<PAGE>

                                 FIRST AMENDMENT
                                       TO
                        TRANSFER AND SERVICING AGREEMENT

     This FIRST AMENDMENT, dated as of October 17, 2001 (this "Amendment"), is
                                                               ---------
to the Transfer and Servicing Agreement, dated as of December 1, 2000 (the
"Transfer and Servicing Agreement"), among Spiegel Credit Corporation III, a
 --------------------------------
Delaware corporation, as Seller, First Consumers National Bank, a national
banking association, as Servicer, and the Spiegel Credit Card Master Note Trust,
as Issuer. Unless otherwise defined herein, capitalized terms used herein have
the meanings ascribed to such terms in the Transfer and Servicing Agreement.

     WHEREAS, the Seller, the Servicer and the Issuer desire to amend the
Transfer and Servicing Agreement in certain respects set forth below;

     NOW THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:

1.   Amendment to Transfer and Servicing Agreement. The parties hereto agree
     ---------------------------------------------
that the representations, warranties and covenants set forth in Schedule 1
                                                                ----------
attached to this Amendment shall be a part of the Transfer and Servicing
Agreement for all purposes.

2.   Conditions. In accordance with Section 9.1 of the Transfer and Servicing
     ----------
Agreement, the foregoing amendment shall become effective as of the date first
written above upon (i) the execution of this Amendment by the Seller, the
Servicer and the Issuer and (ii) the satisfaction of the conditions set forth in
Section 9.1 of the Transfer and Servicing Agreement.

3.   Miscellaneous. As herein amended, the Transfer and Servicing Agreement
     -------------
shall remain in full force and effect and is hereby ratified and confirmed in
all respects. This Amendment shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns. This Amendment
may be executed in any number of counterparts and by the different parties in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Amendment.

4.   Governing Law. This Amendment shall be construed in accordance with the
     -------------
laws of the State of Illinois, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
shall be determined in accordance with such laws.

<PAGE>

IN WITNESS WHEREOF, the Seller, the Servicer and Issuer have caused this
Amendment to be duly executed by their respective officers as of the date first
written above.

                             SPIEGEL CREDIT CORPORATION III, Seller


                             By: /s/ John R. Steele
                                ------------------------------------------------
                                Name: John R. Steele
                                     -------------------------------------------
                                Title:Treasurer
                                     -------------------------------------------

                             FIRST CONSUMERS NATIONAL BANK

                              By: /s/ John R. Steele
                                ------------------------------------------------
                                Name: John R. Steele
                                     -------------------------------------------
                                Title:Treasurer
                                     -------------------------------------------


                             SPIEGEL CREDIT CARD MASTER NOTE TRUST


                             By: BANKERS TRUST COMPANY,
                                 not in its individual capacity, but solely as
                                 Owner Trustee on behalf of the Issuer

                             By:/s/ Eileen M. Hughes
                                ------------------------------------------------
                                Name:  Eileen M. Hughes
                                    --------------------------------------------
                                Title: Vice President
                                     -------------------------------------------



ACKNOWLEDGED AND ACCEPTED:

THE BANK OF NEW YORK,
not in its individual capacity, but
solely as Indenture Trustee


By: /s/ Greg Anderson
  -------------------------------------
   Name:  Greg Anderson
       --------------------------------
   Title: Authorized Agent
        -------------------------------

                                       2

<PAGE>

                                   Schedule 1

                     PERFECTION REPRESENTATIONS, WARRANTIES
                                  AND COVENANTS

In addition to the representations, warranties and covenants contained in the
Transfer and Servicing Agreement, Seller hereby represents, warrants and
covenants to the Trust as follows as of October 17, 2001:

(1)  The Transfer and Servicing Agreement creates either (A) a valid transfer to
     the Issuer of all right, title and interest of Seller in, to and under the
     Receivables conveyed to the Issuer pursuant to Section 2.1 of the Transfer
     and Servicing Agreement, and such property will be held by the Issuer free
     and clear of any Lien, except for (w) the interests of the Indenture
     Trustee, the Holders of the Notes and the Enhancement Providers, (x) Liens
     permitted pursuant to paragraph 3 below, or (y) the interests of the Seller
                           -----------
     as holder of the Exchangeable Seller Certificate or (B) a valid and
     continuing security interest (as defined in UCC Section 1-102) in the
     Receivables in favor of the Issuer, which is enforceable with respect to
     existing Receivables in the Accounts on October 17, 2001, and, with respect
     to Receivables thereafter arising in the Accounts at the time such
     Receivables arise. If the Transfer and Servicing Agreement constitutes the
     grant of a security interest to the Issuer in the Receivables, such
     security interest is, and in the case of Receivables created after October
     17, 2001, upon the creation thereof will be, prior to all other Liens
     (other than Liens permitted pursuant to paragraph 3 below).
                                             -----------

(2)  The Receivables constitute "accounts" within the meaning of UCC Section
     9-102.

