Document:

Exhibit 10(B)

 

 

 

TARGET CREDIT CARD OWNER TRUST 2008-1

 

 

Floating Rate Asset-Backed Notes

 

 

 

INDENTURE

 

 

Dated as of May 19, 2008

 

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION

 

as Indenture Trustee, Securities Intermediary and Transfer Agent

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE
  I

  
	
   

  	
   

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  
	
   

  
	
  SECTION 1.1

  	
  Definitions

  
	
  SECTION 1.2

  	
  Incorporation by Reference of Trust
  Indenture Act

  
	
  SECTION 1.3

  	
  Usage of Terms

  
	
  SECTION 1.4

  	
  Calculations of Interest

  
	
   

  	
   

  
	
  ARTICLE II

  
	
   

  	
   

  
	
  THE NOTES

  
	
   

  
	
  SECTION 2.1

  	
  Form

  
	
  SECTION 2.2

  	
  Execution, Authentication and Delivery

  
	
  SECTION 2.3

  	
  Registration of Transfer and Exchange

  
	
  SECTION 2.4

  	
  Mutilated, Destroyed, Lost or Stolen Notes

  
	
  SECTION 2.5

  	
  Persons Deemed Owner

  
	
  SECTION 2.6

  	
  Payment of Principal and Interest

  
	
  SECTION 2.7

  	
  Cancellation

  
	
  SECTION 2.8

  	
  Authenticating Agent

  
	
  SECTION 2.9

  	
  Defeasance

  
	
  SECTION 2.10

  	
  Appointment of Paying Agent

  
	
  SECTION 2.11

  	
  CUSIP Numbers

  
	
  SECTION 2.12

  	
  Determination of LIBOR

  
	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  
	
  COVENANTS

  
	
   

  	
   

  
	
  SECTION 3.1

  	
  Payment of Principal and Interest

  
	
  SECTION 3.2

  	
  Maintenance of Office or Agency

  
	
  SECTION 3.3

  	
  Money for Payments To Be Held in Trust

  
	
  SECTION 3.4

  	
  Existence

  
	
  SECTION 3.5

  	
  Protection of Owner Trust Estate

  
	
  SECTION 3.6

  	
  Opinions as to Owner Trust Estate

  
	
  SECTION 3.7

  	
  Performance of Obligations; Servicing of
  Collateral Certificate

  
	
  SECTION 3.8

  	
  Negative Covenants

  
	
  SECTION 3.9

  	
  Annual Statement as to Compliance

  
	
  SECTION 3.10

  	
  The Issuer May Consolidate, Etc. Only
  on Certain Terms

  
	
  SECTION 3.11

  	
  Successor or Transferee

  
	
  SECTION 3.12

  	
  No Other Business

  

 

 

	
  SECTION 3.13

  	
  No Borrowing

  
	
  SECTION 3.14

  	
  Administrator’s Obligations

  
	
  SECTION 3.15

  	
  Guarantees, Loans, Advances and Other
  Liabilities

  
	
  SECTION 3.16

  	
  Capital Expenditures

  
	
  SECTION 3.17

  	
  Restricted Payments

  
	
  SECTION 3.18

  	
  Notice of Events of Default

  
	
  SECTION 3.19

  	
  Further Instruments and Acts

  
	
  SECTION 3.20

  	
  Removal of Administrator

  
	
  SECTION 3.21

  	
  Representations and Warranties of the Issuer
  with Respect to the Collateral Certificate

  
	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  
	
  SATISFACTION AND DISCHARGE

  
	
   

  	
   

  
	
  SECTION 4.1

  	
  Satisfaction and Discharge of Indenture

  
	
  SECTION 4.2

  	
  Application of Trust Money

  
	
  SECTION 4.3

  	
  Repayment of Moneys Held by Paying Agent

  
	
  SECTION 4.4

  	
  No Revocation or Termination of Issuer
  Without Noteholder Approval

  
	
   

  	
   

  
	
  ARTICLE V

  
	
   

  	
   

  
	
  EVENTS OF DEFAULT AND REMEDIES

  
	
   

  
	
  SECTION 5.1

  	
  Events of Default

  
	
  SECTION 5.2

  	
  Acceleration of Maturity; Rescission and
  Annulment

  
	
  SECTION 5.3

  	
  Collection of Indebtedness and Suits for
  Enforcement by the Indenture Trustee

  
	
  SECTION 5.4

  	
  Remedies; Priorities

  
	
  SECTION 5.5

  	
  Optional Preservation of the Owner Trust
  Estate

  
	
  SECTION 5.6

  	
  Limitation of Suits

  
	
  SECTION 5.7

  	
  Unconditional Rights of Noteholders To
  Receive Principal and Interest

  
	
  SECTION 5.8

  	
  Restoration of Rights and Remedies

  
	
  SECTION 5.9

  	
  Rights and Remedies Cumulative

  
	
  SECTION 5.10

  	
  Delay or Omission Not a Waiver

  
	
  SECTION 5.11

  	
  Control by Noteholders

  
	
  SECTION 5.12

  	
  Waiver of Past Defaults

  
	
  SECTION 5.13

  	
  Undertaking for Costs

  
	
  SECTION 5.14

  	
  Waiver of Stay or Extension Laws

  
	
  SECTION 5.15

  	
  Action on Notes

  
	
  SECTION 5.16

  	
  Performance and Enforcement of Certain
  Obligations

  
	
  SECTION 5.17

  	
  Sale of Owner Trust Estate

  

 

 

	
  ARTICLE VI

  
	
   

  	
   

  
	
  THE INDENTURE TRUSTEE

  
	
   

  
	
  SECTION 6.1

  	
  Duties of the Indenture Trustee

  
	
  SECTION 6.2

  	
  Rights of the Indenture Trustee

  
	
  SECTION 6.3

  	
  Individual Rights of the Indenture Trustee

  
	
  SECTION 6.4

  	
  The Indenture Trustee’s Disclaimer

  
	
  SECTION 6.5

  	
  Notice of Defaults

  
	
  SECTION 6.6

  	
  Reports by the Indenture Trustee to Holders

  
	
  SECTION 6.7

  	
  Compensation and Indemnity

  
	
  SECTION 6.8

  	
  Replacement of the Indenture Trustee

  
	
  SECTION 6.9

  	
  Successor Indenture Trustee by Merger

  
	
  SECTION 6.10

  	
  Appointment of Co-Indenture Trustee or
  Separate Indenture Trustee

  
	
  SECTION 6.11

  	
  Eligibility; Disqualification

  
	
  SECTION 6.12

  	
  Preferential Collection of Claims Against
  the Issuer

  
	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  	
   

  
	
  NOTEHOLDERS’ LISTS AND REPORTS

  
	
   

  	
   

  
	
  SECTION 7.1

  	
  The Issuer To Furnish the Indenture Trustee
  Names and Addresses of the Noteholders

  
	
  SECTION 7.2

  	
  Preservation of Information; Communications
  to the Noteholders

  
	
  SECTION 7.3

  	
  Reports by the Administrator

  
	
  SECTION 7.4

  	
  Fiscal Year of the Issuer

  
	
  SECTION 7.5

  	
  Reports by the Indenture Trustee

  
	
   

  	
   

  
	
  ARTICLE VIII

  
	
   

  	
   

  
	
  ACCOUNTS, DISBURSEMENTS AND RELEASES

  
	
   

  	
   

  
	
  SECTION 8.1

  	
  Collection of Money

  
	
  SECTION 8.2

  	
  Issuer Accounts

  
	
  SECTION 8.3

  	
  Investment of Funds in the Note Principal
  Funding Account and the Noteholder Reserve Account

  
	
  SECTION 8.4

  	
  Application of Funds in the Note Principal
  Funding Account and the Noteholder Reserve Account

  
	
  SECTION 8.5

  	
  Release of Owner Trust Estate

  
	
  SECTION 8.6

  	
  Opinion of Counsel

  
	
  SECTION 8.7

  	
  Treatment as Financial Assets

  
	
  SECTION 8.8

  	
  Powers Coupled With an Interest

  

 

 

	
  ARTICLE IX

  
	
   

  	
   

  
	
  SUPPLEMENTAL INDENTURES

  
	
   

  	
   

  
	
  SECTION 9.1

  	
  Supplemental Indentures Without Consent of
  Noteholders

  
	
  SECTION 9.2

  	
  Supplemental Indentures With Consent of the
  Noteholders

  
	
  SECTION 9.3

  	
  Effect of Supplemental Indenture

  
	
  SECTION 9.4

  	
  Conformity with Trust Indenture Act

  
	
  SECTION 9.5

  	
  Reference in Notes to Supplemental
  Indentures

  
	
  SECTION 9.6

  	
  Execution of Supplemental Indentures

  
	
   

  	
   

  
	
  ARTICLE X

  
	
   

  	
   

  
	
  REDEMPTION OF NOTES

  
	
   

  	
   

  
	
  SECTION 10.1

  	
  Redemption

  
	
  SECTION 10.2

  	
  Form of Redemption Notice

  
	
  SECTION 10.3

  	
  Notes Payable on Redemption Date

  
	
   

  	
   

  
	
  ARTICLE XI

  
	
   

  	
   

  
	
  MISCELLANEOUS

  
	
   

  	
   

  
	
  SECTION 11.1

  	
  Compliance Certificates and Opinions, etc.

  
	
  SECTION 11.2

  	
  Form of Documents Delivered to the
  Indenture Trustee

  
	
  SECTION 11.3

  	
  Actions of Noteholders

  
	
  SECTION 11.4

  	
  Notices, etc., to the Indenture Trustee,
  the Issuer, the Note Purchaser and the Rating Agencies

  
	
  SECTION 11.5

  	
  Notices to Noteholders; Waiver

  
	
  SECTION 11.6

  	
  Alternate Payment and Notice Provisions

  
	
  SECTION 11.7

  	
  Conflict with Trust Indenture Act

  
	
  SECTION 11.8

  	
  Effect of Headings and Table of Contents

  
	
  SECTION 11.9

  	
  Successors and Assigns

  
	
  SECTION 11.10

  	
  Separability

  
	
  SECTION 11.11

  	
  Benefits of Indenture

  
	
  SECTION 11.12

  	
  GOVERNING LAW

  
	
  SECTION 11.13

  	
  Counterparts

  
	
  SECTION 11.14

  	
  Recording of Indenture

  
	
  SECTION 11.15

  	
  Trust Obligation

  
	
  SECTION 11.16

  	
  No Petition

  
	
  SECTION 11.17

  	
  Inspection

  
	
  SECTION 11.18

  	
  Tax Treatment

  
	
  SECTION 11.19

  	
  Other Rights

  

 

	
  Exhibit A

  	
   

  	
  –

  	
   

  	
  Form of Note

  
	
  Exhibit B

  	
   

  	
  –

  	
   

  	
  Form of Transferee Representation Letter

  

 

 

CROSS REFERENCE TABLE1

 

	
  TIA Section

  	
   

  	
   

  	
   

  	
  Indenture Section

  
	
  310

  	
   

  	
  (a)(1)

  	
   

  	
  6.11

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  6.11

  
	
   

  	
   

  	
  (a)(3)

  	
   

  	
  6.10

  
	
   

  	
   

  	
  (a)(4)

  	
   

  	
  N.A.2

  
	
   

  	
   

  	
  (a)(5)

  	
   

  	
  6.11

  
	
   

  	
   

  	
  (b)

  	
   

  	
  6.8; 6.11

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  311

  	
   

  	
  (a)

  	
   

  	
  6.12

  
	
   

  	
   

  	
  (b)

  	
   

  	
  6.12

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  312

  	
   

  	
  (a)

  	
   

  	
  7.1; 7.2(a)

  
	
   

  	
   

  	
  (b)

  	
   

  	
  7.2(b)

  
	
   

  	
   

  	
  (c)

  	
   

  	
  7.2(c)

  
	
  313

  	
   

  	
  (a)

  	
   

  	
  7.5

  
	
   

  	
   

  	
  (b)(1)

  	
   

  	
  7.5

  
	
   

  	
   

  	
  (b)(2)

  	
   

  	
  7.5

  
	
   

  	
   

  	
  (c)

  	
   

  	
  7.4; 7.5

  
	
   

  	
   

  	
  (d)

  	
   

  	
  7.4

  
	
  314

  	
   

  	
  (a)(1), (2), (3)

  	
   

  	
  7.3; 7.4

  
	
   

  	
   

  	
  (a)(4)

  	
   

  	
  3.9

  
	
   

  	
   

  	
  (b)

  	
   

  	
  3.6

  
	
   

  	
   

  	
  (c)(1)

  	
   

  	
  8.3; 11.1

  
	
   

  	
   

  	
  (c)(2)

  	
   

  	
  8.3; 11.1

  
	
   

  	
   

  	
  (d)

  	
   

  	
  8.3; 11.1

  
	
   

  	
   

  	
  (e)

  	
   

  	
  11.1

  
	
   

  	
   

  	
  (f)

  	
   

  	
  N.A.

  
	
  315

  	
   

  	
  (a)

  	
   

  	
  6.1

  
	
   

  	
   

  	
  (b)

  	
   

  	
  6.5; 11.5

  
	
   

  	
   

  	
  (c)

  	
   

  	
  6.1

  
	
   

  	
   

  	
  (d)

  	
   

  	
  6.1

  
	
   

  	
   

  	
  (e)

  	
   

  	
  5.13

  
	
  316

  	
   

  	
  (a) (last sentence)

  	
   

  	
  1.1

  
	
   

  	
   

  	
  (a)(1)(A)

  	
   

  	
  5.11

  
	
   

  	
   

  	
  (a)(1)(B)

  	
   

  	
  5.12

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  
	
   

  	
   

  	
  (b)

  	
   

  	
  5.7

  

 

1                                            Note:  This Cross Reference Table shall not, for any
purpose, be deemed to be part of this Indenture.

 

2                                            N.A. means
Not Applicable.

 

 

	
  TIA Section

  	
   

  	
   

  	
   

  	
  Indenture Section

  
	
   

  	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  317

  	
   

  	
  (a)(1)

  	
   

  	
  5.3(a)

  
	
   

  	
   

  	
  (a)(2)

  	
   

  	
  5.3(d)(iv)

  
	
   

  	
   

  	
  (b)

  	
   

  	
  2.10, 3.3

  
	
  318

  	
   

  	
  (a)

  	
   

  	
  11.7

  

 

 

INDENTURE dated as of May 19, 2008, by
and between TARGET CREDIT CARD OWNER TRUST 2008-1, a Delaware statutory trust
(the “Issuer” or “Owner Trust”), and WELLS FARGO BANK, NATIONAL
ASSOCIATION, a national banking association, as indenture trustee (the “Indenture
Trustee”), securities intermediary and transfer agent and not in its
individual capacity.

 

Each party agrees as follows for the benefit
of the other party and for the benefit of the Noteholders:

 

GRANTING CLAUSE

 

The Issuer hereby Grants to the Indenture
Trustee at the Closing Date, as Indenture Trustee for the benefit of the
Noteholders, all right, title and interest of the Issuer in, to and under the
following property whether now owned or hereafter acquired, now existing or
hereafter created and wherever located: 
all accounts, money, chattel paper, investment property, instruments,
documents, deposit accounts, letters of credit, commercial tort claims,
supporting obligations, general intangibles and goods, including without
limitation all of the foregoing and the proceeds thereof, to the extent arising
from or relating to (a) the Collateral Certificate; (b) all money,
instruments, investment property and other property (together with all earnings,
dividends, distributions, income, issues, and profits relating to), distributed
or distributable in respect of the Collateral Certificate pursuant to the terms
of the Series Supplement, the Pooling and Servicing Agreement or the
Deposit and Administration Agreement; (c) all money, investment property,
instruments and other property on deposit from time to time in, credited to or
related to the Note Distribution Account, and all interest, dividends,
earnings, income and other distributions from time to time received, receivable
or otherwise distributed to or in respect thereto (including any accrued
discount realized on liquidation of any investment purchased at a discount); (d) all
rights, remedies, powers, privileges and claims of the Issuer under or with
respect to the Collateral Certificate and the Deposit and Administration
Agreement (whether arising pursuant to the terms of the Deposit and
Administration Agreement or otherwise available to the Issuer at law or in
equity), including, without limitation, the rights of the Issuer to enforce the
Pooling and Servicing Agreement, the Series Supplement and the Deposit and
Administration Agreement, and to give or withhold any and all consents,
requests, notices, directions, approvals, extensions or waivers under or with
respect to the Pooling and Servicing Agreement, the Series Supplement or
the Deposit and Administration Agreement to the same extent as the Issuer could
but for the assignment and security interest granted to the Indenture Trustee
for the benefit of the Noteholders; (e) all other property of the Issuer;
and (f) all present and future claims, demands, causes and choses in
action in respect of any or all of the foregoing and all payments on or under
and all proceeds of every kind and nature whatsoever in respect of any or all
of the foregoing, including all proceeds, products, rents, receipts or profits
of the conversion, voluntary or involuntary, into cash or other property, all
cash and non-cash proceeds, and other property consisting of, arising from or
relating to all or any part of any of the foregoing or any proceeds thereof
(collectively, the “Collateral”).

 

The foregoing Grant is made in trust to
secure the payment of principal of and interest on, and any other amounts owing
in respect of, the Notes, equally and ratably without prejudice, priority or
distinction except as set forth herein, and to secure compliance with the
provisions of this Indenture, all as provided in this Indenture.

 

 

The Indenture Trustee, as trustee on behalf
of the Noteholders, acknowledges such Grant, accepts the trusts under this
Indenture in accordance with the provisions of this Indenture and agrees to
perform its duties required in this Indenture to the end that the interests of
the Noteholders and (only to the extent expressly provided herein) the
Certificateholder may be adequately and effectively protected.

 

On or before May 19, 2008, the Issuer
shall cause the Collateral Certificate with an undated bond power covering such
Collateral Certificate, duly executed by the Issuer, and endorsed in blank, to
be delivered to the Indenture Trustee, and the Indenture Trustee shall maintain
possession of the Collateral Certificate for the benefit of the Noteholders,
subject to the terms of this Indenture.

 

ARTICLE I

 

DEFINITIONS AND
INCORPORATION BY REFERENCE

 

SECTION 1.1                 Definitions.  The following terms which are defined in the
Uniform Commercial Code in the State of Delaware shall have the meanings set
forth therein:  “certificated security,” “control,”
“financial asset,” “entitlement order,” “investment property,” “securities
account,” “securities intermediary,” and “security entitlement.”  All capitalized terms used herein and not
otherwise defined herein shall have the meanings ascribed to them in the
Pooling and Servicing Agreement or, if not therein, the Series Supplement.  Whenever used in this Indenture, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:

 

“Act” has the meaning specified in subsection
11.3(a).

 

“Additional Interest” means with
respect to any Distribution Date, an additional amount of interest payable to
the Noteholders, to the extent permitted by applicable law, equal to the
product of (i) the Interest Rate, (ii) the aggregate amount of Monthly
Interest Shortfall remaining unpaid from prior Distribution Dates and (iii) 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.

 

“Additional Notes” has the meaning specified
in subsection 2.2(b).

 

“Additional Issuance Date” has the
meaning specified in subsection 2.2(b).

 

“Administrator” means TRC, as
administrator pursuant to the Deposit and Administration Agreement, and its
successors and assigns.

 

“Affiliate” has the meaning specified
in the Pooling and Servicing Agreement.

 

“Authenticating Agent” has the meaning
specified in subsection 2.8(a) and shall initially be Wells Fargo,
and its successors and assigns in such capacity.

 

 

“Authorized Officer” means any officer
of the Owner Trustee, the Administrator or the Servicer, who is authorized to
act on behalf of the Owner Trustee, the Administrator or the Issuer, or the
Servicer, respectively, and who is identified as such on the list of authorized
officers delivered by each such party on the Closing Date as such list may be
modified by notice to the other parties.

 

“Available Amount” means, with respect
to each Distribution Date (i) prior to the defeasance of the Notes
pursuant to Section 2.9, an amount equal to the amount to be paid
in respect of the Collateral Certificate pursuant to Section 5.1 of the Series Supplement
on such date and (ii) on and after the date of defeasance of the Notes
pursuant to Section 2.9, the amount required pursuant to Section 8.4
to be deposited into the Note Distribution Account for such Distribution Date.

 

“Basic Documents” means this
Indenture, the Deposit and Administration Agreement, the Trust Agreement, the
Note Purchase Agreement, the Pooling and Servicing Agreement and the Series Supplement
and other documents and certificates delivered in connection therewith.

 

“Business Day” has the meaning
specified in the Series Supplement.

 

“Carryover Interest” means, with
respect to any Distribution Date, (a) any Monthly Interest due but not paid
to the Noteholders on any previous Distribution Date plus (b) any Additional Interest due with respect to
such Distribution Date.

 

“Certificate” means the certificate
evidencing the beneficial interest in the Issuer, substantially in the form
attached to the Trust Agreement as Exhibit A.

 

“Certificateholder” means TRC.

 

“Closing Date” has the meaning
specified in the Series Supplement.

 

“Code” has the meaning specified in
the Pooling and Servicing Agreement.

 

“Collateral” has the meaning assigned
to such term in the Granting Clause hereof.

 

“Collateral Certificate” has the
meaning specified in the Series Supplement.

 

“Collateral Certificateholder” means
the Issuer, as the holder of the Collateral Certificate.

 

“Commission” has the meaning specified
in the Pooling and Servicing Agreement.

 

“Corporate Trust Office” means the
principal corporate trust office of the Indenture Trustee, which as of the date
hereof is located at Sixth and Marquette, MAC: N9311-161 Minneapolis, Minnesota
55479, Attention: Corporate Trust Administration, or the corporate trust office
of the Owner Trustee, as applicable.

 

 

“Default” means any occurrence that
is, or with notice or the lapse of time or both would become, an Event of
Default.

 

“Defeasance Covered Amount” means,
with respect to any Interest Accrual Period within the Defeasance Period, the
product of (a) the Interest Rate in effect with respect to such Interest
Accrual Period, (b) a fraction the numerator of which is the actual number
of days in such Interest Accrual Period and the denominator of which is 360,
and (c) the Note Principal Balance as of the first day of such Interest
Accrual Period.

 

“Defeasance Period” means the period
commencing on (and including) the date of the deposit, if any, to be made into
the Note Principal Funding Account and the Noteholder Reserve Account pursuant
to Section 2.9 and ending on the Series 2008-1 Termination
Date.

 

“Deposit and Administration Agreement”
means the Deposit and Administration Agreement, dated as of May 19, 2008,
between TRC, as Depositor and Administrator, and the Issuer, as the same may be
amended, supplemented or otherwise modified from time to time.

 

“Depositor” means TRC in its capacity
as Depositor under the Trust Agreement.

 

“Distribution Date” has the meaning
specified in the Series Supplement.

 

“Early Amortization Commencement Date”
has the meaning specified in the Series Supplement.

 

“Early Amortization Event” means a Series 2008-1
Early Amortization Event, as defined in the Series Supplement, or any of
the events specified as such in Section 9.1 of the Pooling and Servicing
Agreement.

 

“Early Amortization Period” has the
meaning specified in the Series Supplement.

 

“Eligible Deposit Account” has the
meaning specified in the Pooling and Servicing Agreement.

 

“Eligible Institution” has the meaning
specified in the Pooling and Servicing Agreement.

 

“Eligible Investments” has the meaning
specified in the Pooling and Servicing Agreement.

 

“Event of Default” means an event
specified in Section 5.1.

 

“Exchange Act” means the Securities
Exchange Act of 1934, as amended.

 

“Executive Officer” means, with
respect to any corporation or bank, the Chief Executive Officer, Chief
Operating Officer, Chief Financial Officer, President, Executive Vice
President, any Vice President, the Secretary or the Treasurer of such
corporation or bank, and with respect to any partnership, any general partner
thereof.

 

 

“Grant” means mortgage, pledge,
bargain, sell, warrant, alienate, remise, release, convey, assign, transfer,
create, and grant a lien upon and a security interest in and right of set-off
against, deposit, set over and confirm pursuant to this Indenture.  A Grant of the Owner Trust Estate or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the Granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments and all other moneys payable thereunder, to
give and receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring Proceedings in the
name of the Granting party or otherwise and generally to do and receive
anything that the Granting party is or may be entitled to do or receive
thereunder or with respect thereto.

 

“Holder” means, unless the context
otherwise requires, the Certificateholder or any Noteholder.

 

“Indenture Trustee” means Wells Fargo,
in its capacity as indenture trustee pursuant to this Indenture.

 

“Independent” means, when used with
respect to any specified Person, that the Person (a) is in fact independent
of the Issuer, any other obligor upon the Notes, the Depositor and any
Affiliate of any of the foregoing Persons, (b) does not have any direct
financial interest or any material indirect financial interest in the Issuer,
any such other obligor, the Depositor or any Affiliate of any of the foregoing
Persons and (c) is not connected with the Issuer, any such other obligor,
the Depositor or any Affiliate of any of the foregoing Persons as an officer,
employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions.

 

“Independent Certificate” means a
certificate or opinion to be delivered to the Indenture Trustee under the
circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.1, made by an Independent appraiser or
other expert appointed by the Issuer and approved by the Indenture Trustee in
the exercise of reasonable care, and such opinion or certificate shall state
that the signer has read the definition of 
“Independent” in this Indenture and that the signer is Independent
within the meaning thereof.

 

“Insolvency Event” means, for a
specified Person, (a) the filing of a decree or order for relief by a
court having jurisdiction in the premises in respect of such Person or any
substantial part of its property in an involuntary case under any applicable
Federal or state bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver (including any receiver appointed under the
Financial Institutions Reform, Recovery and Enforcement Act of 1989, as
amended), liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person’s affairs, and such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or (b) the commencement by such Person of a voluntary
case under any applicable Federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by such Person to the
entry of an order for relief in an involuntary case under any such law, or the
consent by such Person to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or the 

 

 

making of such
Person of any general assignment for the benefit of creditors, or the failure
by such Person generally to pay its debts as such debts become due, or the
taking of action by such Person in furtherance of any of the foregoing.

 

“Interest Accrual Period” has the
meaning specified in the Series Supplement.

 

“Interest Rate” means, with respect to
any Interest Accrual Period, a per annum
rate equal to LIBOR, as determined on the related LIBOR Determination Date, plus (x) for each Interest Accrual
Period through and including the earlier of (i) the Interest Accrual
Period beginning on April 25, 2013 and (ii) the Interest Accrual
Period related to the first Special Payment Date, 0.65% and (y) for each
Interest Accrual Period thereafter, 2.28%.

 

“Invested Amount” has the meaning
specified in the Series Supplement.

 

“Issuer” means Target Credit Card
Owner Trust 2008-1, a Delaware statutory trust created under the Trust
Agreement.

 

“Issuer Accounts” means each of the
Note Distribution Account, the Note Principal Funding Account and the
Noteholder Reserve Account.

 

“Issuer Order” and “Issuer Request”
means a written order or request signed in the name of the Issuer by any of its
Authorized Officers and delivered to the Indenture Trustee and the Paying
Agent.

 

“Legal Maturity Date” means the May 25,
2016 Distribution Date.

 

“LIBOR” means, with respect to any
Interest Accrual Period, the London Interbank Offered Rate indexed to the
offered rates for one-month United States dollar deposits determined by the
Indenture Trustee for each Interest Accrual Period in accordance with the
provisions of subsection 2.12(a).

 

“LIBOR Determination Date” means (a) for
the first Interest Accrual Period, May 15, 2008 and (b) for each
subsequent Interest Accrual Period, the second Business Day prior to the
commencement of such subsequent Interest Accrual Period.

 

“Lien” means a security interest,
lien, charge, pledge or encumbrance of any kind other than tax liens, mechanics’
liens or any other liens that attach by operation of law.

 

“Master Trust” means the Target Credit
Card Master Trust created pursuant to the Pooling and Servicing Agreement.

 

“Master Trust Trustee” means Wells
Fargo, as trustee under the Pooling and Servicing Agreement and each successor
to Wells Fargo in the same capacity.

 

“Monthly Interest” has the meaning
specified in the Series Supplement.

 

“Monthly Interest Shortfall” means,
with respect to each Distribution Date, an amount equal to the excess, if any,
of (x) the Monthly Interest for the related Interest Accrual 

 

 

Period over (y) the amount available to be paid to the
Noteholders in respect of interest on such Distribution Date.

 

“Monthly Period” has the meaning
specified in the Series Supplement.

 

“Moody’s” means Moody’s Investors
Service, Inc., and its successors and assigns.

 

“Notes” means the Issuer’s Floating
Rate Asset-Backed Notes (including any Additional Notes) issued and delivered
pursuant to this Indenture.

 

“Note Distribution Account” means the
account designated as such, established and maintained pursuant to Section 8.2.

 

“Note Initial Principal Balance” means
$3,825,000,000.

 

“Note Interest Requirement” means,
with respect to any Distribution Date, the sum of (a) the Monthly Interest
for such Distribution Date and (b) the amount of any unpaid Carryover
Interest.

 

“Note Principal Balance” means, with
respect to any date, an amount equal to the excess of (a) (i) the
Note Initial Principal Balance, plus
(ii) the aggregate principal amount of Additional Notes issued prior to
such date minus (iii) the
Principal Payment Adjustment for such date or any prior date over (b) an amount equal to the sum of (i) the
aggregate amount of any principal payments made to the Noteholders pursuant to subsection
2.6(a) prior to such date, plus (ii) the aggregate principal
amount of Notes acquired by the Issuer or the Depositor for cancellation
pursuant to Section 2.7.

 

“Note Principal Due Date” means any of
(a) the Legal Maturity Date and (b) the date on which the Owner Trust
Estate is liquidated following an Event of Default and acceleration of the
Notes.

 

“Note Principal Funding Account” means
the account designated as such, established and maintained pursuant to Section 8.2.

 

“Note Purchase Agreement” means the
Note Purchase Agreement, dated as of May 5, 2008, by and among TRC,
Target, BOTAC, Inc. and Chase Bank USA, National Association, as the same
may be amended, supplemented or otherwise modified from time to time.

 

“Note Purchaser” means BOTAC, Inc.,
a Nevada corporation, for so long as all Notes are held by one or more of BOTAC, Inc.
or an Affiliate that is a wholly-owned direct or indirect subsidiary of Chase
Bank USA, National Association or JPMorgan Chase & Co.

 

“Note Register” means the register
maintained pursuant to subsection 2.3(a).

 

“Note Registrar” means the registrar
appointed pursuant to subsection 2.3(a).

