Series 2002-1 Supplement (Trendwest) dated Nov 14, 2005


EXHIBIT
10.6


 

EXECUTION
COPY







 

SERIES
2002-1 SUPPLEMENT

Dated as
of August 29, 2002

 

to

 

MASTER
LOAN PURCHASE AGREEMENT

Dated as
of August 29, 2002

 

Amended
and Restated as of November 14, 2005








CENDANT
TIMESHARE CONDUIT RECEIVABLES FUNDING, LLC

LOAN-BACKED

VARIABLE
FUNDING NOTES,

SERIES
2002-1








by and
between

 

TRENDWEST
RESORTS, INC.,

 

as
Seller

 

and

 

SIERRA
DEPOSIT COMPANY, LLC,

as
Purchaser





























TABLE
OF CONTENTS





	 	 	 	
      Page
	 
	 	
      Section
      1.

       
	
      Definitions

       
	
      1

       
	 
	 	
      Section
      2.

       
	
      Sale

       
	
      6

       
	 
	 	 	
      (a)
      Series 2002-1 Loans

       
	
      6

       
	 
	 	 	
      (b)
      Filing of Financing Statements

       
	
      6

       
	 
	 	 	
      (c)
      Delivery of Series 2002-1 Loan Schedule

       
	
      7

       
	 
	 	 	
      (d)
      Purchase of Additional Series 2002-1 Loans

       
	
      7

       
	 
	 	 	
      (e)
      Treatment as Sale

       
	
      8

       
	 
	 	 	
      (f)
      Recharacterization

       
	
      8

       
	 
	 	 	
      (g)
      Security Interest in Transferred Assets

       
	
      8

       
	 
	 	 	
      (h)
      Transfer of Loans

       
	
      9

       
	 
	 	
      Section
      3.

       
	
      Purchase
      Price

       
	
      9

       
	 
	 	
      Section
      4.

       
	
      Payment
      of Purchase Price

       
	
      9

       
	 
	 	
      Section
      5.

       
	
      Conditions
      Precedent to Sale of Series 2002-1 Loans and Additional Loans

       
	
      9

       
	 
	 	 	
      (a)
      Conditions Precedent to Sale of Series 2002-1 Loans

       
	
      9

       
	 
	 	 	
      (b)
      Conditions Precedent to Sale of Additional Loans

       
	
      10

       
	 
	 	
      Section
      6.

       
	
      Representations
      and Warranties of the Seller

       
	
      10

       
	 
	 	 	
      (a)
      [Reserved]

       
	
      10

       
	 
	 	 	
      (b)
      Representations and Warranties Regarding the Series 2002-1
      Loans

       
	
      10

       
	 
	 	
      Section
      7.

       
	
      Repurchases
      or Substitution of Series 2002-1 Loans

       
	
      11

       
	 
	 	 	
      (a)
      Repurchase or Substitution Obligation

       
	
      11

       
	 
	 	 	
      (b)
      Repurchases and Substitutions

       
	
      12

       
	 
	 	 	
      (c)
      Repurchases of Series 2002-1 Loans that Become Defaulted
Loans

       
	
      13

       
	 
	 	 	
      (d)
      Maximum Repurchases

       
	
      13

       
	 
	 	
      Section
      8.

       
	
      Covenants
      of the Seller

       
	
      13

       
	 
	 	
      Section
      9.

       
	
      Representations
      and Warranties of the Company

       
	
      13

       
	 
	 	
      Section
      10.

       
	
      Covenants
      of the Company

       
	
      13

       
	 
	 	
      Section
      11.

       
	
      Miscellaneous
      Provisions

       
	
      14

       
	 
	 	 	
      (k)
      Ratification of Agreement

       
	
      14

       
	 
	 	 	
      (l)
      Amendment

       
	
      14

       
	 





 












-i-














 


	 	
      (m)
      Counterparts

       
	
      14

       
	 
	 	
      (n)
      GOVERNING LAW

       
	
      14

       
	 
	 	
      (o)
      Successors and Assigns

       
	
      14

       
	 





 

 







-ii-















THIS
PURCHASE AGREEMENT SUPPLEMENT (this “PA
Supplement”), dated
as of August 29, 2002, as amended and restated as of November 14, 2005, is by
and between TRENDWEST RESORTS, INC., an Oregon corporation, as seller (the
“Seller”) and
SIERRA DEPOSIT COMPANY, LLC, a Delaware limited liability company, as purchaser
(hereinafter referred to as the “Purchaser” or the
“Company”).

 

Section 2
of the Agreement provides that the Seller may from time to time sell and assign
to the Company, and the Company may from time to time Purchase from the Seller,
all the Seller’s right, title and interest in, to and under Loans listed on the
Loan Schedule of the related PA Supplement on the Closing Date for the related
Series. The principal terms of the Purchase and sale of Loans for each Series
shall be set forth in a PA Supplement to the Agreement.

 

Pursuant
to this PA Supplement and in accordance with Section 2 of the Agreement,
the Seller hereby sells to the Company, and the Company hereby Purchases from
the Seller, the Series 2002-1 Loans and the Seller and the Company hereby
specify the principal terms of such sales and Purchases.

