Document:

Class C(2010-1) Terms Document

 Exhibit 4.2 

Execution Version 
  

 
 DISCOVER CARD EXECUTION NOTE TRUST

 Issuer 

and 
 U.S. BANK
NATIONAL ASSOCIATION 
 Indenture Trustee 

CLASS C(2010-1) TERMS DOCUMENT 

Dated as of July 29, 2010 

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	  	1
	Definitions and Other Provisions of General Application	  	1
	Section 1.01.	 	Definitions	  	1
	Section 1.02.	 	Representations and Warranties of Issuer	  	9
	Section 1.03.	 	Representations and Warranties of Indenture Trustee	  	10
	Section 1.04.	 	Limitations on Liability	  	10
	Section 1.05.	 	Governing Law	  	11
	Section 1.06.	 	Counterparts	  	11
	Section 1.07.	 	Ratification of Indenture and Indenture Supplement	  	11
	ARTICLE II	  	11
	The Class C(2010-1) Notes	  	11
	Section 2.01.	 	Creation and Designation	  	11
	Section 2.02.	 	Adjustments to Required Subordinated Percentage and Amount	  	11
	Section 2.03.	 	Interest Payment	  	11
	Section 2.04.	 	Notification of LIBOR	  	12
	Section 2.05.	 	Payments of Interest and Principal	  	12
	Section 2.06.	 	Form of Delivery of Class C(2010-1) Notes; Denominations	  	12
	Section 2.07.	 	Delivery and Payment for the Class C(2010-1) Notes	  	13
	Section 2.08.	 	Targeted Deposits to the Accumulation Reserve Account	  	13
	Section 2.09.	 	Additional Issuances of Notes	  	14
	Section 2.10.	 	Designation of Additional Amounts to be included in the Excess Spread Amount for the DiscoverSeries Notes	  	14
	Section 2.11.	 	No Payments from Interest Funding Subaccount for accretion of principal of the Class C(2010-1) Notes	  	15
	Section 2.12.	 	Calculation of Class C(2010-1) Accreted Discount	  	15

 Exhibit 

 

			
	Exhibit A	    	Form of Class C Note

 THIS CLASS C(2010-1) 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 July 29, 2010. 

Pursuant to this Terms Document, the Issuer shall create a new Tranche of Class C 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 C(2010-1) Notes; 

(6) each capitalized term defined herein shall relate only to the Class C(2010-1) 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 $41,250,000; provided, however, if the
commencement of the Accumulation Period is delayed in accordance with Section 4.02 of the Indenture Supplement, the Accumulation Amount shall be determined in accordance with the definition of “Accumulation Amount” in the Indenture
Supplement. 
 “Accumulation Commencement Date” means July 1, 2011, or such later date as the Calculation
Agent on behalf of the Issuer determines in accordance with Section 4.02 of the Indenture Supplement. 

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

“Accumulation Period Length” means 12 months; provided, however, if the commencement of the Accumulation
Period is delayed in accordance with Section 4.02 of the Indenture Supplement, 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 C(2010-1) Notes and 

(y) the Principal Payment Date on which the Outstanding Dollar Principal Amount of the Class C(2010-1) 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 4.02 of the Indenture Supplement) 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 4.02	 	The three-month rolling average Excess Spread Percentage is less than 4%.

 

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	of the Indenture Supplement) and any following Distribution Date	 	
		
	(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 4.02 of the Indenture Supplement) 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 4.02 of the Indenture Supplement) and any following Distribution Date	 	The three-month rolling average Excess Spread Percentage is less than 2%.

“Class C(2010-1) Accreted Discount” means, for any Distribution Date, the amount of principal accreted on the Class
C(2010-1) Notes in accordance with Section 2.12 hereof through the Monthly Principal Accretion Period ending on such Distribution Date. 

“Class C(2010-1) Adverse Event” means the occurrence of any of the following: (a) an Early Redemption Event with
respect to the Class C(2010-1) Notes or (b) an Event of Default and acceleration of the Class C(2010-1) 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 C(2010-1) Adverse Event shall not be treated as continuing from and after the date of such cure. 

“Class C(2010-1) Note” means any Note, in the form set forth in Exhibit A hereto, designated therein as a Class
C(2010-1) Note and duly executed and authenticated in accordance with the Indenture. 
 “Class C(2010-1)
Noteholder” means a Person in whose name a Class C(2010-1) Note is registered in the Note Register. 
 “Class
C(2010-1) Termination Date” means the earliest to occur of (a) the Principal Payment Date on which the Outstanding Dollar Principal Amount of the Class C(2010-1) 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 C Tranche Interest
Allocation” notwithstanding anything to the contrary in the Indenture Supplement, for the Class C (2010-1) Notes shall be zero; provided that, if the Outstanding Dollar Principal Amount is not paid in full on or prior to the Expected
Maturity Date, for any Distribution Date after the Expected Maturity Date, the Class C Tranche Interest Allocation shall be the Class C Interest for the Class C(2010-1) Notes plus any Interest

  

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Allocation Shortfall from the prior Distribution Date. Following a Receivables Sale for the Class C (2010-1) Notes, the Class C Tranche Interest Allocation shall be zero. 

“Class C Reserve Account Percentage” means, for any Distribution Date on which a condition in the left column of the
following table was in effect on the immediately preceding Distribution Date, the percentage in the corresponding right column of the following table (or if more than one conditions were in effect on the immediately preceding Distribution Date, the
largest percentage). 
  

			
	 Condition:
  

The three-month rolling average Excess Spread Percentage is:
	 	Class C Reserve Account Percentage:
		
	(a) 4.50% or greater	 	0%
		
	(b) 4.00% to 4.49%	 	1.25%
		
	(c) 3.50% to 3.99%	 	2.00%
		
	(d) 3.00% to 3.49%	 	2.75%
		
	(e) 2.50% to 2.99%	 	3.50%
		
	(f) 2.00% to 2.49%	 	4.50%
		
	 (g) less than 2.00%, or
  

an Early Redemption Event or Event of Default for the Class C(2010-1) Notes has occurred and is continuing.
	 	6.00%

 “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. 

“Discount Amount” means initially $23,852,070; provided that following any issuance of additional Class C(2010-1) Notes
in accordance with Section 2.09, the Discount Amount shall mean the amount specified in the Notice of Additional Issuance. 

“Encumbered Amount” means, for the Class C(2010-1) Notes, an amount equal to 

(a) the Nominal Liquidation Amount of the Class C(2010-1) Notes, divided by 

(b) the Nominal Liquidation Amount of all Tranches of Class C Notes in the DiscoverSeries, multiplied by 

 

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 (c) the sum of (i) the aggregate Required Subordinated Amount of Class C Notes for all
Tranches of Class A Notes in the DiscoverSeries with a Required Subordinated Amount of Class B Notes equal to zero and a Required Subordinated Amount of Class C Notes greater than zero and (ii) the aggregate Required Subordinated Amount of
Class C Notes for all Tranches of Class B Notes in the DiscoverSeries with a Required Subordinated Amount of Class C Notes greater than zero. 

“Encumbered Required Subordinated Amount of Class D Notes” means, for the Class C(2010-1) Notes, the product of

 (a) the sum of (1) the aggregate Required Subordinated Amount of Class D Notes for all Tranches of Class A Notes in
the DiscoverSeries with a Required Subordinated Amount of Class D Notes greater than zero, plus (2) the aggregate Unencumbered Required Subordinated Amount of Class D Notes for all Tranches of Class B Notes in the DiscoverSeries with an
Unencumbered Required Subordinated Amount of Class D Notes greater than zero, multiplied by 
 (b) a percentage
equivalent to a fraction, the numerator of which is the Nominal Liquidation Amount of the Class C(2010-1) Notes, and the denominator of which is the Nominal Liquidation Amount of all Tranches of Class C Notes in the DiscoverSeries. 

“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 July 16, 2012. 

“Indenture” means the Indenture, dated as of July 26, 2007, by and between the Issuer and Indenture Trustee, as
amended by the First Amendment to Indenture, dated as of June 4, 2010, as such agreement may be further amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time. 

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

“Initial Dollar Principal Amount” means $471,147,930, or such higher amount as is specified in any Notice of Additional
Issuance under Section 2.09. 
 “Interest Accrual Period” means, with respect to any Interest Payment
Date, the period from and including the previous Interest Payment Date to but excluding such Interest Payment Date (or, in the case of the first Interest Payment Date occurring after the Expected Maturity Date, from and including the Expected
Maturity Date to but excluding such Interest Payment Date). 
  

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 “Interest Payment Date” means, if the Outstanding Dollar Principal Amount
is not paid in full on or prior to the Expected Maturity Date, the fifteenth day of each month commencing in August 2012, or if such fifteenth day is not a Business Day, the next succeeding Business Day. 

“Issuance Date” means July 29, 2010 with respect to all Class C(2010-1) Notes issued on the date hereof and, with
respect to any additional Class C(2010-1) Notes issued pursuant to Section 2.09, any Issuance Date specified in the Notice of Additional Issuance delivered thereunder. 

“Legal Maturity Date” means January 15, 2015. 

“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 Determination Date” means the second LIBOR Business Day immediately preceding the commencement of an Interest
Accrual Period. 
 “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. 

“Nominal Liquidation Amount” means, notwithstanding anything to the contrary in the Indenture Supplement, with respect
to the Class C(2010-1) Notes: 
 (a) on the Issuance Date thereof, $495,000,000; 

(b) on any Distribution Date thereafter such amount as increased or decreased pursuant to Section 3.01 of the Indenture Supplement
and Section 2.09 hereof; 
 (c) on any date, other than a Distribution Date, on which Prefunding Excess Amount are
withdrawn from the applicable Principal Funding Subaccount pursuant to Section 4.04 of the Indenture Supplement, the Nominal Liquidation Amount as of the beginning of such date plus the Prefunding Excess Amount so withdrawn; and 

 

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 (d) on and after the date of a Receivables Sale for the Class C(2010-1) Notes, zero.

 “Note Interest Rate” means zero; provided that if the Outstanding Dollar Principal Amount is not paid in
full on or prior to the Expected Maturity Date, the Note Interest Rate shall be LIBOR + 2.50% per annum, calculated on the basis of the actual number of days elapsed and a 360-day year. 

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

“Outstanding Dollar Principal Amount” means, for the Class C(2010-1) Notes, notwithstanding anything to the contrary in
the Indenture Supplement, (a) prior to an issuance of additional Class C(2010-1) Notes, the sum of (i) the Initial Dollar Principal Amount of such Notes and (ii) the Class C(2010-1) Accreted Discount as determined in accordance with
Section 2.12 hereof, minus (i) the aggregate amount of principal paid with respect to the Class C(2010-1) Notes as of the relevant date of determination and (ii) any net losses of principal of funds on deposit in respect of principal
in the Principal Funding Account or the related Principal Funding Subaccount, as applicable, for the Class C(2010-1) Notes and (b) following the issuance of additional Class C(2010-1) Notes, the sum of (i) the Outstanding Dollar Principal
Amount of such Notes determined as of the date of such additional issuance and (ii) the Class C(2010-1) Accreted Discount accreted after the date of such additional issuance, as determined in accordance with Section 2.12 hereof, minus
(i) the aggregate amount, as of the relevant date of determination, of principal paid with respect to the Class C(2010-1) Notes after the date of such additional issuance and (ii) any net losses, as of the relevant date of determination,
of principal of funds on deposit in respect of principal in the Principal Funding Account or the related Principal Funding Subaccount, as applicable, for the Class C(2010-1) Notes after the date of such additional issuance. Notwithstanding the
foregoing, if a Receivables Sale has occurred with respect to the Class C(2010-1) Notes, the Outstanding Dollar Principal Amount shall be zero. 