 

 

“Noteholder” means the Person in whose
name Notes are registered on the Note Register.

 

“Noteholders’ Principal Distributable
Amount” means, with respect to any Distribution Date on and after the
earlier to occur of (i) the June 25, 2013 Distribution Date, (ii) the
first Special Payment Date and (iii) any Note Principal Due Date, the lesser
of (a) the Note Principal Balance on such Distribution Date and (b) the
amounts available pursuant to subsection 5.1(b) of the Series Supplement.

 

“Noteholder Reserve Account” means the
account designated as such, established and maintained pursuant to Section 8.2.

 

“Officer’s Certificate” means a
certificate signed by the chairman of the board, the president, the treasurer,
the controller, any executive or senior vice president or any vice president of
the Depositor, the Administrator (on behalf of itself or the Issuer), or the
Servicer, as appropriate, meeting the requirements of Section 11.1.

 

“Opinion of Counsel” means a written
opinion of counsel (who may be counsel to the Depositor, the Administrator or
the Servicer) reasonably acceptable in form and substance to the Indenture
Trustee, meeting the requirements of Section 11.1 (or in the case
of an Opinion of Counsel delivered to the Owner Trustee, reasonably acceptable
in form and substance to the Owner Trustee).

 

“Outstanding” means, when used with
respect to Notes, as of any date of determination, all Notes theretofore
authenticated and delivered under this Indenture except:

 

(a)  Notes theretofore
cancelled by the Note Registrar or delivered to the Note Registrar for
cancellation;

 

(b)  Notes, the payment
for which money in the necessary amount has been theretofore deposited with the
Indenture Trustee or any Paying Agent in trust for the related Noteholders (provided that if such Notes are to be redeemed, notice of
such redemption has been duly given pursuant to this Indenture or provision
therefor, satisfactory to the Indenture Trustee, has been made); and

 

(c)  Notes in exchange for
or in lieu of other Notes which have been authenticated and delivered pursuant
to this Indenture unless proof satisfactory to the Indenture Trustee is
presented that any such Notes are held by a bona fide
purchaser;

 

provided
that, in determining whether the Holders of the requisite Outstanding Amount of
Notes have given any request, demand, authorization, direction, notice, consent
or waiver hereunder or under any other Basic Document, Notes owned by the
Issuer, any other obligor upon the Notes, Target National Bank, Target Capital
Corporation, TRC or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Indenture Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Notes that a Responsible Officer of the Indenture Trustee either actually knows
to be so owned or has received written notice that such Notes are so owned
shall be so disregarded.  Notes so owned
that have been pledged in good 

 

 

faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Indenture
Trustee the pledgee’s right so to act with respect to such Notes and the
pledgee is not the Issuer, any other obligor upon the Notes, Target National
Bank, Target Capital Corporation, TRC or any Affiliate of any of the foregoing
Persons.

 

“Outstanding Amount” means, when used
with respect to Notes, as of any date of determination, the aggregate Note
Principal Balance of all Notes Outstanding as of such date of determination.

 

“Owner Trust Estate” has the meaning
specified in the Trust Agreement.

 

“Owner Trustee” means Wilmington Trust
Company, not in its individual capacity but solely as owner trustee under the
Trust Agreement, and any successor Owner Trustee thereunder.

 

“Paying Agent” means the Indenture
Trustee or any other Person that meets the eligibility standards for the
Indenture Trustee specified in Section 6.11 and is authorized by
the Indenture Trustee to make the payments to and distributions from the Note
Distribution Account as provided in Section 2.10 hereof, including
payment of principal of or interest on the Notes on behalf of the Issuer.

 

“Person” has the meaning specified in
the Pooling and Servicing Agreement.

 

“Pooling and Servicing Agreement”
means the Amended and Restated Pooling and Servicing Agreement, dated as of April 28,
2000, as amended by the Amendment No. 1 thereto, dated as of August 22,
2001, among TRC, the Master Trust Trustee, and the Servicer.

 

 “Predecessor
Note” means, with respect to any particular Note, every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.4 in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.

 

“Proceeding” means any suit in equity,
action or law or other judicial or administrative proceeding.

 

“Record Date” has the meaning
specified in the Series Supplement.

 

“Redemption Date” means in the case of
a redemption of the Notes pursuant to Section 10.1, the
Distribution Date specified by the Administrator pursuant to such Section 10.1.

 

“Redemption Price” means, with respect
to the Notes, the respective Outstanding Amount for such Notes plus accrued and unpaid interest thereon at the applicable
Interest Rate on the Distribution Date on which the Transferor exercises its
option to repurchase the Collateral Certificate.

 

“Reference Banks” has the meaning
specified in the Series Supplement.

 

 

“Responsible Officer” means any
officer within the Corporate Trust Office (or any successor group of the
Indenture Trustee) with responsibility for matters covered by this Indenture,
including any vice president, assistant vice president, assistant secretary or
any other officer or assistant officer of the Indenture Trustee customarily
performing functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom a corporate trust matter
relating to this Indenture is referred at the Indenture Trustee’s Corporate
Trust Office because of such officer’s knowledge of and familiarity with the
particular subject.

 

“Revolving Period” has the meaning
specified in the Series Supplement.

 

“Reuters Screen LIBOR01 Page” means
the display page so designated on the Reuters Monitor Money Rates (or such
other page as may replace that page on that service, or such other
service as may be nominated as the information vendor, for the purposes of
displaying rates comparable to LIBOR).

 

“Securities Intermediary” has the
meaning specified in Section 8.2.

 

“Series Supplement” means the Series 2008-1
Supplement, dated the date hereof, to the Pooling and Servicing Agreement.

 

“Series 2008-1 Termination Date”
has the meaning specified in the Series Supplement.

 

“Servicer” has the meaning specified
in the Pooling and Servicing Agreement.

 

“Servicer Default” has the meaning
specified in the Pooling and Servicing Agreement.

 

“Special Payment Date” has the meaning
specified in the Series Supplement.

 

“Standard & Poor’s” means
Standard & Poor’s Ratings Services and its successors and assigns.

 

“Target” has the meaning specified in
the Series Supplement.

 

“Tax Opinion” means, with respect to
any action taken or proposed to be taken, an Opinion of Counsel to the effect
that, for Federal income tax purposes, (i) such action will not adversely
affect the tax characterization as debt of the Notes to the extent
characterized as debt at the time of their issuance, (ii) following such
action neither the Master Trust nor the Issuer will be treated as an
association (or publicly traded partnership) taxable as a corporation and (iii) such
action will not cause or constitute an event in which gain or loss would be
recognized by any Noteholder.

 

“Transfer” means, in respect of any
Note, the sale, participation, transfer, assignment, exchange or other pledge
or conveyance of such Note in whole or in part.

 

“Transfer Agent” means Wells Fargo, in
its capacity as the transfer agent pursuant to subsection 2.3(a).

 

 

“Transfer Date” has the meaning
specified in the Pooling and Servicing Agreement.

 

“Transferor” has the meaning specified
in the Pooling and Servicing Agreement.

 

“TRC” means Target Receivables
Corporation, a Minnesota corporation.

 

“Trust Agreement” means the Amended
and Restated Trust Agreement, dated as of May 19, 2008, between the
Depositor and the Owner Trustee, as the same may be amended, supplemented or
otherwise modified from time to time.

 

“Trust Indenture Act” or “TIA”
means the Trust Indenture Act of 1939 as in force on the date hereof, unless
otherwise specifically provided.

 

“Wells Fargo” means Wells Fargo Bank,
National Association, a national banking association.

 

SECTION 1.2         Incorporation by Reference of Trust Indenture Act  .  Whenever this Indenture refers to a provision
of the TIA, the provision is incorporated by reference in and made a part of
this Indenture.  The following TIA terms
used in this Indenture have the following meanings:

 

“indenture securities” means the
Notes.

 

“indenture security holder” means a
Noteholder.

 

“indenture to be qualified” means this
Indenture.

 

“indenture trustee” or “institutional
trustee” means the Indenture Trustee.

 

“obligor” on the indenture securities
means the Issuer and any other obligor on the indenture securities.

 

All other TIA terms used in this Indenture
that are defined by the TIA, defined by TIA reference to another statute or
defined by Commission rule have the meaning assigned to them by such
definitions.

 

SECTION 1.3         Usage of Terms.  With respect to all terms in this Indenture,
the singular includes the plural and the plural the singular; words importing
any gender include the other gender; references to “writing” include printing,
typing, lithography, and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance
with their respective terms and not prohibited by this Indenture; references to
Persons include their permitted successors and assigns; and the term “including”
means “including without limitation.” 
The words “hereof,” “herein,” “hereunder,” and words of similar import
when used in this Indenture shall refer to this Indenture as a whole and not to
any particular provision of this Indenture. 
The words “due date” as used herein with respect to interest on and
principal of the Notes refer to each Note Principal Due Date, and do not
include any Distribution Date following

 

 

the Revolving
Period unless that date is a Note Principal Due Date.  All references herein to Articles, Sections,
subsections and Exhibits are references to Articles, Sections, subsections and
Exhibits contained in or attached to this Indenture unless otherwise specified,
and each such Exhibit is part of the terms of this Indenture.

 

SECTION 1.4         Calculations of Interest.  All calculations of interest made hereunder
with respect to the Notes shall be made on the basis of a 360-day year based
upon the actual number of days elapsed.

 

ARTICLE II

 

THE NOTES

 

SECTION 2.1         Form.  The Notes will be issued in certificated
form.  The Notes, together with the
Indenture Trustee’s or Authenticating Agent’s certificate of authentication,
shall be in substantially the form set forth in Exhibit A, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon
as may, consistently herewith, be determined to be appropriate by the officers
executing such Notes, as evidenced by their execution of the Notes.  Any portion of the text of a Note may be set
forth on the reverse thereof, with an appropriate reference thereto on the face
of such Note. Each Note shall be dated the date of its authentication.  The Notes shall be issuable as registered
notes in minimum denominations of $100,000 and in integral multiples thereof
(except, if applicable, for one note representing a residual portion of the
Notes which may be issued in a denomination other than an integral multiple of
$100,000).

 

A Note bearing the manual or facsimile
signature of individuals who were at any time Authorized Officers of the Issuer
shall bind the Issuer, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the date of authentication and
delivery of such Notes or did not hold such offices at such date.  No Note shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose, unless there
appears on such Note, a certificate of authentication substantially in the form
provided for herein executed by the Indenture Trustee or an Authenticating
Agent by the manual or facsimile signature of one of its authorized
signatories, and such certificate upon any Note shall be conclusive evidence,
and the only evidence, that such Note has been duly authenticated and delivered
hereunder.  The terms of the Notes set
forth in Exhibit A are part of the terms of this Indenture.

 

The Notes shall be word processed, printed,
lithographed or engraved or produced by any combination of these methods (with
or without steel engraved borders), all as determined by the officers executing
such Notes, as evidenced by their execution of such Notes.

 

SECTION 2.2         Execution, Authentication and
Delivery.

 

(a)     The
Notes shall be executed on behalf of the Issuer by any of its Authorized
Officers.  The signature of any such
Authorized Officer on the Notes may be manual or facsimile.

 

 

The
Indenture Trustee shall, upon written order of the Depositor, authenticate and
deliver Notes for original issue in an aggregate principal amount of
$3,825,000,000.  The aggregate principal
amount of Notes outstanding at any time may not exceed $4,200,000,000, except
as provided in Section 2.4.

 

(b)        Upon
the order of the Depositor, the Indenture Trustee shall authenticate and
deliver additional Notes (“Additional Notes”) in connection with an
increase in the outstanding principal amount of the Collateral Certificate on
any date (each, an “Additional Issuance Date”) pursuant to Section 4.8
of the Series Supplement and the purchase of Additional Notes pursuant to
the terms of the Note Purchase Agreement. 
The aggregate principal amount of Additional Notes to be issued on any
Additional Issuance Date may not exceed the aggregate principal amount of the
corresponding increase in the outstanding principal amount of the Collateral
Certificate. Upon issuance, the Additional Notes will be identical in all respects
(except that the principal amount of such Additional Notes may be different) to
the Notes currently outstanding and the Additional Notes will be equally and
ratably entitled to the benefits of this Indenture.  From and after each Additional Issuance Date,
all applicable calculations and allocations required pursuant to this Indenture
shall take into account the Additional Notes issued on such date.

 

The issuance
of Additional Notes may be effected only upon satisfaction of the following
conditions:

 

(i)    at least three Business Days prior to the
issuance thereof, the Depositor shall have provided written notice of the
proposed issuance of Additional Notes to the Indenture Trustee, the Servicer
and the Note Purchaser specifying the date and terms of the additional
issuance;

 

(ii)   the conditions precedent for increasing the
principal amount of the Collateral Certificate pursuant to Section 4.8 of
the Series Supplement shall have been satisfied and the principal amount
of the Collateral Certificate shall have been increased by an amount equal to
the aggregate principal amount of the Additional Notes proposed to be issued;
and

 

(iii)  (x)  if after giving effect to the
purchase of Additional Notes on the Additional Issuance Date, the Note
Principal Balance does not exceed the Note Initial Principal Balance, the
Depositor shall have delivered to the Indenture Trustee an Officer’s
Certificate to the effect that the Depositor reasonably believes that no Event
of Default shall have occurred, or been deemed to have occurred, and be
continuing as of the Additional Issuance Date and the issuance of Additional
Notes shall not result in the occurrence (or deemed occurrence) of an Event of
Default; and (y) if after giving effect to the purchase of Additional
Notes on the Additional Issuance Date, the Note Principal Balance shall exceed
the Note Initial Principal Balance, the Depositor shall have delivered to the
Indenture Trustee an Officer’s Certificate to the effect that the Depositor
reasonably believes that (I) the issuance of the Additional Notes will not
have a material adverse effect on the Outstanding Notes and (II) no Event
of Default shall have occurred, or been deemed to have occurred, and be
continuing as of the Additional Issuance Date and the issuance of Additional
Notes shall not result in the occurrence (or deemed 

 

 

occurrence) of an
Event of Default; provided, however, that, for the purposes of making this
determination, a dilution of voting rights will not constitute a material
adverse effect on the Outstanding Notes.

 

SECTION 2.3         Registration
of Transfer and Exchange.

 

(a)     The
Issuer shall cause to be kept a register (the “Note Register”) in which,
subject to such reasonable regulations as it may prescribe, the Note Registrar
shall provide for the registration of the Notes and the registration of
transfers of the Notes.  The Indenture
Trustee shall initially be “Note Registrar” for the purpose of
registering Notes and transfers of Notes as herein provided.  In the event that, subsequent to the date of
issuance of the Notes, the Indenture Trustee notifies the Issuer that it is
unable to act as Note Registrar, the Issuer shall appoint another bank or trust
company, having an office or agency located in the City of New York or the City
of Minneapolis and which agrees to act in accordance with the provisions of
this Indenture applicable to it, to act, as successor Note Registrar under this
Indenture.

 

If a Person other than the Indenture Trustee
is appointed by the Issuer as the Note Registrar, the Issuer will give the
Indenture Trustee prompt written notice of the appointment of such Note
Registrar and of the location, and any change in the location, of the Note
Register, and the Indenture Trustee shall have the right to inspect the Note
Register at all reasonable times and to obtain copies thereof, and the
Indenture Trustee shall have the right to conclusively rely upon a certificate
executed on behalf of the Note Registrar by an Executive Officer thereof as to
the names and addresses of the Noteholders and the principal amounts and number
of the Notes.

 

An institution succeeding to the corporate
agency business of the Note Registrar shall continue to be the Note Registrar
without the execution or filing of any paper or any further act on the part of
the Indenture Trustee or such Note Registrar.

 

The Note Registrar shall maintain in the City
of Minneapolis an office or offices or agency or agencies where Notes may be
surrendered for registration of transfer or exchange.  The Note Registrar initially designates its
corporate trust office located at Sixth and Marquette, MAC N9311-161
Minneapolis, Minnesota 55479, Attention: Corporate Trust Administration as its
office for such purposes.  The Note
Registrar shall give prompt written notice to the Indenture Trustee, the Depositor,
the Administrator and the Noteholders (other than the Depositor) of any change
in the location of such office or agency.

 

Upon surrender for registration of transfer
of any Note at the office or agency of the Issuer to be maintained as provided
in Section 3.2, if the requirements of Section 8-401(a) of
the relevant UCC are met, the Issuer shall execute, the Indenture Trustee shall
upon receipt of a written order from the Issuer authenticate and (if the Note
Registrar is different from the Indenture Trustee, then the Note Registrar
shall) deliver to the Noteholder, in the name of the designated transferee or
transferees, one or more new Notes, in any authorized denominations and a like
aggregate principal amount.

 

At the option of the Noteholders, Notes may
be exchanged for other Notes in any authorized denominations, of the same class
and a like aggregate principal amount, upon 

 

surrender of
the Notes to be exchanged at such office or agency.  Whenever any Notes are so surrendered for
exchange, if the requirements of Section 8-401(a) of the relevant UCC
are met, the Issuer shall execute and the Indenture Trustee shall authenticate
and (if the Note Registrar is different from the Indenture Trustee, then the
Note Registrar shall) deliver to the Noteholder, the Notes which the Noteholder
making the exchange is entitled to receive.

 

All Notes issued upon any registration of
transfer or exchange of the Notes shall be the valid obligations of the Issuer,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Notes surrendered upon such registration of transfer or
exchange.

 

Every Note presented or surrendered for
registration of transfer or exchange shall be (i) duly endorsed by, or be
accompanied by a written instrument of Transfer in form satisfactory to the
Indenture Trustee duly executed by, the Noteholder or such Noteholder’s
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, the City of Minneapolis or the city in which the
Corporate Trust Office is located, or by a member firm of a national securities
exchange, and (ii) accompanied by such other documents as the Indenture
Trustee may require.  Each Note
surrendered for registration of transfer or exchange shall be cancelled by the
Note Registrar and disposed of by the Indenture Trustee or Note Registrar in
accordance with its customary practice. 
The Note Registrar shall notify promptly the Transfer Agent of any
Transfer of the Notes pursuant to this Section 2.3.

 

No service charge shall be made to a
Noteholder for any registration of transfer or exchange of the Notes, but the
Issuer may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges of Notes pursuant to Section 9.5
not involving any Transfer.

 

The preceding provisions of this Section notwithstanding,
the Issuer shall not be required to make, and the Note Registrar need not
register, Transfers of the Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment in full with respect
to such Note.

 

The Issuer hereby appoints the Indenture
Trustee as the Transfer Agent and the Indenture Trustee accepts such
appointment.

 

(b)     The
Notes may be Transferred, unless such Transfer would violate any of the
restrictions set forth in this subsection 2.3(b).  No Transfer may be made unless such Transfer
is made (x) either (i) pursuant to an effective registration under
the Securities Act of 1933, as amended (the “Securities Act”) and
applicable state securities or “Blue Sky” laws or (ii) in a transaction
exempt from the registration requirements of the Securities Act and applicable
state securities or “Blue Sky” laws and (y) to (1) a person who the
transferor reasonably believes is a Qualified Institutional Buyer (a “QIB”)
within the meaning thereof in Rule 144A under the Securities Act that is
aware that the resale or other transfer is being made in reliance on Rule 144A
or (2) a person who is an accredited investor as defined in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act.  The Notes may not be Transferred to (a) an
“employee benefit plan” (as defined in Section 3(3) of ERISA),
including governmental plans and church plans, (b) any 

 

 

“plan”
(as defined in Section 4975(e)(1) of the Code) including individual
retirement accounts and Keogh plans, or (c) any other entity whose
underlying assets include “plan assets” (within the meaning of Department of
Labor Regulation Section 2510.3-101, 29 C.F.R. § 2510.3-101 or otherwise
under ERISA) by reason of a plan’s investment in the entity, including, without
limitation, an insurance company general account.

 

Each potential transferee shall
be required to represent that it is not a retail competitor of Target. Prior to
any Transfer, the Noteholder must obtain the prior written consent of the
Transferor (which consent shall not be unreasonably withheld, it being
understood that it would be reasonable for the Transferor to withhold consent
if a proposed Transfer would cause the Issuer or the Master Trust to be treated
as an association (or publicly traded partnership) taxable as a corporation), except that such consent shall not be
required if the Transfer is to JPMorgan Chase & Co. or a wholly-owned
subsidiary of JPMorgan Chase & Co. 
Each Transfer shall be subject to the prior delivery to the Indenture
Trustee of (1) an Opinion of Counsel to the effect that, for U.S. federal
income tax purposes, (i) such action will not adversely affect the tax
characterization as debt of the Notes or the Investor Certificates of any
outstanding Series or Class that were characterized as debt at the
time of their issuance and (ii) following such action neither the Owner
Trust nor the Master Trust will be treated as an association (or publicly
traded partnership) taxable as a corporation and (2) a transferee
representation letter substantially in the form of Exhibit B
hereto.

 

Without limiting the generality
of the foregoing, the parties hereto acknowledge and agree that no pledge of
the Notes to a Federal Reserve Bank shall require either the consent of the
Transferor or the delivery of an Opinion of Counsel.  The Notes shall bear legends to the effect
set forth in Exhibit A.

 

None of the Transferor, the
Transfer Agent and Note Registrar, the Owner Trustee or the Indenture Trustee
is obligated to register the Note under the Securities Act or any other
securities or “Blue Sky” law or to take any other action not otherwise required
under this Indenture, the Series Supplement or the Pooling and Servicing
Agreement to permit the transfer of the Note without registration or as
described above.

 

SECTION 2.4         Mutilated, Destroyed, Lost or Stolen Notes.  If (i) any mutilated Note is surrendered
to the Note Registrar, or the Note Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Note, and (ii) there
is delivered to the Note Registrar and the Indenture Trustee such security or
indemnity as may be required by them to hold the Issuer, the Note Registrar and
the Indenture Trustee harmless, then, in the absence of notice to the Issuer,
the Note Registrar or the Indenture Trustee that such Note has been acquired by
a bona fide purchaser, and provided that the requirements of Section 8-405 of the
relevant UCC are met, the Issuer shall execute and the Indenture Trustee or an
Authenticating Agent shall authenticate and (if the Note Registrar is different
from the Indenture Trustee, the Note Registrar shall) deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement
Note of like tenor and denomination; provided that
if any such destroyed, lost or stolen Note, but not a mutilated Note, shall
have become or within seven days shall be due and payable, or shall have been
called for redemption, instead of issuing a replacement Note, the Issuer may
pay such destroyed, lost or stolen Note when so due or payable or upon the
Redemption Date without surrender thereof.

 

 

Upon the issuance of any replacement Note
under this Section, the Issuer may require the payment by the related
Noteholder of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other reasonable expenses
(including the fees and expenses of the Indenture Trustee, its agents and
counsel) connected therewith.

 

Every replacement Note issued pursuant to
this Section 2.4 in replacement of any mutilated, destroyed, lost
or stolen Note shall constitute an original additional contractual obligation
of the Issuer, whether or not the mutilated, destroyed, lost or stolen Note
shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Notes duly issued hereunder.

 

The provisions of this Section are
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes.

 

SECTION 2.5         Persons Deemed Owner.  Prior to due presentment for registration of
Transfer of any Note, the Issuer, the Indenture Trustee, the Note Registrar and
any agent of the Issuer, the Indenture Trustee or the Note Registrar may treat
the Person in whose name such Note is registered (as of the day of
determination) as the owner of such Note for the purpose of receiving payments
of principal of and interest, if any, on such Note and for all other purposes
whatsoever, whether or not such Note shall be overdue, and neither the Issuer,
the Indenture Trustee or the Note Registrar nor any agent of the Issuer, the
Indenture Trustee or the Note Registrar shall be bound by notice to the contrary.

 

SECTION 2.6         Payment of Principal and Interest.  (a)  On each Distribution Date, the
Paying Agent, acting in accordance with written instructions from the
Administrator, shall deposit, or shall direct the Master Trust Trustee to
deposit, in the Note Distribution Account the Available Amount for such
Distribution Date and the Paying Agent shall make the following distributions
to the extent of the Available Amount for such Distribution Date, in the
following order of priority:

 

(i)    to the Noteholders in respect of interest,
the Note Interest Requirement for such Distribution Date;

 

(ii)   to the Noteholders in respect of principal,
the Noteholders’ Principal Distributable Amount for such Distribution Date; and

 

(iii)  to the Certificateholder, on behalf of the
Issuer, the remaining Available Amount for such Distribution Date, if any;

 

provided, however, that the aggregate amounts payable under clause (i) on
any Distribution Date shall not exceed the aggregate amounts distributable to
the Collateral Certificateholder pursuant to subsection 5.1(a) of the Series Supplement
in respect of interest for such Distribution Date; and, provided,
further, that (A) so long as the
Indenture Trustee and the Master Trust Trustee are the same Person, the
distributions described above may be made directly by the Master Trust Trustee
in lieu of being deposited into the Note Distribution Account and, if so made,
such distributions shall be 

 

 

deemed to be made by the Paying Agent from the Note Distribution
Account and (B) amounts distributed directly to the Depositor, as
Certificateholder, pursuant to subsection 5.1(e) of the Series Supplement
shall be deemed to have been deposited by the Master Trust Trustee into the
Note Distribution Account and distributed by the Paying Agent to the Depositor
in its respective capacities as provided above.

 

(b)     All
principal and interest in respect of the Notes shall be due and payable to the
extent not previously paid on the Legal Maturity Date.

 

(c)     Any
installment of principal or interest, if any, payable on any Note which is
punctually paid or duly provided for by the Issuer on the applicable
Distribution Date shall be paid to the Person in whose name such Note (or one
or more Predecessor Notes) is registered on the preceding Record Date, by check
mailed first-class, postage prepaid or by wire transfer in immediately
available funds to the account designated by such nominee, except for the final
installment of principal payable with respect to such Note and except for the
Redemption Price for any Note called for redemption pursuant to Section 10.1,
which shall be payable as provided in subsection 2.6(d) below.  The funds represented by any such checks
returned undelivered shall be held in accordance with Section 3.3.

 

(d)     All
principal and interest payments on the Notes shall be made pro rata
to the Noteholders entitled thereto.  The
Paying Agent shall notify the Person in whose name a Note is registered at the
close of business on the Record Date immediately preceding the Distribution
Date on which the Issuer expects that the final installment of principal of and
interest on such Note will be paid.  Such
notice shall be mailed as provided in Section 10.2 not later than
three Business Days after such Record Date if the Notes are outstanding and shall
specify that such final installment will be payable only upon presentation and
surrender of such Note and shall specify the place where such Note may be
presented and surrendered for payment of such installment.

 

SECTION 2.7         Cancellation.  All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Note Registrar, be delivered to the Note Registrar and
shall be promptly cancelled by the Note Registrar.  The Issuer or the Depositor may at any time
deliver to the Note Registrar for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer or the Depositor may
have acquired in any manner whatsoever, including pursuant to subsection 17(a) of
the Note Purchase Agreement, and all Notes so delivered shall be promptly
cancelled by the Note Registrar.  No
Notes shall be authenticated in lieu of or in exchange for any Notes cancelled
as provided in this Section, except as expressly permitted by this Indenture. All
cancelled Notes may be held or disposed of by the Note Registrar in accordance
with its standard retention or disposal policy as in effect at the time unless
the Issuer shall direct that they be destroyed or returned to it; provided that
such direction is timely and the Notes have not been previously disposed of by
the Note Registrar.

 

SECTION 2.8         Authenticating Agent.  (a)  The Indenture Trustee may appoint
one or more authenticating agents (each, an “Authenticating Agent”) with
respect to the Notes which shall be authorized to act on behalf of the
Indenture Trustee in authenticating the Notes in connection with the issuance,
delivery, registration of transfer, exchange or repayment of the 

 

 

Notes.  The Indenture Trustee is hereby appointed as
initial Authenticating Agent for the authentication of the Notes upon any
registration of transfer or exchange of such Notes.  Whenever reference is made in this Indenture
to the authentication of the Notes by the Indenture Trustee or the Indenture
Trustee’s certificate of authentication, such reference shall be deemed to
include authentication on behalf of the Indenture Trustee by an Authenticating
Agent and a certificate of authentication executed on behalf of the Indenture
Trustee by an Authenticating Agent.

 

(b)     Any
institution succeeding to the corporate agency business of an Authenticating
Agent shall continue to be an Authenticating Agent without the execution or
filing of any paper or any further act on the part of the Indenture Trustee or
such Authenticating Agent.

 

(c)     An
Authenticating Agent may at any time resign by giving written notice of
resignation to the Indenture Trustee and the Issuer.  The Indenture Trustee may at any time
terminate the agency of an Authenticating Agent by giving notice of termination
to such Authenticating Agent and to the Issuer. 
Upon receiving such a notice of resignation or upon such a termination,
or in case at any time an Authenticating Agent shall cease to be acceptable to
the Indenture Trustee or the Issuer, the Indenture Trustee promptly may appoint
a successor Authenticating Agent with the consent of the Issuer.  Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. 
No successor Authenticating Agent shall be appointed unless acceptable
to the Issuer.

 

(d)     The
Administrator shall pay the Authenticating Agent from time to time reasonable
compensation for its services under this Section 2.8.

 

(e)     The
provisions of Sections 6.1, 6.2, 6.3, 6.4, 6.7
and 6.9 shall be applicable, mutatis mutandis,
to any Authenticating Agent.

 

(f)      Pursuant
to an appointment made under this Section 2.8, the Notes may
have endorsed thereon, in lieu of the Indenture Trustee’s certificate of
authentication, an alternate certificate of authentication in substantially the
following form:

 

This is one of the Notes referred to in the
within mentioned Indenture.