 

The
Company has determined with the agreement of the Seller that Loans purchased
from the Seller may be sold to Cendant Timeshare Conduit Receivables Funding,
LLC, formerly known as Sierra Receivables Funding Company, LLC (the “Initial
Issuer”) and pledged to secure notes issued by the Initial Issuer or may be sold
by the Company to an Additional Issuer and pledged to secure Notes issued by the
Additional Issuer. The Company may also, from time to time, purchase Loans from
the Initial Issuer and transfer such Loans to an Additional Issuer to be pledged
to secure an Additional Series.

 

The
Seller and the Company agree that Loans sold to the Company under the Agreement
and the PA Supplement retain their character as Series 2002-1 Loans whether sold
to and retained by the Initial Issuer or reacquired by the Company and
transferred to an Additional Issuer.

 

The PA
Supplement supplements the Master Loan Purchase Agreement dated as of August 29,
2002, as amended and restated as of November 14, 2005 and as amended from time
to time. The Master Loan Purchase Agreement, as so amended, is the “Agreement.”
Terms used in this Amendment and not defined herein have the meaning assigned in
the Agreement.

 

  Section
1. Definitions.

 

All
capitalized terms used herein and not otherwise defined herein have the meanings
ascribed to them in the Agreement. Each capitalized term defined herein shall
relate only to the Series 2002-1 Loans and to no other Loans purchased by the
Company from the Seller.

 

In the
event that any term or provision contained herein shall conflict with or be
inconsistent with any term or provision contained in the Agreement, the terms
and provisions of this PA Supplement shall be controlling.

 

The words
“hereof,” “herein” and “hereunder” and words of similar import when used in this
PA Supplement shall refer to this PA Supplement as a whole and not to any
particular provision of this PA Supplement; and Article, Section, subsection,
Schedule and Exhibit 

 




















references
contained in this PA Supplement are references to Articles, Sections,
subsections, Schedules and Exhibits in or to this PA Supplement unless otherwise
specified.

 

“Addition
Date” shall
mean the date from and after which Additional Loans are sold pursuant to Section
2(d).

 

“Agreement” shall
mean the Master Loan Purchase Agreement dated as of August 29, 2002, as amended
and restated as of November 14, 2005, by and between the Seller and the
Purchaser, as the same may be amended, supplemented or otherwise modified from
time to time thereafter in accordance with its terms.

 

“Assignment” shall
have the meaning set forth in Section 2(d)(iii)(E).

 

“Closing
Date” shall
mean August 29, 2002.

 

“Company” shall
have the meaning set forth in the preamble.

 

“Cut-Off
Date” shall
mean August 27, 2002.

 

“Eligible
Loan” shall
mean a Series 2002-1 Loan:

 


	 	
      (a)
	
      with
      respect to which (i) the related Timeshare Property is not a Lot,
      (ii) the related Timeshare Property has been purchased by an Obligor,
      (iii) except in the case of a Green Loan, a certificate of occupancy for
      the related Timeshare Property has been issued, (iv) except in the case of
      a Green Loan, the unit for the related Timeshare Property is complete and
      ready for occupancy, is not in need of material maintenance or repair,
      except for ordinary, routine maintenance and repairs that are not
      substantial in nature or cost and contains no structural defects
      materially affecting its value, (v) the related Timeshare Property Regime
      is not in need of maintenance or repair, except for ordinary, routine
      maintenance and repairs that are not substantial in nature or cost and
      contains no structural defects materially affecting its value, (vi) there
      is no legal, judicial or administrative proceeding pending, or to the
      Seller’s knowledge threatened, for the total condemnation of the related
      Timeshare Property or partial condemnation of any portion of the related
      Timeshare Property Regime that would have a material adverse effect on the
      value of the related Timeshare Property and (vii) the related Timeshare
      Property, if not Vacation Credits, is not related to a Resort located
      outside of the United States, Canada, Mexico or the United States Virgin
      Islands;




 


	 	
      (b)
	
      with
      respect to which the rights of the Obligor thereunder are subject to
      declarations, covenants and restrictions of record affecting the
      Resort;




 


	 	
      (c)
	
      in
      the case of a Series 2002-1 Loan that is an Installment Contract, with
      respect to which the Seller has a valid ownership or security interest in
      an underlying Timeshare Property, subject only to Permitted Encumbrances,
      unless the criteria in paragraph (d) are
satisfied;




 




















 


	 	
      (d)
	
      with
      respect to which (i) if the related Timeshare Property has been deeded to
      the Obligor of the related Series 2002-1 Loan, (A) the Seller has a valid
      and enforceable first lien Mortgage on such Timeshare Property, except as
      such enforceability may be limited by Debtor Relief Laws and as such
      enforceability may be limited by general principles of equity, regardless
      of whether such enforceability is considered in a proceeding in equity or
      at law, (B) such Mortgage and related mortgage note have been assigned to
      the Collateral Agent, (C) such Mortgage and the related note for such
      Mortgage have been transferred or will be transferred to the custody of
      the Custodian in accordance with the provisions of Section 6(c)(i) of the
      Agreement and (D) if any Mortgage relating to such Series 2002-1 Loan is a
      deed of trust, a trustee duly qualified under applicable law to serve as
      such has been properly designated in accordance with applicable law and
      currently so serves or (ii) if the related Timeshare Property has not been
      deeded to the Obligor of the related Series 2002-1 Loan, the Seller has
      legal title to such Timeshare Property underlying the related Series
      2002-1 Loan;




 


