Form of Class B Terms Document



 Exhibit 4.7 

[FORM OF] 
  

 
 DISCOVER CARD EXECUTION NOTE TRUST

 Issuer 

and 
 U.S. BANK
NATIONAL ASSOCIATION 
 Indenture Trustee 

CLASS B(        -    ) TERMS DOCUMENT 

Dated as of [                    ]

 to 

AMENDED AND RESTATED INDENTURE SUPPLEMENT 

Dated as of June 4, 2010 

for the DiscoverSeries Notes 

to 
 INDENTURE

 Dated as of July 26, 2007 
  

 







 TABLE OF CONTENTS 

 

					
	 	  	 	  	Page
	
	 ARTICLE I
  

Definitions and Other Provisions of General Application

			
	 Section 1.01
	  	Definitions	  	1
	 Section 1.02
	  	Representations and Warranties of Issuer	  	8
	 Section 1.03
	  	Representations and Warranties of Indenture Trustee	  	9
	 Section 1.04
	  	Limitations on Liability	  	9
	 Section 1.05
	  	Governing Law	  	9
	 Section 1.06
	  	Counterparts	  	10
	 Section 1.07
	  	Ratification of Indenture and Indenture Supplement	  	10
	
	ARTICLE II
	
	The Class B(        -    ) Notes
			
	 Section 2.01
	  	Creation and Designation	  	10
	 Section 2.02
	  	Adjustments to Required Subordinated Percentages and Amount	  	10
	 Section 2.03
	  	[Interest Payment]	  	10
	 Section 2.04
	  	[Notification of LIBOR]	  	11
	 Section 2.05
	  	Payments of Interest and Principal	  	11
	 Section 2.06
	  	Form of Delivery of Class B(        -    ) Notes; Depository; Denominations	  	11
	 Section 2.07
	  	Delivery and Payment for the Class B(        -    ) Notes	  	12
	 Section 2.08
	  	[Targeted Deposits to the Accumulation Reserve Account]	  	12
	 Section 2.09
	  	Additional Issuances of Notes	  	12
	 Section 2.10
	  	[Designation of Additional Amounts to be included in the Excess Spread Amount for the DiscoverSeries Notes]	  	13
	 Section 2.11
	  	[Variable Accumulation Period]	  	13
	
	Exhibit
			
	 Exhibit A
	  	Form of Class B Note                    	  	








 THIS CLASS B(        -    )
TERMS DOCUMENT (this “Terms Document”), by and between DISCOVER CARD EXECUTION NOTE TRUST, a statutory trust created under the laws of the State of Delaware (the “Issuer”), and U.S. BANK NATIONAL ASSOCIATION, a
national banking association organized and existing under the laws of the United States of America, as Indenture Trustee (the “Indenture Trustee”), is made and entered into as of
[                    ]. 

Pursuant to this Terms Document, the Issuer shall create a new Tranche of Class B Notes of the DiscoverSeries and shall specify the
principal terms thereof. 
 ARTICLE I 

Definitions and Other Provisions of General Application 

Section 1.01 Definitions. For all purposes of this Terms Document, except as otherwise expressly provided or unless the
context otherwise requires: 
 (1) the terms defined in this Article have the meanings assigned to them in this Article, and
include the plural as well as the singular; 
 (2) all other terms used herein which are defined in the Indenture Supplement or
the Indenture, either directly or by reference therein, have the meanings assigned to them therein; 
 (3) all accounting terms
not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with
respect to any computation required or permitted hereunder means such accounting principles as are generally accepted in the United States of America at the date of such computation; 

(4) all references in this Terms Document to designated “Articles,” “Sections” and other subdivisions are to the
designated Articles, Sections and other subdivisions of this Terms Document; The words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Terms Document as a whole and not to any
particular Article, Section or other subdivision; 
 (5) in the event that any term or provision contained herein shall conflict
with or be inconsistent with any term or provision contained in the Indenture Supplement or the Indenture, the terms and provisions of this Terms Document shall be controlling, but solely with respect to the Class
B(        -    ) Notes; 
 (6) each capitalized term defined herein
shall relate only to the Class B(        -    ) Notes and no other Tranche of Notes issued by the Issuer; 

(7) “including” and words of similar import will be deemed to be followed by “without limitation”; and 







 (8) for purposes of determining any amount or making any calculation hereunder, such amount
or calculation, (x) if specified to be as of the first day of any Due Period, shall (a) include any Notes issued during such Due Period as if such Notes had been outstanding on the first day of such Due Period and (b) give effect to
any payments, deposits or other allocations made on the Distribution Date related to the prior Due Period, and (y) if specified to be as of the close of business on the last day of any Due Period shall give effect to any payments, deposits or
other allocations made on the related Distribution Date. 
 [“Accumulation Amount” means
$[            ]; provided, however, if the commencement of the Accumulation Period is delayed in accordance with Section 2.11 hereof, the Accumulation Amount shall be
determined in accordance with the definition of “Accumulation Amount” in the Indenture Supplement.] 