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Indenture Trustee

 

	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  or

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  as Authenticating Agent

  	
   

  	
   

  
	
   

  	
  for the Indenture Trustee,

  	
   

  	
   

  
							

 

 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Officer

  	
   

  	
   

  

 

 

SECTION 2.9         Defeasance.  On any date on which the following conditions
have been satisfied, the Notes will no longer be entitled to the security
interest of the Indenture Trustee in the Issuer’s right, title and interest in
and to the Collateral Certificate (including amounts distributable by the
Master Trust Trustee in respect thereof) and the Collateral Certificate shall
be released from the Lien of this Indenture: (i) the Issuer has deposited (x) into
the Note Principal Funding Account an amount equal to the Note Principal
Balance, (y) into the Noteholder Reserve Account an amount equal to the
Note Interest Requirement for the first Distribution Date in the Defeasance
Period and (z) if such deposit occurs prior to an Early Amortization
Commencement Date, into the Noteholder Reserve Account an amount equal to the Defeasance
Covered Amount, as estimated by the Administrator, for each Interest Accrual
Period in the Defeasance Period (other than the Interest Accrual Period related
to the first Distribution Date therein); (ii) the Issuer has delivered to
the Indenture Trustee an opinion of counsel to the effect that such deposit and
termination of obligations as described above will not result in the Issuer
being required to register as an “investment company” within the meaning of the
Investment Company Act of 1940, as amended, and an opinion of counsel to the
effect that following such deposit none of the Issuer, the Noteholder Reserve
Account or the Note Principal Funding Account will be deemed to be an
association (or a publicly traded partnership) taxable as a corporation; (iii) the
Issuer has delivered to the Indenture Trustee a certificate (which may be a
certificate from an officer of the Depositor) stating that the Issuer (or the
Depositor) reasonably believes that such deposit and the release of the lien of
the Indenture Trustee on the Collateral Certificate will not cause an Event of
Default or a Default to occur and (iv) the Note Purchaser has consented to
such defeasance pursuant to subsection 8(e) of the Note Purchase
Agreement; provided, that in any
case, the Noteholders shall not retain any rights under either of the Pooling
and Servicing Agreement or the Series Supplement if the Notes are defeased
pursuant to this Section 2.9, subject to Section 12.4 of the
Pooling and Servicing Agreement; provided,
further, that in any case, the Noteholders shall not retain any
rights under the Note Purchase Agreement if the Notes are defeased pursuant to
this Section 2.9, except as set forth in subsection 8(e) of
the Note Purchase Agreement.

 

SECTION 2.10       Appointment of Paying Agent.  (a)  The Indenture Trustee may appoint a
Paying Agent with respect to the Notes. 
The Indenture Trustee is hereby appointed as the initial Paying
Agent.  The Paying Agent shall have the
revocable power to withdraw funds from the Note Distribution Account and make
distributions to the Noteholders and the Certificateholders, pursuant to Section 2.6.  The Indenture Trustee may revoke such power
and remove the Paying Agent if the Indenture Trustee determines in its sole
discretion that the Paying Agent shall have failed to perform its obligations
under this Indenture in any material respect or for other good cause.  The Indenture Trustee may resign as Paying
Agent upon 30 days’ prior written notice to the Depositor.  In the event that the Indenture Trustee shall
no longer be the Paying Agent, the Indenture Trustee shall appoint a successor
to act as Paying Agent (which shall be a bank or trust company and may be a
successor Indenture Trustee) with the consent of the Depositor, which consent
shall not be unreasonably withheld.  If
at any time 

 

 

the Indenture
Trustee shall be acting as the Paying Agent, the provisions of Sections  6.1,
6.3 and 6.4 shall apply, mutatis mutandis,
to the Indenture Trustee in its role as Paying Agent.

 

The Indenture Trustee will cause each Paying
Agent, other than itself,  to execute and
deliver to the Indenture Trustee an instrument in which such Paying Agent shall
agree with the Indenture Trustee (and if the Indenture Trustee acts as Paying
Agent, it hereby so agrees), subject to the provisions of this Section, that
such Paying Agent will:

 

(i)    hold all sums held by it for the payment of
amounts due with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and pay such sums to such Persons as herein
provided;

 

(ii)   give the Indenture Trustee notice of any
default by the Issuer (or any other obligor upon the Notes) of which it has
actual knowledge in the making of any payment required to be made with respect
to the Notes;

 

(iii)  at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith pay to
the Indenture Trustee all sums so held in trust by such Paying Agent;

 

(iv)  immediately resign as a Paying Agent and
forthwith pay to the Indenture Trustee all sums held by it in trust for the
payment of the Notes if at any time it ceases to meet the standards required to
be met by the Paying Agent at the time of its appointment; and

 

(v)   comply with all requirements of the Code with
respect to the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any applicable
reporting requirements in connection therewith.

 

(b)     An
institution succeeding to the corporate agency business of the Paying Agent
shall continue to be the Paying Agent without the execution or filing of any
paper or any further act on the part of the Indenture Trustee or such Paying Agent.

 

SECTION 2.11       CUSIP Numbers.  The Issuer in issuing the Notes may use “CUSIP”
numbers (if then generally in use), and, if so, the Indenture Trustee shall use
“CUSIP” numbers in notices of redemption as a convenience to Noteholders; provided that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Notes or as contained in any notice of a redemption and that reliance
may be placed only on the other identification numbers printed on the Notes,
and any such redemption shall not be affected by any defect in or omission of
such numbers.  The Issuer will promptly
notify the Indenture Trustee of any change in the “CUSIP” numbers.

 

SECTION 2.12       Determination of LIBOR.

 

(a)     On
each LIBOR Determination Date, the Indenture Trustee shall determine LIBOR on
the basis of the rate for deposits in United States dollars for a one-month 

 

 

period
which appears on Reuters Screen LIBOR01 Page or on such comparable system
as is customarily used to quote LIBOR as of 11:00 a.m., London time, on
such date.  If such rate does not appear
on Reuters Screen LIBOR01 Page or on such comparable system as is
customarily used to quote LIBOR, the rate for that LIBOR Determination Date
shall be determined on the basis of the rates at which deposits in United
States dollars are offered by the Reference Banks at approximately 11:00 a.m.,
London time, on that day to prime banks in the London interbank market for a
one-month period.  The Indenture Trustee
shall request the principal London office of each of the Reference Banks to
provide a quotation of its rate.  If at
least two such quotations are provided, the rate for that LIBOR Determination
Date will be the arithmetic mean of the quotations.  If fewer than two quotations are provided as
requested, the rate for that LIBOR Determination Date will be the arithmetic
mean of the rates quoted by major banks in New York City, selected by the
Servicer, at approximately 11:00 a.m., New York City time, on that day for
loans in United States dollars to leading European banks for a one-month
period.

 

Notwithstanding the foregoing, LIBOR for the
initial Interest Accrual Period will be 2.49750%.

 

(b)     The
Indenture Trustee shall provide the Interest Rate applicable to the then
current and immediately preceding Interest Accrual Periods to any Noteholder
requesting such information by telephoning the Indenture Trustee at its
telephone number which is currently (612) 667-8058.

 

(c)     On
each LIBOR Determination Date prior to 12:00 noon New York City time, the
Indenture Trustee shall send to the Issuer, the Servicer and the Master Trust
Trustee by electronic mail or facsimile notification of LIBOR for the following
Interest Accrual Period.

 

ARTICLE III

 

COVENANTS

 

SECTION 3.1         Payment of Principal and Interest.  The Issuer will duly and punctually pay the
principal of and interest on the Notes in accordance with the respective terms
of the Notes and this Indenture.  Without
limiting the foregoing, the Issuer will cause to be distributed all amounts on
deposit in the Note Distribution Account on a Distribution Date deposited
therein pursuant to Section 2.6 and the Series Supplement (i) for
the benefit of the Notes, to the Noteholders and (ii) to the extent so
specified, to the Certificateholder. 
Amounts properly withheld under the Code by any Person from a payment to
any Noteholder of principal and/or interest shall be considered as having been
paid by the Issuer to such Noteholder for all purposes of this Indenture.

 

SECTION 3.2         Maintenance of Office or Agency.  The Issuer will maintain in the City of
Minneapolis an office or agency where Notes may be surrendered for registration
of transfer or exchange.  The Issuer
hereby initially appoints the Note Registrar to serve as its agent for the
foregoing purposes.   The Issuer will
give prompt written notice to the Indenture Trustee of the location, and of any
change in the location, of any such office or agency.  If at any time the 

 

 

Issuer shall fail to maintain
any such office or agency or shall fail to furnish the Indenture Trustee with
the address thereof, such surrenders, notices and demands may be made or served
at the Corporate Trust Office, and the Issuer hereby appoints the Indenture
Trustee as its agent to receive all such surrenders, notices and demands.

 

SECTION 3.3         Money for Payments To Be Held in Trust.  As provided in Section 8.2, all
payments of amounts due and payable with respect to any Notes that are to be
made from amounts withdrawn from the Note Distribution Account shall be made on
behalf of the Issuer by the Indenture Trustee or by a Paying Agent, and no
amounts so withdrawn from the Note Distribution Account or payments on the
Notes shall be paid over to the Issuer except as provided in this Section 3.3.

 

On or before each Distribution Date and
Redemption Date, subject to the proviso to subsection 2.6(a), the Master
Trust Trustee or the Paying Agent shall deposit or cause to be deposited in the
Note Distribution Account the Available Amount, such sum to be held in trust
for the benefit of the Persons entitled thereto and (unless the Paying Agent is
the Indenture Trustee) shall promptly notify the Indenture Trustee of its
action or failure so to act.

 

The Issuer may, at any time, for the purpose
of obtaining the satisfaction and discharge of this Indenture or for any other
purpose, direct any Paying Agent to pay to the Indenture Trustee all sums held
in trust by such Paying Agent, such sums to be held by the Indenture Trustee
upon the same trusts as those upon which the sums were held by such Paying
Agent; and upon such a payment by any Paying Agent to the Indenture Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.

 

Subject to applicable laws with respect to
the escheat of funds, any money held by the Indenture Trustee or any Paying
Agent in trust for the payment of any amount due with respect to any Note and
remaining unclaimed for two years after such amount has become due and payable
shall be discharged from such trust and be paid to the Issuer on its request;
and the related Noteholder shall thereafter, as an unsecured general creditor,
look only to the Issuer for payment thereof (but only to the extent of the amounts
so paid to the Issuer), and all liability of the Indenture Trustee or such
Paying Agent with respect to such trust money shall thereupon cease; provided that the Indenture Trustee or such Paying Agent,
before being required to make any such repayment, shall at the expense of the
Issuer cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in the City of New York, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Issuer.  The
Indenture Trustee shall also adopt and employ, at the expense of the Issuer,
any other reasonable means of notification of such repayment (including, but
not limited to, mailing notice of such repayment to the Noteholders whose Notes
have been called but have not been surrendered for redemption or whose right to
or interest in moneys due and payable but not claimed is determinable from the
records of the Indenture Trustee or of any Paying Agent, at the last address of
record for each such Noteholder).

 

SECTION 3.4         Existence.  Except as otherwise permitted by the provisions
of Section 3.10, the Issuer will keep in full effect its existence, rights
and franchises as a statutory 

 

 

trust under
the laws of the State of Delaware (unless it becomes, or any successor to the
Issuer hereunder is or becomes, organized under the laws of any other state or
of the United States of America, in which case the Issuer will keep in full
effect its existence, rights and franchises under the laws of such other
jurisdiction) and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Indenture, the Notes, the
Collateral and each other instrument and agreement included in the Owner Trust
Estate.

 

SECTION 3.5         Protection of Owner Trust Estate.  The Issuer will from time to time prepare (or
shall cause to be prepared), execute and deliver all such supplements and
amendments hereto and all such financing statements, continuation statements,
instruments of further assurance and other instruments, and will take such
other action necessary or advisable to:

 

(a)     maintain
or preserve the lien and security interest (and the priority thereof) of this
Indenture or carry out more effectively the purposes hereof;

 

(b)     perfect,
publish notice of or protect the validity of any Grant made or to be made by
this Indenture;

 

(c)     enforce
the rights of the Indenture Trustee and the Noteholders in any of the
Collateral; or

 

(d)     preserve
and defend title to the Owner Trust Estate and the rights of the Indenture
Trustee and the Noteholders in such Owner Trust Estate against the claims of
all persons and parties.

 

The Issuer hereby designates the Indenture
Trustee its agent and attorney-in-fact to execute any financing statement,
continuation statement or other instrument required to be filed by the
Indenture Trustee pursuant to this Section.

 

SECTION 3.6         Opinions as to Owner Trust Estate.  (a)  On the Closing Date, the Issuer
shall furnish to the Indenture Trustee an Opinion of Counsel either stating
that, in the opinion of such counsel, such action has been taken with respect
to the recording and filing of this Indenture, any indentures supplemental
hereto, and any other requisite documents, and with respect to the execution
and filing of any financing statements and continuation statements, as are
necessary to perfect and make effective the lien and security interest of this
Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.

 

(b)     On
or before March 31 of each calendar year, commencing with March 31,
2009, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been taken
with respect to the recording, filing, re-recording and refiling of this
Indenture, any indentures supplemental hereto and any other requisite documents
and with respect to the execution and filing of any financing statements and
continuation statements as are necessary to maintain the perfection of the lien
and security interest created by this Indenture and reciting the details of
such action or stating that in the opinion of such counsel no such action is
necessary to maintain the perfection of such lien 

 

 

and
security interest.  Such Opinion of
Counsel shall also describe the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be required
to maintain the perfection of the lien and security interest of this Indenture
until March 31 in the following calendar year.

 

SECTION 3.7         Performance of Obligations; Servicing of Collateral
Certificate.  (a)  The Issuer will not take any action
and will use its best efforts not to permit any action to be taken by others
that would release any Person from any of such Person’s material covenants or
obligations under any instrument or agreement included in the Owner Trust
Estate or that would result in the amendment, hypothecation, subordination,
termination or discharge of, or impair the validity or effectiveness of, any
such instrument or agreement, except as ordered by any bankruptcy or other
court or as expressly provided in this Indenture, any other Basic Documents or
such other instrument or agreement.

 

(b)     The
Issuer may contract with other Persons to assist it in performing its duties
under this Indenture, and any performance of such duties by a Person identified
to the Indenture Trustee in an Officer’s Certificate of the Issuer shall be
deemed to be action taken by the Issuer. 
Initially, the Issuer has contracted with the Administrator to assist
the Issuer in performing its duties under this Indenture.

 

(c)     The
Issuer will punctually perform and observe all of its obligations and
agreements contained in this Indenture, in the other Basic Documents and in the
instruments and agreements included in the Owner Trust Estate, including but
not limited to preparing (or causing to be prepared) and filing (or causing to
be filed) all UCC financing statements and continuation statements required to
be filed by the terms of this Indenture and the Deposit and Administration
Agreement in accordance with and within the time periods provided for herein
and therein.

 

(d)     If
the Issuer shall have knowledge of the occurrence of a Servicer Default under
the Pooling and Servicing Agreement, the Issuer shall promptly notify the
Indenture Trustee in accordance with Section 11.4, and shall
specify in such notice the action, if any, the Issuer is taking in respect of
such default.  If a Servicer Default
shall arise from the failure of the Servicer to perform any of its duties or
obligations under the Pooling and Servicing Agreement with respect to the
Collateral Certificate, the Issuer shall take all reasonable steps available to
it to remedy such failure.

 

SECTION 3.8         Negative Covenants. 
So long as any Notes are Outstanding, the Issuer shall not:

 

(a)     except
as expressly permitted by this Indenture or the other Basic Documents, sell,
transfer, exchange or otherwise dispose of any of the properties or assets of
the Issuer, including those included in the Owner Trust Estate, unless directed
to do so by the Indenture Trustee;

 

(b)     claim
any credit on, or make any deduction from the principal or interest payable in
respect of, the Notes (other than amounts properly withheld from such 

 

 

payments
under the Code) or assert any claim against any present or former Noteholder by
reason of the payment of the taxes levied or assessed upon any part of the
Owner Trust Estate; or

 

(c)     (i) 
permit the validity or effectiveness of this Indenture to be impaired, or
permit the lien of this Indenture to be amended, hypothecated, subordinated,
terminated or discharged, or permit any Person to be released from any
covenants or obligations with respect to the Notes under this Indenture except
as may be expressly permitted hereby, (ii) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance (other than the
lien of this Indenture) to be created on or extend to or otherwise arise upon
or burden the Owner Trust Estate or any part thereof or any interest therein or
the proceeds thereof (other than tax liens, mechanics’ liens and other liens
that arise by operation of law) or (iii) permit the lien of this Indenture
not to constitute a valid first priority (other than with respect to any such
tax, mechanics’ or other lien) security interest in the Owner Trust Estate.

 

SECTION 3.9         Annual Statement as to Compliance.  The Issuer will deliver to the Indenture
Trustee on or before March 31 of each year, commencing March 31, 2009
and otherwise in compliance with the requirements of TIA Section 314(a)(4),
an Officer’s Certificate stating, as to the Authorized Officer signing such
Officer’s Certificate, that:

 

(a)     a
review of the activities of the Issuer during such year and of performance
under this Indenture has been made under such Authorized Officer’s supervision;
and

 

(b)     to
the best of such Authorized Officer’s knowledge, based on such review, the
Issuer has complied with all conditions and covenants in all material respects
under this Indenture throughout such year, or, if there has been a default in
the compliance of any such condition or covenant, specifying each such default
known to such Authorized Officer and the nature and status thereof.

 

SECTION 3.10       The
Issuer May Consolidate, Etc. Only on Certain Terms.

 

(a)     The
Issuer shall not consolidate or merge with or into any other Person, unless all the Noteholders have provided
their prior written consent and:

 

(i)    the Person (if other than the Issuer) formed
by or surviving such consolidation or merger shall be a Person organized and
existing under the laws of the United States of America or any state thereof
and shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee,
the due and punctual payment of the principal of and interest on all the Notes
and the performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all as
provided herein;

 

(ii)   immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;

 

(iii)  the Issuer shall have received an Opinion of
Counsel (and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such 

 

 

transaction will not
have any material adverse tax consequence to the Issuer or any Noteholder;

 

(iv)  such entity is not subject to regulation as an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended;

 

(v)   any action as is necessary to maintain the
lien and security interest created by this Indenture shall have been taken; and

 

(vi)  the Issuer shall have delivered to the
Indenture Trustee an Officer’s Certificate and an Opinion of Counsel each stating
that such consolidation or merger and such supplemental indenture comply with
this subsection 3.10(a) and that all conditions precedent herein
provided for relating to such transaction have been complied with (including
any filing required by the Exchange Act).

 

(b)     Except
as otherwise expressly permitted by this Indenture or the other Basic
Documents, the Issuer shall not convey or transfer all or substantially all of
its properties or assets, including those included in the Owner Trust Estate,
to any Person, unless all the
Noteholders have provided their prior written consent and:

 

(i)    the Person that acquires by conveyance or
transfer the properties and assets of the Issuer the conveyance or transfer of
which is hereby restricted shall (A) be a United States citizen or a
Person organized and existing under the laws of the United States of America or
any state thereof, (B) expressly assume, by an indenture supplemental
hereto, executed and delivered to the Indenture Trustee, in form satisfactory
to the Indenture Trustee, the due and punctual payment of the principal of and
interest on all the Notes and the performance or observance of every agreement
and covenant of this Indenture on the part of the Issuer to be performed or
observed, all as provided herein, (C) expressly agree by means of such
supplemental indenture that all right, title and interest so conveyed or
transferred shall be subject and subordinate to the rights of the Noteholders,
and (D) unless otherwise provided in such supplemental indenture,
expressly agree to indemnify, defend and hold harmless the Issuer against and
from any loss, liability or expense arising under or related to this Indenture
and the Notes;

 

(ii)   immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;

 

(iii)  the Issuer shall have received an Opinion of
Counsel (and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such transaction will not have any material adverse tax consequence
to the Issuer, any Noteholder;

 

(iv)  any action as is necessary to maintain the
lien and security interest created by this Indenture shall have been taken; and

 

(v)   the Issuer shall have delivered to the
Indenture Trustee an Officers’ Certificate and an Opinion of Counsel each
stating that such conveyance or transfer and such supplemental indenture comply
with this subsection 3.10(b) and that all 

 

 

conditions precedent
herein provided for relating to such transaction have been complied with
(including any filing required by the Exchange Act).

 

SECTION 3.11       Successor
or Transferee.

 

(a)     Upon
any consolidation or merger of the Issuer in accordance with subsection
3.10(a), the Person formed by or surviving such consolidation or merger (if
other than the Issuer) shall succeed to, and be substituted for, and may
exercise every right and power of, the Issuer under this Indenture with the
same effect as if such Person had been named as the Issuer herein.

 

(b)     Upon
a conveyance or transfer of all the assets and properties of the Issuer in
accordance with subsection 3.10(b), Target Credit Card Owner Trust
2008-1 will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the Notes immediately
upon the delivery of written notice to the Indenture Trustee from the Person
acquiring such assets and properties stating that Target Credit Card Owner
Trust 2008-1 is to be so released.

 

SECTION 3.12       No Other Business. 
The Issuer shall not engage in any business other than financing,
purchasing, owning, selling and managing the Collateral Certificate in the
manner contemplated by this Indenture and the other Basic Documents, issuing
the Notes, making payments thereon, and such other activities that are
necessary, suitable or desirable to accomplish the foregoing or are incidental
to the purposes as set forth in Section 2.3 of the Trust Agreement.

 

SECTION 3.13       No Borrowing.  The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for money borrowed in respect of the Notes or in accordance
with the Basic Documents.

 

SECTION 3.14       Administrator’s Obligations.  The Issuer shall use its best efforts to
cause the Administrator to comply with the Deposit and Administration
Agreement.

 

SECTION 3.15       Guarantees, Loans, Advances and Other Liabilities.  Except as contemplated by the Deposit and
Administration Agreement or this Indenture, the Issuer shall not make any loan
or advance or credit to, or guarantee (directly or indirectly or by an
instrument having the effect of assuming another’s payment or performance on
any obligation or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire
(or agree contingently to do so) any stock, obligations, assets or securities
of, or any other interest in, or make any capital contribution to, any other
Person.

 

SECTION 3.16       Capital Expenditures.  The Issuer shall not make any expenditure (by
long-term or operating lease or otherwise) for capital assets (either realty or
personalty) other than the purchase of the Collateral Certificate and related
property pursuant to the Deposit and Administration Agreement.

 

SECTION 3.17       Restricted Payments.  The Issuer shall not, directly or indirectly,
(a) pay any dividend or make any distribution (by reduction of capital or
otherwise), 

 

 

whether in
cash, property, securities or a combination thereof, to the Owner Trustee or
any owner of a beneficial interest in the Issuer or otherwise with respect to
any ownership or equity interest or security in or of the Issuer, (b) redeem,
purchase, retire, or otherwise acquire for value any such ownership or equity
interest or security or (c) set aside or otherwise segregate any amounts
for any such purpose; provided that
the Issuer may make, or cause to be made, distributions to the Depositor, the
Owner Trustee, the Administrator, the Indenture Trustee and the Noteholders as
permitted by, and to the extent funds are available for such purpose under, the
Basic Documents.  The Issuer will not,
directly or indirectly, make payments to or distributions from the Note
Distribution Account except in accordance with this Indenture and the other
Basic Documents.

 

SECTION 3.18       Notice of Events of Default.  The Issuer agrees to give the Indenture
Trustee prompt (and in any event within five Business Days) written notice of
each Event of Default, Servicer Default and each default on the part of the
Depositor of its obligations under the Deposit and Administration Agreement; provided, that for so long as there are
outstanding securities issued by the Trust or a related owner trust that are
rated by a Rating Agency, notice pursuant to this Section 3.18
shall also be provided to such Rating Agency.

 

SECTION 3.19       Further Instruments and Acts.  The Issuer will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purpose of this Indenture.

 

SECTION 3.20       Removal of Administrator.  So long as any Notes are Outstanding, the
Issuer shall not remove the Administrator without cause.

 

SECTION 3.21       Representations and Warranties of the Issuer with Respect
to the Collateral Certificate.  The Issuer hereby represents and warrants to
the Indenture Trustee that as of the date hereof:

 

(a)     Valid
Security Interest.  This Indenture
creates a valid and continuing security interest (as defined in the applicable
UCC) in the Collateral Certificate in favor of the Indenture Trustee which
security interest is prior to all other liens and is enforceable as such
against the creditors of and purchasers from the Issuer.

 

(b)     Certificated
Security.  The Collateral Certificate
constitutes a “certificated security” within the meaning of the applicable UCC.

 

(c)     Good
Title.  Prior to the pledge to the
Indenture Trustee, the Issuer owns and has good and marketable title to the
Collateral Certificate free and clear of any Lien, claim or encumbrance of any
Person.

 

(d)     Delivery.  The sole original Collateral Certificate has
been delivered to the Indenture Trustee with an undated bond power covering the
Collateral Certificate, duly executed by the Issuer and endorsed in blank.

 

(e)     No
Other Pledge.  Other than the
security interested granted to the Indenture Trustee pursuant to this
Indenture, the Issuer has not pledged, assigned, sold, granted a security
interest in, or otherwise conveyed the Collateral Certificate.  The Issuer has not 

 

 

authorized
the filing of and is not aware of any financing statements against the Issuer
that include a description of collateral covering the Collateral Certificate
other than any financing statement relating to the security interest granted to
the Indenture Trustee hereunder.  The
Issuer is not aware of any judgment or tax lien filings against the
Issuer.  The Collateral Certificate has
no marks or notations indicating that it has been pledged, assigned or
otherwise conveyed by the Issuer to any Person other than the Indenture
Trustee.

 

ARTICLE IV

 

SATISFACTION AND DISCHARGE

 

SECTION 4.1         Satisfaction and Discharge of Indenture.  This Indenture shall cease to be of further
effect with respect to the Notes except as to (a) rights of registration
of transfer or exchange, (b) substitution of mutilated, destroyed, lost or
stolen Notes, (c) rights of Noteholders to receive payments of principal
thereof and interest thereon, (d) Sections  3.2, 3.3, 3.4,
3.5, 3.8, 3.10, 3.12, 3.13, 3.15, 3.16,
3.17, 3.18 and 3.19, (e) the rights, obligations and
immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.7 and the obligations of the
Indenture Trustee under Section 4.2) and (f) the rights of
Noteholders as beneficiaries hereof with respect to the property so deposited
with the Indenture Trustee payable to all or any of them, and the Indenture
Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, when,

 

(i)            either:

 

(A)      all Notes theretofore authenticated and
delivered (other than (1) the Notes that have been destroyed, lost or
stolen and that have been replaced or paid as provided in Section 2.4
and (2) the Notes for which payment money has theretofore been deposited
in trust or segregated and held in trust by the Issuer and thereafter repaid to
the Issuer or discharged from such trust, as provided in Section 3.3)
have been delivered to the Indenture Trustee for cancellation; or

 

(B)       all Notes not theretofore delivered to
the Indenture Trustee for cancellation (x) have become due and payable, (y) will
become due and payable within one year on the Legal Maturity Date, or (z) are
to be called for redemption pursuant to Article X and the Issuer
has irrevocably deposited or caused to be irrevocably deposited with the
Indenture Trustee cash or direct obligations of or obligations guaranteed by
the United States of America (which will mature prior to the date such amounts
are payable); in trust for such purpose, in an amount sufficient to pay and
discharge the entire unpaid principal and accrued interest on such Notes not
theretofore delivered to the Indenture Trustee for cancellation when due or on
the Redemption Date (if the Notes shall have been called for redemption
pursuant to Section 10.1), as applicable;

 

 

 

(ii)   the Issuer has paid or caused to be paid all
other sums payable hereunder by the Issuer; and

 

(iii)  the Issuer has delivered to the Indenture
Trustee an Officer’s Certificate, an Opinion of Counsel and (if required by the
TIA or the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements of Section 11.1
and each stating that all conditions precedent herein provided for relating to
the satisfaction and discharge of this Indenture have been complied with.

 

Notwithstanding the satisfaction and
discharge of this Indenture, the obligations of the Issuer to the Indenture
Trustee under Section 6.7 and, if money shall have been deposited
with the Indenture Trustee pursuant to subclause (B) of clause (i) of
this Section, the obligations of the Indenture Trustee under Section 4.2
and the last paragraph of Section 3.3 shall survive such
satisfaction and discharge.

 

SECTION 4.2         Application of Trust Money.  All moneys deposited with the Indenture
Trustee pursuant to subsection 4.1(i)(B) shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Noteholders for the payment or
redemption of the Notes for which such moneys have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and
interest; but such moneys need not be segregated from other funds except to the
extent required herein or in the Deposit and Administration Agreement or
required by law.

 

SECTION 4.3         Repayment of Moneys Held by Paying Agent.  In connection with the satisfaction and
discharge of this Indenture with respect to the Notes, all moneys then held by
any Paying Agent other than the Indenture Trustee under the provisions of this
Indenture with respect to such Notes shall, upon demand of the Issuer, be paid
to the Indenture Trustee to be held and applied according to Section 3.3
and thereupon such Paying Agent shall be released from all further liability
with respect to such moneys.

 

SECTION 4.4         No Revocation or Termination of Issuer Without Noteholder
Approval.  Notwithstanding anything herein to the
contrary, in no event shall the Indenture Trustee consent to the termination or
revocation of the Issuer pursuant to subsection 8.1(c) of the Trust
Agreement without the consent of the Holders of a majority of the Outstanding
Amount of the Notes, by Act of such Noteholders delivered to the Issuer and the
Indenture Trustee.

 

ARTICLE V

 

EVENTS OF DEFAULT AND REMEDIES

 

SECTION 5.1         Events of Default. 
“Event of Default”, wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):

 

 

(a)     the
failure by the Issuer to pay the Outstanding Note Principal Balance in full on
the Legal Maturity Date;

 

(b)     the
failure by the Issuer to pay all interest due on the Notes in full on the Legal
Maturity Date;

 

(c)     an
Insolvency Event occurs related to the Issuer or the Master Trust;

 

(d)     failure
on the part of the Issuer duly to observe or perform in any material respect
any covenants or agreements of the Issuer set forth herein, which failure has a
material adverse effect on the Noteholders and which continues unremedied for a
period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Issuer and the
Certificateholder by the Administrator or the Indenture Trustee, or to the
Issuer, the Certificateholder and the Indenture Trustee by the Holders of more
than 50% of the Outstanding Amount of the Notes and continues to affect
materially and adversely the interests of the Noteholders for such 60-day
period; and

 

(e)     the
Issuer is subject to regulation as an “investment company” within the meaning
of the Investment Company Act of 1940, as amended.

 

SECTION 5.2         Acceleration of Maturity; Rescission and Annulment.  If an Event of Default shall occur and be
continuing, then and in every such case the Indenture Trustee or the
Noteholders of not less than a majority of the Outstanding Amount of the Notes
may, if the Notes are not otherwise due and payable in full, declare all the
Notes to be immediately due and payable, by a notice in writing to the Issuer
and the Certificateholder (and to the Indenture Trustee if given by the
Noteholders), and upon any such declaration the unpaid principal amount of such
Notes, together with accrued and unpaid interest thereon through the date of
acceleration, if any, shall become immediately due and payable.

