract or
        Mortgage Loan and the Related Security to Trendwest, signed by the
        president, senior vice president or any vice president of the Issuer.
        Each such assignment shall operate as an assignment, without recourse,
        representation, or warranty, to Trendwest of all of the Issuer's right,
        title, and interest in and to such Contract or Mortgage Loan, the
        related Receivable and the Related Security and any security documents
        relating thereto, such assignment being an assignment outright and not
        for security, and upon payment of the Purchase Price or delivery of a
        Substitute Contract, Trendwest will thereupon own such interest in the
        Contract or Mortgage Loan, as applicable and all such security and
        documents, free of any further obligation to the Issuer with respect
        thereto. If in any enforcement suit or legal proceeding it is held that
        Trendwest may not enforce a Contract on the ground that it is not a real
        party in interest or holder entitled to enforce the Contract, the Issuer
        shall, at the Issuer's expense, take



                                      -22-
<PAGE>   26

        such steps as the Issuer deems necessary to enforce the Contract,
        including bringing suit in the Issuer's name.

                (c) The Issuer warrants that, except as contemplated by the
        Transaction Documents, it will have a valid security interest in the
        Related Security. The Issuer shall not assign, sell, pledge, or
        exchange, or in any way encumber or otherwise dispose of the Related
        Security, except as contemplated by or permitted under the Transaction
        Documents.

        Section 4.03. Assignment of Assets. The Sellers understand that the
Issuer will assign to and grant to the Trustee a security interest in the Assets
(including but not limited to the Receivables, Loan Documents and the Related
Security). The Sellers consent to such assignments and grants and further agree
that all representations, warranties, covenants and agreements the Sellers made
herein shall also be for the benefit of and inure to the Issuer, the Trustee and
all Holders from time to time of the Notes.


                                    ARTICLE 5

                              CONDITIONS PRECEDENT

        Section 5.01. Conditions to Issuer's Initial Obligations. The
obligations of the Issuer to execute and deliver the Asset Assignment to the
Sellers on the Closing Date pursuant to, and perform it obligations pursuant to,
this Agreement shall be subject to the satisfaction of the following conditions:

                (a) All representations and warranties of the Sellers contained
        in Sections 3.01(b) and 3.01(c) hereof and all information provided in
        the Contract Schedule shall be true and correct on the Closing Date,
        with the same effect as though such representations and warranties had
        been made on such date, and on the Closing Date the Sellers shall have
        delivered to the Issuer, the Trustee and the Initial Purchaser an
        Officer's Certificate to such effect (with respect to the Closing Date
        sale only);

                (b) All representations and warranties of the Sellers contained
        in Section 3.01(a) hereof shall be true and correct on the Closing Date
        with respect to the Contracts listed on the Contract Schedule on the
        Closing Date, with the same effect as though such representations and
        warranties had been made on such date, and on the Closing Date the
        Sellers shall have delivered to the Issuer, the Trustee and the Initial
        Purchaser of the Notes an Officer's Certificate to such effect;

                (c) The Sellers shall have delivered all other information
        theretofore required or reasonably requested by the Issuer to be
        delivered by the Sellers hereunder, duly certified by an officer of each
        of the Sellers, and the Sellers shall have substantially performed all
        other obligations required to be performed as of the Closing Date by the
        provisions of this Agreement;



                                      -23-
<PAGE>   27

                (d) On or prior to the Closing Date, Trendwest, on behalf of the
        Sellers shall have delivered, or caused the delivery of, the Custodian
        File related to the Contracts identified in the Contract Schedule to the
        Custodian or its agent and, subject to Section 2.04 hereof, there shall
        have been made all filings, recordings and/or registrations, and there
        shall have been given, or taken, any notice or any other similar action,
        as may be necessary in the opinion of the Issuer, in order to establish
        and preserve the right, title and interest of the Issuer in such
        Contract and the other Assets;

                (e) On or before the Closing Date, the Issuer, the Servicer and
        the Trustee shall have entered into the Servicing Agreement;

                (f) The Notes shall be issued and sold on the Closing Date, the
        Issuer shall receive the full consideration due it upon the issuance of
        such Notes, the Issuer shall have applied such consideration, to the
        extent necessary, to pay the related consideration to the Sellers on
        such date; and

                (g) Each applicable Seller shall have executed and delivered the
        Asset Assignment.