[“Accumulation Commencement Date” means [        ],
[        ], or such later date as the Calculation Agent on behalf of the Issuer determines in accordance with Section 2.11 hereof.] 

[“Accumulation Period” has the meaning set forth in the Indenture Supplement.] 

[“Accumulation Period Length” means [        ] months; provided,
however, if the commencement of the Accumulation Period is delayed in accordance with Section 2.11 hereof, the Accumulation Period Length shall be determined in accordance with the definition of “Accumulation Period Length” in
the Indenture Supplement.] 
 [“Accumulation Reserve Funding Period” shall not apply if the Calculation Agent
on behalf of the Issuer notifies the Indenture Trustee that it expects the Accumulation Period Length to be adjusted to one (1) month, and otherwise shall mean a period commencing on the first Distribution Date on which a condition in the right
column of the following table was in effect on the immediately preceding Distribution Date, if the Distribution Date is a Distribution Date described in the corresponding left column of the following table, and ending on the Distribution Date
immediately preceding the earlier to occur of: 
 (x) the Expected Maturity Date for the Class
B(        -    ) Notes and 
 (y) the Principal Payment Date on
which the Outstanding Dollar Principal Amount of the Class B(        -    ) Notes is paid in full. 
  

			
	Distribution Date:	  	Condition:
		
	(a) The Distribution Date occurring three (3) calendar months prior to the first scheduled Distribution Date of the Accumulation Period (as adjusted in accordance with
Section 2.11 hereof) and any following Distribution Date	  	No condition.
		
	(b) The Distribution Date occurring [four (4)] calendar months prior to the first scheduled Distribution Date of the Accumulation Period (as adjusted in accordance with
Section 2.11 hereof) and any following Distribution Date	  	The three-month rolling average Excess Spread Percentage is less than 4%.

  

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	(c) The Distribution Date occurring [six (6)] calendar months prior to the first scheduled Distribution Date of the Accumulation Period (as adjusted in accordance with Section 2.11
hereof) and any following Distribution Date	  	The three-month rolling average Excess Spread Percentage is less than 3%.
		
	(D) The Distribution Date occurring [twelve (12)] calendar months prior to the first scheduled Distribution Date of the Accumulation Period (as adjusted in accordance with
Section 2.11 hereof) and any following Distribution Date	  	The three-month rolling average Excess Spread Percentage is less than 2%.


provided, however, if at any point the Accumulation Reserve Funding Period has not commenced because no condition requiring funding has occurred
or the Calculation Agent has determined that the Accumulation Period Length will be shortened to one (1) month, and subsequently a condition requiring funding occurs and the Calculation Agent determines that the Accumulation Period Length will
not be so shortened, the Accumulation Reserve Funding Period shall commence on the following Distribution Date.] 

“Class B(        -    ) Adverse Event” means the occurrence
of any of the following: (a) an Early Redemption Event with respect to the Class B(        -    ) Notes or (b) an Event of Default and acceleration of the Class
B(        -    ) Notes; provided, however, that if the only such event to have occurred is an Excess Spread Early Redemption Event for which an Excess Spread Early Redemption
Cure has occurred, a Class B(        -    ) Adverse Event shall not be treated as continuing from and after the date of such cure. 

“Class B(        -    ) Note” means any Note, in the form
set forth in Exhibit A hereto, designated therein as a Class B(        -    ) Note and duly executed and authenticated in accordance with the Indenture. 

“Class B(        -    ) Noteholder” means a Person in whose
name a Class B(        -    ) Note is registered in the Note Register. 

“Class B(        -    ) Termination Date” means the earliest
to occur of (a) the Principal Payment Date on which the Outstanding Dollar Principal Amount of the Class B(        -    ) Notes is paid in full, (b) the Legal Maturity Date and
(c) the date on which the Indenture is discharged and satisfied pursuant to Article VI thereof. 
 [“Class Expected
Final Payment Date” with respect to Series 2009-SD of the Master Trust has the meaning set forth in the Series 2009-SD Supplement.] 