	 	
      (e)
	
      that
      was issued in a transaction that complied, and is in compliance, in all
      material respects with all material requirements of applicable federal,
      state and local law, except, with respect only to California Business and
      Professions Code Section 11018.10, where such failure to comply would not
      have a Material Adverse Effect on the Seller or a material adverse effect
      on such Series 2002-1 Loan;




 


	 	
      (f)
	
      that
      requires the Obligor to pay the unpaid principal balance over an original
      term of not greater than 120 months and (ii) the original term of which
      does not exceed 84 months unless (A) the Series 2002-1 Loan relates to a
      Timeshare Upgrade or (B) the weighted average FICO score of all such
      Series 2002-1 Loans with original terms longer than 84 months is at least
      640 and (x) with respect to Series 2002-1 Loans sold prior to November 14,
      2005 has a FICO score not less than 600 or (xi) with respect to Series
      2002-1 Loans sold on or after November 14, 2005 has a FICO score not less
      than 550;




 


	 	
      (g)
	
      the
      Scheduled Payments on which are denominated and payable in United States
      dollars;




 


	 	
      (h)
	
      that
      is not a Defective Loan or a Defaulted
Loan;




 


	 	
      (i)
	
      that,
      with respect to Loans sold prior to July 28, 2004,
      is not a Delinquent Loan and has never been a Defaulted Loan, as of the
      Cut-Off Date or related Addition Cut Off Date, as applicable;
      or




 


	 	
      
	
      that,
      with respect to Loans sold on or after July 28, 2004,
      is not a Delinquent Loan and, unless it is a Permitted Deferred Loan, it
      has never been a Defaulted Loan, as of the Addition Cut-Off
      Date;




 




















 


	 	
      (j)
	
      that
      does not (i) finance the purchase of credit life insurance and (ii)
      finance, and was not originated in connection with, the “Explorer”
      program, unless such Loan has been converted to be in connection with the
      WorldMark program;




 


	 	
      (k)
	
      with
      respect to any Loan sold prior to July 28, 2004,
      no Due Date thereunder occurring after the Cut-Off Date or the related
      Addition Cut-Off Date, as applicable, has been deferred; (this
      provision (k) shall not be applicable to Loans sold on or after July 28,
      2004);




 


	 	
      (l)
	
      with
      respect to which the related Timeshare Property consists of Vacation
      Credits or a UDI;




 


	 	
      (m)
	
      that
      was originated by the Seller and has been consistently serviced by the
      Seller or by CTRG-CF, in each case in the ordinary course of their
      business and in accordance with the Seller’s Customary Practices and
      Credit Standards and Collection Policies;




 


	 	
      (n)
	
      that
      has not been specifically reserved against by the Seller or classified by
      the Seller as uncollectible or charged off;




 


	 	
      (o)
	
      that
      arises from transactions in a jurisdiction in which the Seller is duly
      qualified to do business, except where the failure to so qualify will not
      adversely affect or impair the legality, validity, binding effect and
      enforceability of such Series 2002-1 Loan;




 


	 	
      (p)
	
      that
      has not been cancelled or terminated by the related Obligor (regardless of
      whether such Obligor is legally entitled to do so) and constitutes a
      legal, valid, binding and enforceable obligation of the related Obligor,
      except as such enforceability may be limited by Debtor Relief Laws and as
      such enforceability may be limited by general principles of equity,
      regardless of whether such enforceability is considered in a proceeding in
      equity or at law;




 


	 	
      (q)
	
      that
      is fully amortizing pursuant to a required schedule of substantially equal
      monthly payments of principal and interest;




 


	 	
      (r)
	
      with
      respect to which (i) the downpayment has been made; and (ii) neither
      statutory nor regulatory rescission rights exist with respect to the
      related Obligor;




 


	 	
      (s)
	
      that
      had an Equity Percentage of 10% or more at the time of the sale of the
      related Timeshare Property to the related Obligor (or, in the case of a
      Loan relating to a Timeshare Upgrade, an Equity Percentage of 10% or more
      of the value of all vacation credits owned by the related
      Obligor);




 


	 	
      (t)
	
      with
      respect to which the related Obligor has not at any time made a written
      request for rescission of such Series 2002-1 Loan or otherwise stated in
      writing that it does not intend to consummate such Loan or to fully
      perform under such Series 2002-1 Loan;




 




















 


	 	
      (u)
	
      with
      respect to which at least one Scheduled Payment has been made by the
      Obligor;




 


	 	
      (v)
	
      as
      of the Cut-Off Date or related Addition Cut-Off Date, as applicable, has
      an outstanding loan balance not greater than $100,000;
  and




 


	 	
      (w)
	
      that,
      in the case of a Green Loan, (i) satisfies each of the eligibility
      criteria set forth in paragraphs (a) through (v) above other than any such
      criteria that cannot be satisfied due solely to (A) the related Green
      Timeshare Property being located in a Resort that is not yet complete and
      ready for occupancy; (B) the Seller not having a valid ownership
      interest in the related Green Timeshare Property; or (C) the related Green
      Timeshare Property not having been deeded to the Obligor or legal title
      not being held by the Nominee; and (ii) the related Green Timeshare
      Property has a scheduled completion date no more than six months following
      the Cut-Off Date or related Addition Cut-Off Date, as
      applicable.




 

“Excess
Concentration Amount” shall
have the meaning set forth in the Series 2002-1 Supplement.