        Section 5.02. Conditions to the Sellers' Obligations. The obligations of
each of the Sellers to execute and deliver to the Issuer the Asset Assignment
and perform its obligations pursuant to this Agreement on the Closing Date shall
be subject to the satisfaction of the following conditions:

                (a) All representations and warranties of the Issuer contained
        in this Agreement shall be true and correct with the same effect as
        though such representations and warranties had been made on such date;

                (b) The Issuer shall have executed and delivered the applicable
        Asset Assignment; and

                (c) All corporate and legal proceedings and all instruments in
        connection with the transactions contemplated by this Agreement shall be
        satisfactory in form and substance to such Seller, and such Seller shall
        have received from the Issuer copies of all documents (including,
        without limitation, records of corporate proceedings) relevant to the
        transactions herein contemplated as such Seller may reasonably have
        requested.

        Trendwest's obligation to repurchase the Contracts pursuant to this
Agreement shall not be affected by any failure of the Issuer to comply with
clause (a) of this Section 5.02 subsequent to the Closing Date.



                                      -24-
<PAGE>   28

                                    ARTICLE 6

                              TERM AND TERMINATION


        Section 6.01. Term. This Agreement shall commence as of the date of
execution and delivery hereof and shall continue in full force and effect until
the later of (i) payment with respect to the last Asset or (ii) termination of
the Indenture.

        Section 6.02. Default by Sellers. If any Seller shall be in default
under this Agreement and such default shall not have been cured for a period of
60 days, or if such Seller shall become insolvent or make an assignment for the
benefit of its creditors or have a receiver appointed for all or substantially
all of its properties, or if any proceedings commenced, or consented to, by such
Seller are not stayed or dismissed within 90 days after being commenced against
such Seller under any bankruptcy, insolvency or other law for the relief of
debtors, the Issuer shall have the right, in addition to any other rights it may
have under any applicable law, to terminate this Agreement with respect to such
Seller upon 30 days' prior written notice to such Seller; provided that any
termination of this Agreement shall not release such Seller from any obligation
under this Agreement.

                                    ARTICLE 7

                                  MISCELLANEOUS

        Section 7.01. Amendments. This Agreement and the rights and obligations
of the parties hereunder may not be changed orally but only by an instrument in
writing signed by the party against which enforcement is sought. This Agreement
may be amended by the Issuer and the Sellers only with the prior written consent
of the Holders of 66-2/3% in principal amount of the Outstanding Notes of the
Controlling Class.

        Section 7.02. Governing Law. This Agreement shall be construed in
accordance with the internal laws of the State of New York, without regard to
choice of law principles.

        Section 7.03. Notices. All demands, notices and communications hereunder
shall be in writing and shall be delivered personally, mailed by registered or
certified United States mail, postage prepaid, or sent via overnight air courier
or facsimile communication and addressed, in the case of the Sellers, to the
Seller Address, and in the case of the Issuer, to the Issuer Address. All
notices and demands shall be deemed to have been given either at the time of the
delivery thereof to any officer of the Person entitled to receive such notices
and demands at the address of such Person for notices hereunder, or on the third
day after the mailing thereof to such address, as the case may be. Any Person
may change the address for notices hereunder by giving notice of such change to
the other Person.

        Section 7.04. Separability Clause. Any provisions of this Agreement
which are prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.



                                      -25-
<PAGE>   29

        Section 7.05. Assignment. Except as provided in Section 4.01(a), this
Agreement may not be assigned or delegated by any Seller without the prior
written consent of the Issuer, the Trustee and the Holders of 66-2/3% in
principal amount of the Outstanding Notes of the Controlling Class and may not
be assigned or delegated by the Issuer without the prior written consent of each
of the Sellers, the Trustee and the Holders of 66-2/3% in principal amount of
the Outstanding Notes of the Controlling Class.

        Section 7.06. Further Assurances. Each of the Sellers and the Issuer
agrees to do such further acts and things and to execute and deliver to the
Trustee such additional assignments, agreements, powers and instruments as are
required by the Trustee to carry into effect the purposes of this Agreement or
to better assure and confirm unto the Trustee or the Holders of the Notes their
rights, powers or remedies hereunder. If any Obligor shall be in default under
any Contract, upon reasonable request from the Servicer, the applicable Seller
will take all reasonable steps to assist in enforcing such Contract and
preserving and maintaining title to the Assets and the rights of the Trustee and
the Holders of the Notes therein against the claims of all persons and parties
to the extent the applicable Seller is capable of performing such requested
steps and the Servicer reasonably determines that the assistance of the
applicable Seller is necessary to effect the intent and purposes hereof.