 

At any time after such declaration of
acceleration of maturity has been made and before a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article V provided, the Holders of a majority
of the Outstanding Amount of the Notes, by written notice to the Issuer, the
Certificateholder and the Indenture Trustee, may rescind and annul such
declaration and its consequences; provided that
no such rescission shall (i) terminate the Early Amortization Period under
the Series Supplement or its effects, or (ii) affect any subsequent
default or impair any right consequent thereto.

 

SECTION 5.3         Collection of Indebtedness and Suits for Enforcement by
the Indenture Trustee.  (a)  The Issuer covenants that if (i) an
Event of Default described in subsection 5.1(b) occurs such that a
default is made in the payment of any interest on any Note when the same
becomes due and payable at the times specified in subsection 5.1(b), or (ii) default
is made in the payment in full of the principal of any Outstanding Note on the
Legal Maturity Date, the Issuer will, upon demand of the Indenture Trustee, pay
to it, for the benefit of the Holders of Outstanding Notes, the whole amount
then due and payable on such Outstanding Notes for principal and interest, with
interest at the applicable Interest Rate upon the overdue principal, and, to
the extent payment at such rate of interest shall be legally enforceable, upon
overdue installments of interest, at the applicable Interest Rate borne by the
Notes.

 

(b)     In
case the Issuer shall fail forthwith to pay such amounts upon such demand, the
Indenture Trustee, in its own name and as trustee of an express trust, may
institute a proceeding for the collection of the sums so due and unpaid, and
may prosecute such proceeding to judgment or final decree, and may enforce the
same against the Issuer or other obligor upon such Notes and collect in the
manner provided by law out of the property of the Issuer or other obligor upon
such Notes, wherever situated, the moneys adjudged or decreed to be due and
payable.

 

(c)     If
an Event of Default occurs and is continuing, the Indenture Trustee may, as
more particularly provided in Section 5.4, in its discretion,
proceed to protect and enforce its rights and the rights of the Noteholders, by
such appropriate proceedings as the Indenture Trustee shall deem most effective
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy or legal or equitable
right vested in the Indenture Trustee by this Indenture or by law.

 

(d)     In
case there shall be pending, relative to the Issuer or any other obligor upon
the Notes or any Person having or claiming an ownership interest in the Owner
Trust Estate, proceedings under Title 11 of the United States Code or any other
applicable Federal or state bankruptcy, insolvency or other similar law, or in
case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in the case of any other comparable judicial proceedings relative to the
Issuer or other obligor upon the Notes, or to the creditors or property of the
Issuer or such other obligor, the Indenture Trustee, irrespective of whether
the principal of any Notes shall then be due and payable as therein expressed
or by declaration or otherwise and irrespective of whether the Indenture
Trustee shall have made any demand pursuant to the provisions of this Section,
shall be entitled and empowered, by intervention in such proceedings or
otherwise:

 

(i)    to file and prove a claim or claims for the
whole amount of principal and interest owing and unpaid in respect of the Notes
and to file such other papers or documents as may be necessary or advisable in
order to have the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee and each predecessor Indenture
Trustee, and their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and all advances made,
by the Indenture Trustee and each predecessor Indenture Trustee, except as a
result of negligence, bad faith or willful misconduct) and of the Noteholders
allowed in such proceedings;

 

(ii)   unless prohibited by applicable law and
regulations, to vote on behalf of the Noteholders in any election of a trustee,
a standby trustee or person performing similar functions in any such
proceedings;

 

(iii)  to collect and receive any moneys or other
property payable or deliverable on any such claims and to distribute all
amounts received with respect to the claims of the Noteholders and of the
Indenture Trustee on their behalf; and

 

 

(iv)  to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of
the Indenture Trustee or the Noteholders allowed in any judicial proceedings
relative to the Issuer, its creditors and its property;

 

and any trustee, receiver,
liquidator, custodian or other similar official in any such proceeding is
hereby authorized by each of such Noteholders to make payments to the Indenture
Trustee, and, in the event that the Indenture Trustee shall consent to the
making of payments directly to such Noteholders, to pay to the Indenture
Trustee such amounts as shall be sufficient to cover reasonable compensation to
the Indenture Trustee, each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and liabilities incurred,
and all advances made, by the Indenture Trustee and each predecessor Indenture
Trustee except as a result of negligence, bad faith or willful misconduct.

 

(e)     Nothing
herein contained shall be deemed to authorize the Indenture Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any
Noteholder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Noteholder or to authorize the
Indenture Trustee to vote in respect of the claim of any Noteholder in any such
proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar person.

 

(f)      All
rights of action and of asserting claims under this Indenture, or under any of
the Notes, may be enforced by the Indenture Trustee without the possession of
any of the Notes or the production thereof in any trial or other proceedings
relative thereto, and any such action or proceedings instituted by the
Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Noteholders, subject to the payment priorities described
below.

 

(g)     In
any proceedings brought by the Indenture Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Indenture Trustee shall be a party), the Indenture Trustee shall be held to
represent all of the Noteholders, and it shall not be necessary to make any
Noteholder a party to any such proceedings.

 

SECTION 5.4         Remedies; Priorities.  (a)  If an Event of Default shall have
occurred and be continuing and the Notes have been accelerated under Section 5.2,
the Indenture Trustee may do one or more of the following (subject to Section 5.5):

 

(i)    institute proceedings in its own name and as
trustee of an express trust for the collection of all amounts then payable on
the Notes or under this Indenture with respect thereto, whether by declaration
or otherwise, enforce any judgment obtained, and collect from the Issuer and
any other obligor upon such Notes moneys adjudged due;

 

(ii)   institute proceedings from time to time for
the complete or partial foreclosure of this Indenture with respect to the Owner
Trust Estate;

 

 

(iii)  exercise any remedies of a secured party under
the relevant UCC and take any other appropriate action to protect and enforce
the rights and remedies of the Indenture Trustee and the Noteholders; and

 

(iv)  sell the Owner Trust Estate or any portion
thereof or rights or interest therein, at one or more public or private sales
called and conducted in any manner permitted by law;

 

provided
that the Indenture Trustee may not sell or otherwise liquidate the Owner Trust
Estate following an Event of Default, unless (A) the Holders of 100% of
the Outstanding Amount of the Notes consent thereto, (B) the proceeds of
such sale or liquidation distributable to the Noteholders are sufficient to
discharge in full all amounts then due and unpaid upon such Outstanding Notes
for principal and interest, or (C)(1) there has been an Event of Default
described in subsections 5.1(a) or (b), (2) the
Indenture Trustee determines that the Owner Trust Estate will not continue to
provide sufficient funds for the payment of principal of and interest on the
Outstanding Notes as they would have become due if the Notes had not been
declared due and payable, and (3) the Indenture Trustee obtains the
consent of Holders of 66-2/3% of the Outstanding Amount of the Notes.  In determining such sufficiency or
insufficiency with respect to clauses (B) and (C), the
Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the Owner
Trust Estate for such purpose.  In
addition, the Indenture Trustee may sell or otherwise liquidate the portion of
the Owner Trust Estate consisting of the Collateral Certificate only in accordance
with and upon satisfaction of the requirements of Section 9.4 of the Series Supplement.

 

(b)     If
the Indenture Trustee collects any money or property pursuant to this Article V,
it shall pay out such money or property held as Collateral for the benefit of
the Noteholders in the following order:

 

FIRST:  to Noteholders for amounts due and unpaid on
the Notes for interest and principal, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Notes for interest
and principal;

 

SECOND:  to the Issuer for payment of all liabilities
of the Issuer in accordance with the Basic Documents and applicable law; and

 

THIRD:  to the Certificateholder.

 

The Indenture Trustee may, upon notification
to the Issuer, fix a record date and Distribution Date for any payment to
Noteholders pursuant to this Section.  At
least fifteen (15) days before such record date, the Indenture Trustee shall
mail or send by facsimile to each Noteholder a notice that states the record
date, the Distribution Date and the amount to be paid.

 

SECTION 5.5         Optional Preservation of the Owner Trust Estate.  If the Notes have been declared to be due and
payable under Section 5.2 following an Event of Default and such
declaration and its consequences have not been rescinded and annulled, the
Indenture Trustee may, but need not, elect to maintain possession of the Owner
Trust Estate.  It is the desire of the
parties hereto and the Noteholders that there be at all times sufficient funds
for the 

 

 

payment of principal
of and interest on the Notes, and the Indenture Trustee shall take such desire
into account when determining whether to maintain possession of the Owner Trust
Estate.  In determining whether to
maintain possession of the Owner Trust Estate, the Indenture Trustee may, but
need not, obtain and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Owner Trust Estate for such purpose.

 

SECTION 5.6         Limitation of Suits. 
No Noteholder shall have any right to institute any proceeding, judicial
or otherwise, with respect to this Indenture, or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless:

 

(a)     such
Noteholder has previously given written notice to the Indenture Trustee of a
continuing Event of Default;

 

(b)     the
Holders of not less than 25% of the Outstanding Amount of the Notes have made
written request to the Indenture Trustee to institute such proceeding in
respect of such Event of Default in its own name as the Indenture Trustee
hereunder;

 

(c)     such
Noteholder has or Noteholders have offered to the Indenture Trustee indemnity
reasonably satisfactory to it against the costs, expenses and liabilities to be
incurred in complying with such request;

 

(d)     the
Indenture Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute such proceedings; and

 

(e)     no
direction inconsistent with such written request has been given to the
Indenture Trustee during such 60-day period by the Holders of a majority of the
Outstanding Amount of the Notes;

 

it being understood and
intended that no one or more Noteholders shall have any right in any manner
whatever by virtue of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other Noteholder or to obtain or
to seek to obtain priority or preference over any other Noteholder or to
enforce any right under this Indenture, except in the manner herein provided.

 

In the event the Indenture Trustee shall
receive conflicting or inconsistent requests and indemnity from two or more
groups of Noteholders, each holding less than a majority of the Outstanding
Amount of the Notes, the Indenture Trustee in its sole discretion may determine
what action, if any, shall be taken, notwithstanding any other provisions of
this Indenture.

 

SECTION 5.7         Unconditional Rights of Noteholders To Receive Principal
and Interest.  Notwithstanding any other provisions in this
Indenture, each Noteholder shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, if any, on
any Note held by it on or after the respective due dates thereof expressed in
such Note or in this Indenture (or, in the case of redemption, on or after the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such Noteholder.

 

 

SECTION 5.8         Restoration of Rights and Remedies.  If the Indenture Trustee or any Noteholder
has instituted any Proceeding to enforce any right or remedy under this
Indenture and such Proceeding has been discontinued or abandoned for any reason
or has been determined adversely to the Indenture Trustee or to such
Noteholder, then and in every such case the Issuer, the Indenture Trustee and
the Noteholders shall, subject to any determination in such Proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Indenture Trustee and the Noteholders
shall continue as though no such proceeding had been instituted.

 

SECTION 5.9         Rights and Remedies Cumulative.  No right or remedy herein conferred upon or
reserved to the Indenture Trustee or to the Noteholders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other right
and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise.  The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.

 

SECTION 5.10       Delay or Omission Not a Waiver.  No delay or omission of the Indenture Trustee
or any Noteholder in exercising any right or remedy accruing upon any Default
or Event of Default shall impair any such right or remedy or constitute a
waiver of any such Default or Event of Default or an acquiescence therein.  Every right and remedy given by this Article V
or by law to the Indenture Trustee or to the Noteholders may be exercised from
time to time, and as often as may be deemed expedient, by the Indenture Trustee
or by the Noteholders, as the case may be.

 

SECTION 5.11       Control by Noteholders.  The Holders of a majority of the Outstanding
Amount of the Notes shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Indenture Trustee
with respect to the Notes or exercising any trust or power conferred on the
Indenture Trustee; provided that:

 

(a)     such
direction shall not be in conflict with any applicable law or with this
Indenture;

 

(b)     subject
to the express terms of Section 5.4, any direction to the Indenture
Trustee to sell or liquidate the Owner Trust Estate shall be by Holders of not
less than 100% of the Outstanding Amount of the Notes;

 

(c)     if
the conditions set forth in Section 5.5 have been satisfied and the
Indenture Trustee elects to retain the Owner Trust Estate pursuant to such
Section, then any direction to the Indenture Trustee by Holders representing
less than 100% of the Outstanding Amount of the Notes to sell or liquidate the
Owner Trust Estate shall be of no force and effect;

 

(d)     the
Indenture Trustee may take any other action deemed necessary by the Indenture
Trustee that is not inconsistent with such direction; and

 

(e)     such
direction shall be in writing;

 

 

provided,
further, that, subject to Section 6.1,
the Indenture Trustee need not take any action that it determines might involve
it in liability (unless indemnified pursuant to subsection 6.2(g)) or
might materially adversely affect the rights of any Noteholders not consenting
to such action but who otherwise have a right to consent to such action prior
to such action being taken.

 

SECTION 5.12       Waiver of Past Defaults.  Prior to the declaration of the acceleration
of the Notes as provided in Section 5.2, the Holders of not less
than a majority of the Outstanding Amount of the Notes may, on behalf of all
such Noteholders, waive any past Default or Event of Default and its
consequences except a Default (a) in payment of principal of or interest
on any of the Notes or (b) in respect of a covenant or provision hereof
which cannot be modified or amended without the consent of each
Noteholder.  In the case of any such
waiver, the Issuer, the Indenture Trustee and the Noteholders shall be restored
to their former positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereto.

 

Upon any such waiver, such Default shall
cease to exist and be deemed to have been cured and not to have occurred, and
any Event of Default arising therefrom shall be deemed to have been cured and
not to have occurred, for every purpose of this Indenture; but no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereto.  For so
long as there are outstanding securities issued by the Trust or a related owner
trust that are rated by a Rating Agency, the Issuer shall give prompt written
notice of any waiver to such Rating Agency.

 

SECTION 5.13       Undertaking for Costs.  All parties to this Indenture agree, and each
Noteholder by such Noteholder’s acceptance of a Note shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as the
Indenture Trustee, the filing by any party litigant in such Proceeding of an
undertaking to pay the costs of such Proceeding, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys’ fees and
expenses, against any party litigant in such Proceeding, having due regard to
the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section shall not apply to (a) any
suit instituted by the Indenture Trustee, (b) any suit instituted by any
Noteholder or group of Noteholders, in each case holding in the aggregate more
than 10% of the Outstanding Amount of the Notes, or (c) any suit
instituted by any Noteholder for the enforcement of the payment of principal of
or interest on any Note on or after the respective due dates expressed in such
Note and in this Indenture (or, in the case of redemption, on or after the
Redemption Date).

 

SECTION 5.14       Waiver of Stay or Extension Laws.  The Issuer covenants (to the extent that it
may lawfully do so) that it will not at any time insist upon, or plead or in
any manner whatsoever, claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Issuer (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Indenture Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.

 

 

SECTION 5.15       Action on Notes. 
The Indenture Trustee’s right to seek and recover judgment on the Notes
or under this Indenture shall not be affected by the seeking, obtaining or
application of any other relief under or with respect to this Indenture.  Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against the
Issuer or by the levy of any execution under such judgment upon any portion of
the Owner Trust Estate or upon any of the assets of the Issuer.  Any money or property collected by the
Indenture Trustee shall be applied in accordance with subsection 5.4(b).

 

SECTION 5.16       Performance and Enforcement of Certain Obligations.  The Issuer agrees to take all such lawful
action as is necessary to compel or secure the performance and observance by
the Depositor and the Administrator, as applicable, of each of their respective
obligations to the Issuer under or in connection with the Deposit and
Administration Agreement in accordance with the terms thereof, and to exercise
any and all rights, remedies, powers and privileges lawfully available to the
Issuer under or in connection with the Deposit and Administration Agreement,
including the transmission of notices of default on the part of the Depositor
or the Administrator thereunder and the institution of legal or administrative
actions or proceedings to compel or secure performance by the Depositor or the
Administrator of each of their respective obligations under the Deposit and
Administration Agreement.

 

SECTION 5.17       Sale of Owner Trust Estate.

 

(a)     The
method, manner, time, place and terms of any sale of Owner Trust Estate (or
portion thereof) pursuant to subsection 5.4(a)(iv) shall be
commercially reasonable.  The Indenture
Trustee may, from time to time, postpone any sale by public announcement made
at the time and place of such sale.  The
Indenture Trustee hereby expressly waives its right to any amount fixed by law
as compensation for any sale.

 

(b)     The
Indenture Trustee is hereby irrevocably appointed the agent and
attorney-in-fact of the Issuer in connection with any sale of the Owner Trust
Estate (or any portion thereof) pursuant to subsection 5.4(a)(iv).  No purchaser or transferee at any such sale
shall be bound to ascertain the Indenture Trustee’s authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
monies.

 

(c)     In
its exercise of the foreclosure remedy pursuant to subsection 5.4(a)(iv),
the Indenture Trustee shall solicit, or cause to be solicited, bids from
prospective purchasers for the Owner Trust Estate (or portions thereof).  The Indenture Trustee shall sell the Owner
Trust Estate (or portions thereof) to the bidder with the highest cash purchase
offer.  The proceeds of any such sale
shall be applied in accordance with subsection 5.4(b).

 

(d)     Prior
to its exercise of the foreclosure remedy pursuant to subsection 5.4(a)(iv),
the Indenture Trustee shall provide written notice to the Transferor of its
intent to exercise such remedy, including the date and time by which bids
solicited pursuant to subsection 5.17(c) are due.

 

(e)     In
connection with the Indenture Trustee’s exercise of its rights under this Section 5.17,
the Indenture Trustee may retain independent auditors and other experts 

 

 

and
shall be entitled to conclusively rely upon the determination of any such
independent auditors or other experts appointed with due care.

 

ARTICLE VI

 

THE INDENTURE
TRUSTEE

 

SECTION 6.1         Duties of the Indenture Trustee.  (a)  The Indenture Trustee, both prior
to and after the occurrence of an Event of Default, shall undertake to perform
such duties and only such duties as are specifically set forth in this
Indenture and the Deposit and Administration Agreement.  If an Event of Default actually known to the
Indenture Trustee has occurred and is continuing, the Indenture Trustee shall
exercise the rights and powers vested in it by this Indenture and the Deposit
and Administration Agreement and use the same degree of care and skill in its
exercise of such rights and powers as a prudent person would exercise or use
under the circumstances in the conduct of such person’s own affairs; provided, however, that
if the Indenture Trustee shall assume the duties of the Administrator pursuant
to Section 5.1 of the Deposit and Administration Agreement, the
Indenture Trustee in performing such duties shall use the degree of skill and
attention customarily exercised by an administrator with respect to a similar
trust estate that it administers for itself.

 

The Indenture Trustee, upon receipt of any
resolutions, certificates, statements, opinions, reports, documents, orders, or
other instruments furnished to the Indenture Trustee that shall be specifically
required to be furnished pursuant to any provision of this Indenture or the
Deposit and Administration Agreement, shall examine them to determine whether
they substantially conform to the requirements of this Indenture or the Deposit
and Administration Agreement; provided, however, that the Indenture Trustee shall not be responsible
for the accuracy or content of any such resolution, certificate, statement,
opinion, report, document, order or other instrument furnished by the
Administrator to the Indenture Trustee pursuant to this Indenture or the
Deposit and Administration Agreement and the Indenture Trustee need not confirm
or investigate the accuracy of any mathematical calculations or other facts
stated therein.

 

(b)     No
provision of this Indenture shall be construed to relieve the Indenture Trustee
from liability for its own negligent action, its own negligent failure to act
or its own bad faith or willful misconduct; provided, however,
that:

 

(i)    prior to the occurrence of an Event of
Default, and after the curing of all such Events of Default, the Indenture
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and the Deposit and Administration
Agreement, and no implied covenants or obligations shall be read into this
Indenture or the Deposit and Administration Agreement against the Indenture
Trustee, and in the absence of bad faith on its part or manifest error, the
Indenture Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the requirements
of this Indenture or the Deposit and Administration Agreement;

 

 

(ii)   the Indenture Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the pertinent
facts nor shall the Indenture Trustee be liable with respect to any action it
takes or omits to take in good faith in accordance with this Indenture or in accordance
with a direction received by it pursuant to Section 5.11; and

 

(iii)  the Indenture Trustee shall  not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority of the Outstanding Amount of the Notes
(or larger percentage(s)), determined as provided in Sections 5.2, 5.4
and 5.11, relating to the time, method and place of conducting any
proceeding for any remedy available to the Indenture Trustee, or exercising any
trust or power conferred upon the Indenture Trustee, under this Indenture with
respect to the Notes or the Certificate.

 

(c)     The
Indenture Trustee shall not be liable for interest on any money received by it
except as the Indenture Trustee may agree in writing with the Issuer.

 

(d)     Money
held in trust by the Indenture Trustee need not be segregated from other funds
except to the extent required by law or the terms of this Indenture or the
Deposit and Administration Agreement.

 

(e)     No
provision of this Indenture shall require the Indenture Trustee to expend or
risk its own funds or otherwise incur financial liability in the performance of
any of its duties hereunder or in the exercise of any of its rights or powers,
if it shall have reasonable grounds to believe that repayment of such funds or
indemnity satisfactory to it against such risk or liability is not assured to
it, and none of the provisions contained in this Indenture shall in any event
require the Indenture Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Administrator under this
Indenture except during such time, if any, as the Indenture Trustee shall be
the successor to, and be vested with the rights, duties, powers and privileges
of, the Administrator in accordance with the terms of the Deposit and
Administration Agreement.

 

(f)      Except
for actions expressly authorized by this Indenture or, based upon an Opinion of
Counsel, in the best interests of the Noteholders, the Indenture Trustee shall
take no action reasonably likely to impair the security interests created or
existing under any asset which is part of the Collateral or to impair the value
of any asset which is part of the Collateral.

 

(g)     Every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Indenture Trustee shall be subject to the
provisions of this Section and to the provisions of the TIA.

 

SECTION 6.2         Rights of the Indenture Trustee.  (a)  The Indenture Trustee may conclusively
rely on any document (whether in its original or facsimile form) believed by it
to be genuine and to have been signed or presented by the proper person.  The Indenture Trustee need not investigate
any fact or matter stated in the document.

 

 

(b)     Before
the Indenture Trustee acts or refrains from acting, it may require an Opinion
of Counsel.  The Indenture Trustee shall
not be liable for any action it takes, suffers or omits to take in good faith
in reliance on the Opinion of Counsel.

 

(c)     The
Indenture Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys or a
custodian or nominee, and the Indenture Trustee shall not be responsible for
any misconduct or negligence on the part of, or for the supervision of, any
such agent, attorney, custodian or nominee appointed with due care by it
hereunder.  The Indenture Trustee shall
have no duty to monitor the performance of the Issuer.

 

(d)     The
Indenture Trustee shall not be personally liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, that the Indenture
Trustee’s conduct does not constitute willful misconduct, negligence or bad
faith.

 

(e)     The
Indenture Trustee may consult with counsel of its own selection, and the
written advice or opinion of counsel with respect to legal matters relating to
this Indenture and the Notes shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered
by it hereunder in good faith and in accordance with the written advice or
opinion of such counsel.  A copy of such
written advice or Opinion of Counsel shall be provided to the Depositor or the
Administrator.

 

(f)      Prior
to the occurrence of an Event of Default and after the curing of all Events of
Default that may have occurred, the Indenture Trustee shall not be bound to
make any investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, or other paper or document, unless requested in writing to do
so by Holders of not less than 25% of the Outstanding Amount of the Notes; provided, however, that
if the payment within a reasonable time to the Indenture Trustee of the costs,
expenses, or liabilities likely to be incurred by it in the making of such
investigation shall be, in the opinion of the Indenture Trustee, not reasonably
assured to the Indenture Trustee by the security afforded to it by the terms of
this Indenture, the Indenture Trustee may require reasonable indemnity
satisfactory to it against such cost, expense, or liability or payment of such
expenses as a condition precedent to so proceeding.  If the Indenture Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Issuer, personally or by agent or attorney
at the sole cost of the Issuer and shall incur no liability or additional
liability of any kind by reason of such inquiry or investigation.  Nothing in this clause (f) shall affect
the obligation of the Issuer or the Administrator to observe any applicable law
prohibiting disclosure of information regarding the obligors.

 

(g)     The
Indenture Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
Noteholders pursuant to this Indenture, unless such Noteholders shall have
offered to the Indenture Trustee security or indemnity satisfactory to the
Indenture Trustee against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.

 

(h)     The
Indenture Trustee shall not be deemed to have notice or knowledge of any
Default or Event of Default unless a Responsible Officer of the Indenture
Trustee has actual knowledge thereof or unless written notice of any event
which is in fact such a default is received by the Indenture Trustee at the
Corporate Trust Office of the Indenture Trustee, and such notice references the
Notes and this Indenture.

 

(i)      The
rights, privileges, protections, immunities and benefits given the Indenture
Trustee, including, without limitation, its right to be indemnified are
extended to, and shall be enforceable by, the Indenture Trustee in each of its
capacities hereunder, and to each agent, custodian and other Person employed to
act hereunder.

 

SECTION 6.3         Individual Rights of the Indenture Trustee.  The Indenture Trustee in its individual or
any other capacity may become the owner or pledgee of Notes and may otherwise
deal with the Issuer or its Affiliates with the same rights it would have if it
were not the Indenture Trustee; provided, however, that the Indenture Trustee shall take no such
action that shall cause it to no longer meet the requirements of Rule 3(a)-7(a)(4)(i) under
the Investment Company Act of 1940, as amended (the “Investment Company Act”).  Any Paying Agent, the Note Registrar,
co-registrar or co-paying agent may do the same with like rights.  The Indenture Trustee shall in any event
comply with Sections 6.11 and 6.12.

 

SECTION 6.4         The Indenture Trustee’s Disclaimer.  The Indenture Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Notes, shall not be accountable for the Issuer’s use of
the proceeds from the Notes, and shall not be responsible for any statement of
the Issuer in the Indenture or in any document issued in connection with the
sale of the Notes or in the Notes other than the Indenture Trustee’s
certificate of authentication.

 

SECTION 6.5         Notice of Defaults.  If a Default occurs and is continuing and if
it is either actually known or written notice of the existence thereof has been
delivered to a Responsible Officer of the Indenture Trustee, the Indenture
Trustee shall mail to each Noteholder notice of the Default within 90 days
after such knowledge or notice occurs. 
Except in the case of a Default in accordance with the provisions of Section 313(c) of
the TIA in payment of principal of or interest on any Note (including payments
pursuant to the mandatory redemption provisions of such Note), the Indenture
Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interest of the Noteholders.

 

SECTION 6.6         Reports by the Indenture Trustee to Holders.  Within the prescribed period of time for tax
reporting purposes after the end of each calendar year during the term of this
Indenture, the Indenture Trustee shall deliver to each Holder such information
as may be reasonably required to enable such Holder to prepare its United
States federal, state and local income or franchise tax returns for such
calendar year.  At the request of the
Holders, the Indenture Trustee shall request any reports available to
Certificateholders from the Servicer under the Pooling and Servicing Agreement
and shall deliver such reports received from the Servicer to the Holders making
such request.

 

 

SECTION 6.7         Compensation and Indemnity.  The Issuer shall cause the Administrator
pursuant to the Deposit and Administration Agreement to pay to the Indenture
Trustee from time to time such compensation as agreed upon from time to time
for its services.  The Indenture Trustee’s
compensation shall not be limited by any law on compensation of a trustee of an
express trust.  The Issuer shall cause
the Administrator pursuant to the Deposit and Administration Agreement to
reimburse the Indenture Trustee for all out-of-pocket expenses incurred or made
by it, including costs of collection, in addition to the compensation for its
services.  Such expenses shall include
the reasonable compensation and expenses, disbursements and advances of the
Indenture Trustee’s agents, counsel, accountants and experts.  The Issuer shall cause the Administrator
pursuant to the Deposit and Administration Agreement to fully indemnify the
Indenture Trustee and any predecessor Indenture Trustee against any and all
loss, liability, claim, damage or expense (including the fees and expenses of
outside counsel) incurred by it in connection with the acceptance and
administration of this trust including costs and expenses of defending itself
against any claim (whether asserted by the Issuer or any Holder or any other
Person) or liability in connection with the performance of its duties
hereunder.  The Indenture Trustee shall,
upon a Responsible Officer obtaining actual knowledge thereof, notify the
Issuer and the Administrator promptly of any claim for which it may seek
indemnity.

 

The Administrator’s payment obligations to
the Indenture Trustee pursuant to this Section shall survive the discharge
of this Indenture.  When the Indenture
Trustee incurs expenses after the occurrence of a Default specified in subsection
5.1(c) with respect to the Issuer, the expenses are intended to constitute
expenses of administration under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or similar law.

 

Notwithstanding anything herein to the
contrary, the Indenture Trustee’s right to enforce any of the Administrator’s
payment obligations pursuant to this Section 6.7 shall be subject
to the provisions of Section 11.15 and Section 11.16.

 

In no event shall the compensation and
indemnification obligations of the Administrator specified above be satisfied
out of the Owner Trust Estate.

 

SECTION 6.8         Replacement of the Indenture Trustee.  (a)  The Indenture Trustee may give
notice of its intent to resign at any time by so notifying the Issuer.  The Holders of a majority of the Outstanding
Amount of the Notes may remove the Indenture Trustee by so notifying the
Indenture Trustee.  The Issuer shall
remove the Indenture Trustee if:

 

(i)        the Indenture Trustee fails to comply
with Section 6.11;

 

(ii)       the Indenture Trustee is adjudged
bankrupt or insolvent;

 

(iii)      a receiver or other public officer takes
charge of the Indenture Trustee or its property; or

 

(iv)      the Indenture Trustee otherwise becomes
incapable of acting.

 

(b)     If
the Indenture Trustee gives notice of its intent to resign or is removed or if
a vacancy exists in the office of the Indenture Trustee for any reason (the 

 

 

Indenture
Trustee in such event being referred to herein as the retiring Indenture
Trustee), the Issuer shall promptly appoint a successor Indenture Trustee.

 

(c)     A
successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer and thereupon
the resignation or removal of the Indenture Trustee shall become effective, and
the successor Indenture Trustee, without any further act, deed or conveyance
shall have all the rights, powers and duties of the Indenture Trustee under
this Indenture.  The successor Indenture
Trustee shall mail a notice of its succession to the Noteholders.  The retiring Indenture Trustee shall promptly
transfer all property held by it as the Indenture Trustee to the successor Indenture
Trustee.