“Required Daily Deposit Target Finance Charge Amount” means, for any day in a Due Period, an amount equal to the Class C
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 C 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 C 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. 

“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 C(2010-1) Notes, the Accumulation Amount, (ii) if such day is on or after the occurrence and during the continuance of a Class C(2010-1) Adverse Event, the lesser of (x) the Outstanding Dollar
Principal Amount of the Class C(2010-1) Notes and (y) the Nominal Liquidation Amount of the Class C(2010-1) Notes, and (iii) in all other circumstances, zero. 

“Required Subordinated Amount of Class D Notes” means, for the Class C(2010-1) Notes for any date of determination, an
amount equal to the sum of 
  

 7 

 (a) the Unencumbered Required Subordinated Amount of Class D Notes for such Class C(2010-1)
Notes and 
 (b) the Encumbered Required Subordinated Amount of Class D Notes for such Class C(2010-1) Notes; 

provided, however, that for any date of determination on or after the occurrence and during the continuation of a Class C(2010-1) Adverse Event,
the Required Subordinated Amount of Class D Notes for the Class C(2010-1) 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 C(2010-1) Adverse Event shall have occurred. 
 “Required Subordinated Percentage of Class D
Notes (Unencumbered)” means, for the Class C(2010-1) Notes, 13.636364%, 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 C(2010-1) Notes will be 11.731844%, 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 and Seller and U.S. Bank National Association as Trustee, as
amended by the Amendment to Specified Series Supplements, dated as of June 4, 2010, as such agreement may be further amended, supplemented, restated, amended and restated, replaced or otherwise modified from time to time. 

“Stated Principal Amount” means $495,000,000 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 C(2010-1) 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. 
 “Targeted Principal
Deposit” means, for the Class C(2010-1) Notes, notwithstanding anything to the contrary in the Indenture Supplement, 

(a) During the Accumulation Period, beginning with the Accumulation Commencement Date for the Class C(2010-1) Notes,
(x) (i) the Accumulation Amount for the Class C(2010-1) Notes, plus (ii) any Accumulation Amount that was scheduled to be deposited on any previous Distribution Date in the Accumulation Period that was not so deposited, minus

  

 8 

 
(y) the amount on deposit in the Principal Funding Subaccount for the Class C(2010-1) Notes that was applied to the amount in clause (x) in accordance with Section 4.04(a), 

(b) If the Class C(2010-1) Notes have been accelerated after the occurrence of an Event of Default, or if an Early Redemption Event with
respect to the Class C(2010-1) Notes has occurred (other than an Excess Spread Early Redemption Event for which an Excess Spread Early Redemption Cure has occurred), with respect to each Distribution Date following the Due Period in which such Event
of Default or Early Redemption Event has occurred, the lesser of (x) the Outstanding Dollar Principal Amount of such Tranche and (y) the Nominal Liquidation Amount of such Tranche, in each case as of the last day of the preceding Due
Period, and 
 (c) If a Receivables Sale has occurred for the Class C(2010-1) Notes, zero. 

“Unencumbered Amount” means, for the Class C(2010-1) Notes, an amount equal to the Nominal Liquidation Amount of the
Class C(2010-1) Notes minus the Encumbered Amount for the Class C(2010-1) Notes. 
 “Unencumbered Required
Subordinated Amount of Class D Notes” means, for the Class C(2010-1) Notes, an amount equal to the product of 
 (a)
the Unencumbered Amount for the Class C(2010-1) Notes and 
 (b) the Required Subordinated Percentage of Class D Notes
(Unencumbered) for the Class C(2010-1) 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; 

 

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 (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 
 (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 
  

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Terms Document, and recourse may be had solely to the Collateral pledged to secure the Class C(2010-1) 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. 

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 C(2010-1) Notes 
 Section 2.01. Creation and Designation. There is hereby created a Tranche of Class C Notes
to be issued pursuant to the Indenture and the Indenture Supplement to be known as the “DiscoverSeries Class C(2010-1) Notes.” 

Section 2.02. Adjustments to Required Subordinated Percentage and Amount. 

(a) On any date, the Issuer may, at the direction of the Beneficiary, change the Required Subordinated Percentage of Class D Notes
(Unencumbered) for the Class C(2010-1) 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 D Notes for the Class C(2010-1) 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 C(2010-1) Notes shall be an amount equal to 
  

 11 

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

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

  

	 	(ii)	the Outstanding Dollar Principal Amount of the Class C(2010-1) Notes determined as of the first date of such related Interest Accrual Period, plus

 any Class C Tranche Interest Allocation Shortfall for such Class C(2010-1) 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 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 C(2010-1) 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 C(2010-1) Adverse Event has occurred and is continuing, principal will instead be payable in monthly installments on each Principal Payment Date for the Class C(2010-1) Notes in
accordance with Sections 3.01 and 3.05 of the Indenture Supplement. All payments of interest and principal on the Class C(2010-1) Notes shall be made as set forth in Section 1101 of the Indenture. 

(b) The right of the Class C(2010-1) Noteholders to receive payments from the Issuer will terminate on the Class C(2010-1) Termination
Date. 
 (c) All payments of principal, interest or other amounts to the Class C(2010-1) Noteholders will be made pro rata based
on the Stated Principal Amount of their Class C(2010-1) Notes. 
 Section 2.06. Form of Delivery of Class C(2010-1)
Notes; Denominations. 
 (a) The Class C(2010-1) Notes shall be delivered in the form of a definitive Registered Note as
provided in Section 201 of the Indenture. The form of the Class C(2010-1) Notes is attached hereto as Exhibit A. 
  

 12 

 (b) The Class C(2010-1) Notes shall, until such time as the laws of any jurisdiction in
which they are offered or sold no longer restrict the transfer or sale thereof, bear a legend in substantially the following form: 

THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A. THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF DISCOVER CARD EXECUTION NOTE TRUST AND DISCOVER BANK THAT
(A) THIS NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN COMPLIANCE WITH RULE
144A UNDER THE SECURITIES ACT OR, IN THE CASE OF THE INITIAL HOLDER HEREOF ONLY, ANOTHER APPLICABLE EXEMPTION UNDER THE SECURITIES ACT, (2) TO DISCOVER CARD EXECUTION NOTE TRUST, DISCOVER BANK OR THEIR AFFILIATES OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT, IF APPLICABLE, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAW OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER FROM IT OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE. 
 No Class C(2010-1) Notes shall
be transferred except in accordance with the transfer restrictions described in the legend set forth above. 
 (c) The Class
C(2010-1) Notes will be issued in minimum denominations of $100,000 and integral multiples of $1,000 in excess of that amount. 

Section 2.07. Delivery and Payment for the Class C(2010-1) Notes. The Issuer shall execute and deliver the Class C(2010-1)
Notes to the Indenture Trustee for authentication, and the Indenture Trustee shall deliver the Class C(2010-1) 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 C(2010-1) 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 C(2010-1) Notes. 
  

 13 

 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 C(2010-1) 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 C(2010-1) 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 C(2010-1) Notes; 

  

	 	(ii)	the amount of such additional Class C(2010-1) Notes being offered, the purchase price for such additional Class C(2010-1) Notes and the resulting Initial Dollar
Principal Amount, Stated Principal Amount and Nominal Liquidation Amount of Class C(2010-1) Notes; 

  

	 	(iii)	the Outstanding Dollar Principal Amount of the Class C(2010-1) Notes after giving effect to the issuance of the additional Class C(2010-1) Notes and all prior
accretions of principal as determined in accordance with Section 2.12; 

  

	 	(iv)	the Discount Amount after giving effect to such additional Class C(2010-1) Notes; and 

 

	 	(v)	any other terms that the Issuer set forth in such notice of issuance of additional Class C(2010-1) Notes to clarify the rights of Holders of such additional Class
C(2010-1) Notes or the effect of such issuance of additional Class C(2010-1) Notes on any calculations to be made with respect to the Class C(2010-1) Notes, Class C, 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 C(2010-1) Notes; and

 (b) no Class C(2010-1) Adverse Event has occurred and is continuing. 

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 C(2010-1) Notes so long as such conditions were satisfied or waived in connection with the initial issuance of Class C(2010-1) Notes. 

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 these 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 
  

 14 

 
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. No Payments from Interest Funding Subaccount for accretion of principal
of the Class C(2010-1) Notes. Section 3.04(4) of the Indenture Supplement shall not apply to the Class C(2010-1) Notes. 

Section 2.12. Calculation of Class C(2010-1) Accreted Discount. The amount of Class C(2010-1) Accreted Discount as of the end
of any Due Period shall be determined on a straight-line basis and shall be equal to the product of (x) a fraction the numerator of which shall be the number of Due Periods elapsed since the Note Issuance Date (or if additional Class C(2010-1)
Notes have been issued under Section 2.09, since the Issuance Date of such additional Notes) and the denominator of which shall be the number of Due Periods from the Note Issuance Date (or the Issuance Date of such additional Notes) to and
including the Due Period related to the Expected Maturity Date and (y) the Discount Amount. 
 [Remainder of page
intentionally blank; signature page follows] 
  

 15 

 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:	 	 /s/ Jennifer A. Luce

		 	Name:	 	Jennifer A. Luce
		 	Title:	 	Assistant Vice President
	
	U.S. BANK NATIONAL ASSOCIATION,
	as Indenture Trustee
		
	By:	 	 /s/ Patricia M. Child

		 	Name:	 	Patricia M. Child
		 	Title:	 	Vice President

 [Signature Page to Class
C(2010-1) Terms Document] 

 Exhibit A 

Form of Class C Note 

See attached. 

 Exhibit 4.2(a) 

DISCOVERSERIES CLASS C(2010-1) NOTE 

THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A. THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF DISCOVER CARD EXECUTION NOTE TRUST AND DISCOVER BANK THAT
(A) THIS NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN COMPLIANCE WITH RULE
144A UNDER THE SECURITIES ACT OR, IN THE CASE OF THE INITIAL HOLDER HEREOF ONLY, ANOTHER APPLICABLE EXEMPTION UNDER THE SECURITIES ACT, (2) TO DISCOVER CARD EXECUTION NOTE TRUST, DISCOVER BANK OR THEIR AFFILIATES, OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT, IF APPLICABLE, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAW OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER FROM IT OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE. 
 THE HOLDER OF
THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST THE ISSUER, ANY MASTER TRUST OR ANY SPECIAL PURPOSE ENTITY THAT ACTS AS A DEPOSITOR WITH RESPECT TO ANY MASTER TRUST OR THE ISSUER, OR JOIN IN ANY INSTITUTION
AGAINST THE ISSUER, ANY MASTER TRUST OR ANY SPECIAL PURPOSE ENTITY THAT ACTS AS A DEPOSITOR WITH RESPECT TO ANY MASTER TRUST OR THE ISSUER, ANY RECEIVERSHIP, INSOLVENCY, BANKRUPTCY OR SIMILAR PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES
FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATIONS RELATING TO THE NOTES, THE INDENTURE, ANY DERIVATIVE AGREEMENT, ANY SUPPLEMENTAL CREDIT ENHANCEMENT AGREEMENT AND ANY SUPPLEMENTAL LIQUIDITY AGREEMENT. 

THE HOLDER OF THIS NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST IN THIS NOTE, BY THE ACQUISITION OF A
BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE NOTES AS INDEBTEDNESS FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON OR MEASURED BY INCOME. 