“Encumbered Amount” means, for the Class B(        -    )
Notes, an amount equal to 
 (a) the Nominal Liquidation Amount of the Class
B(        -    ) Notes, divided by 
  

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 (b) the Nominal Liquidation Amount of all Tranches of Class B Notes in the DiscoverSeries,
multiplied by 
 (c) the aggregate Required Subordinated Amount of Class B Notes for all Tranches of Class A Notes in the
DiscoverSeries with a Required Subordinated Amount of Class B Notes greater than zero. 
 “Encumbered Required
Subordinated Amount of Class C Notes” means, for the Class B(        -    ) Notes, an amount equal to the product of 

(a) the Encumbered Amount for the Class B(        -    ) Notes, and

 (b) the Required Subordinated Percentage of Class C Notes (Encumbered) for the Class
B(        -    ) Notes. 
 “Encumbered Required Subordinated
Amount of Class D Notes” means, for the Class B(        -    ) Notes, an amount equal to the product of 

(a) the Encumbered Amount for the Class B(        -    ) Notes and

 (b) the Required Subordinated Percentage of Class D Notes (Encumbered) for the Class
B(        -    ) Notes. 
 “Excess Spread
Percentage” for any Distribution Date means a fraction, the numerator of which is the Excess Spread Amount for such Distribution Date multiplied by 12 and the denominator of which is the sum of the Nominal Liquidation Amounts of all
Tranches of DiscoverSeries Notes as of the first day of the related Due Period. 
 “Expected Maturity Date”
means [            ]. 
 “Indenture” means the
Indenture dated as of July 26, 2007 between the Issuer and Indenture Trustee, as the same may be amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time. 

“Indenture Supplement” means the Amended and Restated Indenture Supplement dated as of June 4, 2010, for the
DiscoverSeries Notes, by and between the Issuer and the Indenture Trustee, as the same may be amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time. 

“Initial Dollar Principal Amount” means $[            ], or
such higher amount as is specified in any Notice of Additional Issuance under Section 2.09 hereof. 
 [“Interest
Accrual Period” means, with respect to any Interest Payment Date, the period from and including the previous Interest Payment Date (or, in the case of the first Interest Payment Date for any Class
B(        -    ) Note, from and including the applicable Issuance Date) to but excluding such Interest Payment Date.] 

 

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 [“Interest Payment Date” means the fifteenth day of each [month] commencing
in [            ], or if such fifteenth day is not a Business Day, the next succeeding Business Day.] 

“Issuance Date” means [            ] with respect to all
Class B(        -    ) Notes issued on the date hereof and, with respect to any additional Class B(        -    ) Notes issued
pursuant to Section 2.09 hereof, any Issuance Date specified in the Notice of Additional Issuance delivered thereunder. 

“Legal Maturity Date” means [            ]. 

[“LIBOR” means, with respect to any LIBOR Determination Date, the rate for deposits in United States dollars with a
duration comparable to the relevant Interest Accrual Period which appears on Reuters Screen LIBOR01 as of 11:00 a.m., London time, on such day. If such rate does not appear on Reuters Screen LIBOR01, the rate will be determined by the Indenture
Trustee on the basis of the rates at which deposits in United States dollars are offered by major banks in the London interbank market, selected by the Indenture Trustee, at approximately 11:00 a.m., London time, on such day to prime banks in the
London interbank market with a duration comparable to the relevant Interest Accrual Period commencing on that day. The Indenture Trustee will request the principal London office of at least four banks to provide a quotation of its rate. If at least
two such quotations are provided, the rate will be the arithmetic mean of the quotations. If fewer than two quotations are provided as requested, the rate for that day will be the arithmetic mean of the rates quoted by four major banks in New York
City, selected by the Trustee, at approximately 11:00 a.m., New York City time, on that day for loans in United States dollars to leading European banks with a duration comparable to the relevant Interest Accrual Period commencing on that day. If
LIBOR with respect to a LIBOR Determination Date is not determined pursuant to the foregoing, LIBOR with respect to such LIBOR Determination Date will be LIBOR with respect to the immediately prior LIBOR Determination Date.] 

[“LIBOR Business Day,” if applicable, shall mean a day other than a Saturday or a Sunday on which banking institutions
in both the City of London, England and in New York, New York are not required or authorized by law to be closed.] 

[“LIBOR Determination Date” means the second LIBOR Business Day immediately preceding the commencement of an Interest
Accrual Period.] 
 [“Note Interest Rate” means [LIBOR] [+/-]
[            ]% per annum, calculated on the basis of [the actual number of days elapsed] [twelve 30-day months] and a 360-day year.] 

“Notice of Additional Issuance” has the meaning set forth in Section 2.09 hereof. 