 

(d)     If
a successor Indenture Trustee does not take office within 60 days after the
retiring Indenture Trustee gives notice of its intent to resign or is removed,
the retiring Indenture Trustee, the Issuer or the Holders of a majority of the
Outstanding Amount of the Notes may petition at the expense of the Issuer any
court of competent jurisdiction for the appointment of a successor Indenture
Trustee.

 

(e)     If
the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.

 

(f)      Any
resignation or removal of the Indenture Trustee and appointment of a successor
Indenture Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Indenture
Trustee pursuant to subsection 6.8(c) and payment of all fees and
expenses owed to the outgoing Indenture Trustee.

 

(g)     Notwithstanding
the resignation or removal of the Indenture Trustee pursuant to this Section,
the Issuer’s and the Administrator’s obligations under Section 6.7
shall continue for the benefit of the retiring Indenture Trustee.  The Indenture Trustee shall not be liable for
the acts or omissions of any successor Indenture Trustee.

 

SECTION 6.9         Successor Indenture Trustee by Merger.  If the Indenture Trustee consolidates with,
merges or converts into, or transfers all or substantially all its corporate
trust business or assets to, another corporation or banking association, the
resulting, surviving or transferee corporation without any further act shall be
the successor Indenture Trustee.  The
Indenture Trustee shall provide the Issuer prior written notice of any such
transaction.

 

In case at the time such successor or
successors by merger, conversion or consolidation to the Indenture Trustee
shall succeed to the trusts created by this Indenture any of the Notes shall
have been authenticated but not delivered, any such successor to the Indenture
Trustee may adopt the certificate of authentication of any predecessor
Indenture Trustee, and deliver such Notes so authenticated; and in case at that
time any of the Notes shall not have been authenticated, any successor
Indenture Trustee may authenticate such Notes either in the name of any
predecessor Indenture Trustee hereunder or in the name of the successor
Indenture Trustee; and in all such cases such certificate of authentication
shall have the same full force as is 

 

 

provided
anywhere in the Notes or this Indenture with respect to the certificate of
authentication of the Indenture Trustee.

 

SECTION 6.10       Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.  (a)  Notwithstanding any other
provisions of this Indenture, at any time, for the purpose of meeting any legal
requirement of any jurisdiction in which any part of the Owner Trust Estate may
at the time be located, the Indenture Trustee shall have the power and may
execute and deliver all instruments to appoint one or more Persons to act as a
co-trustee or co-trustees, or separate trustee or separate trustees, of all or
any part of the Owner Trust Estate, and to vest in such Person or Persons, in
such capacity and for the benefit of the Noteholders, such title to the Owner
Trust Estate, or any part hereof, and, subject to the other provisions of this Section 6.10,
such power, duties, obligations, rights and trusts as the Indenture Trustee may
consider necessary or desirable.  The
Administrator will pay all reasonable fees and expenses of any co-trustee or
co-trustees or separate trustee or separate trustees.  The appointment of any separate trustee or
co-trustee shall not absolve the Indenture Trustee of its obligations under
this Indenture.  No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as an
Indenture Trustee under Section 6.11, and no notice to the
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.8.

 

(b)     Every
separate trustee and co-trustee shall, to the extent permitted by law, be
appointed and act subject to the following provisions and conditions:

 

(i)        all rights, powers, duties and
obligations conferred or imposed upon the Indenture Trustee shall be conferred
or imposed upon and exercised or performed by the Indenture Trustee and such
separate trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee is not authorized to act separately without the Indenture
Trustee joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed the
Indenture Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations (including the
holding of title to the Owner Trust Estate or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Indenture Trustee;

 

(ii)       no trustee hereunder shall be personally
liable by reason of any act or omission of any other trustee hereunder,
including acts or omissions of predecessor or successor trustees; and

 

(iii)      the Indenture Trustee may at any time
accept the resignation of or remove any separate trustee or co-trustee.

 

(c)     Any
notice, request or other writing given to the Indenture Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. 
Every instrument appointing any separate trustee or co-trustee shall
refer to this Indenture and the conditions of this Article VI.  Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or 

 

 

separately,
as may be provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the
conduct of, affecting the liability of, or affording protection to, the
Indenture Trustee.  Every such instrument
shall be filed with the Indenture Trustee (with a copy given to the Issuer).

 

(d)     Any
separate trustee or co-trustee may at any time constitute the Indenture Trustee
its agent or attorney-in-fact with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Indenture
on its behalf and in its name.  If any
separate trustee or co-trustee shall die, become incapable of acting, resign or
be removed, all of its estates, properties, rights, remedies and trusts shall
vest in and be exercised by the Indenture Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.

 

SECTION 6.11       Eligibility; Disqualification.  The Indenture Trustee shall at all times
satisfy the requirements of TIA §310(a)(1), (2), (3) and (5).  The Indenture Trustee shall at all times meet
the requirements of Rule 3(a)-7(a)(4)(i) under the Investment Company
Act and shall not provide credit or credit enhancement to the Issuer.  The Indenture Trustee shall have a combined
capital and surplus of at least $150,000,000 as of the last day of the most recent
fiscal quarter for such institution and shall be subject to examination or
supervision by federal or state authorities. 
The Indenture Trustee shall not be an Affiliate of the Issuer, the
Transferor, the Administrator or the Servicer. 
The long-term unsecured debt of the Indenture Trustee shall at all times
be rated not lower than “BBB-” by Standard & Poor’s and “Baa3” by
Moody’s.  The Indenture Trustee shall
comply with TIA §310(b), including the optional provision permitted by the
second sentence of TIA §310(b)(9); provided that
there shall be excluded from the operation of TIA §310(b)(1) any indenture
or indentures under which other securities of the Issuer are outstanding if the
requirements for such exclusion set forth in TIA §310(b)(1) are met.

 

SECTION 6.12       Preferential Collection of Claims Against the Issuer.  The Indenture Trustee shall comply with TIA
§311(a), excluding any creditor relationship listed in TIA §311(b).  An Indenture Trustee who has resigned or been
removed shall be subject to TIA §311(a) to the extent indicated therein.

 

ARTICLE VII

 

NOTEHOLDERS’ LISTS AND REPORTS

 

SECTION 7.1         The Issuer To Furnish the Indenture Trustee Names and
Addresses of the Noteholders.  The Issuer will furnish or cause to be
furnished to the Indenture Trustee (a) not more than five days after each
Record Date, a list, in such form as the Indenture Trustee may reasonably
require, of the names and addresses of the Holders as of such Record Date and (b) at
such other times as the Indenture Trustee may request in writing, within 14
days after receipt by the Issuer of any such request, a list of similar form
and content as of a date not more than 10 days prior to the time such list is
furnished, provided that so long as the Indenture
Trustee is the Note Registrar, no such list shall be required to be furnished.

 

 

SECTION 7.2         Preservation of Information; Communications to the
Noteholders.  (a)  The Indenture Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of the Noteholders contained in the most recent list furnished to the
Indenture Trustee as provided in Section 7.1 or, if the Indenture
Trustee is acting as Note Registrar, the names and addresses of the Noteholders
received by the Indenture Trustee in its capacity as the Note Registrar.  The Indenture Trustee may destroy any list
furnished to it as provided in such Section 7.1 upon receipt of a
new list so furnished.

 

(b)     The
Noteholders may communicate pursuant to TIA §312(b) with other Noteholders
with respect to their rights under this Indenture or under the Notes.  Upon the issuance of the Notes, Holders of
not less than 10% of the Outstanding Amount of the Notes may, by written
request to the Indenture Trustee pursuant to the terms of this Indenture,
obtain access to the list of all Noteholders maintained by the Indenture
Trustee for the purpose of communicating with other Noteholders with respect to
their rights under this Indenture or the Notes. 
The Indenture Trustee may elect not to afford the requesting Noteholders
access to the list of such Noteholders if it agrees to mail the desired
communication or proxy, on behalf and at the expense of the requesting
Noteholders, to all Noteholders of record.

 

(c)     The
Issuer, the Indenture Trustee and the Note Registrar shall have the protection
of TIA §312(c).

 

SECTION 7.3         Reports by the Administrator.  On or prior to each Transfer Date, the
Administrator will provide to the Indenture Trustee for the Indenture Trustee
to forward to each Noteholder of record, and to the Owner Trustee, a statement
setting forth (to the extent applicable) the following information as to the
Notes with respect to the related Distribution Date or the period since the
previous Distribution Date, as applicable:

 

(i)        the amount of the distribution allocable
to principal of the Notes;

 

(ii)       the amount of the distribution allocable
to interest on or with respect to the Notes; and

 

(iii)      the aggregate outstanding principal amount
of the Notes after giving effect to all payments reported under clause (i) above
on such date.

 

Each amount set forth pursuant to clauses (i) and
(ii) above will be expressed as a dollar amount per $1,000 of the initial
principal balance of the Notes.

 

SECTION 7.4         Fiscal Year of the Issuer.  Unless the Issuer otherwise determines, each
fiscal year of the Issuer shall end on the last day of the January fiscal
month of the corresponding fiscal year of the Transferor.

 

SECTION 7.5         Reports by the Indenture Trustee.  If required by TIA §313(a), within 60 days
after each March 31, beginning with March 31, 2009, the Indenture
Trustee shall mail to each Noteholder as required by TIA §313(c) a brief
report dated as of such date that complies with TIA §313(a).  The Indenture Trustee also shall comply with
TIA §313(b).  On each Distribution Date,
the Indenture Trustee shall make available at its Internet website located 

 

 

at www.ctslink.com
(or such other website address as the Indenture Trustee may provide in writing
to Noteholders) a copy of the statement for the related Monthly Period provided
to the Indenture Trustee pursuant to Section 7.3.

 

ARTICLE VIII

 

ACCOUNTS, DISBURSEMENTS AND RELEASES

 

SECTION 8.1         Collection of Money. 
Except as otherwise provided herein, the Indenture Trustee may demand
payment or delivery of, and shall receive and collect, directly and without
intervention or assistance of any fiscal agent or other intermediary, all money
and other property payable to or receivable by the Indenture Trustee pursuant
to this Indenture.  The Indenture Trustee
shall apply all such money received by it as provided in this Indenture and the
Deposit and Administration Agreement. 
Except as otherwise provided in this Indenture, if any default occurs in
the making of any payment or performance under any agreement or instrument that
is part of the Owner Trust Estate, the Indenture Trustee may take such action
as may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings.  Any such action shall be without prejudice to
any right to claim a Default or an Event of Default under this Indenture and
any right to proceed thereafter as provided in Article V.

 

SECTION 8.2         Issuer Accounts. 
On or prior to the Closing Date, the Issuer shall cause the
Administrator to establish and maintain, an Eligible Deposit Account, in the
name of the Indenture Trustee, for the benefit of the Noteholders, the “Note
Distribution Account”.  If the Issuer
elects to defease the Notes pursuant to Section 2.9, then, on or
prior to the date of defeasance, the Issuer shall cause the Administrator to
establish and maintain, in the name of the Indenture Trustee, for the benefit
of the Noteholders, two separate Eligible Deposit Accounts to be designated as
the “Note Principal Funding Account” and the “Noteholder Reserve
Account,” respectively, and shall take such steps as are necessary to
perfect the Grant to the Indenture Trustee of such Issuer Accounts (including,
if requested by the Indenture Trustee, the delivery to the Indenture Trustee of
an Opinion of Counsel to such effect).

 

Each of the
Issuer Accounts shall bear a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders.  The Indenture Trustee shall possess all
right, title and interest in all funds on deposit from time to time in the Issuer
Accounts and in all proceeds thereof. 
Each Issuer Account shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders.  Each of the Issuer Accounts shall be a
securities account.  Wells Fargo agrees
that it is the securities intermediary (the “Securities Intermediary”)
with respect to each Issuer Account, and as such agrees that the account is
maintained for the Issuer and, subject to the terms of this Indenture, that the
Issuer is entitled to exercise the rights that comprise any financial asset
credited to such Issuer Account.  All
securities or other property underlying any financial assets credited to any
Issuer Account shall be registered in the name of Wells Fargo Bank, National
Association, endorsed to Wells Fargo Bank, National Association in blank or
credited to another securities account maintained in the name of Wells Fargo
Bank, National Association and in no case will any financial asset credited to
any Issuer Account be registered in the name of the Issuer, payable to the
order of the Issuer or 

 

 

specially endorsed to the
Issuer.  Until termination of this
Indenture, the Issuer shall not be entitled to give the Indenture Trustee any
entitlement orders with respect to any Issuer Account.  If, at any time, any Issuer Account ceases to
be an Eligible Deposit Account, the Administrator shall notify the Indenture
Trustee, and the Indenture Trustee upon being notified (or the Administrator on
its behalf) shall, within 10 Business Days, establish a new corresponding
Issuer Account which meets the conditions specified in the definition of
Eligible Deposit Account, and shall transfer any cash or any investments from
such ineligible account to such new Issuer Account.  The Indenture Trustee, at the direction of
the Administrator, shall make withdrawals from the Issuer Accounts from time to
time, in the amounts and for the purposes set forth in this Indenture.  The Securities Intermediary shall comply with
entitlement orders issued by the Indenture Trustee without further consent by
the Issuer.

 

SECTION 8.3         Investment
of Funds in the Note Principal Funding Account and the Noteholder Reserve
Account.

 

(a)     So
long as the Notes have not been accelerated pursuant to Section 5.2,
funds on deposit in the Note Principal Funding Account and the Noteholder
Reserve Account shall be invested and reinvested in Eligible Investments by the
Indenture Trustee upon Issuer Order (which Issuer Order may be upon direction
of the Administrator)  Such Issuer Order
shall not direct the Indenture Trustee to make any investment of any funds held
in such Issuer Accounts unless the security interest granted and perfected in
such accounts will continue to be perfected in such investment, and, in
connection with any direction to the Indenture Trustee to make any such
investment, if requested by the Indenture Trustee, the Issuer shall deliver to
the Indenture Trustee an Opinion of Counsel, acceptable to the Indenture
Trustee, to such effect.  All Eligible
Investments acquired with funds on deposit in the Note Principal Funding
Account or the Noteholder Reserve Account shall mature no later than the
Business Day immediately preceding the next Distribution Date.

 

(b)     Subject
to subsection 6.1(c), the Indenture Trustee and the Paying Agent shall
not in any way be held liable by reason of any insufficiency in any Issuer
Account resulting from any loss on any Eligible Investments included therein
except for losses attributable to the Indenture Trustee’s or the Paying Agent’s
failure to make payments on such Eligible Investments issued by the Indenture
Trustee or the Paying Agent, in its commercial capacity as principal obligor
and not as trustee or paying agent, in accordance with their terms.

 

(c)     If
(i) the Administrator shall have failed to give investment directions for
any funds on deposit in the Note Principal Funding Account or the Noteholder
Reserve Account to the Indenture Trustee by 11:00 a.m. New York City time
(or such other time as may be agreed by the Administrator and the Indenture Trustee)
on any Business Day, or (ii) a Default or Event of Default shall have
occurred and be continuing with respect to the Notes but the Notes shall not
have been declared due and payable pursuant to Section 5.2, or, if
such Notes shall have been declared due and payable following an Event of
Default, amounts collected or receivable from the Owner Trust Estate are being
applied in accordance with Section 5.5 as if there had not been
such a declaration, then the Indenture Trustee shall, to the fullest extent
practicable, invest and reinvest funds in the Note Principal Funding Account
and the Noteholder Reserve Account in one or more Eligible Investments.  The Indenture Trustee shall not be liable for
losses in respect of such investments in Eligible Investments that comply with
the 

 

 

requirements
of the Basic Documents except for losses attributable to the Indenture Trustee’s
failure to make payments on such Eligible Investments issued by the Indenture
Trustee, in its commercial capacity as principal obligor and not as trustee, in
accordance with their terms.

 

(d)     For
purposes of this Section 8.3, Eligible Investments shall be limited
to those investments specified pursuant to clause (a) of the definition
thereof; provided, however, for
purposes of subsection 8.3(c), Eligible Investments shall be limited to
the Wells Fargo 100% Treasury Money Market Fund (or a successor fund thereto
which is a money market fund investing solely in those investments specified
pursuant to clause (a) of the definition thereof).

 

SECTION 8.4         Application of Funds in the Note Principal Funding
Account and the Noteholder Reserve Account.  On each Distribution Date with respect to the
Defeasance Period, the Indenture Trustee or Paying Agent, upon written
instructions from the Administrator, shall withdraw from the Note Principal
Funding Account and the Noteholder Reserve Account, as applicable, and deposit
into the Note Distribution Account for application in accordance with Section 2.6
the aggregate amount specified in subsections 2.6(a)(i) through 2.6(a)(iii) for
such Distribution Date.  Upon payment in
full of the Note Principal Balance, including all accrued interest thereon, any
amounts remaining in the Note Principal Funding Account and the Noteholder
Reserve Account shall be paid to the Certificateholder.

 

SECTION 8.5         Release of Owner Trust Estate.  (a)  The Indenture Trustee shall, when
required by the provisions of this Indenture, execute instruments to release
property from the lien of this Indenture, or convey the Indenture Trustee’s
interest in the same, in a manner and under circumstances that are not
inconsistent with the provisions of this Indenture; provided
that the Indenture Trustee shall not release its security interest for the
benefit of the Noteholders in the Collateral Certificate except (i) in
connection with a defeasance of the Notes under Section 2.9, (ii) in
connection with a sale of the Collateral Certificate following the occurrence
of an Event of Default and foreclosure on the Collateral Certificate in accordance
with Article V or (iii) pursuant to subsection 8.5(b).  No party relying upon an instrument executed
by the Indenture Trustee as provided in this Article VIII shall be
bound to ascertain the Indenture Trustee’s authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.

 

(b)     The
Indenture Trustee shall, at such time as there are no Outstanding Notes,
release any remaining portion of the Owner Trust Estate that secured the Notes
from the lien of this Indenture and release to the Issuer or any other Person
entitled thereto any funds then on deposit in the Note Distribution
Account.  The Indenture Trustee shall
release property from the lien of this Indenture pursuant to this subsection
8.5(b) only upon receipt of an Issuer Request accompanied by an
Officer’s Certificate, an Opinion of Counsel and (if required by the TIA)
Independent Certificates in accordance with TIA §§ 314(c) and 314(d)(1),
in each case meeting the applicable requirements of Section 11.1.

 

SECTION 8.6         Opinion of Counsel. 
The Indenture Trustee shall receive at least seven days notice when
requested by the Issuer to take any action pursuant to subsection 8.3(a),
accompanied by copies of any instruments involved, and the Indenture Trustee
may also require as a condition of such action, an Opinion of Counsel, in form
and substance satisfactory 

 

 

to the
Indenture Trustee, stating the legal effect of any such action, outlining the
steps required to complete the same, and concluding that all such action will
not materially and adversely impair the security for the Notes or the rights of
the Noteholders; provided, however,
that such Opinion of Counsel shall not be required to express an opinion as to
the fair value of the Owner Trust Estate. 
Counsel rendering any such opinion may rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such
action.

 

SECTION 8.7         Treatment as Financial Assets.  Each item of property (whether investment
property, financial asset, security, instrument or cash) credited to the Note
Distribution Account shall be treated as a financial asset.  The Note Distribution Account shall be
governed by the law of the State of New York and the State of Minnesota shall
be the Securities Intermediary jurisdiction.

 

SECTION 8.8         Powers Coupled With an Interest.  The rights and powers granted in this Article VIII
to the Indenture Trustee have been granted in order to perfect its security
interest in the Note Distribution Account, are powers coupled with an interest
and will be affected neither by the bankruptcy or insolvency of the Issuer nor
by the lapse of time.

 

ARTICLE IX

 

SUPPLEMENTAL INDENTURES

 

SECTION 9.1         Supplemental Indentures Without Consent of Noteholders.  Without the consent of the Noteholders, but
with prior notice to the Note Purchaser and the Rating Agencies (for so long as
there are outstanding securities issued by the Trust or a related owner trust
that are rated by such Rating Agency), when authorized by an Issuer Request,
the Issuer and the Indenture Trustee at any time and from time to time, may
enter into one or more indentures supplemental hereto (which shall conform to
the provisions of the Trust Indenture Act as in force at the date of the
execution thereof), in form satisfactory to the Indenture Trustee, for any of
the following purposes:

 

(i)        to correct or amplify the description of
any property at any time subject to the lien of this Indenture, or better to
assure, convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the lien of this Indenture, or to subject to the
lien of this Indenture additional property;

 

(ii)       to evidence the succession, in compliance
with the applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer contained
herein and in the Notes;

 

(iii)      to add to the covenants of the Issuer, for
the benefit of the Noteholders, or to surrender any right or power herein
conferred upon the Issuer;

 

(iv)      to convey, transfer, assign, mortgage or
pledge any property to or with the Indenture Trustee;

 

(v)       to cure any ambiguity, to correct or
supplement any provision herein or in any supplemental indenture which may be
inconsistent with any other provision herein or in any supplemental indenture
or to make any other provisions with respect to matters or questions arising
under this Indenture or in any supplemental indenture; provided
that such action shall not materially and adversely affect the interests of the
Noteholders;

 

(vi)      to evidence and provide for the acceptance
of the appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as shall be
necessary to facilitate the administration of the trusts hereunder by more than
one trustee, pursuant to the requirements of Article VI; or

 

(vii)     to modify, eliminate or add to the
provisions of this Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar federal
statute hereafter enacted and to add to this Indenture such other provisions as
may be expressly required by the TIA.

 

The Issuer and the Indenture
Trustee shall not enter into any indenture supplemental hereto if such
indenture would cause either (x) the Issuer or the Master Trust to be
classified as an association or a publicly traded partnership taxable as a
corporation for United States federal income tax purposes or (y) a taxable
event that could cause the beneficial owner of any Outstanding Amount of Notes
to recognize gain or loss for such purposes.

 

The Indenture Trustee is hereby authorized to
join in the execution of any such supplemental indenture and to make any
further appropriate agreements and stipulations that may be therein contained.

 

SECTION 9.2                 Supplemental Indentures With
Consent of the Noteholders.  The
Issuer and the Indenture Trustee, when authorized by the Issuer, and with prior
notice to the Rating Agencies (for so long as there are outstanding securities
issued by the Trust or a related owner trust that are rated by such Rating
Agency), also may with the consent of the Holders of a majority of the
Outstanding Amount of the Notes, by Act of such Noteholders delivered to the
Issuer and the Indenture Trustee, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders under this Indenture; provided that no such supplemental indenture shall, without
the consent of each Holder of an Outstanding Note affected thereby:

 

(i)        change the due date of payment of any
installment of principal of or interest on any Note, or reduce the principal
amount thereof, the Interest Rate thereon or the Redemption Price with respect
thereto, change the provision of this Indenture relating to the application of
collections on, or the proceeds of the sale of, the Owner Trust Estate to
payment of principal of or interest on the Notes, or change any place of
payment where, or the coin or currency in which, any Note or the interest
thereon is payable, or impair the right to institute suit for the enforcement
of the provisions of this Indenture requiring the application of funds
available therefor, as 

 

 

provided in Article V,
to the payment of any such amount due on the Notes on or after the respective
due dates thereof (or, in the case of redemption, on or after the Redemption
Date);

 

(ii)       reduce the percentage of the Outstanding
Amount of the Notes the consent of the Holders of which is required for any
such supplemental indenture, or the consent of the Holders of which is required
for any waiver of compliance with provisions of this Indenture or defaults
hereunder and their consequences provided for in this Indenture;

 

(iii)      modify or alter the provisions of the
proviso to the definition of the term “Outstanding”;

 

(iv)      reduce the percentage of the Outstanding
Amount of the Notes required to direct the Indenture Trustee to sell or
liquidate the Owner Trust Estate pursuant to Section 5.4;

 

(v)       modify any provision of this Section except
to increase any percentage specified herein or to provide that certain
additional provisions of this Indenture or any of the other Basic Documents
cannot be modified or waived without the consent of the Holder of each
Outstanding Note affected thereby;

 

(vi)      modify any of the provisions of this
Indenture in such manner as to affect the calculation of the amount of any
payment of interest or principal due on any Note on any Distribution Date
(including the calculation of any of the individual components of such
calculation) or to affect the rights of the Noteholders to the benefit of any
provisions for the mandatory redemption of the Notes contained herein; or

 

(vii) permit the creation of any Lien ranking prior
to or on a parity with the lien of this Indenture with respect to any part of
the Owner Trust Estate or, except as otherwise permitted or contemplated
herein, terminate the lien of this Indenture on any property at any time
subject hereto or deprive any Noteholder of the security provided by the lien
of this Indenture.

 

The Indenture Trustee may determine whether
any Notes would be affected by any supplemental indenture and any such
determination shall be conclusive upon all Noteholders, whether the related
Notes were theretofore or are thereafter authenticated and delivered
hereunder.  The Indenture Trustee shall
not be liable for any such determination made in good faith.

 

It shall not be necessary for any Noteholders
under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Noteholders shall
approve the substance thereof.

 

Promptly after the execution by the Issuer
and the Indenture Trustee of any supplemental indenture pursuant to this
Section, the Indenture Trustee shall mail to the Noteholders a notice setting
forth in general terms the substance of such supplemental indenture.  

 

 

Any failure of the Indenture Trustee to mail
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.

 

SECTION 9.3                 Effect of Supplemental
Indenture.  Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby, and the respective rights, limitations
of rights, obligations, duties, liabilities and immunities under this Indenture
of the Indenture Trustee, the Issuer and the Noteholders shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and conditions
of this Indenture and the Notes affected thereby for any and all purposes.

 

SECTION 9.4                 Conformity with Trust
Indenture Act.  Every amendment of
this Indenture and every supplemental indenture executed pursuant to this Article IX
shall comply in all respects with the TIA.

 

SECTION 9.5                 Reference in Notes to
Supplemental Indentures.  Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as to
any matter provided for in such supplemental indenture.  If the Issuer or the Indenture Trustee shall
so require, new Notes so modified as to conform, in the opinion of the
Indenture Trustee and the Issuer, to any such supplemental indenture may be
prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.

 

SECTION 9.6                 Execution of Supplemental
Indentures.  In executing, or
accepting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Indenture Trustee shall be entitled to
receive, and (subject to Section 6.1) shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture.  The Indenture Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Indenture Trustee’s own rights, duties or immunities under this Indenture or
otherwise.

 

ARTICLE X

 

REDEMPTION OF
NOTES

 

SECTION 10.1               Redemption.  The Notes are subject to redemption in whole,
but not in part, at the direction of the Depositor, on any date on which the
Collateral Certificate is retransferred to the Transferor pursuant to Section 7.1
of the Series Supplement. For so long as there are outstanding securities
issued by the Trust or a related owner trust that are rated by a Rating Agency,
the Issuer shall furnish such Rating Agency notice of such redemption.  If the Notes are to be redeemed pursuant to
this Section 10.1, the Issuer shall furnish notice of such
redemption to the Indenture Trustee no later than fifteen (15) Business Days
prior to the 

 

 

Redemption Date, and the Issuer
shall, on the Redemption Date, deposit with the Indenture Trustee in the Note
Distribution Account the Redemption Price of the Notes to be redeemed whereupon
all such Notes shall be due and payable on the Redemption Date upon the
furnishing of a notice complying with Section 10.2 to each
Noteholder.

 

SECTION 10.2               Form of Redemption Notice.  Notice of redemption under Section 10.1
shall be given by the Indenture Trustee by facsimile or by first-class mail,
postage prepaid, transmitted or mailed prior to the applicable Redemption Date
to each Noteholder, as of the close of business on the Record Date preceding
the applicable Redemption Date, at such Noteholder’s address appearing in the
Note Register.

 

All notices of redemption shall state:

 

(i)    the Redemption Date;

 

(ii)   the Redemption Price;

 

(iii)  that the Record Date otherwise applicable to
such Distribution Date is not applicable and that payments shall be made only
upon presentation and surrender of such Notes and the place where such Notes
are to be surrendered for payment of the Redemption Price (which shall be the
office or agency to be maintained as provided in Section 3.2);

 

(iv)  that interest on the Notes shall cease to
accrue on the Redemption Date; and

 

(v)   the CUSIP numbers, if applicable, for the
Notes.

 

Notice of redemption of the Notes shall be
given by the Indenture Trustee in the name and at the expense of the
Issuer.  Failure to give notice of
redemption, or any defect therein, to any Noteholder shall not impair or affect
the validity of the redemption of any Note held by any other Noteholder.

 

SECTION 10.3               Notes Payable on Redemption
Date.  The Notes to be redeemed
shall, following notice of redemption as required by Section 10.2,
on the Redemption Date become due and payable at the applicable Redemption
Price and (unless the Issuer shall default in the payment of the Redemption
Price) no interest shall accrue on the Redemption Price for any period after
the date to which accrued interest is calculated for purposes of calculating
the Redemption Price.

 

ARTICLE XI

 

MISCELLANEOUS

 

SECTION 11.1               Compliance Certificates and
Opinions, etc.  (a)  Upon any
application or request by the Issuer to the Indenture Trustee to take any
action under any provision of this Indenture, the Issuer shall furnish to the
Indenture Trustee:  (i) an Officer’s

 

 

Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with, and (iii) (if required by the TIA) an
Independent Certificate meeting the applicable requirements of this Section from
a firm of certified public accountants or other experts, except that, in the
case of any such application or request as to which the furnishing of such
documents is specifically required by any provision of this Indenture, no
additional certificate or opinion need be furnished.

 

Every certificate or opinion with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:

 

(i)    a statement that each signatory of such
certificate or opinion has read or has caused to be read such covenant or
condition and the definitions herein relating thereto;

 

(ii)   a brief statement as to the nature and scope
of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;

 

(iii)  a statement that, in the opinion of each such
signatory, such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to whether
such covenant or condition has been complied with; and

 

(iv)  a statement as to whether, in the opinion of
each such signatory such condition or covenant has been complied with.

 

(b)     (i)            Prior
to the deposit of any Collateral or other property or securities with the
Indenture Trustee that is to be made the basis for the release of any property
or securities subject to the lien of this Indenture, the Issuer shall, in
addition to any obligation imposed in subsection 11.1(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an Officer’s
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such deposit) to the Issuer
of the Collateral or other property or securities to be so deposited, provided that no certificate need be provided as to the fair
value of cash so deposited.