 THIS NOTE HAS BEEN ISSUED WITH “ORIGINAL ISSUE DISCOUNT” (WITHIN THE MEANING OF
SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED). UPON WRITTEN REQUEST TO DISCOVER BANK, 12 READ’S WAY, NEW CASTLE, DELAWARE, 19720, ATTENTION: TREASURER, DISCOVER BANK WILL PROMPTLY MAKE AVAILABLE TO ANY HOLDER OF THIS NOTE THE
FOLLOWING INFORMATION: (1) THE ISSUE PRICE AND ISSUE DATE OF THE NOTE, (2) THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THE NOTE AND (3) THE YIELD TO MATURITY OF THE NOTE. 

DISTRIBUTIONS OF PRINCIPAL AND INTEREST TO THE HOLDER OF THIS CLASS C NOTE ARE SUBORDINATE TO THE PAYMENT ON EACH DISTRIBUTION DATE OF
PRINCIPAL OF AND INTEREST ON THE CLASS A NOTES AND CLASS B NOTES OF THE DISCOVERSERIES AND THE PAYMENT OF CERTAIN OTHER AMOUNTS, TO THE EXTENT AND AS DESCRIBED IN THE INDENTURE AND INDENTURE SUPPLEMENT REFERRED TO HEREIN. 

 

 2 

			
	 REGISTERED
	  	$495,000,000 *
	 No. 1
	  	

 DISCOVER CARD EXECUTION NOTE TRUST 

Floating Rate 

DISCOVERSERIES CLASS C(2010-1) NOTE 

DISCOVER CARD EXECUTION NOTE TRUST, a statutory trust created under the laws of the State of Delaware (herein referred to as the
“Issuer” or the “Note Issuance Trust”), for value received, hereby promises to pay to DISCOVER PRODUCTS INC., or registered assigns, subject to the following provisions, a principal sum of $495,000,000 (four hundred
ninety-five million dollars) payable on the July 16, 2012 Payment Date (the “Expected Maturity Date”), except as otherwise provided below or in the Indenture or the Indenture Supplement (as defined on the reverse hereof);
provided, however, that the entire unpaid principal amount of this Note shall be due and payable on the January 15, 2015 Payment Date (the “Legal Maturity Date”). If the Outstanding Dollar Principal Amount is not
paid in full on or prior to the Expected Maturity Date, interest will accrue on this Note at the rate of one-month LIBOR + 2.50% per annum, as more specifically set forth in the Class C(2010-1) Terms Document dated as of July 29, 2010 (the
“Terms Document”), between the Issuer and U.S. Bank National Association, as Indenture Trustee (the “Indenture Trustee”, which term includes any successor Indenture Trustee under the Indenture), and shall be due and
payable on each Interest Payment Date from and including the previous Interest Payment Date to but excluding such Interest Payment Date (or, in the case of the first Interest Payment Date for the Class C(2010-1) Notes occurring after the Expected
Maturity Date, from and including the Expected Maturity Date to but excluding such Interest Payment Date). Interest will be computed on the basis of the actual number of days elapsed and a 360-day year. Such principal of and interest on this Note
shall be paid in the manner specified on the reverse hereof. 
 The principal may be payable monthly, and may be payable earlier
or later than the Expected Maturity Date, following an Event of Default or while an Early Redemption Event has occurred and is continuing. The interest is payable monthly on each Interest Payment Date if the Outstanding Dollar Principal Amount is
not paid in full on or prior to the Expected Maturity Date. No principal or interest will be distributed on the Note following the distribution of proceeds of a Receivables Sale. 

Series Principal Amounts allocated to these Class C(2010-1) Notes will be applied first to pay shortfalls in interest on Class A
Notes and Class B Notes, then to pay any shortfalls in Series Servicing Fees allocable to the DiscoverSeries, and then to make Targeted Principal Deposits to the Principal Funding Subaccounts for Class A Notes and Class B Notes, including
Targeted Prefunding Deposits, before being applied to make Targeted Principal Deposits to the Principal Funding Subaccounts of Subordinate Notes, including these Class C(2010-1) Notes. Principal will not be paid on these Class C(2010-1) Notes prior
to their Legal Maturity Date unless each of the Class A Usage of Class C Notes and the Class B Usage of Class C Notes is zero for each Tranche of Class A Notes and Class B Notes of the DiscoverSeries and the required level of subordination
for the Class A Notes and Class B Notes of the DiscoverSeries is available after giving effect to such payment. 
  

 3 

 The principal of and interest on this Note are payable in such coin or currency of the
United States of America as at the time of payment is legal tender for payment of public and private debts. 
 The Initial
Dollar Principal Amount of this Note is $471,147,930. 
 The Stated Principal Amount of this Note is $495,000,000. 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though
fully set forth on the face of this Note. 
 Unless the certificate of authentication hereon has been executed by the Indenture
Trustee, whose name appears below by manual signature, this Note shall not be entitled to any benefit under the Indenture, Indenture Supplement or the Terms Document referred to on the reverse hereof, or be valid or obligatory for any purpose.

  

	*	Denominations of $100,000 and in integral multiples of $1,000 in excess thereof. 

 

 4 

 IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or in facsimile, by its
Authorized Officer. 
  

							
	 DISCOVER CARD EXECUTION NOTE TRUST,
as Issuer

		
	By:	 	WILMINGTON TRUST COMPANY, not in its individual capacity, but solely as Owner Trustee
		
	By:	 	  

		 	Name:	 	
		 	Title:	 	
		
		 	Date: July 29, 2010

  

 5 

 INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

This is one of the Notes designated above and referred to in the within-mentioned Indenture. 

 

					
	 US BANK NATIONAL ASSOCIATION,
not in its individual capacity but solely as Indenture Trustee

		
	By:	 	  

		 	Name:	 	
		 	Title:	 	
		
		 	Date: July 29, 2010

  

 6 

 REVERSE OF NOTE 

This Note is one of the Notes of a duly authorized issue of Notes of the Issuer, designated as its Class C(2010-1) DiscoverSeries Notes
(herein called the “Class C(2010-1) Notes”), all issued under an Indenture, dated as of July 26, 2007, as amended by the First Amendment to Indenture, dated as of June 4, 2010 (such Indenture, as may be further amended,
restated, amended and restated, supplemented, replaced or otherwise modified from time to time, is herein called the “Indenture”), as supplemented by an Amended and Restated Indenture Supplement for the DiscoverSeries Notes, dated
as of June 4, 2010 (such Indenture Supplement, as may be further amended, restated, amended and restated, supplemented, replaced or otherwise modified from time to time, is herein called the “Indenture Supplement”), between the
Issuer and Indenture Trustee, to which Indenture and Indenture Supplement reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes. The Class
C(2010-1) Notes are subject to all terms of the Indenture, the Indenture Supplement and the Terms Document. All terms used in this Class C(2010-1) Note that are defined in the Indenture, the Indenture Supplement and the Terms Document shall have the
meanings assigned to them in or pursuant to the Indenture, the Indenture Supplement and the Terms Document. 
 The Class A
Notes, the Class B Notes and the Class D Notes of the DiscoverSeries and other tranches of Class C Notes of the DiscoverSeries will also be issued under the Indenture and the Indenture Supplement. 

The Class C(2010-1) Notes are and will be equally and ratably secured by the collateral pledged as security therefor as provided in the
Indenture and the Indenture Supplement. 
 The Class C(2010-1) Notes are subordinated in right of payment of principal and
interest to the Class A Notes and the Class B Notes and provide loss protection to the Class A Notes and the Class B Notes of the DiscoverSeries, to the extent set forth in the Indenture Supplement. Principal Amounts allocable to
the Class C(2010-1) Notes may be applied to pay the Class A Interest Allocation and Class B Interest Allocation or the Series Servicing Fees of the DiscoverSeries, to the extent set forth in the Indenture Supplement. 

The Stated Principal Amount of the Class C(2010-1) Notes will be payable on the Expected Maturity Date in an amount described on the face
hereof. 
 As described above, the entire unpaid Stated Principal of this Class C(2010-1) Note shall be due and payable on the
Legal Maturity Date. Notwithstanding the foregoing, the entire unpaid Outstanding Dollar Principal Amount of the Class C(2010-1) Notes shall be due and payable on the date on which an Event of Default relating to the Class C(2010-1) Notes shall have
occurred and be continuing and, except in the event of an insolvency related default, the Indenture Trustee or the Majority Holders of the applicable Series, Class or Tranche of Outstanding Dollar Principal Amount of the Outstanding Notes have
declared the Class C(2010-1) Notes to be immediately due and payable in the manner provided in Section 702 of the Indenture; provided, however, that such acceleration of the entire unpaid Outstanding Dollar Principal Amount
of the Notes may be rescinded by the Majority Holders of such applicable Series, Class or Tranche of Notes. 
 On any day
occurring on or after the date on which the aggregate Nominal Liquidation Amount of any Tranche of Notes is reduced to less than 5% of its highest Outstanding Dollar 

 

 7 

 
Principal Amount, the Depositor or any Affiliate thereof has the right, but not the obligation, to redeem such Tranche of Notes in whole but not in part, pursuant to Section 1202 of
the Indenture. The redemption price will be an amount equal to the Outstanding Dollar Principal Amount of such Tranche, plus accrued, unpaid and additional interest, if any, or principal accreted and unpaid on such Tranche to but excluding the date
of redemption. 
 Subject to the terms and conditions of the Indenture, the Beneficiary, on behalf of the Note Issuance Trust,
may from time to time issue, or direct the Owner Trustee, on behalf of the Note Issuance Trust, to issue, one or more Series, Classes or Tranches of Notes. 

On each Payment Date, the Paying Agent shall distribute to each Holder of Class C(2010-1) Notes of record on the related Record Date
(except for the final distribution with respect to these Class C(2010-1) Notes) the pro rata share for such Holder of Class C(2010-1) Notes of the amounts held by the Paying Agent that are allocated and available on such Payment Date to pay interest
(only if the Outstanding Dollar Principal Amount is not paid in full on or prior to the Expected Maturity Date) and principal on the Class C Notes. 

Payments of interest on this Class C(2010-1) Note due and payable on each Payment Date, together with any installment of principal, if
any, to the extent not in full payment of this Class C(2010-1) Note, shall be made by check mailed to the Person whose name appears as the Registered Holder of this Class C(2010-1) Note on the Note Register as of the close of business on each Record
Date, except that with respect to Class C(2010-1) Notes registered on the Record Date in the name of the nominee of a clearing agency, payments will be made by wire transfer in immediately available funds to the account designated by such nominee.
Such checks shall be mailed to the Person entitled thereto at the address of such Person as it appears on the Note Register as of the applicable Record Date without requiring that this Class C(2010-1) Note be submitted for notation of payment. Any
reduction in the principal amount of this Class C(2010-1) Note (or any one or more Predecessor Notes) effected by any payments made on any Payment Date shall be binding upon all future Holders of this Class C(2010-1) Note and of any Class C(2010-1)
Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds are expected to be available, as provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Class C(2010-1) Note on a Payment Date, then the Indenture Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the Registered Holder hereof as of the Record Date preceding such Payment Date by
notice mailed within five days of such Payment Date and the amount then due and payable shall be payable only upon presentation and surrender of this Class C(2010-1) Note at the Indenture Trustee’s principal Corporate Trust Office or at the
office of the Indenture Trustee’s agent appointed for such purposes located in the City of New York. On any payment of interest or principal being made, details of such payment shall be entered by the Indenture Trustee on behalf of the Issuer
in Schedule A hereto. 
 As provided in the Indenture and subject to certain limitations set forth therein and as set forth in
the first legend on the face hereof, the transfer of this Class C(2010-1) Note may be registered on the Note Register upon surrender of this Class C(2010-1) Note for registration of transfer at the office or agency designated by the Issuer pursuant
to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by, the Holder hereof or his attorney duly authorized in writing, with such signature guaranteed by a
commercial bank or trust company located, or having a correspondent located, in the City of New York or the city in which the Corporate Trust Office is located, or a 

 

 8 

 
member firm of a national securities exchange, and such other documents as the Indenture Trustee may require, and thereupon one or more new Class C(2010-1) Notes of authorized denominations and
in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Class C(2010-1) Note, but the transferor may be required to pay
a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange. 