(3)  Immediately prior to the conveyance of the Receivables pursuant to the
     Transfer and Servicing Agreement, Seller owns and has good and marketable
     title to, or has a valid security interest in, the Receivables free and
     clear of any Lien, claim or encumbrance of any Person; provided that
     nothing in this paragraph 3 shall prevent or be deemed to prohibit Seller
                     -----------
     from suffering to exist upon any of the Receivables any Liens for any taxes
     if such taxes shall not at the time be due and payable or if FCNB or
     Seller, as applicable, shall currently be contesting the validity thereof
     in good faith by appropriate proceedings and shall have set aside on its
     books adequate reserves with respect thereto.

(4)  Seller has caused the filing of all appropriate financing statements in the
     proper filing office in the appropriate jurisdictions under applicable law
     in order to perfect the security interest granted to the Issuer under the
     Transfer and Servicing Agreement in the Receivables arising in the
     Accounts.

(5)  Other than the transfer of the Receivables to the Issuer pursuant to the
     Transfer and Servicing Agreement, Seller has not pledged, assigned, sold,
     granted a security interest in, or otherwise conveyed any of the
     Receivables. Seller has not authorized the filing of and is not aware of
     any financing statements against Seller that include a description of
     collateral covering the Receivables.

                                       3

<PAGE>

(6)  Seller is not aware of any judgment, ERISA or tax lien filings against
     Seller.

(7)  Notwithstanding any other provision of the Transfer and Servicing
     Agreement, the representations and warranties set forth in this Schedule 1
                                                                     ----------
     shall be continuing, and remain in full force and effect, until such time
     as all Notes have been finally and fully paid. Indenture Trustee shall not,
     without satisfying the Rating Agency Condition, waive a breach of any
     representation or warranty set forth in this Schedule 1. In order to
                                                  ----------
     evidence the interests of Seller and the Issuer under the Transfer and
     Servicing Agreement, Seller and Servicer shall take such action, or execute
     and deliver such instruments (other than filing financing statements) as
     may be necessary or advisable (including, without limitation, such actions
     as are requested by Indenture Trustee) to maintain and perfect, as a first
     priority interest, Seller's or the Issuer's security interest in the
     Receivables. The Servicer shall, from time to time and within the time
     limits established by law, prepare and present to the Indenture Trustee for
     the Indenture Trustee's authorization and approval all financing
     statements, amendments, continuations or initial financing statements in
     lieu of a continuation statement, or other filings necessary to continue,
     maintain and perfect as a first-priority interest. Indenture Trustee's
     approval of such filings shall authorize the Servicer to file such
     financing statements under the UCC without the signature of Seller or
     Indenture Trustee where allowed by applicable law. Notwithstanding anything
     else in the Transfer and Servicing Agreement to the contrary, the Servicer
     shall not have any authority to file a termination, partial termination,
     release, partial release, or any amendment that deletes the name of a
     debtor or excludes collateral of any such financing statements, without the
     prior written consent of Indenture Trustee. The Indenture Trustee may
     require, prior to authorizing or filing any such termination, partial
     termination, release, partial release or amendment, that Servicer provide
     an Opinion of Counsel that such filings are authorized under the Transfer
     and Servicing Agreement.

(8)  Notwithstanding paragraph (7) of this Schedule 1, the Indenture Trustee
     hereby consents to, and no further authorization or approval from Indenture
     Trustee is necessary with respect to, the following filings made in
     connection with the execution of this Amendment:

     New Financing Statement:
     -----------------------

          1.   Financing statement naming the Issuer as secured party and SCC
     III as debtor, in Delaware, covering receivables transferred by SCC III to
     Issuer pursuant to this Agreement.

     Amendment to Financing Statement:
     --------------------------------

          2.   Financing statement naming the Issuer as secured party and SCC
     III as debtor, in Delaware, covering receivables transferred by SCC III to
     Issuer pursuant to this Agreement.

                                       4

<PAGE>

     Termination Statements:
     ----------------------

          3.   Financing statements naming the trustee of the Spiegel Master
     Trust as secured party and SCC III as debtor, in Delaware and Illinois,
     covering receivables transferred by SCC III to the Spiegel Master Trust
     pursuant to the Amended and Restated Pooling and Servicing Agreement dated
     as of December 13, 1994.

                                       5