        Section 7.07. No Waivers; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Issuer or the Sellers, any right,
remedy, power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise of any right, remedy, or privilege hereunder
preclude any other or further exercise hereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and privileges
herein provided are cumulative and not exhaustive of any rights, remedies,
powers and privileges provided by law.

        Section 7.08. Binding Effect; Third Party Beneficiaries. This Agreement
will inure to the benefit of and be binding upon the parties hereto, the Holders
of Outstanding Notes, and their respective successors and permitted assigns.

        Section 7.09. Set-Off. (a) Each of the Sellers hereby irrevocably and
unconditionally waives all right of set-off that it may have under contract
(including this Agreement), applicable law or otherwise with respect to any
funds or monies of the Issuer at any time held by or in the possession of such
Seller.

        (b) The Issuer shall have the right to set-off against each Seller any
amounts to which such Seller may be entitled and to apply such amounts to any
claims the Issuer may have against such Seller from time to time under this
Agreement. Upon any such set-off the Issuer shall give notice of the amount
thereof and the reasons therefor.

        Section 7.10. Sellers Will Not Institute Insolvency Proceedings. During
the term of this Agreement and for one year and one day after the termination
hereof, none of the parties hereto



                                      -26-
<PAGE>   30

or any Affiliate thereof or any Holder of Outstanding Notes (and each Holder of
Outstanding Notes so agrees by acceptance of a Note) will file any involuntary
petition or otherwise institute any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding or other proceeding under any federal or
state bankruptcy or similar law against the Issuer.

        Section 7.11. Counterparts. This Agreement may be executed in one or
more counterparts all of which together shall constitute one original document.




                                      -27-
<PAGE>   31

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

                                             TRENDWEST RESORTS, INC.


                                             By
                                                Name:
                                                Title:


                                             TW HOLDINGS II, INC.


                                             By
                                                Name:
                                                Title:


                                             TW HOLDINGS III, INC.


                                             By
                                                Name:
                                                Title:


                                             TRI FUNDING IV, INC.


                                             By
                                                Name:
                                                Title:



                                      -28-
<PAGE>   32

                                     ANNEX A

                   FORM OF SUPPLEMENT FOR SUBSTITUTE CONTRACTS
                              AND UPGRADE CONTRACTS


        Pursuant to Section 3.04(b) and Section 3.04(d) of the Receivables
Purchase Agreement dated as of November 1, 2000 (the "Agreement"), among
Trendwest Resorts, Inc. ("Trendwest"), TW Holdings II, Inc., TW Holdings III,
Inc. and TRI Funding IV, Inc. (the "Issuer"), attached as Schedule I hereto is a
Supplemental Contract Schedule, which includes information regarding Assets that
are hereby sold, assigned, transferred and delivered by Trendwest to the Issuer
in accordance with the Agreement and the Asset Assignment and setting forth the
Collateral Value of any Contract being sold to the Issuer by Trendwest pursuant
to an Upgrade or exchanged pursuant to a substitution.


                                             TRENDWEST RESORTS, INC.

                                             By
                                                Name:
                                                Title:


<PAGE>   33


                                   SCHEDULE I

             SUPPLEMENTAL CONTRACT SCHEDULE FOR SUBSTITUTE CONTRACTS
                              AND UPGRADE CONTRACTS


<PAGE>   34

                                    EXHIBIT A

                                FORM OF CONTRACT


<PAGE>   35

                                    EXHIBIT B

                            FORM OF ASSET ASSIGNMENT


        This Asset Assignment ("Assignment") is made as of November __, 2000
(the "Closing Date"), by and among Trendwest Resorts, Inc., an Oregon
corporation ("Trendwest"), TW Holdings II, Inc., a Delaware corporation ("TWH
II"), TW Holdings III, Inc., a Delaware corporation (together with Trendwest,
and TWH II, the "Assignors" and each an "Assignor") and TRI Funding IV, Inc., a
Delaware corporation ("Assignee"), with reference to the following facts:

                                    RECITALS:

        A. In connection with the sale of certain assets of the Assignors in
conjunction with the issuance of notes on the date hereof by TRI Funding IV,
Inc., Assignee and the Assignors have executed the Receivables Purchase
Agreement dated as of November 1, 2000 (the "Agreement").

        B. In connection with the Agreement, each of the Assignors desires to
assign and transfer to Assignee all of such Assignor's right, title and interest
in and to each of the assets described in Schedule I hereto, and the
corresponding paragraphs below (the "Assigned Interests").