 

“Noteholder” shall
mean any Series 2002-1 Noteholder and any holder of a note of any Additional
Series.

 

“PA
Supplement” shall
have the meaning set forth in the preamble.

 

“Permitted
Deferred Loan” shall
mean a Loan with respect to which the Obligor has been granted an extension of
the time required to pay the amounts due thereon, provided that (i) any such
extension was made in accordance with the Credit Standards and Collection
Policies and Customary Practices and (ii) such Loan is not a Delinquent Loan as
of the Addition Cut-Off Date.

 

“Pool
Purchase Price” shall
have the meaning set forth in Section 3.

 

“Purchase” shall
have the meaning set forth in Section 2(e).

 

“Purchaser” shall
have the meaning set forth in the preamble.

 

“Repurchase
Date” shall
have the meaning set forth in Section 7.

 

“Repurchase
Price” shall
have the meaning set forth in Section 7.

 

“Series
Termination Date” shall
mean, with respect to Series 2002-1, the date on which all obligations with
respect to the Series 2002-1 Notes issued under the Series 2002-1 Supplement
have been paid in full and the Series 2002-1 Supplement is discharged and, with
respect to any Additional Series, the date set forth in the related Indenture
and Servicing Agreement.

 




















 

“Series
2002-1 Additional Loan” shall
mean each Additional Loan constituting one of the Series 2002-1 Loans Purchased
from the Seller on an Addition Cut-Off Date and listed on Schedule 1 to the
related Assignment.

 

“Series
2002-1 Loan” shall
mean each Loan listed from time to time on the Series 2002-1 Loan Schedule
whether such Loan is at such time a Series 2002-1 Pledged Loan or is pledged to
secure an Additional Series.

 

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

 

“Series
2002-1 Noteholder” shall
mean any Noteholder under the Series 2002-1 Supplement.

 

“Series
2002-1 Pledged Loan” shall
have the meaning set forth in the Series 2002-1 Supplement.

 

“Series
2002-1 Supplement” shall
mean the supplement to the Master Indenture and Servicing Agreement executed and
delivered in connection with the original issuance of the Series 2002-1 Notes
and all amendments thereof and supplements thereto.

 

“Substitution
Adjustment Amount” shall
have the meaning set forth in Section 7.

 

  Section
2.  Sale.

 



		
      (a)
	Series 2002-1 Loans.
      Subject to the terms and conditions and in reliance on the
      representations, warranties, and covenants and agreements set forth in the
      Agreement and this PA Supplement, the Seller hereby sells and assigns to
      the Company, and the Company hereby Purchases from the Seller, without
      recourse except as specifically set forth herein, all of the Seller’s
      right, title and interest in, to and under the Initial Loans, if any,
      listed on the Series 2002-1 Loan Schedule delivered on the Closing Date,
      together with all Transferred Assets relating thereto. The Series 2002-1
      Additional Loans existing at the close of business on the related Addition
      Cut-Off Date and all other Transferred Assets relating thereto shall be
      sold by the Seller and purchased by the Company on the related Addition
      Date. Notwithstanding the foregoing, and for avoidance of doubt, the
      Seller does not assign, and the Purchaser does not agree to assume, any
      obligations specific to the Seller as developer of any Timeshare Property
      underlying an Installment Contract.



 


		
      (b)
	Filing of Financing Statements.
      In connection with the foregoing sale, the Seller agrees to record and
      file a financing statement or statements (and continuation statements or
      other amendments with respect to such financing statements) with respect
      to the Series 2002-1 Loans and related Transferred Assets described in
      Section 2(a) sold by the Seller hereunder meeting the requirements of
      applicable state law in such manner and in such jurisdictions as are
      necessary to perfect the interests of the Purchaser created hereby under
      the applicable UCC and to deliver a file-stamped copy of such financing
      statements and continuation statements (or other amendments) or other
      evidence of such filings to the
Purchaser.




  




















 


		
      (c)
	 Delivery
      of Series 2002-1 Loan Schedule.
      In connection with the sale and conveyance hereunder, the Seller agrees on
      or prior to the Closing Date and on or prior to the applicable Addition
      Date (in the case of Additional Series 2002-1 Loans) to indicate or cause
      to be indicated clearly and unambiguously in its accounting, computer and
      other records that the Series 2002-1 Loans and related Transferred Assets
      have been sold to the Purchaser pursuant to this PA Supplement. In
      addition, in connection with the sale and conveyance hereunder, the Seller
      agrees on or prior to the Closing Date and on or prior to the applicable
      Addition Date (in the case of Additional Series 2002-1 Loans) to deliver
      to the Company a Series 2002-1 Loan Schedule for such Series 2002-1 Loans
      or Additional Series 2002-1 Loans. The Seller and the Company agree that
      the Series 2002-1 Loan Schedule shall include all Loans sold under the
      Agreement and this PA Supplement whether such Loans are Series 2002-1
      Pledged Loans or are pledged to secure an Additional
    Series.



 


		
      (d)
	 Purchase
      of Additional Series 2002-1 Loans.

  

(i) [Reserved].

 

(ii) The
Seller may, with the consent of the Purchaser, designate Eligible Loans to be
sold as Additional Series 2002-1 Loans.