To the fullest extent permitted by applicable law, each Noteholder or Note Owner, by acceptance of a Class C(2010-1) Note or, in the case
of a Note Owner, a beneficial interest in a Class C(2010-1) Note, covenants and agrees that by accepting the benefits of the Indenture that it will not at any time institute against the Issuer, any Master Trust or any special purpose entity that
acts as a depositor with respect to any Master Trust or the Issuer, or join in any institution against the Issuer, any Master Trust or any special purpose entity that acts as a depositor with respect to any Master Trust or the Issuer of, any
receivership, insolvency, bankruptcy or other similar proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture, any Derivative
Agreement, any Supplemental Credit Enhancement Agreement and any Supplemental Liquidity Agreement. 
 Prior to the due
presentment for registration of transfer of this Class C(2010-1) Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat the Person in whose name this Class C(2010-1) Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Class C(2010-1) Note be overdue, and neither the Issuer, the Indenture Trustee nor any such agent
shall be affected by notice to the contrary. 
 The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Notes under the Indenture at any time by the Issuer with the consent of the Holders of Notes representing not less
than 66  2/3% of the Outstanding Dollar Principal
Amount of each adversely affected Series, Class or Tranche of Notes. The Indenture also contains provisions permitting the Holders of Notes representing specified percentages of the Outstanding Dollar Principal Amount of the Notes, on behalf of the
Holders of all the Notes, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Class C(2010-1) Note shall be
conclusive and binding upon such Holder and upon all future Holders of this Class C(2010-1) Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or
waiver is made upon this Class C(2010-1) Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Holders of the Notes issued thereunder.

 The term “Issuer” as used in this Class C(2010-1) Note includes any successor to the Issuer under the
Indenture. 
 The Issuer is permitted by the Indenture, under certain circumstances, to merge or consolidate, subject to the
rights of the Indenture Trustee and the Holders of Notes under the Indenture. 
  

 9 

 The Class C(2010-1) Notes are issuable only in registered form in denominations as provided
in the Indenture, subject to certain limitations therein set forth. 
 THIS CLASS C(2010-1) NOTE AND THE INDENTURE 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. 
 No reference herein to the Indenture and no provision of this Class C(2010-1) Note or of the Indenture shall alter or
impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Class C(2010-1) Note at the times, place, and rate, and in the coin or currency herein prescribed. 

No recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer on the Notes or under the Indenture or
any certificate or other writing delivered in connection therewith, against (i) the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent,
officer, director or employee of the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuer or any successor or assign of the Owner Trustee in its individual capacity, except as any such Person may have expressly
agreed (it being understood that the Owner Trustee has no such obligations in its individual capacity). The Holder of this Class C(2010-1) Note by the acceptance hereof agrees that, except as expressly provided in the Indenture and the Indenture
Supplement in the case of an Event of Default under the Indenture, the Holder shall have no claim against any of the foregoing for any deficiency, loss or claim therefrom; provided, however, that nothing contained herein shall be taken
to prevent recourse to, and enforcement against, the assets of the Issuer for any and all liabilities, obligations and undertakings contained in the Indenture or in this Class C(2010-1) Note. 

 

 10 

 ASSIGNMENT 

Social Security or taxpayer I.D. or other identifying number of assignee 

 
 FOR VALUE RECEIVED, the undersigned
hereby sells, assigns and transfers unto 
 (name and address of assignee) 

the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints attorney, to transfer said Note on the books kept for
registration thereof, with full power of substitution in the premises. 
  

											
	 Dated:
	 	  
	 		 	  
	 	*
					
		 		 		 	Signature Guaranteed:	 	

  

	*	NOTE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without
alteration, enlargement or any change whatsoever. 

  

 11 

 SCHEDULE A 

PART I 

INTEREST PAYMENTS 
  

									
	 Interest
Payment Date
	  	Date of
Payment	  	Total Amount
of
Interest
Payable	  	Amount of
Interest Paid	  	 Confirmation of

payment by or on
behalf of the Note Issuance

Trust

					
	1.	  		  		  		  	
	2.	  		  		  		  	
	3.	  		  		  		  	
	4.	  		  		  		  	
	5.	  		  		  		  	
	6.	  		  		  		  	
	7.	  		  		  		  	
	8.	  		  		  		  	
	9.	  		  		  		  	
	10.	  		  		  		  	
	11.	  		  		  		  	
	12.	  		  		  		  	
	13.	  		  		  		  	
	14.	  		  		  		  	
	15.	  		  		  		  	
	16.	  		  		  		  	
	17.	  		  		  		  	
	18.	  		  		  		  	
	19.	  		  		  		  	
	20.	  		  		  		  	
	21.	  		  		  		  	
	22.	  		  		  		  	
	23.	  		  		  		  	
	24.	  		  		  		  	

  

 12 

 PART II 

PRINCIPAL PAYMENTS 
  

									
	 Principal
Payment Date
	  	Date of
Payment	  	Total Amount
of Principal
Payable	  	Total Amount
Paid	  	 Confirmation
of
payment by or on
behalf of the Note
Issuance Trust

					
	1.	  		  		  		  	
	2.	  		  		  		  	
	3.	  		  		  		  	
	4.	  		  		  		  	
	5.	  		  		  		  	
	6.	  		  		  		  	
	7.	  		  		  		  	
	8.	  		  		  		  	
	9.	  		  		  		  	
	10.	  		  		  		  	
	11.	  		  		  		  	
	12.	  		  		  		  	

  

 13Restated Employment Agreement

 Exhibit 10.1 

HOSSEIN FATEH 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT 

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is dated as of July 29, 2010, by and between
DuPont Fabros Technology, Inc., a Maryland corporation (the “Company”), DF Property Management LLC, a Delaware limited liability company (the “LLC”), and Hossein Fateh (the “Executive”). 

WHEREAS, the Company and the Executive have previously entered into an Employment dated as of October 18, 2007 (the “Original
Agreement”) pursuant to which the Executive serves as the President and Chief Executive Officer of the Company; 
 WHEREAS,
the Company, the LLC and the Executive now desire to amend and restate the terms of the Original Agreement to, among other changes, revise the form in which Executive receives his Annual Salary (as defined below). 

Accordingly, the parties hereto agree as follows: 

1. Term. The Company and the LLC shall continue to employ the Executive, and the Executive hereby accepts such continued
employment for an initial term under this Agreement ending October 17, 2010, unless sooner terminated in accordance with the provisions of Section 4 or Section 5 (the period during which the Executive is employed hereunder being
hereinafter referred to as the “Term”). If either the Company or Executive does not wish to renew this Agreement when it expires at the end of the initial or any renewal term hereof as hereinafter provided, or if either the Company
or Executive wishes to renew this Agreement on different terms than those contained herein, it or he shall give written notice in accordance with Section 10.4 below of such intent to the other party at least sixty (60) days prior to the
expiration date. In the absence of such notice, this Agreement shall be renewed on the same terms and conditions contained herein for a term of one (1) year from the date of expiration. The parties expressly agree that designation of a term and
renewal provisions in this Agreement does not in any way limit the right of the parties to terminate this Agreement at any time as hereinafter provided. Reference herein to the Term shall refer both to the initial term and any renewal term as the
context requires. 
 2. Duties. 

2.1 Services as an Employee. The Executive, in his capacity as President and Chief Executive Officer, shall faithfully perform for
the Company and the LLC the duties of said office and shall perform such other duties of an executive, managerial or administrative nature as shall be specified and designated from time to time by the Company’s board of directors or similar
governing body of the Company (the “Board”) (including the performance of services for, and serving on the Board of Directors of, any subsidiary or affiliate of the Company without any additional compensation). The Executive shall
devote substantially all of the Executive’s business time and effort to the performance of the Executive’s duties hereunder, provided that in no event shall this sentence prohibit the Executive from (i) performing personal and
charitable activities, (ii) delivering lectures at educational institutions or professional or corporate associations, (iii) managing personal investments and affairs, (iv) participating as an officer or

 
director of, or advisor to, DuPont Fabros Development LLC or any other organization that is not engaged in the acquisition, development and operation of data centers, or (v) any other
activities approved by the Board, so long as such activities do not materially and adversely interfere with the Executive’s duties for the Company and the LLC. The Board may delegate its authority to take any action under this Agreement to the
Compensation Committee of the Board (the “Compensation Committee”), except for any action required to be taken by the Board under the first sentence of this Section 2.1 or under Sections 2.2 or 6.1. Executive’s principal
place of employment shall be at the principal executive offices of the Company in Washington, D.C. or in such other location in Washington, D.C. to which the Company may from time to time relocate its principal executive offices. 

2.2 Service as a Director. During the Term, and for so long after the date of Termination as the Executive beneficially owns
shares of the Company’s common stock (including units of limited partnership interest in Dupont Fabros Technology, L.P. (the “Operating Partnership”)) representing 9.8% or more of the outstanding shares of common stock of the
Company, calculated on a diluted basis assuming conversion into shares of common stock of the Company of all outstanding units of limited partnership interest in the Operating Partnership: 

 

	 	(i)	the Executive agrees to continue to serve as a director of the Company; and 

 

	 	(ii)	the Company agrees that the Executive shall be nominated for election as a director of the Company at each annual meeting of the Company’s stockholders or other
meeting of the Company’s stockholders at which directors are elected. 

 Any failure by the Board to nominate
the Executive for election as a director of the Company in accordance with clause (ii) above shall be deemed to be a material breach by the Company of this Agreement and shall also constitute Good Reason for the Executive to resign in
accordance with Section 5.4 of this Agreement. 
 3. Compensation. 

3.1 Salary. The Company shall pay the Executive during the Term an annual salary at the rate of $1.00 per annum (the
“Annual Salary”), payable as set forth below and subject to such deductions and withholdings as required by law. The Annual Salary may be increased annually by an amount as may be approved by the Board or the Compensation Committee,
and, upon such increase, the increased amount shall thereafter be deemed to be the Annual Salary for purposes of this Agreement. 

3.2 Cash Bonus. Executive may receive cash performance bonuses solely as determined by the Compensation
Committee. Any such cash bonus will be paid within
2 1/2 months after the end of the calendar year to
which the cash bonus relates. 
 3.3 Benefits. 