 

(ii)   Whenever the Issuer is required to furnish to
the Indenture Trustee an Officer’s Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause (i),
the Issuer shall also deliver to the Indenture Trustee an Independent
Certificate as to the same matters, if the sum of the fair values to the Issuer
(as set forth in the certificates delivered pursuant to clause (i) and
this clause (ii)), of (A) the securities to be so deposited and (B) all
other such securities made the basis of any such release since the commencement
of the then-current fiscal year of the Issuer is 10% or more of the outstanding
principal amount of the Notes; provided, however, that  such a
certificate need not be furnished with respect to any securities so deposited,
if the fair value thereof to the Issuer (as set forth in the related Officer’s
Certificate delivered 

 

 

under
clause (i) above) is less than $25,000 or less than one percent of
the outstanding principal amount of the Notes.

 

(iii)  Whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall also furnish to the
Indenture Trustee an Officer’s Certificate certifying or stating the opinion of
each person signing such certificate as to the fair value (within 90 days of
such release) of the property or securities proposed to be released and stating
that in the opinion of such person the proposed release will not impair the
security under this Indenture in contravention of the provisions hereof.

 

(iv)  Whenever the Issuer is required to furnish to
the Indenture Trustee an Officer’s Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause (iii),
the Issuer shall also furnish to the Indenture Trustee an Independent
Certificate as to the same matters if the sum of the fair values, as set forth
in the certificates required by clause (iii) and this clause
(iv), of (A) the property or securities to be released and (B) all
other property equals 10% or more of the outstanding principal amount of the
Notes; provided, however,
that such certificate need not be furnished in the case of any release of
property or securities if the fair value thereof, as set forth in the related Officer’s
Certificate, is less than $25,000 or less than one percent of the then
outstanding principal amount of the Notes.

 

(v)   Notwithstanding any provision of this
Section, the Issuer may (A) collect, liquidate, sell or otherwise dispose
of the Collateral Certificate as and to the extent permitted or required by the
Basic Documents and (B) make cash payments out of the Note Distribution
Account as and to the extent permitted or required by the Basic Documents.

 

SECTION 11.2               Form of Documents
Delivered to the Indenture Trustee. 
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

 

Any certificate or opinion of an Authorized
Officer of the Issuer may be based, insofar as it relates to legal matters,
upon a certificate to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his or her certificate or opinion is
based are erroneous.  Any such
certificate of an Authorized Officer or Opinion of Counsel may be based,
insofar as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Administrator, the Depositor
or the Issuer, stating that the information with respect to such factual
matters is in the possession of the Administrator, the Depositor or the Issuer,
unless such counsel knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous.

 

 

Where any Person is required to make, give or
execute two or more applications, requests, consents, certificates, statements,
opinions or other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.

 

Whenever in this Indenture, in connection
with any application, certificate or report to the Indenture Trustee, it is
provided that the Issuer shall deliver any document (x) as a condition of
the granting of such application, or (y) as evidence of the Issuer’s
compliance with any term hereof, it is intended that the truth and accuracy, at
the time of the granting of such application or at the effective date of such
certificate or report (as the case may be), of the facts and opinions stated in
such document shall in each case be conditions precedent to the right of the
Issuer to have such application granted or to the sufficiency of such
certificate or report.  The foregoing
shall not, however, be construed to affect the Indenture Trustee’s right to
rely upon the truth and accuracy of any statement or opinion contained in any
such document as provided in Article VI.

 

SECTION 11.3               Actions of Noteholders.  (a)  Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be given or taken by the Noteholders may be embodied in and evidenced by one
or more instruments of substantially similar tenor signed by such Noteholders
in person or by an agent duly appointed in writing; and except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee and, when
required, to the Issuer or the Administrator. 
Such instrument or instruments (and the action or actions embodied
therein and evidenced thereby) are herein sometimes referred to as the “Act”
of the Noteholders signing such instrument or instruments.  Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any purpose of
this Indenture and conclusive in favor of the Indenture Trustee, the Issuer and
the Administrator, if made in the manner provided in this Section 11.3.

 

(b)        The fact and date of the execution by
any Noteholder of any such instrument or writing may be proved in any
reasonable manner which the Indenture Trustee deems sufficient.

 

(c)        Any request, demand, authorization,
direction, notice, consent, waiver or other act by a Noteholder shall bind
every Holder of every Notes issued upon the registration of transfer thereof or
in exchange therefor or in lieu thereof, in respect of anything done, or
omitted to be done, by the Indenture Trustee, the Issuer or the Administrator
in reliance thereon, regardless of whether notation of such action is made upon
such Note.

 

(d)        The Indenture Trustee may require such
additional proof of any matter referred to in this Section 11.3 as
it shall deem necessary.

 

(e)        Any
request, demand, authorization, direction, notice, consent, waiver or other act
permitted or required by the Series Supplement or the Pooling and
Servicing Agreement to be taken by the Issuer, as Collateral Certificateholder,
shall be taken or given, as the case may be, by the Issuer at the direction of
Holders of the same percentage of Outstanding Notes as the percentage of the
Certificates (as defined in the Pooling and Servicing Agreement) 

 

 

required
or permitted to take such action under the Series Supplement or the
Pooling and Servicing Agreement.

 

SECTION 11.4               Notices, etc., to the Indenture
Trustee, the Issuer, the Note Purchaser and the Rating Agencies.  Any request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders or other documents
provided or permitted by this Indenture to be made upon, given or furnished to
or filed with:

 

(a)        The
Indenture Trustee by any Noteholder or by the Issuer shall be sufficient for
every purpose hereunder if personally delivered, telefaxed or mailed certified
mail, return receipt requested and shall be deemed to have been duly given upon
receipt by a Responsible Officer of the Indenture Trustee at its Corporate
Trust Office; or

 

(b)        The
Issuer by the Indenture Trustee or any Noteholder shall be sufficient for every
purpose hereunder if personally delivered or mailed certified mail, return
receipt requested to the Issuer addressed to: 
Target Credit Card Owner Trust 2008-1, in care of Wilmington Trust
Company, not in its individual capacity but solely as Owner Trustee for the
Target Credit Card Owner Trust 2008-1, at Wilmington Trust Company, Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Target Credit Card Owner Trust 2008-1, with a copy to Target
Receivables Corporation, as Administrator, 1000 Nicollet Mall, TPS 3136,
Minneapolis, Minnesota 55403, Attention: 
General Counsel, or at any other address previously furnished in writing
to the Indenture Trustee by the Issuer. 
Notices required to be given to the Note Purchaser by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally
delivered, by facsimile or mailed certified mail, return receipt requested, to
BOTAC, Inc., c/o Chase Bank USA, National Association, 201 North Walnut
Street, Wilmington, Delaware 19801, Attention: Keith W. Schuck, President with
a copy to JPMorgan Chase & Co., 270 Park Avenue, Floor 28, New York,
New York 10017, Attention:  Brent Barton,
Vice President – Securitization.  The
Issuer shall promptly transmit any notice received by it from the Noteholders
to the Indenture Trustee.  Notices
required to be given to the Rating Agencies by the Issuer, the Indenture
Trustee or the Owner Trustee shall be in writing, personally delivered, by
facsimile or mailed certified mail, return receipt requested, to (i) in
the case of Moody’s, at the following address: 
Moody’s Investors Service, Inc., 7 World Trade Center, 250
Greenwich Street, New York, New York 10007, Attention: ABS Monitoring Group,
Facsimile: (212) 298-6664 and (ii) in the case of Standard & Poor’s,
at the following address:  Standard &
Poor’s Ratings Services, 55 Water Street, New York, New York 10041, Attention:
Asset Backed Surveillance Department, Facsimile: (212) 438-2648; or as to each
of the foregoing, at such other address as shall be designated by written
notice to the other parties.

 

SECTION 11.5               Notices to Noteholders; Waiver.  Where this Indenture provides for notice to
Noteholders of any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first-class,
postage prepaid to each Noteholder affected by such event, at his address as it
appears on the Note Register, not later than the latest date, and not earlier
than the earliest date, prescribed for the giving of such notice.  In any case where notice to Noteholders is
given by mail, neither the failure to mail such notice nor any defect in any
notice so mailed to any particular Noteholder shall affect the sufficiency of
such notice with respect to other Noteholders, and any notice that is mailed in
the manner herein provided shall conclusively be presumed to have been duly
given.

 

 

Where this Indenture provides for notice in
any manner, such notice may be waived in writing by any Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice.  Waivers
of notice by Noteholders shall be filed with the Indenture Trustee but such
filing shall not be a condition precedent to the validity of any action taken
in reliance upon such a waiver.

 

In case, by reason of the suspension of
regular mail service as a result of a strike, work stoppage or similar
activity, it shall be impractical to mail notice of any event to the
Noteholders when such notice is required to be given pursuant to any provision
of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving
of such notice.

 

Where this Indenture provides for notice to
the Note Purchaser, failure to give such notice shall not affect any other
right or obligations created hereunder, and shall not under any circumstance
constitute a Default or an Event of Default.

 

SECTION 11.6               Alternate Payment and Notice
Provisions.  Notwithstanding any
provision of this Indenture or any of the Notes to the contrary, the Issuer may
enter into any agreement with any Noteholder providing for a method of payment,
or notice by the Indenture  Trustee or
any Paying Agent to such Noteholder that is different from the methods provided
for in this Indenture for such payments or notices; provided
that such methods are reasonable and consented to by the Indenture Trustee
(which consent shall not be unreasonably withheld).  The Issuer will furnish to the Indenture
Trustee a copy of each such agreement, and the Indenture Trustee will cause
payments to be made and notices to be given in accordance with such agreements.

 

SECTION 11.7               Conflict with Trust Indenture
Act.  If any provision hereof limits,
qualifies or conflicts with another provision hereof that is required to be
included in this Indenture by any of the provisions of the TIA, such required
provision shall control.

 

The provisions of TIA §§310 through 317 that
impose duties on any person (including the provisions automatically deemed
included herein unless expressly excluded by this Indenture) are a part of and
govern this Indenture, whether or not physically contained herein.

 

SECTION 11.8               Effect of Headings and Table
of Contents.  The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.

 

SECTION 11.9               Successors and Assigns.  All covenants and agreements in this
Indenture and the Notes by the Issuer shall bind its successors and
assigns.  All agreements of the Indenture
Trustee in this Indenture shall bind its successors.

 

SECTION 11.10             Separability.  In case any provision in this Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not be affected or
impaired thereby.

 

 

SECTION 11.11             Benefits
of Indenture.  Nothing in this
Indenture or in the Notes, express or implied, shall give to any Person, other
than the parties hereto and their successors hereunder, and (only to the extent
expressly provided herein), TRC, the Noteholders, any other party secured
hereunder and any other person with an ownership interest in any part of the
Owner Trust Estate, any benefit or any legal or equitable right, remedy or
claim under this Indenture.

 

SECTION 11.12             GOVERNING
LAW.  THIS
INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ITS CONFLICT
OF LAW PRINCIPLES.

 

THE
PARTIES HERETO HEREBY DECLARE THAT IT IS THEIR INTENTION THAT THIS INDENTURE
SHALL BE REGARDED AS MADE UNDER THE LAWS OF THE STATE OF DELAWARE AND THAT THE
LAWS OF SAID STATE SHALL BE APPLIED IN INTERPRETING ITS PROVISIONS IN ALL CASES
WHERE LEGAL INTERPRETATION SHALL BE REQUIRED. 
EACH OF THE PARTIES HERETO AGREES (A) THAT THIS AGREEMENT INVOLVES
AT LEAST $100,000.00, AND (B) THAT THIS INDENTURE HAS BEEN ENTERED INTO BY
THE PARTIES HERETO IN EXPRESS RELIANCE UPON 6 DEL. C. § 2708.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY AGREES (A) TO BE SUBJECT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF DELAWARE AND OF THE FEDERAL COURTS SITTING IN THE STATE
OF DELAWARE, AND (B) (1) TO THE EXTENT SUCH PARTY IS NOT OTHERWISE
SUBJECT TO SERVICE OF PROCESS IN THE STATE OF DELAWARE, TO APPOINT AND MAINTAIN
AN AGENT IN THE STATE OF DELAWARE AS SUCH PARTY’S AGENT FOR ACCEPTANCE OF LEGAL
PROCESS AND NOTIFY THE OTHER PARTY OR PARTIES HERETO OF THE NAME AND ADDRESS OF
SUCH AGENT, AND (2) THAT SERVICE OF PROCESS MAY, TO THE FULLEST EXTENT PERMITTED
BY LAW, ALSO BE MADE ON SUCH PARTY BY PREPAID CERTIFIED MAIL WITH A PROOF OF
MAILING RECEIPT VALIDATED BY THE UNITED STATES POSTAL SERVICE CONSTITUTING
EVIDENCE OF VALID SERVICE, AND THAT SERVICE MADE PURSUANT TO
(B) (1) OR (2) ABOVE SHALL, TO THE FULLEST EXTENT PERMITTED BY
LAW, HAVE THE SAME LEGAL FORCE AND EFFECT AS IF SERVED UPON SUCH PARTY
PERSONALLY WITHIN THE STATE OF DELAWARE.

 

SECTION 11.13             Counterparts.  This Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.

 

SECTION 11.14             Recording
of Indenture.  If this Indenture is
subject to recording in any appropriate public recording offices, such
recording is to be effected by the Issuer and at its expense accompanied by an
Opinion of Counsel (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any
other 

 

 

person secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture or to satisfy any
provision of the TIA.

 

SECTION 11.15             Trust
Obligation.  No recourse may be
taken, directly or indirectly, with respect to the obligations of the Issuer,
the Owner Trustee or the Indenture Trustee on the Notes or under this Indenture
or any certificate or other writing delivered in connection herewith or
therewith, against (i) the Depositor, the Administrator, the Transferor,
the Servicer, the Indenture Trustee or the Owner Trustee in its individual
capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any
partner, owner, beneficiary, officer, director, employee or agent of the
Indenture Trustee or the Owner Trustee in its individual capacity, any holder
of a beneficial interest in the Issuer, the Owner Trustee or the Indenture
Trustee or of any successor or assign of the Indenture Trustee or the Owner
Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Indenture Trustee and the Owner
Trustee have no such obligations in their individual capacities) and except
that any such partner, owner or beneficiary shall be fully liable, to the extent
provided by applicable law, for any unpaid consideration for stock, unpaid
capital contribution or failure to pay any installment or call owing to such
entity.  For all purposes of this
Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Owner Trustee shall be subject to, and entitled to the benefits
of, the terms and provisions of Articles IV, V, VI and VII of the Trust
Agreement.

 

SECTION 11.16             No
Petition.  Notwithstanding any prior
termination of this Indenture, the Indenture Trustee and each Noteholder, by
its acceptance of a Note or portion thereof, hereby covenants that (a) they
shall not at any time, with respect to the Issuer or the Master Trust,
acquiesce, petition or otherwise invoke or cause the Issuer or the Master Trust
to invoke the process of any court or government authority for the purpose of
commencing or sustaining a case against the Issuer or the Master Trust under
any Federal or state bankruptcy, insolvency or similar law or appointing a
receiver, conservator, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Issuer or the Master Trust or any substantial
part of its property, or ordering the winding up or liquidation of the affairs
of the Issuer or the Master Trust, (b) any claim that they may have at any
time against the corpus of the Master Trust that they may seek to enforce
against the corpus of the Master Trust, shall be subordinate to the payment in
full, including post-petition interest, in the event that the Master Trust
becomes a debtor or debtor in possession in a case under any applicable Federal
or state bankruptcy, insolvency or other similar law now or hereafter in effect
or otherwise subject to any insolvency, reorganization, liquidation, rehabilitation
or other similar proceedings, of the claims of the holders of any securities of
the Master Trust and the holders of any other notes, bonds, contracts or other
obligations that are related to the Master Trust and (c) they hereby
irrevocably make the election afforded by Title 11 United States Code Section 1111(b)(1)(A)(i) to
secured creditors to receive the treatment afforded by Title 11 United States
Code Section 1111(b)(2) with respect to any secured claim that they
may have at any time against the Issuer or the Master Trust.

 

SECTION 11.17             Inspection.  The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee, during the
Issuer’s normal business hours, to examine all the books of account, records,
reports, and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer’s affairs, finances and accounts with the Issuer’s
officers, employees and Independent certified 

 

 

public
accountants, all at such reasonable times and as often as may be reasonably
requested.  The Indenture Trustee shall,
and shall cause its representatives to, hold in confidence all such information
except to the extent disclosure may be required by law (and all reasonable
applications for confidential treatment are unavailing) and except to the
extent that the Indenture Trustee may reasonably determine that such disclosure
is consistent with its obligations hereunder.

 

SECTION 11.18             Tax
Treatment.  The Issuer intends that
the Notes will be treated as debt for all United States tax purposes.  Each Noteholder, by acceptance of its Note,
agrees to treat, and to take no action inconsistent with the treatment of, the
Notes as indebtedness for all United States tax purposes.

 

SECTION 11.19             Other Rights.

 

Notwithstanding
any other provision in this Indenture, including, but not limited to Sections
5.11, 9.1, 9.2 and 11.5, while the Note Purchase
Agreement is in effect it is understood and acknowledged that the Note
Purchaser will have no less favorable economics and notice and consent rights
as a holder of the Notes as it would have if it were the direct owner of the
Collateral Certificate (as such term is defined in the Series Supplement).  In addition, any amendment to a Basic
Document after the Closing Date which may have a material adverse effect on the
Noteholders shall be subject to the prior written consent of the Noteholders
and additionally, the Indenture Trustee shall be given notice of any proposed
amendment to such documents (regardless of any determination of materiality)
not less than ten Business Days prior to the proposed effective date for such
amendment.

 

 

IN WITNESS
WHEREOF, the Issuer and the Indenture Trustee have caused this Indenture to be
duly executed by their respective officers, thereunto duly authorized, all as
of the day and year first above written.

 

 

	
   

  	
  TARGET
  CREDIT CARD OWNER TRUST 2008-1

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Wilmington
  Trust Company,

  	
   

  
	
   

  	
   

  	
  not in its
  individual capacity but solely as

  	
   

  
	
   

  	
   

  	
  Owner
  Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.
  Christopher Murphy

  	
   

  
	
   

  	
   

  	
  Name: J.
  Christopher Murphy

  	
   

  
	
   

  	
   

  	
  Title:   Financial Services Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION,

  	
   

  
	
   

  	
  solely in
  its capacities as Indenture Trustee,

  	
   

  
	
   

  	
  Securities
  Intermediary and Transfer Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Benjamin
  J. Krueger

  	
   

  
	
   

  	
   

  	
  Name:
  Benjamin J. Krueger

  	
   

  
	
   

  	
   

  	
  Title:   Vice President

  	
   

  

 

 

INDENTURE

 

 

EXHIBIT A

 

FORM OF NOTE

 

THIS FLOATING
RATE ASSET-BACKED NOTE OF TARGET CREDIT CARD OWNER TRUST 2008-1 MAY BE
TRANSFERRED, UNLESS SUCH TRANSFER WOULD VIOLATE ANY OF THE RESTRICTIONS SET
FORTH IN SUBSECTION 2.3(B) OF THE INDENTURE.  NO TRANSFER MAY BE MADE UNLESS SUCH
TRANSFER IS MADE (X) EITHER (I) PURSUANT TO AN EFFECTIVE REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND
APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS OR (II) IN A TRANSACTION
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES OR “BLUE SKY” LAWS AND (Y) TO (1) A PERSON WHO THE
TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (A “QIB”)
WITHIN THE MEANING THEREOF IN RULE 144A UNDER THE SECURITIES ACT THAT IS AWARE
THAT THE RESALE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OR (2) A
PERSON WHO IS AN ACCREDITED INVESTOR AS DEFINED IN RULE 501(A)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT. 
THE NOTES MAY NOT BE TRANSFERRED TO (A) AN “EMPLOYEE BENEFIT
PLAN” (AS DEFINED IN SECTION 3(3) OF ERISA), INCLUDING GOVERNMENTAL
PLANS AND CHURCH PLANS, (B) ANY “PLAN” (AS DEFINED IN
SECTION 4975(E)(1) OF THE CODE) INCLUDING INDIVIDUAL RETIREMENT
ACCOUNTS AND KEOGH PLANS, OR (C) ANY OTHER ENTITY WHOSE UNDERLYING ASSETS
INCLUDE “PLAN ASSETS” (WITHIN THE MEANING OF DEPARTMENT OF LABOR REGULATION
SECTION 2510.3-101, 29 C.F.R. § 2510.3-101 OR OTHERWISE UNDER ERISA) BY
REASON OF A PLAN’S INVESTMENT IN THE ENTITY, INCLUDING, WITHOUT LIMITATION, AN
INSURANCE COMPANY GENERAL ACCOUNT.

 

THIS NOTE IS
SUBJECT TO ADDITIONAL RESTRICTIONS ON RESALE OR TRANSFER SET FORTH IN
SECTION 2.3 OF THE INDENTURE.

 

EACH POTENTIAL
TRANSFEREE SHALL BE REQUIRED TO REPRESENT THAT IT IS NOT A RETAIL COMPETITOR OF
TARGET. PRIOR TO PURCHASING ANY NOTES, PURCHASERS SHOULD CONSULT COUNSEL WITH
RESPECT TO THE AVAILABILITY AND CONDITIONS OF EXEMPTION FROM THE RESTRICTION ON
RESALE OR TRANSFER.  THE TRANSFEROR HAS
NOT AGREED TO REGISTER THE NOTES UNDER THE SECURITIES ACT, TO QUALIFY THE NOTES
UNDER THE SECURITIES LAWS OF ANY STATE OR TO PROVIDE REGISTRATION RIGHTS TO ANY
PURCHASER.

 

THE HOLDER OF
THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY
TIME INSTITUTE AGAINST THE ISSUER, OR JOIN IN INSTITUTING AGAINST THE ISSUER,
ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION
PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE
BANKRUPTCY OR SIMILAR LAW.

 

 

THE HOLDER OF
THIS NOTE, BY ACCEPTANCE OF THIS NOTE, AGREES TO TREAT THE NOTE AS INDEBTEDNESS
FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW PURPOSES
AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

ANY TRANSFER
IN VIOLATION OF THE FOREGOING OR THE RESTRICTIONS SET FORTH IN SECTION 2.3
OF THE INDENTURE WILL BE OF NO FORCE AND EFFECT, WILL BE VOID AB INITIO,
AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO THE PURCHASER OR TRANSFEREE,
NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO THE ISSUER, THE INDENTURE
TRUSTEE OR ANY INTERMEDIARY.

 

 

	
  REGISTERED

  	
   

  	
  $

  	
   

  	
  1

  
	
  No. A-

  	
   

  	
   

  	
   

  	
   

  
							

 

 

THE PRINCIPAL OF THIS NOTE MAY BE
PAID IN INSTALLMENTS AS SET FORTH HEREIN. 
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

 

TARGET CREDIT CARD OWNER TRUST 2008-1

 

FLOATING RATE ASSET-BACKED NOTES

 

Target Credit Card Owner Trust 2008-1, a statutory
trust organized and existing under the laws of the State of Delaware (including
any successor, the “Issuer”), for value received, hereby promises to pay
to ____________, or its registered assigns, the principal sum of ______ DOLLARS
($________); partially payable on each applicable Distribution Date in an
amount equal to the result obtained by multiplying (i) a fraction, the
numerator of which is $__________ and the denominator of which is
$____________by (ii) the aggregate amount, if any, payable from the Note
Distribution Account in respect of principal on the Notes pursuant to Section 3.1
on such Distribution Date; provided that
the entire unpaid principal amount of this Note shall be due and payable on the
Legal Maturity Date (which is May 25, 2016).  The Issuer will pay interest on this Note at
the rate per annum described in the Indenture, on each Distribution Date until
the principal of this Note is paid or made available for payment, on the Note
Principal Balance outstanding at the end of the last day of the related Monthly
Period, subject to certain limitations contained in Sections 2.7 and 3.1.
Interest on this Note will accrue for each Distribution Date from the most
recent Distribution Date on which interest has been paid to but excluding the
then current Distribution Date or, if no interest has yet been paid, from May 19,
2008.  Interest will be computed on the
basis of the actual number of days elapsed in a 360-day year (which is ___ days
in the case of the initial Interest Accrual Period).  Such principal of and interest on this Note
shall be paid in the manner specified in the Indenture.

 

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.  All payments made by the Issuer with respect
to this Note shall be applied first to interest due and payable on this Note as
provided above and then to the unpaid principal of this Note.

 

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 or facsimile signature, this Note shall not be 

 

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

 

 

entitled to any benefit under the Indenture
referred to on the reverse hereof, or be valid or obligatory for any purpose.

 

 

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

 

Dated:  May 19, 2008

 

 

	
   

  	
  TARGET
  CREDIT CARD OWNER TRUST 2008-1

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:
  Wilmington Trust Company,

  	
   

  
	
   

  	
  not in its
  individual capacity but solely as Owner Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

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

 

 

Dated:  May 19, 2008

 

 

	
   

  	
  WELLS FARGO BANK, NATIONAL ASSOCIATION

  	
   

  
	
   

  	
  not in its
  individual capacity but solely as Indenture Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  	
   

  

 

 

[REVERSE OF NOTE]

 

This Note is one of a duly authorized issue
of Notes of the Issuer, designated as its Floating Rate Asset-Backed Notes
(herein called the “Notes”), all issued under an Indenture dated as of May 19,
2008 (such Indenture, as supplemented, amended or otherwise modified, is herein
called the “Indenture”), between the Issuer and Wells Fargo Bank,
National Association, not in its individual capacity but solely as indenture
trustee (the “Indenture Trustee”, which term includes any successor indenture
trustee under the Indenture) and as securities intermediary and transfer agent,
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights and obligations thereunder of the
Issuer, the Indenture Trustee and the Noteholders.  The Notes are subject to all terms of the
Indenture.  All terms used in this Note
that are not otherwise defined herein and that are defined in the Indenture
shall have the meanings assigned to them in or pursuant to the Indenture.

 

The Notes are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture.

 

Each Noteholder, by acceptance of a Note,
covenants and agrees that no recourse may be taken, directly or indirectly,
with respect to the obligations of the Issuer, the Owner Trustee or the
Indenture Trustee on the Notes or under the Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Depositor, the Administrator, the Transferor, the Servicer, the Owner Trustee
or the Indenture Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, officer, director, employee or agent of the Owner Trustee or the
Indenture Trustee in its individual capacity, any holder of a beneficial
interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any
successor or assign of the Owner Trustee or the Indenture Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Owner Trustee and the Indenture Trustee have no such
obligations in their individual capacities) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.

 

It is the intent of the Depositor, the
Administrator, the Issuer, the Noteholders and TRC, that the Notes will be
classified as indebtedness for all United States tax purposes.  The Noteholders, by acceptance of a Note,
agree to treat, and to take no action inconsistent with the treatment of, the
Notes as indebtedness for such tax purposes.

 

Each Noteholder, by acceptance of a Note,
covenants and agrees that it will not at any time institute against the Issuer,
or join in any institution against the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation 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 or any
of the other Basic Documents.

 

This Note and the Indenture shall be construed
in accordance with the laws of the State of Delaware, without giving effect to
its conflict of law principles, and the obligations, rights and remedies of the
parties hereunder and thereunder shall be determined in accordance with such
laws.

 

 

No reference herein to the Indenture and no
provision of this 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 Note at the times, place and rate, and in the coin or
currency, herein prescribed.

 

Anything herein to the contrary
notwithstanding, except as expressly provided in the Basic Documents, none of
Wilmington Trust Company in its individual capacity, any owner of a beneficial
interest in the Issuer, or any of their respective partners, beneficiaries,
agents, officers, directors, employees, successors or assigns shall be
personally liable for, nor shall recourse be had to any of them for, the
payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in
this Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Issuer for the sole
purpose of binding the interests of the Owner Trustee in the assets of the
Issuer.  The Holder of this Note by the
acceptance hereof agrees that, except as expressly provided in the Basic
Documents, in the case of an Event of Default under the Indenture, the
Noteholder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided 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 Note.

 

 

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:

  	
   

  	
   

  	
   

  	
  2

  	
   

  
	
   

  	
   

  	
   

  	
  Signature Guaranteed:

  	
   

  	
   

  
								

 

2                                           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.

 

 

EXHIBIT B

 

FORM OF TRANSFEREE
REPRESENTATION LETTER

 

[DATE]

 

Target Receivables Corporation

1000 Nicollet Mall

Minneapolis, Minnesota 55403

 

Wells Fargo Bank, National Association

Sixth Street and Marquette Avenue

MAC N9311-161

Minneapolis, Minnesota  55479

 

Re:  Target Credit Card Owner Trust 2008-1

 

Ladies and Gentlemen:

 

This letter (the “Transferee
Representation Letter”) is delivered by the undersigned (the “Transferee”)
pursuant to the Indenture, dated as of May 19, 2008, by and among TARGET CREDIT
CARD OWNER TRUST 2008-1, a Delaware statutory trust (the “Issuer” or “Owner
Trust”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking
association, as indenture trustee (the “Indenture Trustee”), securities
intermediary and transfer agent and not in its individual capacity.  Capitalized terms used herein without
definition shall have the meanings set forth or incorporated by reference in
the Indenture or if not therein, in the Amended and Restated Pooling and
Servicing Agreement, dated as of April 28, 2000, as amended by Amendment No. 1,
dated as of August 22, 2001 (the “Pooling and Servicing Agreement,”
such term to include any amendment thereto), by and among Target Receivables
Corporation, as Transferor (the “Transferor”), Target National Bank, as
the Servicer, and Wells Fargo Bank, National Association, as Trustee (the “Trustee”),
and the Series 2008-1 Supplement, dated as of May 19, 2008 (the “Series Supplement”),
by and among the Transferor, the Servicer and the Trustee.  The Pooling and Servicing Agreement, as
supplemented by the Series Supplement, is herein referred to as the “Agreement.”  The Transferee represents to and agrees with
the Transferor as follows:

 

I.              The
Transferee has received such information and documentation as the Transferee
deems necessary in order to make its investment decision.  The Transferee understands that such
information and documentation speaks only as of its date and that the
information contained therein may not be correct or complete as of any time subsequent
to such date.

 

 

II.            The
Transferee agrees to be bound by the restrictions and conditions relating to
the Notes set forth in the Indenture. 
The Transferee agrees to be bound by, and not to reoffer, resell, pledge
or otherwise transfer (any such act, a “Transfer”) the Notes except in
compliance with such restrictions and conditions including but not limited to
those in subsection 2.3(b) of the Indenture.