 

(iii) On the
Addition Date with respect to any Additional Series 2002-1 Loans, such
Additional Series 2002-1 Loans shall become Series 2002-1 Loans, and the
Purchaser shall Purchase the Seller’s right, title and interest in, to and under
the Additional Series 2002-1 Loans and the other related Transferred Assets as
provided in the Assignment, subject to the satisfaction of the following
conditions on such Addition Date:

 

(A) The
Seller shall have delivered to the Purchaser copies of UCC financing statements
covering such Additional Series 2002-1 Loans, if necessary to perfect the
Purchaser’s first priority interest in such Series 2002-1 Additional Loans and
the other related Transferred Assets;

 

(B) On each
of the Addition Cut-Off Date and the Addition Date, the sale of such Additional
Series 2002-1 Loans and the other related Transferred Assets to the Purchaser
shall not have caused the Seller’s insolvency or have been made in contemplation
of the Seller’s insolvency;

 

(C) No
selection procedure shall have been utilized by the Seller that would result in
a selection of such Additional Series 2002-1 Loans (from the Eligible Loans
available to the Seller) that would be materially adverse to the interests of
the Purchaser as of the Addition Date;

 

(D) The
Seller shall have indicated in its accounting, computer and other records that
the Additional Series 2002-1 Loans and the other related Transferred Assets have
been sold to the Purchaser and shall have delivered to the Purchaser the
required Series 2002-1 Loan Schedule;

 




















 

(E) The
Seller and the Purchaser shall have entered into a duly executed, written
assignment substantially in the form of Exhibit B to the Agreement (an
“Assignment”);

 

(F) The
Seller shall have delivered to the Purchaser an Officer’s Certificate of the
Seller dated the Addition Date, confirming, to the extent applicable, the items
set forth in Section 2(d)(iii) (A) through (E);

 

(G) The
Seller shall have executed the letter agreement relating to the amendment of
documents and the letter agreement relating to inspections and audits which
agreements were entered into by CTRG-CF, formerly known as Fairfield Acceptance
Corporation—Nevada, the Purchaser and the Initial Issuer on the date of this PA
Supplement; and

 

(H) The
Purchaser shall have paid the Additional Pool Purchase Price as provided in
Section 3 of the Agreement.

 

(iv) The
Seller shall have no obligation to sell the Additional Series 2002-1 Loans if it
has not been paid the Additional Pool Purchase Price therefor.


 


		
      (e)
	Treatment
      as Sale.
      It is the express and specific intent of the parties that the sale of the
      Series 2002-1 Loans and related Transferred Assets from the Seller to the
      Company as provided in this Section 2 (the “Purchase”)
      is and shall be construed for all purposes as a true and absolute sale of
      such Series 2002-1 Loans and related Transferred Assets, shall be absolute
      and irrevocable and provide the Company with the full benefits of
      ownership of the Series 2002-1 Loans and related Transferred Assets and
      will be treated as such for all federal income tax reporting and all other
      purposes.




 


		
      (f)
	Recharacterization.
      Without prejudice to the provisions of Section 2(e) providing for the
      absolute transfer of the Seller’s interest in the Series 2002-1 Loans and
      related Transferred Assets to the Company in order to secure the prompt
      payment and performance of all of the obligations of the Seller to the
      Company and the Company’s assignees arising in connection with the
      Agreement, this PA Supplement and the other Facility Documents, whether
      now or hereafter existing, due or to become due, direct or indirect, or
      absolute or contingent, the Seller hereby assigns and grants to the
      Company a first priority security interest in all of the Seller’s right,
      title and interest, whether now owned or hereafter acquired, if any, in,
      to and under all of the Series 2002-1 Loans and related Transferred Assets
      and the proceeds thereof.



 


		
      (g)
	 Security
      Interest in Transferred Assets.
      The Seller acknowledges that the Series 2002-1 Loans and related
      Transferred Assets are subject to the Lien of the Series 2002-1 Supplement
      for the benefit of the Trustee and the Series 2002-1 Noteholders (or to
      the Collateral Agent on behalf of the Trustee and the Series 2002-1
      Noteholders). With respect to Series 2002-1 Loans and related Transferred
      Assets which have been released from the Lien of the Series 2002-1
      Supplement, conveyed to the Company and transferred by the Company to an
      Additional Issuer, the Seller acknowledges that such Series 2002-1 Loans
      and related Transferred Assets are subject to the Lien of the applicable
      Indenture and Servicing Agreement for the benefit of the applicable
      Trustee and
Noteholders.



  




















  


		
      (h)
	
      Transfer
      of Loans.
      All Series 2002-1 Loans conveyed to the Company hereunder shall be held by
      the Custodian pursuant to the terms of the Custodial Agreement for the
      benefit of the Company, the respective Issuers, the respective Trustees
      and the Collateral Agent. Upon each Purchase hereunder, the Custodian
      shall execute and deliver to the Company a certificate acknowledging
      receipt of the applicable Series 2002-1 Loans pursuant to the Custodial
      Agreement; provided that, with respect to a Series 2002-1 Loan purchased
      on a Purchase Date, receipt shall be timely delivered if it is delivered
      to the Company no later than 30 days after the Purchase Date for that
      Loan.