“Required Daily Deposit Target Finance Charge Amount” means, for any day in a Due Period, an amount equal to the Class B
Tranche Interest Allocation for the related Distribution Date[; provided, however, that for purposes of determining the Required Daily Deposit Target Finance Charge Amount on any day on which the Class B Tranche Interest Allocation cannot be
determined because [the LIBOR Determination Date] for the applicable Interest Accrual Period has not yet occurred, the Required Daily Deposit Target Finance Charge Amount shall be the Class B Tranche Interest Allocation determined based on a pro
forma calculation made on the assumption that [LIBOR] will be [LIBOR] for the applicable period determined on the first day of such calendar month, multiplied by 1.25]. 

 

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 “Required Daily Deposit Target Principal Amount” means, for any day in a
Due Period, (i) if such Due Period is in [the Accumulation Period for the Class B(        -    ) Notes, the Accumulation Amount], (ii) if such day is on or after the occurrence
and during the continuance of a Class B(        -    ) Adverse Event, the Nominal Liquidation Amount of the Class
B(        -    ) Notes, and (iii) in all other circumstances, zero. 

“Required Subordinated Amount of Class C Notes” means, for the Class
B(        -    ) Notes for any date of determination, an amount equal to the sum of 

(a) the Unencumbered Required Subordinated Amount of Class C Notes for such Class
B(        -    ) Notes and 
 (b) the Encumbered Required
Subordinated Amount of Class C Notes for such Class B(        -    ) Notes; 

provided, however, that for any date of determination on or after the occurrence and during the continuation of a Class
B(        -    ) Adverse Event, the Required Subordinated Amount of Class C Notes for the Class B(        -    ) Notes will be
the greater of 
 (x) the amount determined above for such date of determination and 

(y) the amount determined above for the date immediately prior to the date on which such Class
B(        -    ) Adverse Event shall have occurred. 

“Required Subordinated Amount of Class D Notes” means, for the Class
B(        -    ) Notes for any date of determination, an amount equal to the sum of 

(a) the Unencumbered Required Subordinated Amount of Class D Notes for such Class
B(        -    ) Notes and 
 (b) the Encumbered Required
Subordinated Amount of Class D Notes for such Class B(        -    ) Notes; 

provided, however, that for any date of determination on or after the occurrence and during the continuation of a Class
B(        -    ) Adverse Event, the Required Subordinated Amount of Class D Notes for the Class B(        -    ) Notes will be
the greater of 
  

	 	(x)	the amount determined above for such date of determination and 

  

	 	(y)	the amount determined above for the date immediately prior to the date on which the Class B(        -    )
Adverse Event shall have occurred. 

 “Required Subordinated Percentage of Class C Notes
(Encumbered)” means, for the Class B(        -    ) Notes, [            ]%, subject to adjustment in accordance with
Section 2.02[; provided, however, that prior to the Class Expected Final Payment Date for Series 2009-SD, the Required Subordinated Percentage of Class C Notes (Encumbered) for the Class
B(        -    ) Notes will be [            ]%, subject to adjustment in accordance with Section 2.02]. 

 

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 “Required Subordinated Percentage of Class C Notes (Unencumbered)” means,
for the Class B(        -    ) Notes, [            ]%, subject to adjustment in accordance with Section 2.02[; provided,
however, that prior to the Class Expected Final Payment Date for Series 2009-SD, the Required Subordinated Percentage of Class C Notes (Unencumbered) for the Class B(        -    ) Notes
will be [            ]%, subject to adjustment in accordance with Section 2.02]. 

“Required Subordinated Percentage of Class D Notes (Encumbered)” means, for the Class
B(        -    ) Notes, [            ]%, subject to adjustment in accordance with Section 2.02[; provided, however, that
prior to the Class Expected Final Payment Date for Series 2009-SD, the Required Subordinated Percentage of Class D Notes (Encumbered) for the Class B(            -    )
Notes will be [            ]%, subject to adjustment in accordance with Section 2.02]. 

“Required Subordinated Percentage of Class D Notes (Unencumbered)” means for the Class
B(        -    ) Notes, [            ]%, subject to adjustment in accordance with Section 2.02[; provided, however, that
prior to the Class Expected Final Payment Date for Series 2009-SD, the Required Subordinated Percentage of Class D Notes (Unencumbered) for the Class B(        -    ) Notes will be
[            ]%, subject to adjustment in accordance with Section 2.02]. 