 

III.           The
Transferee represents that it is not a retail competitor of Target.

 

IV.           The
Transferee agrees that the Notes may be reoffered, resold, pledged or otherwise
transferred only (x) either (i) pursuant to an effective registration
under the Securities Act and applicable state securities or “Blue Sky” laws or (ii) in
a transaction exempt from the registration requirements of the Securities Act
and applicable state securities or “Blue Sky” laws and (y) to (1) a
person who the transferor reasonably believes is a Qualified Institutional
Buyer (a “QIB”) within the meaning thereof in Rule 144A under the
Securities Act that is aware that the resale or other transfer is being made in
reliance on Rule 144A or (2) a person who is an accredited investor
as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.

 

V.            The
Transferee is, for federal income tax purposes, either (i) a citizen or
resident of the United States, (ii) a corporation or partnership organized
in or under the laws of the United States or any state thereof or the District
of Columbia which, if such entity is a tax-exempt entity, recognizes that
payments with respect to the Notes may constitute unrelated business taxable
income, (iii) an estate the income of which is includible in gross income
for U.S. federal income tax purposes regardless of its source, or (iv) either
(x) a trust for which a court within the United States is able to exercise
primary supervision over its administration and for which one or more persons
described in this paragraph are able to control all substantial decisions or (y) a
trust for which a valid election has been made to be treated as a United States
person.  The Transferee will furnish to
the Person from whom it is acquiring any interest in the Notes, the Servicer
and the Indenture Trustee, a properly executed U.S. Internal Revenue Service Form W-9
(and will furnish a new Form W-9, or any successor applicable form, upon
the expiration or obsolescence of any previously delivered form) and such other
certifications, representations or Opinions of Counsel as may be requested by
the Indenture Trustee.

 

VI.           The
Transferee has not acquired and it will not Transfer any interest in the Notes,
or cause an interest in the Notes to be marketed, on or through an “established
securities market” within the meaning of Section 7704(b)(1) of the
Code and any Treasury regulations thereunder, including, without limitation, an
over the counter market or an interdealer quotation system that regularly
disseminates firm buy or sell quotations. 
In addition, (i) the Transferee is not and will not become (and, if
it is disregarded as an entity separate from its owner within the meaning of
Treasury Regulations Section 301.7701-3(a) (a “DRE”), its
owner is not and will not become), for so long as the Transferee holds an
interest in the Notes, a partnership, Subchapter S corporation or grantor trust
for U.S. federal income tax purposes (a “Flow-Thru Entity”) or (ii) if
the Transferee (or, if the assignee is a DRE, its owner) is, or becomes, a
Flow-Thru Entity, for so long as the Transferee (or, if the Transferee is a
DRE, its owner) is a Flow-Thru Entity and the Transferee holds an interest in
the Notes, not more than 50% of the value of any interests in the Transferee
(or, if the Transferee is a DRE, its owner) will be attributable to interests
in the Trust held by the Transferee.  The
opinion of tax counsel to the effect that the Owner Trust will not be 

 

 

treated as an association or as a publicly traded partnership taxable
as a corporation is dependent in part on the accuracy of the Transferee’s
certifications described in this paragraph.

 

VII.          The
Transferee understands that the opinion of tax counsel that the Owner Trust is
not a publicly traded partnership taxable as a corporation is dependent in part
on the accuracy of the representations in paragraphs V and VI.

 

VIII.        The
Transferee is (a) a Qualified Institutional Buyer (a “QIB”) within
the meaning thereof in Rule 144A under the Securities Act that is aware
that the resale or other transfer is being made in reliance on Rule 144A
or (b) an institutional “accredited investor” (as defined in Rule 501(a)(1),
(2), (3), or (7) of Regulation D under the Securities Act) and has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of its investment in the Notes, and the Transferee
and any account for which the Transferee is acting are each able to bear the
economic risk of its investment.

 

X.            The
Transferee is acquiring the Notes purchased by it for its own account or for a
single account (each of which is a QIB or institutional accredited investor) as
to which the Transferee exercises sole investment discretion.

 

XI.           The
Transferee represents and warrants for the benefit of Target Receivables
Corporation and the Indenture Trustee that such Transferee is not (a) an “employee
benefit plan” (as defined in Section 3(3) of ERISA), including
governmental plans and church plans, (b) any “plan” (as defined in Section 4975(e)(1) of
the Code) including individual retirement accounts and Keogh plans, or (c) any
other entity whose underlying assets include “plan assets” (within the meaning
of Department of Labor Regulation Section 2510.3-101, 29 C.F.R. §
2510.3-101 or otherwise under ERISA) by reason of a plan’s investment in the
entity, including, without limitation, an insurance company general account.

 

XII.         The
Transferee understands that any purported Transfer of any portion of the Notes
in contravention of the restrictions and conditions in paragraphs I through XI
above (including any violation of the representation in paragraph V by an
investor who continues to hold an interest in the Notes occurring any time
after the Transfer in which it acquired such Notes) shall be null and void and
the purported Transferee shall not be recognized by the Trust or any other
person as a Noteholder for any purpose.

 

XIII. .      The
Transferee further understands that, on any proposed reoffer, resale, pledge or
other transfer of the Notes, the Transferee will be required to furnish to the
Indenture Trustee and the Transfer Agent and Registrar, such certifications and
other information as the Indenture Trustee or the Transfer Agent and Registrar
may reasonably require to confirm that the proposed sale complies with the
foregoing restrictions and with the restrictions and conditions of the Notes
and the Indenture pursuant to which the Notes were issued and the Transferee
agrees that if the Transferee determines to Transfer the Notes, the Transferee
will cause its proposed Transferee to provide the Transferor and the Indenture
Trustee with a letter substantially in the form of this Transferee
Representation Letter.  The Transferee
further understands that the Notes purchased by it will bear a legend to the
foregoing effect.

 

 

XIV.        The
person signing this Transferee Representation Letter on behalf of the ultimate
beneficial purchaser of the Notes has been duly authorized by such beneficial
purchaser of the Notes to do so.

 

XV.         The Transferee certifies that this
Transferee Representation Letter has been duly executed and delivered and
constitutes the legal, valid and binding obligation of the Transferee,
enforceable against the Transferee in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws or equitable principles affecting the enforcement of
creditors’ rights generally and general principles of equity and that the name
set forth below constitutes the full legal name of the Transferee.

 

You are entitled to rely upon this Transferee
Representation Letter and are irrevocably authorized to produce this Transferee
Representation Letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.

 

	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Full Legal Name of Transferee]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:Exhibit 10(C)

 

TARGET RECEIVABLES CORPORATION,

 

Transferor

 

TARGET NATIONAL BANK,

 

Servicer

 

and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

 

Trustee

 

on behalf of the Collateral Certificateholder

 

 

SERIES 2008-1 SUPPLEMENT

 

Dated as of May 19, 2008

 

to

 

AMENDED AND RESTATED

POOLING AND SERVICING AGREEMENT

 

Dated as of April 28, 2000,

as amended by Amendment No. 1, dated as of August 22, 2001

 

 

TARGET CREDIT CARD MASTER TRUST

 

Series 2008-1

 

 

TABLE
OF CONTENTS

 

	
  ARTICLE I

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CREATION OF
  THE COLLATERAL CERTIFICATE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.1

  	
   

  	
  Designation

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.2

  	
   

  	
  Delivery of and Payment for the Collateral Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.3

  	
   

  	
  Form of Delivery of the Collateral Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DEFINITIONS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.1

  	
   

  	
  Definitions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SERVICER COMPENSATION, PROGRAM FEE AND
  LOYALTY, REWARDS AND TCOE

  FEE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.1

  	
   

  	
  Servicer Compensation

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.2

  	
   

  	
  Program Fee

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.3

  	
   

  	
  Loyalty, Rewards and TCOE Fee

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RIGHTS OF THE COLLATERAL CERTIFICATEHOLDER
  AND

  ALLOCATION AND APPLICATION OF COLLECTIONS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.1

  	
   

  	
  Rights of the Collateral Certificateholder

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.2

  	
   

  	
  Collections and Allocations; Payments on
  Transferor Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.3

  	
   

  	
  Determination of Monthly Interest

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.4

  	
   

  	
  Determination of Principal Amounts

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.5

  	
   

  	
  Special Shared Principal Collections

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.6

  	
   

  	
  Application of Funds on Deposit in the
  Collection Account Allocable to the
  Collateral Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.7

  	
   

  	
  Investor Defaulted Amount

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.8

  	
   

  	
  Collateral Certificate Additional Amount

  	
   

  	
   

  

 

 

	
  ARTICLE V

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DISTRIBUTIONS AND REPORTS TO SERIES 2008-1

  
	
  CERTIFICATEHOLDER

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.1

  	
   

  	
  Distributions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.2

  	
   

  	
  Reports and Statements to Collateral
  Certificateholder

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EARLY AMORTIZATION EVENTS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.1

  	
   

  	
  Series 2008-1 Early Amortization
  Events

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  OPTIONAL TERMINATION; SERIES TERMINATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.1

  	
   

  	
  Optional Termination

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.2

  	
   

  	
  Series 2008-1 Termination

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.3

  	
   

  	
  Special Reduction of the Invested Amount

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FINAL DISTRIBUTION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 8.1

  	
   

  	
  Sale of Receivables or Collateral Certificateholder’s Interest
  pursuant to Section 2.6 or 10.1 of the Agreement and Section 7.1 or
  7.2 of this Series Supplement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MISCELLANEOUS PROVISIONS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.1

  	
   

  	
  Legend on Collateral Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.2

  	
   

  	
  Ratification of Agreement

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.3

  	
   

  	
  Counterparts

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.4

  	
   

  	
  Transfer of the Collateral Certificate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.5

  	
   

  	
  Jurisdiction; Service

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.6

  	
   

  	
  GOVERNING LAW

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.7

  	
   

  	
  Article 8

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.8

  	
   

  	
  No Petition

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.9

  	
   

  	
  Instructions in Writing

  	
   

  	
   

  

 

 

	
  Section 9.10

  	
   

  	
  Adjustments

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.11

  	
   

  	
  Eligible Investments

  	
   

  	
   

  

 

 

	
  EXHIBITS

  

 

	
  Form of Collateral Certificate

  	
   

  	
   

  
	
  Form of
  Monthly Collateral Certificateholder’s Statement

  	
   

  	
   

  
	
  Form of Monthly
  Servicer’s Certificate

  	
   

  	
   

  
	
  Form of
  Transferee Representation Letter

  	
   

  	
   

  
	
  Adjustment
  Payment Schedule

  	
   

  	
   

  

 

 

SERIES 2008-1
SUPPLEMENT, dated as of May 19, 2008 (this “Series Supplement”)
by and among TARGET RECEIVABLES CORPORATION, a corporation organized and
existing under the laws of the State of Minnesota, as Transferor (the “Transferor”),
TARGET NATIONAL BANK, a national banking association organized and existing
under the laws of the United States, as Servicer (“Target National Bank”
or the “Servicer”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, a
national banking association organized and existing under the laws of the
United States, as trustee (together with its successors in trust thereunder as
provided in the Agreement referred to below, the “Trustee”) on behalf of
the Certificateholders of the Target Credit Card Master Trust (the “Trust”)
under the Amended and Restated Pooling and Servicing Agreement, dated as of April 28,
2000, as amended by Amendment No. 1, dated as of August 22, 2001 (as
amended, supplemented or otherwise modified, as amended, the “Agreement”)
by and among the Transferor, the Servicer and the Trustee.

 

WHEREAS, Section 6.3
of the Agreement provides, among other things, that the Transferor and the
Trustee may at any time and from time to time enter into a supplement to the
Agreement for the purpose of authorizing the issuance by the Transferor, for
execution and redelivery to the Trustee for authentication, of one or more Series of
Certificates;

 

WHEREAS,
pursuant to this Series Supplement, the Transferor and the Trustee shall
create a new Series of Investor Certificates and shall specify the
Principal Terms thereof; and

 

WHEREAS, on
the Closing Date, the Investor Certificates created hereunder will be deposited
by the Transferor in Target Credit Card Owner Trust 2008-1 (the “Owner Trust”)
and pledged by the Owner Trust to an indenture trustee to secure the
$3,825,000,000 Floating Rate Asset-Backed Notes to be issued by the Owner Trust
pursuant to the Indenture (as defined herein).

 

ARTICLE I

 

CREATION OF THE COLLATERAL CERTIFICATE

 

Section 1.1             Designation.

 

There is
hereby created a Series of Investor Certificates to be issued pursuant to
the Agreement and this Series Supplement to be known generally as the “Series 2008-1
Certificates.”  The Series 2008-1
Certificates shall be issued in a single class evidenced by a single
certificate and designated generally as the Series 2008-1 Collateral
Certificate (the “Collateral Certificate”).  Series 2008-1 shall not be a Principal
Sharing Series and shall not be entitled to share Excess Finance Charge
Collections with other Series.

 

Section 1.2             Delivery of and Payment for the
Collateral Certificate.

 

The Transferor
shall execute and deliver the Collateral Certificate to the Trustee for
authentication in accordance with Section 6.1 of the Agreement.  The Trustee shall deliver the Collateral
Certificate to or upon the order of the Transferor when authenticated in
accordance with Section 6.2 of the Agreement.  The Collateral Certificate will be deposited
by the 

 

 

Transferor into the Owner Trust
and pledged by the Owner Trust to an indenture trustee to secure the Notes.

 

Section 1.3             Form of Delivery of the
Collateral Certificate.

 

The Collateral
Certificate shall be delivered as a Registered Certificate as provided in Section 6.1
of the Agreement and shall be a Definitive Certificate as provided in Section 6.12
of the Agreement.  The Collateral
Certificate shall be substantially in the form of Exhibit A hereto.

 

ARTICLE II

 

DEFINITIONS

 

Section 2.1             Definitions.

 

In the event
that any term or provision contained herein shall conflict with or be
inconsistent with any provision contained in the Agreement, the terms and
provisions of this Series Supplement shall govern with respect to the
Collateral Certificate.  All Articles,
Sections, subsections and Exhibits references herein shall mean Articles,
Sections, subsections and Exhibits of this Series Supplement except as
otherwise provided herein.  All
capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to them in the Agreement. 
Each capitalized term defined herein shall relate only to the Collateral
Certificate and to no other Series of Certificates issued by the
Trust.  Certain terms used herein are
defined by reference to the Indenture. 
If the Indenture should terminate prior to the termination of this Series Supplement,
then each term defined herein by reference to the Indenture shall be deemed a
reference to such term as defined in the Indenture immediately prior to the
termination thereof and shall have the same force and effect as if fully set
forth herein, notwithstanding the termination of the Indenture.

 

“Accreted
Note Value” shall have the meaning specified in the Note Purchase
Agreement.

 

“Additional
Interest” shall have the meaning specified in Section 4.3.

 

“Additional
Notes” shall have the meaning specified in the Indenture.

 

“Adjustment
Payment” shall mean any payment the Transferor is required to make into the
Special Funding Account pursuant to subsection 3.9(a) of the Agreement.

 

“Adjustment
Payment Shortfall Reinstatement” shall mean, for any date of determination
following a Distribution Date on which the Invested Amount has been reduced by
the Series 2008-1 Allocation Percentage of unpaid Adjustment Payments
required to be made by the Transferor when the Transferor Amount had been
reduced to zero, an amount equal to the lesser of (a) the aggregate amount
of such reductions minus the
aggregate amount of any reimbursement of such reductions pursuant to subsection
4.6(a)(iii) on any prior Distribution Date and (b) the Transferor
Amount on such date of determination.

 

 

“Adjustment
Percentage” shall mean, with respect to any Distribution Date, the
percentage specified for such Distribution Date on Exhibit E.

 

“Amortization
Period Commencement Date” shall mean the earlier of (a) May 5,
2013 and (b) an Early Amortization Commencement Date.

 

“Available Series 2008-1
Finance Charge Collections” shall have the meaning specified in subsection
4.6(a).

 

“Available Series 2008-1
Principal Collections” shall mean, with respect to any Distribution Date,
the sum of (a) the Principal Allocation Percentage of Collections of
Principal Receivables collected during the preceding Monthly Period and (b) the
sum of the amounts designated to be treated as Available Series 2008-1 Principal
Collections pursuant to subsections 4.6(a)(ii) and (iii) with
respect to such Distribution Date.

 

“Business
Day” shall (a) for the purpose of determining LIBOR, have the meaning
provided in the Agreement; provided,
however, that for such purpose, a
Business Day shall not include any day on which banking institutions in London,
England, trading in United States dollar deposits in the London interbank
market, are authorized or obligated by law or executive order to be closed and (b) for
all other purposes, have the meaning provided in the Agreement.

 

“Cap Test
Percentage” shall have the meaning specified in the Note Purchase
Agreement.

 

“Cap
Trigger” shall have the meaning specified in the Note Purchase Agreement.

 

“Carryover
Interest” shall mean, with respect to any Distribution Date, (a) any
Monthly Interest due but not paid to the Collateral Certificateholder on any
previous Distribution Date plus (b) any
Additional Interest due with respect to such Distribution Date.

 

“Closing
Date” shall mean May 19, 2008.

 

“Collateral
Certificate” shall have the meaning specified in Section 1.1.

 

“Collateral
Certificate Addition Date” shall have the meaning specified in subsection
4.8(a).

 

“Collateral
Certificate Additional Amount” shall have the meaning specified in subsection
4.8(a).

 

“Collateral
Certificateholder” shall mean the holder of record of the Collateral
Certificate.

 

“Collateral
Certificateholder’s Interest” shall have the meaning specified in Section 4.1.

 

 

“Distribution
Date” shall mean June 25, 2008, and the 25th day of each
month thereafter, or if such day is not a Business Day, the next succeeding
Business Day.

 

“Early
Amortization Commencement Date” shall mean the Business Day immediately
following the date on which an Early Amortization Event or a Series 2008-1
Early Amortization Event occurs or is deemed to have occurred.

 

“Early
Amortization Event” shall mean any of the events specified in Section 9.1
of the Agreement.

 

“Early
Amortization Period” shall mean the period beginning on an Early Amortization
Commencement Date and ending on the Series 2008-1 Termination Date.

 

“Event of
Default” shall have the meaning specified in the Indenture.

 

“Floating
Allocation Percentage” shall mean, with respect to any Monthly Period, the
percentage equivalent of a fraction the numerator of which equals the Invested
Amount as of the end of the last day of the immediately preceding Monthly
Period, or in the case of the first Monthly Period, the Closing Date, and the
denominator of which is the sum of (a) the Principal Receivables plus (b) any amount on deposit in
the Special Funding Account, in each case as of the end of the last day of the
Monthly Period used to determine the numerator, or in the case of the first
Monthly Period, the Closing Date; provided
that such calculations are subject to adjustment upon the direction of the
Transferor, in accordance with subsection 2.9(g) of the Agreement, to give
effect to additions of Additional Accounts.

 

“Indenture”
shall mean that certain indenture, dated as of May 19, 2008, by and
between the Owner Trust and Wells Fargo Bank, National Association, as
indenture trustee.

 

“Initial
Invested Amount” shall mean $3,825,000,000.

 

“Interest
Accrual Period” shall mean, with respect to any Distribution Date, the
period from and including the preceding Distribution Date to but excluding such
Distribution Date; provided, however,
that the initial Interest Accrual Period shall begin on and include the Closing
Date and end on but exclude the first Distribution Date.

 

“Interest
Rate” shall have the meaning specified in the Indenture.

 

“Invested
Amount” shall mean, for any date of determination, an amount equal to the
sum of (a) the Initial Invested Amount, plus
(b) the sum of the aggregate amounts allocated with respect to
the reimbursement of Investor Charge-Offs and available on all prior
Distribution Dates pursuant to subsection 4.6(a)(iii), plus (c) the sum of the aggregate
Adjustment Payment Shortfall Reinstatements on all prior dates of
determination, plus (d) the
aggregate amount of any increases in the principal amount of the Collateral
Certificate after the Closing Date pursuant to Section 4.8,
including the principal balance of any Note Purchaser Note Repurchase pursuant
to subsection 17(b) of the Note Purchase Agreement, minus (e) the aggregate amount of
principal payments made to the Collateral Certificateholder prior to such date,
minus (f) the aggregate
amount of Investor Charge-Offs for all prior Distribution Dates, minus (g) the Principal Payment
Adjustment for such date or any prior date, and minus (h) the aggregate amount of any 

 

 

reductions in the Invested
Amount as a result of the purchase by the Transferor for cancellation of a
portion of the Notes pursuant to Section 7.3, including the
principal balance of any Transferor Note Repurchase pursuant to subsection 17(a) of
the Note Purchase Agreement.

 

“Investor
Charge-Off” shall mean, with respect to any Distribution Date, the
aggregate amount of any reduction in the Invested Amount pursuant to Section 4.7.

 

“Investor
Defaulted Amount” shall mean, with respect to any Monthly Period, an amount
equal to the product of the Defaulted Amount and the Floating Allocation
Percentage with respect to such Monthly Period.

 

“Investor
Percentage” shall mean, with respect to Principal Receivables, the
Principal Allocation Percentage and, with respect to Finance Charge Receivables
and the Defaulted Amount, the Floating Allocation Percentage.

 

“Legal
Maturity Date” shall mean the May 25, 2016 Distribution Date.

 

“LIBOR”
shall have the meaning specified in the Indenture.

 

“LIBOR
Determination Date” shall have the meaning specified in the Indenture.

 

“Loyalty,
Rewards and TCOE Fee” shall mean, with respect to any Monthly Period, the
direct cost or related accrual of loyalty, reward and TCOE benefits provided to
or on behalf of cardholders for such Monthly Period; for the avoidance of
doubt, the Loyalty, Rewards and TCOE Fee does not include the marketing or
operational expenses related to the programs.

 

“Loyalty,
Rewards and TCOE Fee Rate Cap” shall mean 2.50%.

 

“Monthly
Interest” shall have the meaning specified in Section 4.3.

 

“Monthly
Interest Shortfall” shall have the meaning specified in Section 4.3.

 

“Monthly
Loyalty, Rewards and TCOE Fee” shall have the meaning specified in Section 3.3.

 

“Monthly
Period” shall mean, with respect to each Determination Date and its related
Distribution Date, the immediately preceding fiscal month of the Transferor; provided that the first Monthly Period
shall begin on the first day of the fiscal month of the Transferor during which
the Closing Date occurs and end on the last day of the fiscal month of the
Transferor during which the Closing Date occurs.

 

“Monthly
Program Fee” shall have the meaning specified in Section 3.2.

 

“Monthly
Servicing Fee” shall have the meaning specified in Section 3.1.

 

“Note”
shall have the meaning specified in the Indenture.

 

“Note
Initial Principal Balance” shall have the meaning specified in the
Indenture.

 

 

“Note
Principal Balance” shall have the meaning specified in the Indenture.

 

“Note
Purchase Agreement” shall mean that certain note purchase agreement, dated
as of May 5, 2008, by and among Target, the Transferor, as seller, BOTAC, Inc.,
as note purchaser, and Chase Bank USA, National Association.

 

“Note
Purchase Agreement Early Amortization Event” shall mean the events
specified in subsections 2(h), 5(b), 9(c) and 17(a) of the Note
Purchase Agreement.

 

“Note
Purchaser Note Repurchase” shall have the meaning specified in the Note
Purchase Agreement.

 

“Noteholder”
shall have the meaning specified in the Indenture.

 

“Owner
Trust” shall have the meaning specified in the recitals.

 

“Percentage
Allocation” shall have the meaning specified in subsection 4.2(b)(i)(y).

 

“Principal
Allocation Percentage” shall mean, with respect to any Monthly Period, the
percentage equivalent of a fraction the numerator of which equals (a) during
the Revolving Period, the Invested Amount at the end of the last day of the
immediately preceding Monthly Period, or in the case of the first Monthly Period,
the Closing Date, and (b) during an Amortization Period, the Invested
Amount at the end of the last day of the Revolving Period, and the denominator
of which equals the greater of (1) the sum of (x) the Principal
Receivables plus (y) the
principal amount on deposit in the Special Funding Account each as of the end
of the last day of the immediately preceding Monthly Period, or in the case of
the first Monthly Period, the Closing Date and (2) the sum of the
numerators used to calculate the principal allocation percentages for all Series and
Participations outstanding as of the date as to which such determination is
made; provided, further, that
such calculations are subject to adjustment upon the direction of the
Transferor, in accordance with subsection 2.9(g) of the Agreement, to give
effect to additions of Additional Accounts.

 

“Principal
Payment Adjustment” shall mean (i) with respect to the Distribution
Date that is the first Special Payment Date, an amount equal to the product of (x) the
Adjustment Percentage for such Distribution Date and (y) the Note Initial
Principal Balance, plus the
amount of any increase in the Invested Amount pursuant to clause (d) of
the definition of Invested Amount as a result of a Note Purchaser Note
Repurchase, minus the amount of
any decrease in the Invested Amount pursuant to clause (h) of the
definition of Invested Amount as a result of a Transferor Note Repurchase and (ii) with
respect to all other Distribution Dates and Special Payment Dates, zero.

 

“Principal
Shortfall” shall mean, with respect to any Distribution Date during the
Amortization Period, (x) for Series 2008-1, the Invested Amount after
the application of Collections of Principal Receivables on such Distribution
Date or (y) for any other Series, the amounts specified as such in the
Supplement for such other Series.

 

 

“Program
Fee” shall mean the compensation to Target Corporation for its account
origination, marketing and program management activities.

 

“Program
Fee Rate” shall mean 3.00% per annum.

 

“Rating
Agency” shall have the meaning specified in the Agreement.

 

“Rating Agency Condition” shall
have the meaning specified in the Agreement; provided, that (i) if and for so long as
there are more than $0 but less than $500,000,000 of outstanding securities
issued by the Trust or a related owner trust that are rated by a nationally
recognized statistical rating agency, satisfaction of the Rating Agency
Condition shall also mean receipt of consent to the particular action from
BOTAC, Inc. for so long as all Notes are held by BOTAC, Inc. or an
Affiliate that is a wholly owned subsidiary of Chase Bank USA, National
Association or JPMorgan Chase & Co. (which consent shall not be
unreasonably withheld) or (ii) if there are no outstanding securities
issued by the Trust or a related owner trust that are rated by a nationally recognized
statistical rating agency, satisfaction of the Rating Agency Condition shall
only mean receipt of consent to the particular action from BOTAC, Inc. for
so long as all Notes are held by BOTAC, Inc. or an Affiliate that is a
wholly owned subsidiary of Chase Bank USA, National Association or JPMorgan
Chase & Co. (which consent shall not be unreasonably withheld).

 

“Reassignment
Amount” shall mean, with respect to any Distribution Date, after giving
effect to any deposits and distributions otherwise to be made on such
Distribution Date, the sum of (i) the Invested Amount on such Distribution
Date plus (ii) the Monthly
Interest for such Distribution Date and the Carryover Interest, if any, for
such Distribution Date.

 

“Record
Date” shall mean, with respect to any Distribution Date, the last Business
Day of the calendar month preceding the month in which such Distribution Date
occurs.

 

“Reference
Banks” shall mean four major banks in the London interbank market selected
by the Servicer.

 

“Required
Retained Transferor’s Percentage” shall mean 2%; provided, however, that such percentage may be adjusted from
time to time upon written notice from the Transferor to the Trustee and such
action shall not, as evidenced by a Tax Opinion, cause the Trust to be characterized
for Federal income tax purposes as an association or publicly traded
partnership taxable as a corporation or otherwise have any material adverse
effect on the Federal income taxation of any outstanding Series of
Certificates or any Certificate Owner.

 

“Revolving
Period” shall mean the period from and including the Closing Date to, but
not including, the Amortization Period Commencement Date.

 

“Series Invested
Amount” shall mean, for Series 2008-1, for any date of determination,
an amount equal to the Invested Amount as of such date.

 

“Series 2005-1”
shall mean the Series of the Target Credit Card Master Trust represented
by the Series 2005-1 Certificates.

 

 

“Series 2005-1
Certificates” shall have the meaning specified in Section 1.1 of the Series 2005-1
Supplement.

 

“Series 2005-1
Supplement” shall mean the Series 2005-1 Supplement, dated as of November 9,
2005, by and among the Transferor, the Servicer and the Trustee.

 

“Series 2005-1
Principal Shortfall” shall mean the “Principal Shortfall” for Series 2005-1
as defined and specified in the Series 2005-1 Supplement.

 

“Series 2008-1”
shall mean the Series of the Target Credit Card Master Trust represented
by the Collateral Certificate.

 

“Series 2008-1
Allocation Percentage” shall mean, on any date of determination, the
percentage equivalent of a fraction the numerator of which is the Invested
Amount and the denominator of which is the sum of the invested amounts (or
adjusted invested amounts, as applicable) of all then outstanding Series.

 

“Series 2008-1
Certificates” shall have the meaning specified in Section 1.1.

 

“Series 2008-1
Early Amortization Event” shall have the meaning specified in Section 6.1.

 

“Series 2008-1
Principal” shall have the meaning specified in Section 4.4.

 

“Series 2008-1
Termination Date” shall mean the earlier to occur of (i) the date on
which the Invested Amount is reduced to zero, and (ii) the Legal Maturity
Date.

 

“Servicing
Fee Rate” shall mean 2.00% per annum.

 

“Special
Payment Date” shall mean each Distribution Date following the Monthly
Period in which an Early Amortization Commencement Date occurs.

 

“Special
Shared Principal Collections” shall have the meaning specified in Section 4.5.

 

“Target”
shall mean Target Corporation, a Minnesota corporation.

 

“Targeted
Holder” shall mean each holder of (i) a right to receive interest or
principal with respect to the Collateral Certificate, (ii) any interest in
the Trust with respect to which an Opinion of Counsel has not been rendered to
the effect that such interest will be treated as debt for federal income tax
purposes, and (iii) a right to receive any amount in respect of the
Transferor’s Interest; provided that
any Person holding more than one right or interest each of which would cause
such Person to be a Targeted Holder shall be treated as a single Targeted
Holder.

 

“TCOE”
shall mean the Take Charge of Education program.

 

 

“Transferor
Note Repurchase” shall have the meaning specified in the Note Purchase
Agreement.

 

“Transferor
Retained Certificates” shall mean Investor Certificates of any Series,
which the Transferor retains or any interest in a trust or other entity that
holds Investor Certificates, that is retained by the Transferor, but only to
the extent that and for so long as the Transferor is the Holder of such Certificates
or interest in a trust that holds Investor Certificates.

 

 

ARTICLE III

 

SERVICER COMPENSATION, PROGRAM FEE AND
LOYALTY, REWARDS AND TCOE FEE

 

Section 3.1             Servicer
Compensation.