(i) In General. The Executive shall be permitted during the Term to participate in any group life, hospitalization or disability
insurance plans, medical, dental, vision and other health programs, 401(k) retirement savings plan, pension and profit sharing plans and 

 

 2 

 
similar benefits that may be available to other senior executives of the Company generally, on the same terms as may be applicable to such other executives, in each case to the extent that the
Executive is eligible under the terms of such plans or programs. 
 (ii) Aircraft Allowance. The Company shall provide to
Executive the use of a chartered aircraft for the Executive’s discretionary travel in an amount up to the annual aircraft allowance (the “Aircraft Allowance”) described below, in accordance with the terms of this Section 3.3(ii).
For the 2010 calendar year, the Executive’s Aircraft Allowance shall be $207,695. For the 2011 calendar year, the Aircraft Allowance shall be no less than $450,000. Upon the Executive’s reasonable prior notice to the Company of his request
for the use of a chartered aircraft, the Company shall procure the use of a chartered aircraft through an independent third party charter company. Executive shall be permitted to require that the aircraft supplied by the charter company be an
aircraft that is owned or controlled, directly or indirectly, by the Executive. The charter company procured by the Company shall be selected by the Chair of the Compensation Committee in his sole discretion. The Executive shall be entitled to the
use of a chartered aircraft pursuant to this Agreement until the Aircraft Allowance for the calendar year has been fully expended, and the parties acknowledge that the Company is not obligated to provide any benefits pursuant to this
Section 3.3(ii) in excess of the Aircraft Allowance. The actual amount paid by the Company for each chartered flight will reduce the amount of the Aircraft Allowance for each applicable calendar year. The parties acknowledge that the Company
shall not be required to pay in excess of market rates for the lease of the aircraft. If the Executive does not use his full Aircraft Allowance in any applicable calendar year, the unused balance of the Aircraft Allowance shall be forfeited and
shall not be carried forward to any future calendar year, nor shall Executive be entitled to any cash payments for the amount of any Aircraft Allowance remaining at the end of the year. Any dispute related to or arising from the Aircraft Allowance,
including without limitation disputes regarding any amounts owed by the Company to a charter company related to Executive’s travel, shall be resolved by the Compensation Committee. 

3.5 Vacation. During the Term, the Executive shall be entitled to (i) vacation of twenty-five (25) working days per
year, (ii) sick and personal leave available to other senior executives of the Company generally, and (iii) holidays recognized by the Company. The Executive’s entitlement to vacation and sick and personal leave will be subject to the
Company’s accrual and carry-over rules applicable to senior executives of the Company generally. 
 3.6 Expenses.
The Company shall pay or reimburse the Executive for all ordinary and reasonable out-of-pocket expenses actually incurred (and, in the case of reimbursement, paid) by the Executive during the Term in the performance of the Executive’s services
under this Agreement, provided that the Executive submits such expenses for payment or reimbursement in accordance with the policies applicable to senior executives of the Company generally. All amounts shall be reimbursed by the end of the calendar
year after the calendar year in which the expense was incurred. 
 3.7 No Reduction. Under no circumstances shall the
total of the Annual Salary and the Aircraft Allowance be reduced below the total of the Annual Salary and Aircraft Allowance for the immediately preceding calendar year without the Executive’s consent. 

 

 3 

 4. Termination Due to Death or Disability. 

4.1 Death. In the event of Executive’s death, all obligations of the Company and Executive under Sections 1 through 3 will
immediately cease except for obligations which expressly continue after death, and the Company will pay Executive’s beneficiary or estate, and Executive’s beneficiary or estate will be entitled to receive, the following: 

 

	 	(i)	Executive’s Compensation and Benefits Accrued at Termination, which shall be paid within fifteen (15) days after termination; 

 

	 	(ii)	 In lieu of any cash bonus payment under Section 3.2 for the year in which Executive dies, a Partial Year Bonus (as defined in Section 6.6),
which shall be paid within 2 1/2 months after the
end of the fiscal year in which termination occurred; 

  

	 	(iii)	All stock options, restricted stock, RSUs and other equity awards held by Executive at termination that would have become vested and exercisable or free from repurchase
restrictions, as applicable, during the twelve (12) months commencing on the date of termination if Executive had remained employed during such period shall become vested and exercisable or free from repurchase restrictions, as applicable, as
of the date of termination; 

  

	 	(iv)	All other terms of such equity awards shall be governed by the plans and programs and the agreements and other documents pursuant to which such equity awards were
granted; and 

  

	 	(v)	All other rights under any other compensatory or benefit plan shall be governed by such plan. In addition, at the Company’s expense, Executive’s spouse and
dependent children shall be entitled to continuation of health insurance coverage (i.e., medical, dental and vision) under any applicable law for a period of eighteen (18) months after termination. 

4.2 Disability. The Company may terminate the employment of Executive hereunder due to the Disability (as defined in
Section 6.4) of Executive. Upon termination of employment, all obligations of the Company and Executive under Sections 1 through 3 will immediately cease except for obligations which expressly continue after termination of employment due to
Disability, and the Company will pay Executive, and Executive will be entitled to receive, the following: 
  

	 	(i)	Executive’s Compensation and Benefits Accrued at Termination, which shall be paid within fifteen (15) days after termination; 

 

	 	(ii)	 In lieu of any cash bonus payment under Section 3.2 for the year in which Executive becomes disabled, a Partial Year Bonus (as defined in
Section 6.6), which shall be paid within 2 1/2
months after the end of the fiscal year in which termination occurred; 

  

 4 

	 	(iii)	All stock options, restricted stock, RSUs and other equity awards held by Executive at termination that would have become vested and exercisable or free from repurchase
restrictions, as applicable, during the twelve (12) months commencing on the date of termination if Executive had remained employed during such period shall become vested and exercisable or free from repurchase restrictions, as applicable, as
of the date of termination; 

  

	 	(iv)	All other terms of such equity awards shall be governed by the plans and programs and the agreements and other documents pursuant to which such equity awards were
granted; and 

  

	 	(v)	Disability benefits shall be payable in accordance with the Company’s plans, programs and policies; 

 

	 	(vi)	All other rights under any other compensatory or benefit plan shall be governed by such plan. In addition, at the Company’s expense, Executive and his spouse and
dependent children shall be entitled to continuation of health insurance coverage (i.e., medical, dental and vision) under any applicable law for a period of eighteen (18) months after termination; and 

 

	 	(vii)	The Company shall maintain for the Executive for a period of eighteen (18) months after termination, pay premiums on the long-term disability insurance policy (if
required in order for the Executive to receive benefits thereunder), and pay premiums on the life insurance policy described in Section 3.4. 

4.3 Other Terms of Payment Following Death or Disability. Nothing in this Section 4 shall limit the benefits payable or
provided in the event Executive’s employment terminates due to death or Disability under the terms of plans or programs of the Company more favorable to Executive (or his beneficiaries) than the benefits payable or provided under this
Section 4 (except in the case of any cash bonus payment under Section 3.2 for the year of termination in lieu of which a Partial Year Bonus is paid hereunder), including plans and programs adopted after the date of this Agreement.

 5. Termination of Employment For Reasons Other Than Death or Disability. 

5.1 Termination by the Company for Cause. The Company may terminate the employment of Executive hereunder for Cause (as defined in
Section 6.1) at any time. At the time Executive’s employment is terminated for Cause, all obligations of the Company and Executive under Sections 1 through 3 will immediately cease, and the Company will pay Executive, and Executive will be
entitled to receive, the following: 
  

	 	(i)	Executive’s Compensation and Benefits Accrued at Termination, which shall be paid within fifteen (15) days after termination; 

 

	 	(ii)	All stock options, restricted stock, RSUs and other equity awards held by Executive at termination shall cease to vest as of the date of termination;

  

 5 

	 	(iii)	All other terms of such equity awards shall be governed by the plans and programs and the agreements and other documents pursuant to which such equity awards were
granted; and 

  

	 	(iv)	All other rights under any other compensatory or benefit plan shall be governed by such plan. 

In addition, Executive shall be required to pay to the Company the value of Aircraft Allowance Deduction within fifteen (15) days
after termination. See Section 6.7 for the definition of “Aircraft Allowance Deduction.” 
 5.2 Termination by
Executive Other Than For Good Reason. Executive may terminate his employment hereunder voluntarily for reasons other than Good Reason (as defined in Section 6.5) at any time upon at least 30 days’ written notice to the Company. An
election by Executive not to extend the Term pursuant to Section 1 hereof shall be deemed to be a termination of employment by Executive for reasons other than Good Reason at the date of expiration of the Term. At the time Executive’s
employment is terminated by Executive other than for Good Reason, all obligations of the Company and Executive under Sections 1 through 3 will immediately cease, and the Company will pay Executive, and Executive will be entitled to, the same
compensation and rights specified in Section 5.1. In addition, Executive shall be required to pay to the Company the value of Aircraft Allowance Deduction within fifteen (15) days after termination. 

5.3 Termination by the Company Without Cause. The Company may terminate the employment of Executive hereunder without Cause upon
at least 30 days’ written notice to Executive. An election by the Company not to extend the Term pursuant to Section 1 hereof. shall be deemed to be a termination of employment by the Company Without Cause at the date of expiration of the
Term. At the time Executive’s employment is terminated by the Company (i.e., at the expiration of such notice period), all remaining obligations of the Company and Executive under Sections 1 through 3 will immediately cease (except as expressly
provided below), and the Company will pay Executive, and Executive will be entitled to receive, the following: 
  

	 	(i)	Executive’s Compensation and Benefits Accrued at Termination, which shall be paid within fifteen (15) days after termination; 

 

	 	(ii)	 A single severance payment in cash in an aggregate amount equal to the sum of (i) the total of the Annual Salary and Aircraft Allowance, plus
(ii) the average of the two highest annual cash bonus payments, if any, paid or approved for payment to Executive during the preceding three completed performance years (or, if Executive has been employed by the Company for fewer than three
completed performance years or if fewer than two annual cash bonus payments have been paid or approved for payment to Executive, the highest annual cash bonus payment, if any, paid or approved for payment to Executive during the Term), minus, if
applicable, the Aircraft Allowance Deduction, as defined in Section 6.7. The severance payment described in this paragraph shall be made within five (5) business days after the date that is six (6) months following the date of

  

 6 

	 	 
termination of Executive’s employment or, if Executive is not a “specified employee” within the meaning of Code Section 409A at the time of such termination, on the sixtieth
(60) day following the date of termination of Executive’s employment, provided, in either case, that the Executive has executed and delivered the general release described in Section 8.5 and the revocation period of such release has
expired; 

  

	 	(iii)	 In lieu of any cash bonus payment under Section 3.2 for the year in which Executive’s employment terminates, a Partial Year Bonus (as defined
in Section 6.6), which shall be paid within
2 1/2 months after the end of the year in which
termination occurred; 

  

	 	(iv)	All stock options, restricted stock, RSUs and other equity awards held by Executive at termination shall become fully vested and exercisable or free from repurchase
restrictions or other risk of forfeiture, as applicable, and all other terms of such awards shall be governed by the plans and programs and the agreements and other documents pursuant to which such equity awards were granted;

  

	 	(v)	Any performance objectives upon which the earning of performance-based restricted stock, RSUs, other equity awards and other long-term incentive awards (including cash
awards) is conditioned shall be deemed to have been met at the greater of (A) target level at the date of termination, or (B) actual performance at the date of termination, and such amounts shall become fully vested and non-forfeitable as
a result of termination of employment at the date of such termination, and, in other respects, such awards shall be governed by the plans and programs and the agreements and other documents pursuant to which such awards were granted; and

  

	 	(vi)	All other rights under any other compensatory or benefit plan shall be governed by such plan. In addition, at Company’s expense, Executive and his spouse and
dependent children shall be entitled to continuation of health insurance coverage (i.e., medical, dental and vision) under the Company’s group health plan(s) in which the Executive was participating on the date of termination or if such plan(s)
have been terminated, in the plans) in which senior executives of the Company participate for a period of eighteen (18) months after the date Executive’s employment terminates. 

Payments and benefits under this Section 5.3 are subject to Section 5.6. 