        C. Assignee desires to accept this Assignment and transfer of the
Assigned Interests and assume all duties and obligations attendant thereto,
accruing after the Closing Date.

        D. Terms used but not defined herein have the meanings ascribed to them
in the Agreement.

        NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged and in consideration of the mutual
covenants set forth herein, the Assignors and Assignee hereby agree as follows:

        1. Assignment. Each Assignor hereby assigns, conveys, grants and
transfers, without recourse except as provided in the Agreement, to Assignee
(and the successors and assigns of Assignee) the following property:

                1.1. Such Assignor's right, title and interest in and to the
        Loan Documents and related Receivables described and listed on Schedule
        I hereto.

                1.2. Such Assignor's security interest in the vacation credits
        and fractional interests subject to each such Contract and Mortgage Loan
        (the "Related Security").

                1.3. All other Assets relating to such Loan Documents.


<PAGE>   36

        2. Assumption. Assignee hereby accepts the foregoing assignment and
hereby assumes all of the indebtedness, if any, duties and obligations incident
hereto and thereto, subject to the terms and conditions of the Agreement.

        3. Further Assurance. The Assignors and Assignee each hereby agree to
provide such further assurances and to execute and deliver such documents and to
perform all such other acts as are necessary or appropriate to consummate and
effectuate this Assignment.

        4. Distinct Entities. The Assignors and Assignee hereby acknowledge that
for all purposes each of the Assignors and the Assignee are separate and
distinct legal entities. Accordingly, no Assignor shall be liable to any third
party for the debts, obligations and liabilities of the Assignee; and Assignee
shall not be liable to any third party for the debts, obligations and
liabilities of any Assignor to the extent that such debts, obligations and
liabilities have not been expressly assumed by Assignee hereunder.

        5. Governing Law. This Assignment shall be governed by and interpreted
in accordance with the laws of the State of New York, and the parties hereto
hereby acknowledge and agree that this Assignment and the transactions
contemplated hereunder were negotiated and entered into in the State of New
York.

        6. Authority. Each of the Assignors and the Assignee hereby represent
respectively that they have full power and authority to enter into this
Assignment.

        7. Counterparts. This Assignment may be executed in multiple
counterparts, each of which shall be deemed an original but all of which, taken
together, shall constitute one and the same instrument.

        8. Successors and Assigns. Each of the Assignors and the Assignee agree
that this Assignment will be binding and will inure to the benefit of each
Assignor and its successors and assigns and the Assignee and its successors and
assigns.


                                      B-2
<PAGE>   37

        IN WITNESS WHEREOF, this Assignment has been executed as of the date
first above written.



                                             TRENDWEST RESORTS, INC., Assignor


                                             By
                                                Name:
                                                Title:


                                             TW HOLDINGS II, INC., Assignor


                                             By
                                                Name:
                                                Title:


                                             TW HOLDINGS III, INC., Assignor


                                             By
                                                Name:
                                                Title:


                                             TRI FUNDING IV, INC., Assignee


                                             By
                                                Name:
                                                Title:



                                      B-3

<PAGE>   38


                                   SCHEDULE I

                                CONTRACT SCHEDULE


<PAGE>   39


                                    EXHIBIT C

                            FORM OF SUBORDINATED NOTE

                                                                   $___________



                              TRI FUNDING IV, INC.

                                SUBORDINATED NOTE

Date:  November 16, 2000                   Stated Maturity:  December 15 , 2011


        TRI FUNDING IV, INC., a special purpose corporation duly organized and
existing under the laws of the State of Delaware (the "Issuer," which term
includes any successor entity under the Indenture referred to below), for value
received, hereby promises to pay to Trendwest Resorts, Inc. ("Trendwest"), or
its assigns, the principal sum ___________________ Dollars ($_____________) in
monthly installments beginning on December 15, 2000 (the "Initial Payment
Date"), and to pay interest monthly in arrears on the unpaid portion of said
principal sum (and, to the extent that the payment of such interest shall be
legally enforceable, on any overdue installment of interest on this Subordinated
Note) on the fifteenth day of each calendar month or, if such fifteenth day is
not a Business Day, the Business Day immediately following (each, a "Payment
Date"), for the period from and including November 16, 2000 through the last day
of the applicable Due Period immediately preceding the Initial Payment Date for
the Notes referred to below, and thereafter, monthly from and including the
first day through the last day of the Due Period immediately preceding the
Payment Date, at the rate of 8.67% per annum (calculated on the basis of a
360-day year consisting of 12 months of 30 days each). Each monthly installment
of principal payable on this Subordinated Note shall be an amount equal to the
cash available for distribution until the principal amount owed hereunder, as
adjusted as set forth below, is paid in full. Any remaining unpaid portion of
the principal amount of this Subordinated Note shall be due and payable no later
than the Stated Maturity referred to above; provided, however, that if the Notes
(as defined below) are not paid in full on such date, no such amounts shall be
due or payable until the Notes are paid in full. All terms used in this
Subordinated Note which are defined in the Indenture (referred to herein as the
"Indenture"), dated as of November 1, 2000, among the Issuer, Trendwest Resorts,
Inc., as Servicer, and Wells Fargo Bank Minnesota, National Association, as
Trustee shall have the meanings assigned to them in the Indenture.