[“Reuters Screen LIBOR01” means the display page currently so designated on the Reuters Screen (or such other page as
may replace that page on that service for the purpose of displaying comparable rates or prices).] 
 [“Series 2009-SD
Supplement” means the Series 2009-SD Series Supplement to the Pooling and Servicing Agreement dated as of September 23, 2009, by and between Discover Bank as Master Servicer, Servicer and Seller and U.S. Bank National Association as
Trustee, as the same may be amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time.] 

“Specified Rating” means, for the Class B(        -    )
Notes, [A] with respect to [Standard & Poors], [A2] with respect to [Moody’s] and [A] with respect to [Fitch]. 

“Stated Principal Amount” means $[            ] or such
higher amount as is specified in any Notice of Additional Issuance under Section 2.09. 
 [“Targeted Accumulation
Reserve Subaccount Deposit” means, with respect to any Distribution Date during the Accumulation Reserve Funding Period, an amount equal to (i) [0.5]% of the Outstanding Dollar Principal Amount of the Class
B(        -    ) Notes as of the close of business on the last day of the related Due Period or (ii) any other amount designated by the Calculation Agent on behalf of the Issuer.]

 “Unencumbered Amount” means, for the Class
B(        -    ) Notes, an amount equal to the Nominal Liquidation Amount of the Class B(        -    ) Notes minus the
Encumbered Amount for the Class B(        -    ) Notes. 
  

 7 








 “Unencumbered Required Subordinated Amount of Class C Notes” means, for the
Class B(        -    ) Notes, an amount equal to the product of 

(a) the Unencumbered Amount for the Class B(        -    ) Notes and

 (b) the Required Subordinated Percentage of Class C Notes (Unencumbered) for the Class
B(        -    ) Notes. 
 “Unencumbered Required
Subordinated Amount of Class D Notes” means, for the Class B(        -    ) Notes, an amount equal to the product of 

(a) the Unencumbered Amount for the Class B(        -    ) Notes and

 (b) the Required Subordinated Percentage of Class D Notes (Unencumbered) for the Class
B(        -    ) Notes. 
 Section 1.02 Representations and
Warranties of Issuer. The Issuer represents and warrants that: 
 (a) the Issuer has been duly formed and is validly
existing as a statutory trust in good standing under the laws of the State of Delaware, and has full power and authority to execute and deliver this Terms Document and to perform the terms and provisions hereof; 

(b) the execution, delivery and performance of this Terms Document by the Issuer have been duly authorized by all necessary corporate and
statutory trust proceedings of any Beneficiary and the Owner Trustee, do not require any approval or consent of any governmental agency or authority, and do not and will not conflict with any material provision of the Certificate of Trust or the
Trust Agreement of the Issuer; 
 (c) this Terms Document is the valid, binding and enforceable obligations of the Issuer,
except as the same may be limited by receivership, insolvency, reorganization, moratorium or other laws relating to the enforcement of creditors’ rights generally or by general equity principles; 

(d) to the best of the Issuer’s knowledge, this Terms Document will not conflict with any law or governmental regulation or court
decree applicable to it; 
 (e) the Issuer is not required to be registered under the Investment Company Act; 

(f) all information heretofore furnished by the Issuer in writing to the Indenture Trustee for purposes of or in connection with this
Terms Document or any transaction contemplated hereby is, and all such information hereafter furnished by the Issuer in writing to the Indenture Trustee will be, true and accurate in every material respect or based on reasonable estimates on the
date as of which such information is stated or certified; and 
  

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 (g) to the best knowledge of the Issuer, there are no proceedings or investigations pending
against the Issuer before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality having jurisdiction over the Issuer (A) asserting the invalidity of this Terms Document, (B) seeking to prevent
the consummation of any of the transactions contemplated by this Terms Document or (C) seeking any determination or ruling which in the Issuer’s judgment would materially and adversely affect the performance by the Issuer of its
obligations under this Terms Document or the validity or enforceability of this Terms Document. 
 Section 1.03
Representations and Warranties of Indenture Trustee. The Indenture Trustee represents and warrants and any successor trustee shall represent and warrant that: 

(a) The Indenture Trustee is organized, existing and in good standing under the laws of the United States of America; 

(b) The Indenture Trustee has full power, authority and right to execute, deliver and perform this Indenture, and has taken all necessary
action to authorize the execution, delivery and performance by it of this Terms Document; and 
 (c) This Terms Document has
been duly executed and delivered by the Indenture Trustee. 
 Section 1.04 Limitations on Liability. 