5.4 Termination by Executive for Good Reason. Executive may terminate his employment hereunder for Good Reason upon 30 days’
written notice to the Company which notice must be given within 90 days of the occurrence of the condition that is the basis for such Good Reason; provided, however, that if the basis for such Good Reason is correctible and the Company has corrected
the basis for such Good Reason within 30 days after receipt of such notice, Executive may not then terminate his employment for Good Reason with respect to the matters addressed in the written notice. At the time Executive’s employment is
terminated by Executive for Good Reason (i.e., at the expiration of such notice period), all obligations of the 
  

 7 

 
Company and Executive under Sections 1 through 3 will immediately cease (except as expressly provided below), and the Company will pay Executive, and Executive will be entitled to receive, the
same compensation and rights specified in Section 5.3(i) - (vi) and the text following clause (vi). 
 If any payment or benefit under this
Section 5.4 is based on Annual Salary or other level of compensation or benefits at the time of Executive’s termination and if a reduction in such Annual Salary or other level of compensation or benefit was the basis for Executive’s
termination for Good Reason, then the Annual Salary or other level of compensation in effect before such reduction shall be used to calculate payments or benefits under this Section 5.4. 

5.5 Other Terms Relating to Certain Terminations of Employment. In the event Executive’s employment
terminates for any reason set forth in Section 5.1 through 5.4, Executive will be entitled to the benefit of any terms of plans or agreements applicable to Executive which are more favorable than those specified in this Section 5 (except
without duplication of payments or benefits, including in the case of any cash bonus payment under Section 3.2 for the year of termination in lieu of which a Partial Year Bonus is paid hereunder). Except as otherwise provided under
Section 5.6, amounts payable under this Section 5 following Executive’s termination of employment, other than those expressly payable on a deferred or installment basis, will be paid as promptly as practicable after such a termination
of employment and, in any event, within 2 1/2 months
after the end of the year in which employment terminates. All expenses reimbursable pursuant to Section 3.6 shall be reimbursed by the end of the calendar year after the calendar year in which the expense was incurred. 

5.6 Limitations Under Code Section 409A. Anything in this Agreement to the contrary notwithstanding, if (A) on the date
of termination of Executive’s employment with the Company or a subsidiary, any of the Company’s stock is publicly traded on an established securities market or otherwise (within the meaning of Section 409A(a)(2)(B)(i) of the Internal
Revenue Code, as amended (the “Code”)), (B) Executive is determined to be a “specified employee” within the meaning of Section 409A(a)(2)(B) of the Code, (C) the payments exceed the amounts permitted to be paid
pursuant to Treasury Regulations section 1.409A-1(b)(9)(iii) and (D) such delay is required to avoid the imposition of the tax set forth in Section 409A(a)(1) of the Code as a result of such termination, the Executive would receive any
payment that, absent the application of this Section 5.6, would be subject to interest and additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(2)(B)(i) of the Code (such
additional tax, together with any such interest and penalties, are hereinafter referred to as the “Additional Tax”), then no such payment shall be payable prior to the date that is the earliest of (1) 6 months after the
Executive’s termination date, (2) the Executive’s death or (3) such other date as will cause such payment not to be subject to such interest and additional tax (with a catch-up payment equal to the sum of all amounts that have
been delayed to be made as of the date of the initial payment plus interest equal to the rate provided in Section 1274(b)(2)(B) of the Code). 

It is the intention of the parties that payments or benefits payable under this Agreement not be subject to the additional tax imposed
pursuant to Section 409A of the Code. To the extent such potential payments or benefits could become subject to such Section, the parties shall cooperate to amend this Agreement with the goal of giving the Executive the economic benefits
described herein in a manner that does not result in such tax being imposed. 
  

 8 

 6. Definitions Relating to Termination Events. 

6.1 “Cause”. For purposes of this Agreement, “Cause” shall mean Executive’s: 

 

	 	(i)	conviction of a felony (other than a violation of traffic laws) that materially interferes with Executive’s ability to perform his duties and responsibilities
under this Agreement and that has a material adverse effect on the interests or reputation of the Company, and exhaustion of all appeals; 

  

	 	(ii)	conviction of fraud against the Company, and exhaustion of all appeals; or 

 

	 	(iii)	willful and continued failure to substantially perform Executive’s material duties hereunder (other than such failure resulting from Executive’s incapacity
due to physical or mental illness), which failure is not remedied within 30 calendar days after written demand for substantial performance is delivered by the Company which specifically identifies the manner in which the Company believes that
Executive has not substantially performed Executive’s material duties. 

 No act, or failure to act, on the part of Executive
shall be deemed “willful” unless done, or omitted to be done, by Executive not in good faith and without reasonable belief that his action or omission was in the best interest of the Company. Notwithstanding the foregoing, Executive shall
not be deemed to have been terminated for Cause unless and until there shall have been delivered to Executive a copy of the resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the independent members of the
Board at a meeting of the Board (after reasonable notice to Executive and an opportunity for Executive, together with Executive’s counsel, to be heard before the Board) finding that, in the good faith opinion of the Board, Executive was guilty
of conduct set forth above in this definition and specifying the particulars thereof in detail, and, in the case of conduct described in clause (iv) above, finding that Executive failed to remedy such conduct within the time permitted.

 6.2 “Change in Control”. For purposes of this Agreement, a “Change in Control” means the
following: 
  

	 	(i)	A transaction or series of transactions (other than an offering of Stock to the general public through a registration statement filed with the Securities and Exchange
Commission) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (other
than the Company, any of its subsidiaries, an employee benefit plan maintained by the Company or any of its subsidiaries or a “person” that, prior to such transaction, directly or indirectly controls, is controlled by, or is under common
control with, the Company) directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the Company and immediately after such acquisition possesses more than 50% of the total
combined voting power of the Company’s securities outstanding immediately after such acquisition; or 

  

 9 

	 	(ii)	During any period of two consecutive years, individuals who, at the beginning of such period, constitute the Board together with any new director(s) (other than a
director designated by a person who shall have entered into an agreement with the Company to effect a transaction described in Section 6.2(i) hereof or Section 6.2(iii) hereof) whose election by the Board or nomination for election by the
Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof; or 

  

	 	(iii)	The consummation by the Company (whether directly involving the Company or indirectly involving the Company through one or more intermediaries) of (x) a merger,
consolidation, reorganization, or business combination or (y) a sale or other disposition of all or substantially all of the Company’s assets in any single transaction or series of related transactions or (z) the acquisition of assets
or stock of another entity, in each case other than a transaction: 

  

	 	(A)	Which results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either by remaining outstanding or by
being converted into voting securities of the Company or the person that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the Company’s assets or
otherwise succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power of the Successor Entity’s outstanding voting securities
immediately after the transaction, and 

  

	 	(B)	After which no person or group (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) beneficially owns (within the meaning of Rule 13d-3 under the
Exchange Act) voting securities representing 50% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this Section 6.2(iii)(B) as beneficially owning 50% or
more of combined voting power of the Successor Entity solely as a result of the voting power held in the Company prior to the consummation of the transaction; or 

 

	 	(iv)	The Company’s stockholders approve a liquidation or dissolution of the Company and all material contingencies to such liquidation or dissolution have been
satisfied or waived. 

  

 10 

 6.3 “Compensation and Benefits Accrued at Termination”. For purposes of
this Agreement, “Compensation Accrued at Termination” means the following: 
  

	 	(i)	The unpaid portion of the Annual Salary at the rate payable, in accordance with Section 3.1 hereof, at the date of Executive’s termination of employment, pro
rated through such date of termination, payable in accordance with the Company’s regular pay schedule; 

  

	 	(ii)	Except as otherwise provided in this Agreement, all earned and unpaid and/or vested, nonforfeitable amounts owing or accrued at the date of Executive’s termination
of employment under any compensation and benefit plans, programs, and arrangements set forth or referred to in Sections 3.2, 3.3 and 3.4 hereof (including any Unused Aircraft Allowance or earned and vested cash bonus payment under Section 3.2)
in which Executive theretofore participated, payable in accordance with the terms and conditions of the plans, programs, and arrangements (and agreements and documents thereunder) pursuant to which such compensation and benefits were granted or
accrued; 

  

	 	(iii)	Reasonable business expenses and disbursements incurred by Executive prior to Executive’s termination of employment, to be reimbursed to Executive, as authorized
under Section 3.6, in accordance the Company’s reimbursement policies as in effect at the date of such termination; and 

  

	 	(iv)	To the extent consistent with the Company’s policies for executives generally, compensation for vacation time accrued but unused at the date of the
Executive’s termination of employment. 

 6.4 “Disability”. For purposes of this Agreement,
“Disability” means the Executive is unable due to a physical or mental condition to perform the essential functions of his position with or without reasonable accommodation for six (6) months in the aggregate during any twelve
(12) month period or based on the written certification by two licensed physicians of the likely continuation of such condition for such period, one selected by the Company or its insurance carrier and the other selected by the Executive or his
legal representative. This definition shall be interpreted and applied consistent with the Americans with Disabilities Act, the Family and Medical Leave Act, Section 409A of the Code and other applicable law. 

6.5 “Good Reason”. For purposes of this Agreement, “Good Reason” shall mean, without Executive’s
express written consent, the occurrence of any of the following circumstances unless, if correctable, such circumstances are fully corrected within 30 days of the notice of termination given in respect thereof: 

 

	 	(i)	 The assignment to Executive of duties materially inconsistent with Executive’s position and status hereunder, or an alteration, materially adverse
to Executive, in the nature of Executive’s duties, responsibilities or authorities, Executive’s positions or the conditions of Executive’s employment from those specified in Section 2 or otherwise hereunder (other than
inadvertent actions which are promptly remedied), including, without limitation, the relocation of Executive’s 

 

 11 

	 	 
place of employment outside Washington, D.C. or the assignment of Executive to any place of employment other than the Company’s headquarters; except the foregoing shall not constitute Good
Reason if occurring in connection with the termination of Executive’s employment for Cause, Disability, as a result of Executive’s death, or as a result of action by or with the consent of Executive; 

 

	 	(ii)	a material reduction by the Company in Executive’s Annual Salary; provided that any reduction in excess of five percent (5%) shall be deemed material;

  

	 	(iii)	the failure of the Company to obtain a written agreement from any successor to the Company to fully assume the Company’s obligations and to perform under this
Agreement; 

  

	 	(iv)	any other failure by the Company to perform any material obligation under, or breach by the Company of any material provision of, this Agreement; or

  

	 	(v)	following a Change in Control, Executive may elect at any time during the 12 month period following the Change in Control to treat the occurrence of the Change in
Control as constituting Good Reason. 

 6.6 “Partial Year Bonus”. For purposes of this Agreement,
a “Partial Year Bonus” is an amount equal to the cash bonus compensation that would have become payable under Section 3.2 to Executive for that year, if any target cash bonus amount had been established for that year,
determined as though Executive had met the individual and objective Company annual performance criteria for the entire year but only to the extent that he met such criteria during the period in which Executive was employed during that year
(disregarding any period of Disability during that year), multiplied by a fraction the numerator of which is the number of days Executive was employed in the year of termination and the denominator of which is the total number of days in the year of
termination. 
 6.7 “Unused Aircraft Allowance”. For purposes of this Agreement, the “Unused Aircraft
Allowance” is an amount equal to (i) the Aircraft Allowance for an applicable calendar year multiplied by a fraction, the numerator of which is the number of days in such calendar year that preceded the Executive’s termination of
employment and the denominator of which is 365, less (ii) the actual amount of the Aircraft Allowance that has been expended in the calendar year of the termination of employment, calculated in accordance with the terms of Section 3.1.2,
provided that the difference between (i) and (ii) above is a positive number. If the difference between (i) and (ii) above is a negative number, the absolute value of such number shall be the “Aircraft Allowance
Deduction” and the value of the Unused Aircraft Allowance shall be deemed to be zero. 
  