       

      The Seller acknowledges that the Company will convey
      the Series 2002-1 Loans and the other related Transferred Assets to the
      Initial Issuer or an Additional Issuer and that the Initial Issuer or
      Additional Issuer will grant a security interest in the Series 2002-1
      Loans and other related Transferred Assets to the Collateral Agent
      pursuant to the applicable Indenture and Servicing Agreement. The Seller
      agrees that, upon such grant, the Initial Issuer or the Additional Issuer
      and the Collateral Agent may enforce all of the Seller’s obligations
      hereunder and under the Agreement directly, including without limitation
      the repurchase obligations of the Seller set forth in Section
      7.




  

 Section
3. Purchase Price.

 

No Series
2002-1 Loans shall be sold on the Closing Date. The purchase price for
Additional Loans sold on an Addition Date shall be the Additional Pool Purchase
Price.

 

 Section
4. Payment of Purchase Price.

 

Sections
4(a) through (c) are set forth in the Agreement.

 

(d) The
closing shall take place at the offices of Orrick, Herrington & Sutcliffe
LLP, Washington Harbour, 3050 K Street, NW, Washington, D.C. 20007, at 10:00
a.m. local time on the Closing Date, or such other time and place as shall be
mutually agreed upon among the parties hereto.

 

Section
5. Conditions Precedent to Sale of Series 2002-1 Loans and Additional
Loans.

 



		
      (a)
	
      Conditions
      Precedent to Sale of Series 2002-1 Loans.
      The Purchaser’s obligations hereunder to Purchase and pay for the Series
      2002-1 Loans and related Transferred Assets are subject to the fulfillment
      of the following conditions on or before the Closing
      Date:




 



	 	
      (i)
	
      (A)
      The Purchaser shall have received the Series 2002-1 Pool Purchase
      Agreement relating to each Series 2002-1 Loan executed by all the parties
      thereto and (B) all conditions precedent to the sale of the Series 2002-1
      Pool Loans thereunder shall have been fulfilled to the extent they are
      capable of being fulfilled prior to the performance by the Purchaser of
      its obligations under this PA Supplement.




 




















 


	 	
      (ii)
	
      The
      representations and warranties of the Seller made in the Agreement and
      herein shall be true and correct in all material respects on the Closing
      Date.




 


		
      (b)
	
      Conditions
      Precedent to Sale of Additional Loans.
      No Purchase of Additional Loans and related Transferred Assets may be made
      hereunder until the Purchaser shall have received each of the following in
      form and substance acceptable to the
      Purchaser:




 


		
      (i) 
	
      Copies
      of search reports certified by parties acceptable to the Purchaser dated a
      date reasonably prior to the initial Addition Date (A) listing all
      effective financing statements which name the Seller (under its present
      name and any previous names) as debtor or seller and which are filed with
      respect to the Seller in each relevant jurisdiction, together with copies
      of such financing statements (none of which shall cover any portion of the
      Series 2002-1 Loans being purchased from the Seller and related
      Transferred Assets except as contemplated by the Facility
      Documents);




 


		
      
      (ii)

	
      Copies
      of proper UCC Financing Statement Amendments (Form UCC3), if any,
      necessary to terminate all security interests previously
      granted by the Seller (except as contemplated by the Facility
      Documents);




 


		
      
      (iii)

	
      Copies of proper UCC Financing Statements (Form
      UCC1) naming the Seller as debtor or seller of the Series 2002-1 Loans
      being purchased from the Seller and related Transferred Assets, the Issuer
      as total assignee and the Purchaser as assignor secured party, and such
      other similar instruments or documents with respect to the Seller as may
      be necessary or in the opinion of the Purchaser desirable under the UCC of
      all appropriate jurisdictions or any comparable law to evidence the
      perfection of the Purchaser’s interest in the Series 2002-1 Loans and
      related Transferred Assets;




 



		
      
      (iv)

	
      An opinion or opinions of counsel to the Seller,
      in the form required by the Purchaser, with respect to the following: (A)
      certain security interest matters, and (B) “true sale” and substantive
      consolidation matters; and




 



	 	
      (v)
	
      Evidence
      that one or more Lockbox Accounts have been
established.




 

Section
6. Representations and Warranties of the Seller.

 



		
      (a)
	
       [Reserved].
      




 




		
      (b)
	
       Representations
      and Warranties Regarding the Series 2002-1 Loans.
      The Seller represents and warrants to the Company as of the Cut-Off Date
      and Addition Cut-Off Date as to each Series 2002-1 Loan conveyed on and as
      of the Closing Date or the related Addition Date, as applicable (except as
      otherwise expressly stated) as
      follows:




  


(xxiii) Loan
Schedule. The
information set forth in the Series 2002-1 Loan Schedule is true and correct
with respect to such Series 2002-1 Loan.

 




















 

(xxiv) Good
Title to Series 2002-1 Loans. The
Seller has good and marketable title to such Series 2002-1 Loan free and clear
of any Lien other than Permitted Encumbrances. (A) With respect to the related
Timeshare Property that consists of a Vacation Credit and the related Loan
Documents, the Seller has not sold, assigned or pledged such related Series
2002-1 Loan or any interest therein to any Person other than the Company and (B)
with respect to the related Timeshare Property that consists of an UDI, the
Assignment of Mortgage of such related Mortgage from the Seller to the Company
and each related endorsement of the related Mortgage note constitutes a duly
executed, legal, valid, binding and enforceable sale, assignment or endorsement
of such related Mortgage and related Mortgage note, and all monies due or to
become due thereunder and all proceeds thereof.