(a) It is expressly understood and agreed by the parties hereto that (i) this Terms Document is executed and delivered by the Owner
Trustee not individually or personally but solely as Owner Trustee under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it, (ii) each of the representations, undertakings and agreements herein made on
the part of the Issuer is made and intended not as a personal representation, undertaking or agreement by the Owner Trustee but is made and intended for the purpose of binding only the Issuer, (iii) nothing herein contained will be construed as
creating any liability on the Owner Trustee individually or personally, to perform any covenant of the Issuer either expressed or implied herein, all such liability, if any, being expressly waived by the parties to this Terms Document and by any
Person claiming by, through or under them and (iv) under no circumstances will the Owner Trustee be personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Issuer under this Terms Document or any related documents. 
 (b)
None of the Indenture Trustee, the Owner Trustee, the Calculation Agent, any Beneficiary, the Depositor, any Master Servicer or any Servicer or any of their respective officers, directors, employees, incorporators or agents will have any liability
with respect to this Terms Document, and recourse may be had solely to the Collateral pledged to secure these Class B(            -    ) Notes under the Indenture, the
Indenture Supplement and this Terms Document. 
 Section 1.05 Governing Law. THIS TERMS DOCUMENT WILL BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATION LAW, WITHOUT REFERENCE TO ANY CONFLICT OF LAW PROVISIONS THAT WOULD RESULT IN THE APPLICATION OF THE LAWS OF ANY OTHER STATE.

  

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 Section 1.06 Counterparts. This Terms Document may be executed in any number of
counterparts, each of which when so executed will be deemed to be an original, but all such counterparts will together constitute but one and the same instrument. 

Section 1.07 Ratification of Indenture and Indenture Supplement. As supplemented by this Terms Document, each of the
Indenture and the Indenture Supplement is in all respects ratified and confirmed and the Indenture as supplemented by the Indenture Supplement and this Terms Document shall be read, taken and construed as one and the same instrument. 

ARTICLE II 
 The
Class B(        -    ) Notes 
 Section 2.01 Creation and
Designation. There is hereby created a Tranche of Class B Notes to be issued pursuant to the Indenture and the Indenture Supplement to be known as the “DiscoverSeries Class
B(        -    ) Notes.” 
 Section 2.02 Adjustments to
Required Subordinated Percentages and Amount. 
 (a) On any date, the Issuer may, at the direction of the Beneficiary,
change the Required Subordinated Percentage of Class C Notes (Encumbered), the Required Subordinated Percentage of Class C Notes (Unencumbered), the Required Subordinated Percentage of Class D Notes (Encumbered), and the Required Subordinated
Percentage of Class D Notes (Unencumbered), in each case for the Class B(        -    ) Notes, without the consent of any Noteholders; provided that the Issuer has received written
confirmation from each applicable Note Rating Agency that the change in such percentage will not result in a Ratings Effect for any Tranche of Outstanding DiscoverSeries Notes. 

(b) On any date, the Issuer may, at the direction of the Beneficiary, replace all or a portion of the Required Subordinated Amount of
Class C Notes or the Required Subordinated Amount of Class D Notes, in each case for the Class B(        -    ) Notes with a different form of credit enhancement (including, without
limitation, a cash collateral account, a letter of credit, a reserve account, a surety bond, an insurance policy or a collateral interest, or any combination thereof) and may add such definitions and other terms and make such additional amendments
to this Terms Document as shall be necessary for such replacement without the consent of any Noteholders, provided that the Issuer has received written confirmation from each applicable Note Rating Agency that such replacement and such other
amendments will not result in a Ratings Effect for any Tranche of Outstanding DiscoverSeries Notes. 
 Section 2.03
[Interest Payment]. For each Interest Payment Date, the amount of interest due with respect to the Class B(        -    ) Notes shall be an amount equal to 

 

	 	(i)	(A) a fraction, the numerator of which is [the actual number of days in the related Interest Accrual Period] [30] and the denominator of which is 360, times


 (B) the Note Interest Rate in effect with respect to such related Interest Accrual Period, times

  

 10 









	 	(ii)	the Outstanding Dollar Principal Amount of the Class B(        -    ) Notes determined as of the first date
of such related Interest Accrual Period, plus 

 any Class B Tranche Interest Allocation Shortfall for such Class
B(        -    ) Notes for the immediately preceding Distribution Date, together with interest thereon at the Note Interest Rate in effect with respect to such related Interest Accrual
Period, calculated on the basis of [the actual number of days in the related Interest Accrual Period] [twelve 30-day months] and a 360-day year.] 