 12 

 7. Excise Tax-Related Provisions. The payments and benefits that the Executive may be
entitled to receive under this Agreement and other payments and benefits that the Executive is or may be entitled to receive under other plans, agreements and arrangements (which, together with the benefits provided under this Agreement, are
referred to as “Payments”), may constitute Parachute Payments that are subject to Sections 280G and 4999 of the Code. As provided in this Section 7, the Parachute Payments will be reduced if, and only to the extent that, a reduction
will allow the Executive to receive a greater Net After Tax Amount (as defined below) than the Executive would receive absent a reduction. 

(i) The Accounting Firm (as defined below) will first determine the amount of any Parachute Payments that are payable to the Executive.
The Accounting Firm also will determine the Net After Tax Amount attributable to the Executive’s total Parachute Payments. 

(ii) The Accounting Firm will next determine the largest amount of Payments that may be made to the Executive without subjecting the
Executive to tax under Section 4999 of the Code (the “Capped Payments”). Thereafter, the Accounting Firm will determine the Net After Tax Amount attributable to the Capped Payments. 

(iii) The Executive will receive the total Parachute Payments or the Capped Payments, whichever provides the Executive with the higher
Net After Tax Amount. If the Executive will receive the Capped Payments, the total Parachute Payments will be adjusted by first reducing the amount of any noncash benefits under this Agreement or any other plan, agreement or arrangement (with the
source of the reduction to be directed by the Company) and then by reducing the amount of any cash benefits under this Agreement or any other plan, agreement or arrangement (with the source of the reduction to be directed by the Company). The
Accounting Firm will notify the Executive and the Company if it determines that the Parachute Payments must be reduced to the Capped Payments and will send the Executive and the Company a copy of its detailed calculations supporting that
determination. 
 (iv) As a result of the uncertainty in the application of Sections 280G and 4999 of the Code at the time that
the Accounting Firm makes its determinations under this Section 7, it is possible that amounts will have been paid or distributed to the Executive that should not have been paid or distributed under this Section 7
(“Overpayments”), or that additional amounts should be paid or distributed to the Executive under this Section 7 (“Underpayments”). If the Accounting Firm determines, based on either the assertion of a deficiency by the
Internal Revenue Service against the Company or the Executive, which assertion the Accounting Firm believes has a high probability of success or controlling precedent or substantial authority, that an Overpayment has been made, the Executive must
repay to the Company, without interest, the amount of the Overpayment; provided, however, that no amount will be payable by the Executive to the Company unless, and then only to the extent that, the payment would either reduce the amount on which
the Executive is subject to tax under Section 4999 of the Code or generate a refund of tax imposed under Section 4999 of the Code. If the Accounting Firm determines, based upon controlling precedent or substantial authority, that an
Underpayment has occurred, the Accounting Firm will notify the Executive and the Company of that determination and the amount of that Underpayment will be paid to the Executive promptly by the Company. 

 

 13 

 For purposes of this Section 7, the term “Accounting Firm” means the
independent accounting firm engaged by the Company immediately before a Change in Control. For purposes of this Section 7, the term “Net After Tax Amount” means the amount of any Parachute Payments or Capped Payments, as applicable,
net of taxes imposed under Sections 1, 3101(b) and 4999 of the Code and any State or local income taxes applicable to the Executive on the date of payment. The determination of the Net After Tax Amount shall be made using the highest combined
effective rate imposed by the foregoing taxes on income of the same character as the Parachute Payments or Capped Payments, as applicable, in effect on the date of payment. For purposes of this Section 7, the term “Parachute Payment”
means a payment that is described in Section 280G(b)(2) of the Code, determined in accordance with Section 280G of the Code and the regulations promulgated or proposed thereunder. 

8. Non-Disclosure; Executive Cooperation; Non Disparagement. 

8.1 Ownership of Work. Executive will promptly disclose in writing to the Company all inventions, discoveries, developments,
improvements and innovations (collectively referred to as “Inventions”) that Executive has conceived or made during the Term; provided, however, that in this context “Inventions” are limited to those which (i) relate
in any manner to the existing or contemplated business activities of the Company and its affiliates; (ii) are suggested by or result from Executive’s work at the Company and its affiliates; or (iii) result from the use of the time,
materials or facilities of the Company and its affiliates. All Inventions will be the Company’s property rather than Executive’s. Should the Company request it, Executive agrees to sign any document that the Company may reasonably require
to establish ownership in any Invention. 
 8.2 Cooperation With Regard to Litigation. Executive agrees to cooperate with
the Company, during the Term and thereafter (including following Executive’s termination of employment for any reason), by making himself available to testify on behalf of the Company or any subsidiary or affiliate of the Company, in any
action, suit, or proceeding, whether civil, criminal, administrative, or investigative, and to assist the Company, or any subsidiary or affiliate of the Company, in any such action, suit, or proceeding, by providing information and meeting and
consulting with the Board or its representatives or counsel, or representatives or counsel to the Company, or any subsidiary or affiliate of the Company, as may be reasonably requested and after taking into account Executive’s post-termination
responsibilities and obligations. The Company agrees to reimburse Executive, on an after-tax basis, for all reasonable expenses actually incurred in connection with his provision of testimony or assistance and to pay a mutually agreed hourly fee to
Executive for any assistance provided after termination of Executive’s employment. 
 8.3 Non-Disparagement.
Executive shall not, at any time during the Term and thereafter make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may, directly or indirectly, disparage
or be damaging to the Company, its subsidiaries or affiliates or their respective officers, directors, employees, advisors, businesses or reputations. The members of the Board, the executive officers of the Company and any personnel who are
generally responsible for communications with investors and the public (including, without limitation, the Company’s public relations and investor relations personnel) shall not, at any time during the Term and thereafter, make statements or
representations, or otherwise communicate, directly or indirectly, in writing, orally 
  

 14 

 
or otherwise, or take any action which may, directly or indirectly, disparage or be damaging to Executive or his reputation. The Company shall be liable for any such statement, representation,
communication or action by any such member of the Board, executive officer or personnel. Notwithstanding the foregoing, nothing in this Agreement shall preclude Executive or such members of the Board, executive officers or personnel from making
truthful statements that are required by applicable law, regulation or legal process, including truthful statements in connection with an action, suit or other proceeding to enforce Executive’s or the Company’s respective rights under this
Agreement. 
 8.4 Release of Employment Claims. Executive agrees, as a condition to receipt of any termination payments
and benefits provided for in Sections 4 and 5 herein (other than Compensation Accrued at Termination) (the “Termination Benefits”), that he will execute a general release in substantially the form attached hereto as Exhibit A within
the time limits set forth in this Agreement. 
 8.5 Survival. The provisions of this Section 8 shall survive the
termination of the Term and any termination or expiration of this Agreement. 
 8.6 Remedies. Executive agrees that any
breach of the terms of this Section 8 would result in irreparable injury and damage to the Company for which the Company would have no adequate remedy at law; Executive therefore also agrees that in the event of said breach or any threat of
breach and notwithstanding Section 9 the Company shall be entitled to seek an immediate injunction and restraining order from a court of competent jurisdiction to prevent such breach and/or threatened breach and/or continued breach by Executive
and/or any and all persons and/or entities acting for and/or with Executive, without having to prove damages. The availability of injunctive relief shall be in addition to any other remedies to which the Company may be entitled at law or in equity,
but remedies other than injunctive relief may only be pursued in an arbitration brought in accordance with Section 9. The terms of this paragraph shall not prevent the Company from pursuing in an arbitration any other available remedies for any
breach or threatened breach of this Section 8, including but not limited to the recovery of damages from Executive. Executive hereby further agrees that, if it is ever determined, in an arbitration brought in accordance with Section 9,
that willful actions by Executive have constituted wrongdoing that results in an accounting restatement due to the material noncompliance of the Company with financial reporting requirements in any report or statement filed by the Company with the
U.S. Securities and Exchange Commission, then the Company, or its successor, as appropriate, may recover all of any bonus or other incentive-based or equity based compensation received by Executive during the 12-month period following the first
public issuance or filing with the U.S. Securities and Exchange Commission, whichever first occurs, of the financial document embodying such financial reporting requirement, less the amount of any net tax owed by Executive with respect to such award
or payment over the tax benefit to Executive from the repayment or return of the award or payment, pursuant to Sections 5.3 or 5.4. The Company or its successor may, in its sole discretion, affect any such recovery by (i) obtaining repayment
directly from Executive; (ii) setting off the amount owed to it against any amount or award that would otherwise be payable by the Company to Executive; or (iii) any combination of (i) and (ii) above. 

 

 15 

 9. Governing Law; Disputes; Arbitration. 

9.1 Governing Law. This Agreement is governed by and is to be construed, administered, and enforced in accordance with the laws of
the District of Columbia, without regard to conflicts of law principles. If under the governing law, any portion of this Agreement is at any time deemed to be in conflict with any applicable statute, rule, regulation, ordinance, or other principle
of law, such portion shall be deemed to be modified or altered to the extent necessary to conform thereto or, if that is not possible, to be omitted from this Agreement. The invalidity of any such portion shall not affect the force, effect, and
validity of the remaining portion hereof. If any court determines that any provision of Section 8 is unenforceable because of the duration or geographic scope of such provision, it is the parties’ intent that such court shall have the
power to modify the duration or geographic scope of such provision, as the case may be, to the extent necessary to render the provision enforceable and, in its modified form, such provision shall be enforced. 

9.2 Arbitration. Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by
arbitration in the District of Columbia by three arbitrators in accordance with the Employment Arbitration Rules and Mediation Procedures of the American Arbitration Association in effect at the time of submission to arbitration. Judgment may be
entered on the arbitrators’ award in any court having jurisdiction. For purposes of entering any judgment upon an award rendered by the arbitrators, the Company and Executive hereby consent to the jurisdiction of any or all of the following
courts: (i) the United States District Court for the District of Columbia, (ii) any of the courts of the District of Columbia, or (iii) any other court having jurisdiction. The Company and Executive further agree that any service of
process or notice requirements in any such proceeding shall be satisfied if the rules of such court relating thereto have been substantially satisfied. The Company and Executive hereby waive, to the fullest extent permitted by applicable law, any
objection which it or he may now or hereafter have to such jurisdiction and any defense of inconvenient forum. The Company and Executive hereby agree that a judgment upon an award rendered by the arbitrators may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Each party shall bear its or his costs and expenses arising in connection with any arbitration proceeding pursuant to this Section 9; provided, however, that the party that
substantially prevails in an arbitration shall be reimbursed by the other party for all reasonable costs, including reasonable attorneys’ fees and costs, incurred by such prevailing party in connection with the arbitration. Notwithstanding any
provision in this Section 9, Executive shall be paid all compensation due and owing under this Agreement during the pendency of any dispute or controversy arising under or in connection with this Agreement. 