        The principal and interest on this Subordinated Note are payable by
check mailed by first-class mail to Trendwest or its assigns or by wire transfer
in immediately available funds to the account specified in writing to the
Trustee by Trendwest or its assigns received at least five Business Days prior
to the Record Date for the Payment Date on which wire transfers will


<PAGE>   40

commence, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts. Funds
represented by checks returned undelivered will be held for payment to the
Person entitled thereto, subject to the terms of the Indenture, at the office or
agency in the United States of America designated as such by the Issuer for such
purpose pursuant to the Indenture.

        The principal owed on this Subordinated Note will be increased from time
to time in the event that Trendwest transfers the receivable related to an
Upgrade Contract to the Issuer to be included in the Trust Estate, such amount
to equal the difference between the principal balance of the receivable of
Upgrade Contract as of the date of such Upgrade and the Collateral Value on such
date of the Receivable being replaced.

        This Subordinated Note and the Issuer's Receivables-Backed Notes 2000-1
(the "Notes") issued pursuant to the Indenture are secured by certain
Receivables and other Collateral described in the Indenture. The Trust Estate
relating to the Notes also secures the payment of certain other amounts and
certain other obligations as described in the Indenture. Until the Notes are
paid in full and the obligations of the Issuer under the Indenture are
satisfied, (i) the Subordinated Notes are payable only at the time and in the
manner provided in the Indenture and are not redeemable or prepayable at the
option of the Issuer before such time and (ii) the holder of this Subordinated
Note will not cause the filing of a bankruptcy petition against the Issuer for
any reason whatsoever, including, without limitation, the failure of the Issuer
to make any payments of principal of or interest on this Subordinated Note until
after a period equal to 10 days plus the applicable preference period under the
United States Bankruptcy Code has passed since the Notes were paid in full.

        The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the holder of this Subordinated Note under the
Indenture at any time by the Issuer, the Trustee and the Servicer with the
consent of the Holders of not less than 66-2/3% in principal amount of Notes of
the Controlling Class of the Notes Outstanding under the Indenture. The
Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Notes, at the time Outstanding
under the Indenture, to waive compliance by the Issuer with certain provisions
of the Indenture and certain past defaults under the Indenture and their
consequences. This Subordinated Note shall not be amended without the consent of
Holders of not less than 66-2/3% in principal amount of the Controlling Class of
the Notes Outstanding.

        No reference herein to the Indenture and no provision of this
Subordinated Note or of the Indenture shall alter or impair the obligation of
the Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Subordinated Note, but, so long as any Notes are Outstanding,
solely from the Collateral pledged to the Trustee under the Indenture with
respect to the Notes at the times, place and rate, and in the coin or currency,
herein prescribed. Notwithstanding anything else to the contrary contained in
this Subordinated Note or the Indenture, the obligation of the Issuer to pay the
principal of and interest on this Subordinated Note is not a general obligation
of the Issuer, nor its officers or directors, but, so long as any Notes are
Outstanding, is limited solely to the Collateral pledged under the Indenture.


                                      C-2
<PAGE>   41

        So long as the Notes are Outstanding, Trendwest shall not transfer this
Subordinated Note to any Person.

        This Subordinated Note and the Indenture shall be governed by and
construed in accordance with the internal laws of the State of New York, without
regard to conflicts of laws principles.

        IN WITNESS WHEREOF, TRI Funding IV, Inc. has caused this Subordinated
Note to be signed, manually, by its Vice President.



                                             TRI FUNDING IV, INC.

                                             By
                                                Name:
                                                Title:



                                      C-3