 

(xxv) No
Defaults. As of
the Cut-Off Date or related Addition Cut-Off Date, as applicable, such Series
2002-1 Loan is not a Defaulted Loan and no event has occurred which, with the
taking of any action or the expiration of any grace or cure period or both,
would cause such Series 2002-1 Loan to be a Defaulted Loan. The Seller has not
waived any such default, breach, violation or event permitting acceleration with
respect to such Series 2002-1 Loan.

 

(xxvi) Equal
Installments. Such
Series 2002-1 Loan has a fixed Loan Rate and provides for substantially equal
monthly payments that fully amortize the Series 2002-1 Loan over its
term.




(xxvii) Excess
Concentration Amount. The
Purchase of such Series 2002-1 Loan occurring on such Closing Date or Addition
Date, as applicable, and the inclusion of such Series 2002-1 Loan as a Series
2002-1 Pledged Loan pursuant to the Series 2002-1 Supplement to the Indenture
and Servicing Agreement, does not cause an increase in the Excess Concentration
Amount.




Sections
6(b)(i) through (xxii) are set forth in the Agreement.




Section
7. Repurchases or Substitution of Series 2002-1 Loans.

 

The
parties understand and agree that references in this Section 7 to the Issuer,
Trustee or Master Servicer, shall in each case refer to the Issuer, Trustee or
Master Servicer for the Series to which the Loan to be repurchased is then
pledged.

 


		
      (a)
	
       Repurchase
      or Substitution Obligation.
      Subject to Section 7(b), upon discovery by the Seller or upon written
      notice from the Company, the Issuer or the Trustee that any Series 2002-1
      Loan is a Defective Loan, the Seller shall, within 90 days after the
      earlier of its discovery or receipt of notice thereof, cure such Defective
      Loan in all material respects or either (i) repurchase such Defective Loan
      from the Company or its assignee at the Repurchase Price or (ii)
      substitute one or more Qualified Substitute Loans for such Defective Loan.
      For purposes of this Agreement, the term “Repurchase Price” shall mean an
      amount equal to the outstanding Principal Balance of such Defective Loan
      as of the close of business on the Due Date immediately preceding the
      Payment Date on which the repurchase is to be made, plus accrued but
      unpaid interest thereon to the date of the repurchase. The Company hereby
      directs
      




 




















 



		
       
	
      directs
      the Seller, for so long as the Indenture and Servicing Agreement is in
      effect, to make such payment on its behalf to the Collection Account
      pursuant to Section 7(b). The following defects with respect to documents
      in any Loan File, solely to the extent they do not impair the validity or
      enforceability of the subject document under applicable law, shall not be
      deemed to constitute a breach of the representations and warranties
      contained in Section 6(b): misspellings of or omissions of initials in
      names; name changes from divorce or marriage; discrepancies as to payment
      dates in a Series 2002-1 Loan of no more than 30 days; discrepancies as to
      Scheduled Payments of no more than $5.00; discrepancies as to origination
      dates of not more than 30 days; inclusion of additional parties other than
      the primary Obligor not listed in the Master Servicer’s records or in the
      Series 2002-1 Loan Schedule and non-substantive typographical errors and
      other non-substantive minor errors of a clerical or administrative
      nature.



   


		
      (b)
	
      Repurchases
      and Substitutions.
      The Seller shall provide written notice to the Company of any repurchase
      pursuant to Section 7(a) not less than two Business Days prior to the date
      on which such repurchase is to be effected, specifying the Defective Loan
      and the Repurchase Price therefor. Upon the repurchase of a Defective Loan
      pursuant to Section 7(a), the Seller shall deposit the Repurchase Price in
      the Collection Account on behalf of the Company no later than 12:00 noon,
      New York time, on the Payment Date on which such repurchase is made (the
      “Repurchase
      Date”).




  

If the
Seller elects to substitute a Qualified Substitute Loan or Loans for a Defective
Loan pursuant to this Section 7(b), the Seller shall deliver such Qualified
Substitute Loan in the same manner as the other Series 2002-1 Loans sold
hereunder, including delivery of the applicable Loan Documents as required
pursuant to the Custodial Agreement and satisfaction of the same conditions with
respect to such Qualified Substitute Loan as to the Purchase of Additional Loans
set forth in Section 2(d)(iii). Payments due with respect to Qualified
Substitute Loans prior to the last day of the Due Period next preceding the date
of substitution shall not be property of the Company, but will be retained by
the Master Servicer and remitted by the Master Servicer to the Seller on the
next succeeding Payment Date. Scheduled Payments due on a Defective Loan prior
to the last day of the Due Period next preceding the date of substitution shall
be property of the Company, and after such last day of the Due Period next
preceding the date of substitution the Seller shall be entitled to retain all
Scheduled Payments due thereafter and other amounts received in respect of such
Defective Loan. The Seller shall cause the Master Servicer to deliver a schedule
of any Defective Loans so removed and Qualified Substitute Loans so substituted
to the Company and such schedule shall be an amendment to the Series 2002-1 Loan
Schedule. Upon such substitution, the Qualified Substitute Loan or Loans shall
be subject to the terms of this PA Supplement in all respects, the Seller shall
be deemed to have made the representations and warranties with respect to each
Qualified Substitute Loan set forth in Section 6(b) of the Agreement and this PA
Supplement and Section 6(c) of the Agreement, in each case as of the date of
substitution, and the Seller shall be deemed to have made a representation and
warranty that each Loan so substituted is an Qualified Substitute Loan as of the
date of substitution. The Seller shall be obligated to repurchase or substitute
for any Eligible Substitute Loan as to which the Seller has breached the
Seller’s representations and warranties in Section 6(b) to the same extent as
for any other Series 2002-1 Loan, as provided herein. In connection with the
substitution of one or more Qualified Substitute Loans for one or more Defective
Loans, the Master Servicer shall determine the amount (such amount, a
“Substitution
Adjustment Amount”), if
any, by which the aggregate principal balance of all such Qualified Substitute