9.3 Interest on Unpaid Amounts. Any amount which has become payable pursuant to the terms of this Agreement or any decision by
arbitrators or judgment by a court of law pursuant to this Section 9 but which has not been timely paid shall bear interest at the prime rate in effect at the time such amount first becomes payable, as quoted by the Company’s principal
bank. 
 9.4 LIMITATION ON LIABILITIES. IF EITHER EXECUTIVE OR THE COMPANY IS AWARDED ANY DAMAGES AS COMPENSATION FOR ANY
BREACH OR ACTION RELATED TO THIS AGREEMENT, A BREACH OF ANY COVENANT CONTAINED IN THIS AGREEMENT (WHETHER EXPRESS OR IMPLIED BY EITHER LAW OR FACT), OR ANY OTHER CAUSE OF ACTION BASED IN WHOLE OR IN PART ON ANY BREACH OF ANY PROVISION OF THIS
AGREEMENT, SUCH DAMAGES 
  

 16 

 
SHALL BE LIMITED TO CONTRACTUAL DAMAGES PLUS INTEREST ON ANY DELAYED PAYMENT AT THE LOWER OF (I) THE RATE PERMITTED BY SECTION 9.3 OR (II) THE MAXIMUM RATE PER ANNUM ALLOWABLE BY APPLICABLE
LAW FROM AND AFTER THE DATE(S) THAT SUCH PAYMENTS WERE DUE AND SHALL EXCLUDE CONSEQUENTIAL DAMAGES AND PUNITIVE DAMAGES EVEN IF THE RULES REFERRED TO IN SECTION 9.2 WOULD PROVIDE OTHERWISE. 

9.5 WAIVER OF JURY TRIAL. TO THE EXTENT APPLICABLE, EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL FOR ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT. This provision is subject to Section 9.2, requiring arbitration
of disputes hereunder. 
 10. Miscellaneous. 

10.1 Integration. This Agreement cancels and supersedes any and all prior agreements and understandings between the parties hereto
with respect to the employment of Executive by the Company, any parent or predecessor company, and the Company’s subsidiaries during the Term, but excluding existing contracts relating to compensation under executive compensation and employee
benefit plans of the Company and its subsidiaries. This Agreement constitutes the entire agreement among the parties with respect to the matters herein provided, and no modification or waiver of any provision hereof shall be effective unless in
writing and signed by the parties hereto. Executive shall not be entitled to any payment or benefit under this Agreement which duplicates a payment or benefit received or receivable by Executive under such prior agreements and understandings or
under any benefit or compensation plan of the Company. 
 10.2 Successors; Transferability. The Company shall require any
successor (whether direct or indirect, by purchase, merger, consolidation or otherwise, and whether or not the corporate existence of the Company continues) to all or substantially all of the business and/or assets of the Company to expressly assume
and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law or otherwise, and, in the case of an acquisition of the Company in which the corporate existence
of the Company continues, the ultimate parent company following such acquisition. Subject to the foregoing, the Company may transfer and assign this Agreement and the Company’s rights and obligations hereunder only to another entity that is
substantially comparable to the Company in its financial strength and ability to perform the Company’s obligations under this Agreement. Neither this Agreement nor the rights or obligations hereunder of the parties hereto shall be transferable
or assignable by Executive, except in accordance with the laws of descent and distribution, for estate or tax planning purposes or as specified in Section 10.3. 

 

 17 

 10.3 Beneficiaries. Executive shall be entitled to designate (and change, to the
extent permitted under applicable law) a beneficiary or beneficiaries to receive any compensation or benefits provided hereunder following Executive’s death. 

10.4 Notices. Whenever under this Agreement it becomes necessary to give notice, such notice shall be in writing, signed by the
party or parties giving or making the same, and shall be served on the person or persons for whom it is intended or who should be advised or notified, by Federal Express or other similar overnight service or by certified or registered mail, return
receipt requested, postage prepaid and addressed to such party at the address set forth below or at such other address as may be designated by such party by like notice: If to the Company or the LLC: 

DUPONT FABROS TECHNOLOGY, INC. 

1212 New York Avenue, NW, Suite 900 

Washington, D.C. 20005 

Attention: Secretary 
 With a
copy to: 
 Stuart A. Barr 

Hogan Lovells US LLP 

555 Thirteenth Street, N.W. 

Washington, D.C. 20004 
 If to
Executive: 
 Hossein Fateh 

Address on file with the Company 

With a copy to: 
 Thomas J.
Knox, Esq. 
 Morrison & Foerster LLP 

1650 Tysons Boulevard, Suite 400 

McLean, VA 22102 
 If the
parties by mutual agreement supply each other with fax numbers for the purposes of providing notice by facsimile, such notice shall also be proper notice under this Agreement. In the case of Federal Express or other similar overnight service (or
facsimile, if the parties supply fax numbers as described in the preceding sentence), such notice or advice shall be effective when sent, and, in the cases of certified or registered mail, shall be effective two business days after deposit into the
mails by delivery to the U.S. Post Office. 
 10.5 Reformation. The invalidity of any portion of this Agreement shall not
be deemed to render the remainder of this Agreement invalid. 
  

 18 

 10.6 Headings. The headings of this Agreement are for convenience of reference only
and do not constitute a part hereof. 
 10.7 No General Waivers. The failure of any party at any time to require
performance by any other party of any provision hereof or to resort to any remedy provided herein or at law or in equity shall in no way affect the right of such party to require such performance or to resort to such remedy at any time thereafter,
nor shall the waiver by any party of a breach of any of the provisions hereof be deemed to be a waiver of any subsequent breach of such provisions. No such waiver shall be effective unless in writing and signed by the party against whom such waiver
is sought to be enforced. 
 10.8 No Obligation To Mitigate. Executive shall not be required to seek other employment or
otherwise to mitigate Executive’s damages upon any termination of employment. 
 10.9 Offsets; Withholding. The
amounts required to be paid by the Company to Executive pursuant to this Agreement shall not be subject to offset other than with respect to any amounts that are owed to the Company by Executive due to his receipt of funds as a result of his
fraudulent activity. The foregoing and other provisions of this Agreement notwithstanding, all payments to be made to Executive under this Agreement, including under Sections 4 and 5, or otherwise by the Company, will be subject to withholding to
satisfy required withholding taxes and other required deductions. 
 10.10 Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of Executive, his heirs, executors, administrators and beneficiaries, and shall be binding upon and inure to the benefit of the Company and its successors and permitted assigns. 

10.11 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument. 
 10.12 Due Authority and Execution. The execution, delivery
and performance of this Agreement have been duly authorized by the Company and this Agreement represents the valid, legal and binding obligation of the Company, enforceable against the Company according to its terms. 

10.13 Representations of Executive. Executive represents and warrants to the Company that he has the legal right to enter into
this Agreement and to perform all of the obligations on his part to be performed hereunder in accordance with its terms and that he is not a party to any agreement or understanding, written or oral, which prevents him from entering into this
Agreement or performing all of his obligations hereunder. Notwithstanding a termination by the Company under this Section 10.13, Executive’s obligations under Section 9 shall survive such termination. 

11. D&O Insurance. 

The Company will maintain directors’ and officers’ liability insurance during the Term and for a period of not less than six
years thereafter, covering acts and omissions of Executive during the Term, on terms substantially no less favorable than those in effect on the 

 

 19 

 
date of this Agreement. During the Term and for a period of not less than six years thereafter, Executive shall receive the same benefits provided to any of the Company’s officers and
directors under any additional D&O insurance or similar policy, any indemnification agreement, Company policies or the Articles of Incorporation or Bylaws of the Company as in effect as of the date hereof, provided, however, that in the event
that the benefits provided to any of the Company’s officers and directors under any of the foregoing documents or policies are enlarged after the date hereof, Executive shall receive such enlarged benefits. 

12. Certain Definitions. For purposes of this Agreement: 

(a) an “affiliate” of any person means another person that directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with, such first person, and includes subsidiaries. 
 (b) A
“business day” means the period from 9:00 am to 5:00 pm on any weekday that is not a banking holiday in New York City, New York. 

(c) A “person” means an individual, corporation, limited liability company, partnership, association, trust or any other
entity or organization, including any court, administrative agency or commission or other governmental authority. 
 (d) A
“subsidiary” of any person means another person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing
body (or, if there are no such voting interests or no board of directors or other governing body, 50% or more of the equity interests of which) is owned directly or indirectly by such first person. 

 

 20 

 IN WITNESS WHEREOF, the parties hereto have signed their names as of the day and year first
above written. 
  

			
	DUPONT FABROS TECHNOLOGY, INC.
		
	By:	 	 /s/ Lammot J. du Pont

	Name:	 	Lammot J. du Pont
	Title:	 	Executive Chairman
	
	DF PROPERTY MANAGEMENT LLC
		
	By:	 	 /s/ Lammot J. du Pont

	Name:	 	Lammot J. du Pont
	Title:	 	Executive Chairman
	
	             /s/ Hossein Fateh

	Name:	 	Hossein Fateh

  

 21 

 EXHIBIT
A1 

FORM OF RELEASE 
 For and
in consideration of the payments and other benefits due to [NAME] (the “Executive”) pursuant to the Employment Agreement dated as of , 2010 (the “Employment Agreement”), by and between DuPont Fabros Technology,
Inc., (the “Company”), DF Property Management LLC (the “LLC”) and the Executive, and for other good and valuable consideration, the Executive hereby agrees, for the Executive, the Executive’s spouse and child
or children (if any), the Executive’s heirs, beneficiaries, devisees, executors, administrators, attorneys, personal representatives, successors and assigns, to forever release, discharge and covenant not to sue the Company, the LLC or any of
their divisions, affiliates, subsidiaries, parents, branches, predecessors, successors, assigns, and, with respect to such entities, their officers, directors, trustees, employees, agents, shareholders, administrators, general or limited partners,
representatives, attorneys, insurers and fiduciaries, past, present and future (the “Released Parties”) from any and all claims of any kind arising out of, or related to, his employment with the Company, the LLC, its affiliates and
subsidiaries (collectively, with the Company and the LLC, the “Affiliated Entities”) or the Executive’s separation from employment with the Affiliated Entities, which the Executive now has or may have against the Released
Parties, whether known or unknown to the Executive, by reason of facts which have occurred on or prior to the date that the Executive has signed this Release. Such released claims include, without limitation, any and all claims relating to the
foregoing under federal, state or local laws pertaining to employment, including, without limitation, the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. Section 2000e et. seq., the Fair
Labor Standards Act, as amended, 29 U.S.C. Section 201 et. seq., the Americans with Disabilities Act, as amended, 42 U.S.C. Section 12101 et. seq. the Reconstruction Era Civil Rights Act, as amended, 42 U.S.C. Section 1981 et. seq.,
the Rehabilitation Act of 1973, as amended, 29 U.S.C. Section 701 et. seq., the Family and Medical Leave Act of 1992, 29 U.S.C. Section 2601 et. seq., and any and all state or local laws regarding employment discrimination and/or federal,
state or local laws of any type or description regarding employment, including but not limited to any claims arising from or derivative of the Executive’s employment with the Affiliated Entities, as well as any and all such claims under state
contract or tort law. 
 The Executive has read this Release carefully, acknowledges that the Executive has been given at least 21 days to
consider all of its terms and has been advised to consult with any attorney and any other advisors of the Executive’s choice prior to executing this Release, and the Executive fully understands that by signing below the Executive is voluntarily
giving up any right which the Executive may have to sue or bring any other claims against the Released Parties, including any rights and claims under the Age Discrimination in Employment Act. The Executive also understands that the Executive has a
period of seven days after signing this Release within which to revoke his agreement, and that neither the Company nor any other person is obligated to make any payments or provide any other benefits to the Executive pursuant to the Agreement until
eight days have passed since the Executive’s signing of this Release without the Executive’s signature having been revoked other than any accrued obligations or other benefits payable. 

 

	1
	 This release may be amended by the Company only to reflect new laws and changes in applicable laws. 

 

 22

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