Section 2.04 [Notification of LIBOR]. On each LIBOR Determination Date, the Indenture Trustee shall send to the Issuer, the
Beneficiary, each applicable Master Servicer and any stock exchange on which the Class B(        -    ) Notes are then listed (if the rules of such exchange so require), by facsimile
transmission or electronic transmission, notification of LIBOR for the following Interest Accrual Period.] 
 Section 2.05
Payments of Interest and Principal. 
 [(a) The Issuer will cause interest to be paid on each Interest Payment Date and
principal to be paid on the Expected Maturity Date; provided, however, that it shall not be an Event of Default if principal is not paid in full on such Expected Maturity Date unless funds for such payment have been allocated in
accordance with Section 3.01 of the Indenture Supplement; and provided, further, that if a Class B(        -    ) Adverse Event has occurred and is continuing, principal
will instead be payable in monthly installments on each Principal Payment Date for the Class B(        -    ) Notes in accordance with Sections 3.01 and 3.05 of the Indenture Supplement.
All payments of interest and principal on the Class B(        -    ) Notes shall be made as set forth in Section 1101 of the Indenture.] 

(b) The right of the Class B(        -    ) Noteholders to receive payments
from the Issuer will terminate on the Class B(        -    ) Termination Date. 

(c) All payments of principal, interest or other amounts to the Class
B(        -    ) Noteholders will be made pro rata based on the Stated Principal Amount of their Class B(        -    )
Notes. 
 Section 2.06 Form of Delivery of Class
B(        -    ) Notes; Depository; Denominations. 
 (a) The
Class B(        -    ) Notes shall be delivered in the form of a [Global Note which shall be a Registered Note as provided in Section 204 of the Indenture] [definitive Registered Note
as provided in Section 201 of the Indenture]. The form of the Class B(        -    ) Notes is attached hereto as Exhibit A. 

(b) [The Depository for the Class B(        -    ) Notes shall be The
Depository Trust Company, and the Class B(        -    ) Notes shall initially be registered in the name of Cede & Co., its nominee.] 

(d) The Class B(        -    ) Notes will be issued in minimum denominations
of $[100,000] and integral multiples of $[1,000] in excess of that amount. 
  

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 Section 2.07 Delivery and Payment for the Class
B(        -    ) Notes. The Issuer shall execute and deliver the Class B(        -    ) Notes to the Indenture Trustee for
authentication, and the Indenture Trustee shall deliver the Class B(        -    ) Notes when authenticated, each in accordance with Sections 203 and 303 of the Indenture. 

Section 2.08 [Targeted Deposits to the Accumulation Reserve Account]. The deposit targeted to be made to the Accumulation
Reserve Subaccount for the Class B(        -    ) Notes for any Due Period during the Accumulation Reserve Funding Period will be an amount equal to the Targeted Accumulation Reserve
Subaccount Deposit minus any amount on deposit in the Accumulation Reserve Subaccount for the Class B(        -    ) Notes.] 

Section 2.09 Additional Issuances of Notes. Subject to clauses (ii), (iii), (iv) and (v) of Sections 2.02 and
Section 2.03 of the Indenture Supplement, the Issuer may issue additional Class B(        -    ) Notes, so long as the following conditions precedent are satisfied: 

(a) the Issuer shall have given the Indenture Trustee written notice of such issuance of additional Class
B(        -    ) Notes (the “Notice of Additional Issuance”) at least one (1) Business Day in advance of the Issuance Date thereof, which notice shall include:

  

	 	(i)	the Issuance Date of such additional Class B(        -    ) Notes; 


 

	 	(ii)	the amount of such additional Class B(        -    ) Notes being offered and the resulting Initial Dollar
Principal Amount and Stated Principal Amount of Class B(        -    ) Notes; 

  

	 	(iii)	the date from which interest on such additional Class B(        -    ) Notes will accrue (which may be a
date prior to the date of issuance thereof); 

  

	 	(iv)	the first Interest Payment Date on which interest will be paid on such additional Class B(        -    )
Notes; and 

  

	 	(v)	any other terms that the Issuer set forth in such notice of issuance of additional Class B(        -    )
Notes to clarify the rights of Holders of such additional Class B(        -    ) Notes or the effect of such issuance of additional Class
B(        -    ) Notes on any calculations to be made with respect to the Class B(        -    ) Notes, Class B, or the Issuer.


 All such terms shall be incorporated into and form a part of this Terms Document on and after the effective date of such Class
B(        -    ) Notes; 
 (b) no Class
B(        -    ) Adverse Event has occurred and is continuing; and 

(c) [either (i) the issuance of such additional Class B(        -    )
Notes would be treated as part of the same issue as the outstanding Class B(        -    ) Notes under Treasury Regulation Sections 1.1275-1(f)(1) or 1.1275-2(k), or (ii) such
additional Class B(        -    ) Notes are not issued with “original issue discount” for purposes of Section 1273 of the Code]. 