 




















 

Loans as
of the date of substitution is less than the aggregate principal balance of all
such Defective Loans (after application of the principal portion of the
Scheduled Payments due in the month of substitution that are to be distributed
to the Company in the month of substitution). The Seller shall deposit the
amount of such shortfall into the Collection Account in immediately available
funds on the date of substitution, without any reimbursement
therefor.

 

Upon each
repurchase or substitution, the Company shall automatically and without further
action sell, transfer, assign, set over and otherwise convey to the Seller,
without recourse, representation or warranty, all of the Company’s right, title
and interest in and to the related Defective Loan, the related Timeshare
Property, the Loan File relating thereto and any other related Transferred
Assets, all monies due or to become due with respect thereto and all Collections
with respect thereto (including payments received from Obligors from and
including the last day of the Due Period next preceding the date of transfer,
subject to the payment of any Substitution Adjustment Amount). The Company shall
execute such documents, releases and instruments of transfer or assignment and
take such other actions as shall reasonably be requested by the Seller to effect
the conveyance of such Defective Loan, the related Timeshare Property and
related Loan File pursuant to this Section 7(b).

 

Promptly
after the occurrence of a Repurchase Date and after the repurchase of Defective
Loans in respect of which the Repurchase Price has been paid on such date, the
Seller shall direct the Master Servicer to delete such Defective Loans from the
Series 2002-1 Loan Schedule.

 

The
obligation of the Seller to repurchase or substitute for any Defective Loan
shall constitute the sole remedy against the Seller with respect to any breach
of the representations and warranties set forth in Section 6(b) available
hereunder to the Company or its successors or assigns.

 


		
      (c)
	
      Repurchases
      of Series 2002-1 Loans that Become Defaulted Loans.
      If any Series 2002-1 Loan becomes a Defaulted Loan during any Due Period,
      the Seller may repurchase such Defaulted Loan from the Company or its
      assignees at the Repurchase Price therefor and in accordance with the
      additional provisions applicable to repurchases of Defective Loans under
      Section
      7(b).




 



		
      (d)
	
      Maximum
      Repurchases.
      Notwithstanding anything to the contrary in the Agreement or this PA
      Supplement, no Defaulted Loans shall be repurchased by the Seller to the
      extent that the aggregate principal balance of all Defaulted Loans so
      repurchased is greater than the Defaulted Loan Repurchase
      Cap.



   

Section
8. Covenants
of the Seller.

 

Section 8
is set forth in the Agreement.

 

Section
9. Representations
and Warranties of the Company.

 

Section 9
is set forth in the Agreement.

 

Section
10. Covenants
of the Company.

 




















 

Section
10 is set forth in the Agreement.

 

Section
11. Miscellaneous
Provisions.

 

Sections
11(a) through (j) are set forth in the Agreement.

 

(k) Ratification
of Agreement. As
supplemented by this PA Supplement, the Agreement is in all respects ratified
and confirmed and the Agreement as so supplemented by this PA Supplement shall
be read, taken and construed as one and the same instrument.

 

(l) Amendment. This PA
Supplement may be amended from time to time or the provisions hereof may be
waived or otherwise modified by the parties hereto by written agreement signed
by the parties hereto.

 

(m) Counterparts. This PA
Supplement may be executed in two or more counterparts, and by different parties
on separate counterparts, each of which shall be an original, but all of which
shall constitute one and the same instrument.

 

(n) GOVERNING
LAW. THIS PA
SUPPLEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, INCLUDING §5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW, BUT OTHERWISE WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.

 

(o) Successors
and Assigns. This PA
Supplement shall be binding upon each of the Seller and the Company and their
respective permitted successors and assigns, and shall inure to the benefit of,
and be enforceable by, each of the Seller and the Company and each of the
Issuer, the Trustee, the Collateral Agent and the Noteholders.

 







































IN
WITNESS WHEREOF, the parties have caused their names to be signed hereto by
their respective officers thereunto duly authorized, all as of the day and year
first above written.

 

 

 


	
       
	
       
	
       
	
      TRENDWEST
      RESORTS, INC.

       
	
       

	
       
	
       
	
      
      By:
      

	
      /s/Michael A. Hug
      

      
	
       

	
       
	
       
	
       
	
      Name:
      Michael A. Hug

      Title:
      Senior Vice President and  Chief
      Financial Officer 
	
       








 

 


	
       
	
       
	
       
	
      SIERRA
      DEPOSIT COMPANY, LLC

       
	
       

	
       
	
       
	
      
      By:
      

	
      /s/ Mark A. Johnson

      
      

      
	
       

	
       
	
       
	
       
	
      Name:
      Mark A. Johnson

      Title:
      President 
	
       







 




 


























SCHEDULE
1

 

SERIES
2002-1 LOAN SCHEDULE