 

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 The Issuer shall not have to satisfy the conditions set forth in Section 310 of the
Indenture in connection with an issuance of additional Class B(        -    ) Notes so long as such conditions were satisfied or waived in connection with the initial issuance of Class
B(        -    ) Notes; provided, however, that the Issuer shall have to deliver to the Indenture Trustee a Master Trust Tax Opinion and an Issuer Tax Opinion with respect to such
issuance. 
 Section 2.10 [Designation of Additional Amounts to be included in the Excess Spread Amount for the
DiscoverSeries Notes]. At any time that any outstanding Series of certificates issued by the Master Trust provides that the Series Principal Collections allocated to such Series will be deposited into the Group Finance Charge Collections
Reallocation Account for the Master Trust to the extent necessary for application to cover shortfalls for other Series issued by the Master Trust, an amount equal to (x) all Series Principal Collections allocated to such Series, multiplied
by (y) a fraction, the numerator of which is the sum of the Nominal Liquidation Amounts for each outstanding Tranche of the DiscoverSeries Notes (including the Class
B(        -    ) Notes and the denominator of which is (i) the Aggregate Investor Interest for the Master Trust minus (ii) the sum of the Series Investor Interests for all
such Series that provide that the Series Principal Collections allocated to such Series will be so deposited (including Series 2009-SD), is hereby designated to be included in the Excess Spread Amount and shall be treated as Series Finance Charge
Amounts for the DiscoverSeries.] 
 Section 2.11 [Variable Accumulation Period]. Notwithstanding anything to the
contrary in Section 4.02 of the Indenture Supplement, the Calculation Agent on behalf of the Issuer shall, by written notice to the Indenture Trustee, delay the commencement of the Accumulation Period for the Class
B(        -    ) Notes and determine a new Accumulation Commencement Date, subject to the conditions set forth in this Section 2.11; provided, however, that the
Accumulation Period shall commence no later than the first day of the Due Period related to the Expected Maturity Date for the Class B(        -    ) Notes. Any such delay by the
Calculation Agent on behalf of the Issuer shall be made no later than the first day of the scheduled Due Period immediately preceding the first Due Period in the Accumulation Period (after giving effect to any prior delay in the commencement of the
Accumulation Period pursuant to this Section 2.11). 
  

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 The Calculation Agent on behalf of the Issuer shall cause such delay if the Calculation
Agent determines in good faith that each of the following conditions will be satisfied: (i) the Calculation Agent on behalf of the Issuer delivers to the Indenture Trustee a certificate to the effect that the Calculation Agent on behalf of the
Issuer reasonably believes that, based on the payment rate and the anticipated availability of Series Principal Amounts and Reallocated Principal Amounts, the delay in the commencement of the Accumulation Period for the Class
B(        -    ) Notes will not result in any Tranche of Notes not being paid in full on the relevant Expected Maturity Date; (ii) such delay is permitted under the Series 2007-CC
Series Supplement or any other applicable agreement relating to any Additional Collateral Certificate; and (iii) the Accumulation Amount, the Accumulation Commencement Date and the Accumulation Period Length shall have been adjusted. The
Calculation Agent on behalf of the Issuer shall not be required to obtain confirmation from the applicable Note Rating Agencies that such delay in the commencement of the Accumulation Period will not result in a Ratings Effect for any Tranche of
Outstanding DiscoverSeries Notes, unless at the time of such delay there is a Tranche of Outstanding DiscoverSeries Notes, which were issued prior to January 1, 2009 and for which the commencement of the Accumulation Period for such Tranche of
Notes has already been delayed pursuant to Section 4.02 of the Indenture Supplement. If such confirmation from the applicable Note Rating Agency is not required, the Calculation Agent on behalf of the Issuer shall provide written notice to each
applicable Note Rating Agency in the event that the commencement of the Accumulation Period for the Class B(        -    ) Notes is delayed pursuant to this Section 2.11.] 

[Remainder of page intentionally blank; signature page follows] 

 

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 IN WITNESS WHEREOF, the parties hereto have caused this Terms Document to be duly executed, all as of the
day and year first above written. 
  

			
	DISCOVER CARD EXECUTION NOTE TRUST,
	  as Issuer
		
	By:	 	Wilmington Trust Company, not in its individual capacity but solely as Owner Trustee
		
	By:	 	  

		 	Name:
		 	Title:
	
	 U.S. BANK NATIONAL ASSOCIATION,

  as Indenture Trustee

		
	By:	 	  

		 	Name:
		 	Title:


 [Signature Page to Class
B(        -    ) Terms Document]