 

The share of
the Servicing Fee allocable to the Collateral Certificateholder with respect to
any Distribution Date shall be equal to the product of (a) a fraction, the
numerator of which is the number of weeks in the related Monthly Period and the
denominator of which is the number of weeks in the related fiscal year of the Transferor,
(b) the Servicing Fee Rate and (c) (i) the Invested Amount at
the end of the last day of the Monthly Period second preceding such
Distribution Date, minus (ii) the
product of the amount, if any, on deposit in the Special Funding Account at the
end of the last day of the Monthly Period second preceding such Distribution
Date and the Floating Allocation Percentage with respect to the Monthly Period
related to such Distribution Date (this amount, together with any such amounts
unpaid from prior Distribution Dates, the “Monthly Servicing Fee”); provided, however, that with respect to
the first Distribution Date, the Monthly Servicing Fee shall be
$2,732,143.  The remainder of the
Servicing Fee for each Distribution Date shall be paid from amounts allocable
to the Holder of the Transferor Certificate, holders of Participations or the
Certificateholders of other Series (as provided in the related
Supplements) and in no event shall the Trust, the Trustee or the Collateral
Certificateholder be liable for the share of the Servicing Fee to be paid from
amounts allocable to the Holder of the Transferor Certificate, holders of
Participations or the Certificateholders of any other Series.  The Monthly Servicing Fee shall be payable to
the Servicer on any Distribution Date solely to the extent amounts are
available for distribution in respect thereof pursuant to subsection
4.6(a)(i).

 

Section 3.2             Program Fee.

 

The share of
the Program Fee allocable to the Collateral Certificateholder with respect to
any Distribution Date shall be equal to the product of (a) a fraction, the
numerator of which is the number of weeks in the related Monthly Period and the
denominator of which is the number of weeks in the related fiscal year of the
Transferor, (b) the Program Fee Rate and (c) (i) the Invested
Amount at the end of the last day of the Monthly Period second preceding such
Distribution Date, minus (ii) the
product of the amount, if any, on deposit in the Special Funding Account at the
end of the last day of the Monthly Period second preceding such Distribution
Date and the Floating Allocation Percentage with respect to the Monthly Period
related to such Distribution Date (this amount, together with any such amounts
unpaid from prior Distribution Dates, the “Monthly Program Fee”); provided, however, that with respect to
the first Distribution Date, the Monthly Program Fee shall be $4,098,214.  The Monthly Program Fee shall be payable to
the Target Corporation on any Distribution Date solely to the extent amounts
are available for distribution in respect thereof pursuant to subsection
4.6(a)(iv).

 

Section 3.3             Loyalty, Rewards and TCOE Fee.

 

The share of
the Loyalty, Rewards and TCOE Fee allocable to the Collateral Certificateholder
with respect to any Distribution Date shall be equal to the lesser of (1) the

 

 

product of (a) a
fraction, the numerator of which is the number of weeks in the related Monthly
Period and the denominator of which is the number of weeks in the related
fiscal year of the Transferor, (b) the Loyalty, Rewards and TCOE Fee Rate
Cap and (c) (i) the Invested Amount at the end of the last day of the
Monthly Period second preceding such Distribution Date, minus (ii) the product of the amount,
if any, on deposit in the Special Funding Account at the end of the last day of
the Monthly Period second preceding such Distribution Date and the Floating
Allocation Percentage with respect to the Monthly Period related to such
Distribution Date and (2) the product of (a) a fraction the numerator
of which is (i) the Invested Amount minus
(ii) the product of the amount, if any, on deposit in the Special Funding
Account at the end of the last day of the Monthly Period second preceding such
Distribution Date and the Floating Allocation Percentage with respect to the
Monthly Period related to such Distribution Date and the denominator of which
is the Principal Receivables, both as of the end of the last day of the Monthly
Period second preceding such Distribution Date and (b) the Loyalty,
Rewards and TCOE Fee for the Monthly Period immediately preceding such
Distribution Date (this amount, together with any such amounts unpaid from
prior Distribution Dates, the “Monthly Loyalty, Rewards and TCOE Fee”); provided, however, that with respect to
the first Distribution Date, the Monthly Loyalty, Rewards and TCOE Fee shall be
$2,302,759.  The Monthly Loyalty, Rewards
and TCOE Fee shall be payable to Target Corporation on any Distribution Date
solely to the extent amounts are available for distribution in respect thereof
pursuant to subsection 4.6(a)(v).

 

ARTICLE IV

 

RIGHTS OF THE COLLATERAL CERTIFICATEHOLDER
AND

ALLOCATION AND APPLICATION OF COLLECTIONS

 

Section 4.1             Rights of the Collateral Certificateholder.

 

The Collateral
Certificate shall represent an undivided interest in the Trust (the “Collateral
Certificateholder’s Interest”), consisting of the right to receive, to the
extent necessary to make the required payments with respect to such Collateral
Certificate at the times and in the amounts specified in this Series Supplement,
(a) the Floating Allocation Percentage and the Principal Allocation
Percentage (as applicable from time to time) of Collections and (b) funds
on deposit in the Special Funding Account and distributable to the Collateral
Certificate pursuant to Section 4.2 of the Agreement.  The Investor Certificates of Series 2008-1
shall not be subordinated to any other Series.

 

Section 4.2             Collections and Allocations;
Payments on Transferor Certificate.

 

(a)        Collections.  The Servicer shall apply or shall instruct
the Trustee to apply all funds on deposit in the Collection Account and the
Special Funding Account allocable to the Collateral Certificate as described in
this Article IV and Article IV of the Agreement.

 

(b)        Allocations.  The Servicer shall apply, or shall instruct
the Trustee to apply, all Collections and other funds that are allocated to the
Collateral Certificate as follows:

 

(i)    Daily
Allocations During the Revolving Period. 
During the Revolving Period, if the conditions specified in the last
sentence of 

 

 

subsection
4.3(a) of the Agreement are no longer satisfied, the Servicer shall, prior
to the close of business on any Date of Processing, allocate the following
amounts as set forth below:

 

(x)  Allocate to the Collateral
Certificateholder and deposit in the Collection Account no later than the
second Business Day following the Date of Processing an amount equal to the
product of (A) the Floating Allocation Percentage with respect to the
current Monthly Period and (B) the aggregate amount of Collections of Finance
Charge Receivables on such Date of Processing; provided, however, that, with respect to each
Monthly Period, such amount shall only be deposited until such time as the
amount of Collections of Finance Charge Receivables allocable to Series 2008-1
deposited in the Collection Account equals the amount of Monthly Interest,
Carryover Interest, if any, and, at any time that Target National Bank is not
the Servicer, the Monthly Servicing Fee, in each case due on the Distribution
Date in the following Monthly Period.

 

(y) Allocate to the Collateral
Certificateholder and deposit in the Collection Account no later than the
second Business Day following the Date of Processing an amount equal to the
product of (I) the Principal Allocation Percentage with respect to the
current Monthly Period and (II) the aggregate amount of Collections of
Principal Receivables on such Date of Processing (for any such date, a “Percentage
Allocation”); provided, however, that with respect to each Monthly
Period, such amount shall only be deposited if Series 2005-1 is
outstanding and in its Accumulation Period, and only until such time as the
amount of Collections of Principal Receivables allocable to Series 2008-1
deposited in the Collection Account equals the amount necessary to be applied
as Special Shared Principal Collections for the benefit of Series 2005-1
on the Distribution Date in the following Monthly Period.

 

Any amount of Collections of
Principal Receivables on deposit in the Collection Account over the amount
required to be retained in the Collection Account and the remainder of the
Percentage Allocation on that Date of Processing shall be paid to the Holder of
the Transferor Certificate only if on such Date of Processing the Transferor
Amount (excluding the interest represented by any Supplemental Certificate) is
greater than the Required Retained Transferor Amount (after giving effect to
all Receivables transferred to the Trust on such day) and otherwise shall be
deposited in the Special Funding Account.

 

(ii)   Daily
Allocations During the Scheduled Amortization Period.  During the Amortization Period but exclusive
of the Early Amortization Period, if the conditions specified in the last
sentence of subsection 4.3(a) of the Agreement are not satisfied, the
Servicer shall, prior to the close of business on any Date of Processing,
allocate the following amounts as set forth below:

 

(x)  Allocate to the Collateral
Certificateholder and deposit in the Collection Account no later than the
second Business Day following the Date of 

 

 

Processing an amount equal to
the product of (A) the Floating Allocation Percentage with respect to the
current Monthly Period and (B) the aggregate amount of Collections of
Finance Charge Receivables on such Date of Processing; provided, however, that, with respect to
each Monthly Period, such amount shall only be deposited until such time as the
amount of Collections of Finance Charge Receivables allocable to Series 2008-1
on deposit in the Collection Account equals the amount of Monthly Interest, Carryover
Interest, if any, and, at any time that Target National Bank is not the
Servicer, the Monthly Servicing Fee, in each case due on the Distribution Date
in the following Monthly Period.

 

(y)  Allocate to the Collateral
Certificateholder and deposit in the Collection Account no later than the
second Business Day following the Date of Processing an amount equal to the
Percentage Allocation; provided, however,
that after the date on which an amount of such Collections equal to the
Invested Amount has been deposited into the Collection Account and allocated to
the Collateral Certificateholder, any excess of the amount determined in
accordance with this subparagraph (y) shall be paid to the Holder of the
Transferor Certificate only if on such Date of Processing the Transferor Amount
(excluding the interest represented by any Supplemental Certificate) is greater
than the Required Retained Transferor Amount (after giving effect to all
Principal Receivables transferred to the Trust on such day) and otherwise shall
be deposited in the Special Funding Account.

 

(iii)  Daily
Allocations During the Early Amortization Period.  During the Early Amortization Period, if the
conditions specified in the last sentence of subsection 4.3(a) of the
Agreement are not satisfied, the Servicer shall, prior to the close of business
on any Date of Processing, allocate the following amounts as set forth below:

 

(x)  Allocate to the Collateral
Certificateholder and deposit in the Collection Account no later than the
second Business Day following the Date of Processing an amount equal to the
product of (A) the Floating Allocation Percentage with respect to the
current Monthly Period and (B) the aggregate amount of Collections of
Finance Charge Receivables on such Date of Processing.

 

(y)  Allocate to the Collateral
Certificateholder and deposit in the Collection Account no later than the
second Business Day following the Date of Processing an amount equal to the
Percentage Allocation; provided, however,
that after the date on which an amount of such Collections equal to the
Invested Amount plus the amount necessary to be applied as Special Shared
Principal Collections for the benefit of Series 2005-1 on the Distribution
Date in the following Monthly Period has been deposited into the Collection
Account and allocated to the Collateral Certificateholder, any excess of the
amount determined in accordance with this subparagraph (y) shall be paid
to the Holder of the Transferor Certificate only if on such Date of Processing
the Transferor Amount (excluding the interest represented by any Supplemental
Certificate) is greater 

 

 

than the Required Retained
Transferor Amount (after giving effect to all Principal Receivables transferred
to the Trust on such day) and otherwise shall be deposited in the Special
Funding Account.

 

(iv)  Monthly
Allocations.  At all times, the
Servicer shall, prior to the close of business on any Transfer Date, allocate
to the Collateral Certificateholder and deposit in the Collection Account an
amount equal to the sum of (I) (A) the lesser of (1) the product
of (x) the Floating Allocation Percentage with respect to the preceding
Monthly Period and (y) the aggregate amount of Collections of Finance
Charge Receivables for the preceding Monthly Period and (2) the aggregate
of (a) the amounts described pursuant to subclause (y) of each of
clauses (i) through (vi) of subsection 4.6(a) with
respect to the related Distribution Date and (b) the amount described in subsection
4.6(a)(vii) with respect to the related Distribution Date, less (B) the
daily amounts deposited in the Collection Account during the preceding Monthly
Period pursuant to subsections 4.2(b)(i)(x), 4.2(b)(ii)(x) and
4.2(b)(iii)(x), if any, (II) (A) the lesser of (1) the
product of (a) the Principal Allocation Percentage with respect to the
preceding Monthly Period and (b) the aggregate amount of Collections of
Principal Receivables for the preceding Monthly Period and (2) (x) for
each Monthly Period during the Revolving Period, zero, and (y) for each
Monthly Period during the Amortization Period, the Invested Amount, less (B) the
daily amounts deposited in the Collection Account during the preceding Monthly
Period pursuant to subsections 4.2(b)(i)(y), 4.2(b)(ii)(y) and
4.2(b)(iii)(y), and (III) an amount equal to (A) the amount of
Special Shared Principal Collections to be applied for the benefit of Series 2005-1
from amounts that were originally allocated to Series 2008-1, not to
exceed (a) during the Revolving Period, the Principal Allocation
Percentage of Collections of Principal Receivables for the preceding Monthly
Period or (b) during the Early Amortization Period, the Principal
Allocation Percentage of Collections of Principal Receivables for the preceding
Monthly Period less the amount thereof applied to pay Series 2008-1
Principal on the related Distribution Date, less (B) the daily amounts
deposited in the Collection Account during the preceding Monthly Period
pursuant to subsections 4.2(b)(i) and 4.2(b)(iii) with
respect to the Revolving Period and the Early Amortization Period,
respectively, if any.

 

Notwithstanding the foregoing or any other
provision of this Series Supplement, in accordance with subsection 4.3(c) of
the Agreement and subsection 5.1(e), the Servicer need not deposit in
the Collection Account any amounts payable to Target Receivables Corporation or
Target, in any capacity, pursuant to this Series Supplement or the
Indenture.

 

(c)        The
allocations to be made pursuant to this Section 4.2 also apply to
deposits into the Collection Account that are treated as Collections (including
adjustment payments made in accordance with Section 3.9 of the Agreement),
payment of the reassignment price pursuant to subsection 2.5(b) of the
Agreement and proceeds from the sale, disposition or liquidation of the Receivables
pursuant to Section 2.6, 10.1, or 12.2 of the Agreement and 

 

 

Section 8.1.  Such deposits to be treated as Collections
will be allocated as Finance Charge Receivables or Principal Receivables as
provided in the Agreement.

 

Section 4.3             Determination of Monthly
Interest.

 

On the
Determination Date preceding each Distribution Date, the Servicer shall
determine an amount of monthly interest (the “Monthly Interest”) with
respect to such Distribution Date equal to the product of (i) the Interest
Rate for the related Interest Accrual Period, (ii) the Note Principal
Balance at the end of the last day of the related Monthly Period, and (iii) 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; provided, however, that with respect to
the first Distribution Date after the Closing Date the Monthly Interest shall
be an amount equal to $12,373,609.

 

On the
Determination Date preceding each Distribution Date, the Servicer shall
determine an amount (the “Monthly Interest Shortfall”) equal to the
excess, if any, of (x) the Monthly Interest for the Interest Accrual
Period applicable to such Distribution Date over
(y) the amount available to be paid to the Collateral Certificateholder in
respect of interest on such Distribution Date. 
If there is a Monthly Interest Shortfall with respect to any
Distribution Date, an additional amount (“Additional Interest”) shall be
payable as provided herein with respect to the Collateral Certificate on each
Distribution Date following such Distribution Date, to and including the
Distribution Date on which such Monthly Interest Shortfall is paid to the
Collateral Certificateholder, equal to the product of (i) the Interest
Rate, (ii) such Monthly Interest Shortfall remaining unpaid, and (iii) 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.  Notwithstanding anything to the contrary
herein, Additional Interest shall be payable or distributed to the Collateral
Certificateholder only to the extent permitted by applicable law.

 

Section 4.4             Determination of Principal Amounts.  The amount of principal (the “Series 2008-1
Principal”) distributable from the Collection Account with respect to the
Collateral Certificate on each Distribution Date with respect to the
Amortization Period shall be equal to an amount calculated as follows:  the sum of (a) the Available Series 2008-1
Principal Collections with respect to such Distribution Date plus (b) any amount on deposit in the Special Funding
Account that is distributable to the Collateral Certificateholder pursuant to subsection
4.6(d) with respect to the preceding Monthly Period; provided, however, that with respect to
any Distribution Date, Series 2008-1 Principal may not exceed the Invested
Amount.

 

Section 4.5             Special Shared Principal
Collections.

 

If Series 2005-1
is outstanding and in its Accumulation Period, the Servicer shall allocate
Collections of Principal Receivables initially allocated to Series 2008-1
to be treated as Shared Principal Collections under the Series 2005-1
Supplement solely for the benefit of Series 2005-1 (“Special Shared
Principal Collections”) in an amount, with respect to any Distribution
Date, equal to the lesser of (x) the Principal Allocation Percentage of
Collections of Principal Receivables for the preceding Monthly Period less the
amount thereof applied to pay Series 2008-1 Principal on the related
Distribution Date and (y) the excess of the amount of the Series 2005-1
Principal Shortfall over the amount of Shared Principal Collections allocated
with respect 

 

 

thereto
pursuant to Section 4.4 of the Agreement. 
Special Shared Principal Collections shall not be allocated pursuant to Section 4.4
of the Agreement but shall be solely shared by Series 2008-1 with Series 2005-1
for application as Shared Principal Collections pursuant to the Series 2005-1
Supplement.

 

Section 4.6             Application of Funds on Deposit
in the Collection Account Allocable to the Collateral Certificate.

 

(a)        On
each Distribution Date, the Servicer shall instruct the Trustee to withdraw,
and the Trustee, acting in accordance with such instructions set forth in the
Monthly Report, substantially in the form of Exhibit B, shall withdraw
from the Collection Account, or retain therein, as applicable, to the extent of
the sum of (i) the Floating Allocation Percentage of Collections of
Finance Charge Receivables collected during the preceding Monthly Period  and (ii) with respect to the first
Distribution Date, an amount equal to $0 deposited by the Transferor into the
Collection Account on the Closing Date (the “Available Series 2008-1
Finance Charge Collections”), the following amounts, and apply such amounts
as follows and in the following priority:

 

(i)    Servicing
Fee.  An amount equal to the lesser
of (x) the Available Series 2008-1 Finance Charge Collections for
such date and (y) the Monthly Servicing Fee for such Monthly Period shall
be paid to the Servicer.

 

(ii)   Investor
Defaulted Amount.  An amount equal to
the lesser of (x) any Available Series 2008-1 Finance Charge
Collections remaining after giving effect to the withdrawal pursuant to subsection
4.6(a)(i) and (y) the aggregate Investor Defaulted Amount for
such Distribution Date, shall be treated as Available Series 2008-1
Principal Collections.

 

(iii)  Reimbursement
of Investor Charge-Offs.  An amount
equal to the lesser of (x) any Available Series 2008-1 Finance Charge
Collections remaining after giving effect to the withdrawal pursuant to subsections
4.6(a)(i) and (ii) and (y) the amount by which the
aggregate amount of Investor Charge-Offs for all prior Distribution Dates
exceeds the sum of the aggregate amount previously applied pursuant to this subsection
4.6(a)(iii) and the aggregate amount of Adjustment Payment Shortfall
Reinstatements will be applied to reinstate prior reductions of the Invested
Amount, and shall be treated as Available Series 2008-1 Principal
Collections.

 

(iv)  Program
Fee.  An amount equal to the lesser of
(x) any Available Series 2008-1 Finance Charge Collections remaining
after giving effect to the withdrawals pursuant to subsections 4.6(a)(i) through
(iii) and (y) the Monthly Program Fee for such Monthly Period
shall be paid to Target Corporation.

 

(v)   Loyalty,
Rewards and TCOE Fee.  An amount
equal to the lesser of (x) any Available Series 2008-1 Finance Charge
Collections remaining after giving effect to the withdrawals pursuant to subsections
4.6(a)(i)

 

through (iv)
and (y) the Monthly Loyalty, Rewards and TCOE Fees
for such Monthly Period shall be paid to Target Corporation.

 

(vi)  Monthly Interest.  An amount equal to the lesser of (x) the
Available Series 2008-1 Finance Charge Collections remaining after giving
effect to the withdrawals pursuant to subsections 4.6(a)(i) through (v) and (y) the sum of
Monthly Interest and Carryover Interest shall be paid to the Collateral Certificateholder in accordance with Section 5.1.

 

(vii) Remaining
Collections.  Any Available Series 2008-1
Finance Charge Collections after giving effect to the withdrawals pursuant to subsections
4.6(a)(i) through (vi) shall
be applied by the Trustee, at the direction of the Servicer,
to pay any unpaid expenses or liabilities of the Trust or, if there are no such
shortfalls or other amounts, then to pay such remaining amount to the
Collateral Certificateholder in accordance with Section 5.1.

 

For
the avoidance of doubt, the amount withdrawn from the Collection Account shall
not exceed the amount deposited in the Collection Account allocated to the
Collateral Certificate pursuant to Section 4.3 of the Agreement or subsections
4.2(b)(i)(x), 4.2(b)(ii)(x), 4.2(b)(iii)(x) and
4.2(b)(iv).

 

(b)        For
each Distribution Date with respect to the Revolving Period, the Available Series 2008-1
Principal Collections will be first, if Series 2005-1
is outstanding and in its Accumulation Period, applied as Special Shared
Principal Collections and second, paid
to the Holder of the Transferor Certificate to the extent that the Transferor
Amount (excluding the interest represented by any Supplemental Certificate) is
greater than the Required Retained Transferor Amount (after giving effect to
all Receivables transferred to the Trust on such day) and otherwise shall be
deposited in the Special Funding Account.

 

(c)        For
each Distribution Date on and after the Amortization Period Commencement Date,
the Trustee, acting pursuant to the Servicer’s
instructions, will distribute the amount of funds on deposit in the Collection
Account available for payment of principal to the Collateral Certificateholder in accordance with Section 4.4
in the following priority:

 

(i)    an amount equal to Series 2008-1 Principal to the
Collateral Certificateholder; and

 

(ii)   an amount equal
to the excess, if any, of (A) the sum of the amounts described in Section 4.4
over (B) the Invested Amount will
be first, if Series 2005-1 is
outstanding and in its Accumulation Period, applied as Special Shared Principal
Collections and second, paid to the Holder of
the Transferor Certificate to the extent that the Transferor Amount (excluding
the interest represented by any Supplemental Certificate) is greater than the
Required Retained Transferor Amount (after giving effect to all Receivables
transferred to the Trust on such day) and otherwise shall be deposited in the
Special Funding Account.

 

 

(d)        On
each Distribution Date during the Amortization Period, funds on deposit in the
Special Funding Account and distributable to Series 2008-1 as provided in Section 4.2
of the Agreement will be deposited in the Collection Account and allocated to
the Collateral Certificateholder in an amount equal
to the lesser of the Principal Shortfalls with respect to Series 2008-1
and the amount allocated with respect thereto pursuant to Section 4.2 of
the Agreement; provided, however,
such amount shall not exceed the Series 2008-1 Principal after subtracting
therefrom any amounts to be deposited in the
Collection Account with respect thereto pursuant to Section 4.4.

 

Section 4.7             Investor Defaulted Amount.

 

Prior to each
Distribution Date, the Servicer will calculate the
Investor Defaulted Amount for Series 2008-1 for the immediately preceding  Monthly
Period.   If, on any Distribution Date, (a) the
aggregate Investor Defaulted Amount for the preceding Monthly Period exceeds
the Available Series 2008-1 Finance Charge Collections applied to the
payment thereof pursuant to subsection 4.6(a)(ii), or (b) the
Transferor Amount has been reduced to zero and the Transferor fails to make an
Adjustment Payment, if any, required to be made by the Transferor on such
Distribution Date, the Invested Amount shall be reduced by the sum of (i) the amount by which the aggregate Investor
Defaulted Amount exceeds the amount applied with respect thereto during such
preceding Monthly Period and (ii) the Series 2008-1 Allocation
Percentage of unpaid Adjustment Payments required to be made by the Transferor
when the Transferor Amount has been reduced to zero on such Distribution Date,
and the amount of such reduction shall be an Investor Charge-Off.

 

Section 4.8             Collateral Certificate
Additional Amount.

 

(a)        During
the Revolving Period, the Transferor may, at its discretion and subject to the
terms of subsection 4.8(b), request the Trustee to increase the
outstanding principal amount of the Collateral Certificate by an amount (the “Collateral
Certificate Additional Amount”) and on a date (the “Collateral
Certificate Addition Date”) determined by the Transferor.  Upon issuance, the Collateral Certificate
Additional Amount shall be equally and ratably entitled to the benefits of this
Series Supplement and the Agreement. 
As a result of such issuance, the Invested Amount shall be increased by
a corresponding amount and all the calculations required pursuant to this Series Supplement
shall, as of the last day of the Monthly Period prior to the Monthly Period in
which the Collateral Certificate Addition Date occurred, be computed using such
increased Invested Amount.

 

(b)        The
Invested Amount shall only be increased pursuant to subsection 4.8(a) upon
satisfaction of all of the following conditions:

 

(i)    on
or before the third Business Day immediately preceding the Collateral
Certificate Addition Date, the Transferor shall give notice to the Trustee, the
Servicer and the Note Purchaser of such issuance and
the date upon which it is to occur; provided,
that for so long as there are outstanding securities issued by the Trust or a
related owner trust that are rated by a Rating Agency, notice shall also be
provided to such Rating Agency;

 

 

(ii)   after giving effect to the Collateral Certificate Additional
Amount, the total amount of Principal Receivables in the Trust shall be greater
than or equal to the Required Principal Balance;

 

(iii)  (x) if after
giving effect to the increase of the Invested Amount on the Collateral
Certificate Addition Date, the Invested Amount does not exceed the Initial
Invested Amount, no Series 2008-1 Early Amortization Event or Early
Amortization Event shall have occurred, or been deemed to have occurred, and be
continuing as of the date of the Collateral Certificate Addition Date and the
increase in the outstanding principal amount and the Invested Amount of the
Collateral Certificate shall not result in the occurrence (or deemed occurrence)
of a Series 2008-1 Early Amortization Event or an Early Amortization
Event; and (y) if after giving effect to the increase of the Invested
Amount on the Collateral Certificate Addition Date, the Invested Amount shall
exceed the Initial Invested Amount, no Series 2008-1 Early Amortization
Event or Early Amortization Event, and no event that, with the giving of notice
or the lapse of time, or both, would constitute a Series 2008-1 Early
Amortization Event or  Early Amortization
Event, shall have occurred, or been deemed to have occurred, and be continuing
as of the date of the Collateral Certificate Addition Date and the increase in
the outstanding principal amount and the Invested Amount of the Collateral
Certificate shall not result in the occurrence (or deemed occurrence) of a Series 2008-1
Early Amortization Event or an Early Amortization Event or any event that, with
the giving of notice or the lapse of time, or both, would constitute a Series 2008-1
Early Amortization Event or an Early Amortization Event;

 

(iv)  such increase
shall be subject to receipt from the Note Purchaser of the amount required to
fund the increase of the Invested Amount; and

 

(v)   after
giving effect to the increase of the Invested Amount, the Transferor Amount
(excluding the interest represented by any Supplemental Certificate) shall be
greater than the Required Retained Transferor Amount (after giving effect to
all Receivables transferred to the Trust on such day).

 

ARTICLE V

 

DISTRIBUTIONS AND REPORTS TO
SERIES 2008-1

CERTIFICATEHOLDER

 

Section 5.1             Distributions.

 

(a)        On
each Distribution Date, the Paying Agent shall distribute to the Collateral Certificateholder of record on the related Record Date
(other than as provided in Section 12.2 of the Agreement) the amounts that
are available on such Distribution Date to make payments pursuant to subsections
4.6(a)(vi) and 4.6(a)(vii) of
this Series Supplement.

 

 

(b)        On
each Distribution Date during the Amortization Period, the Paying Agent shall
distribute to the Collateral Certificateholder of
record on the related Record Date (other than as provided in Section 12.2
of the Agreement) the amounts that are available in the Collection Account
pursuant to subsections 4.6(c) and 4.6(d) on such date
to pay principal of the Collateral Certificate pursuant to this Series Supplement
up to a maximum amount on any such date equal to the Invested Amount on such
date.

 

(c)        The
distributions to be made pursuant to this Section 5.1 are subject
to the provisions of Sections 2.6, 10.1 and 12.2 of the Agreement and Section 8.1.

 

(d)        Except
as provided in Section 12.2 of the Agreement with respect to a final
distribution, distributions to the Collateral Certificateholder
hereunder shall be made by wire transfers in immediately available funds to the
account specified by such Holder; provided that
if no account is so specified, such payments shall be made by check mailed to
such Holder at such Collateral Certificateholder’s
address appearing in the Certificate Register without presentation or surrender
of any Collateral Certificate or the making of any notation thereon; provided, however, that the final payment
in retirement of the Collateral Certificate will be made only upon presentation
and surrender of the Collateral Certificate at the offices specified in the
notice of such final distribution delivered by the Trustee pursuant to Section 12.2
of the Agreement.

 

(e)        Notwithstanding
anything in this Series Supplement to the contrary, the Paying Agent need
not distribute to the Collateral Certificateholder,
by deposit into the Note Distribution Account (as defined in the Indenture) or
otherwise, any amounts distributable under this Section 5.1 and
allocable under the Indenture to the Depositor (as defined in the Indenture),
as the owner of the beneficial interest in the Owner Trust, but may pay such
amounts directly to the Depositor, which amounts so paid shall be deemed to
have been paid to the Collateral Certificateholder as
provided above.

 

Section 5.2             Reports and Statements to
Collateral Certificateholder.

 

(a)        On
each Distribution Date, the Paying Agent, on behalf of the Trustee, shall
forward to each Collateral Certificateholder a
statement substantially in the form of Exhibit B prepared by the Servicer.

 

(b)        Not
later than each Determination Date, the Servicer
shall deliver to the Trustee and the Paying Agent (i) statements
substantially in the form of Exhibit B prepared by the Servicer and (ii) a certificate of a Servicing Officer
substantially in the form of Exhibit C.

 

(c)        On
or before January 31 of each calendar year, beginning with calendar year
2009, the Paying Agent, on behalf of the Trustee, shall furnish or cause to be
furnished to each Person who at any time during the preceding calendar year was
a Collateral Certificateholder, a statement prepared
by the Servicer containing the information which is
required to be contained in the statement to the Collateral Certificateholder,
as set forth in paragraph (a) or (b) above, as applicable, aggregated
for such calendar year or the applicable portion thereof during which such
Person was a Collateral Certificateholder, together
with other information as is required to be provided by an issuer of
indebtedness under the Code.  Such

 

 

obligation of the Servicer shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Paying Agent pursuant to any requirements of the Code as from time to time in
effect.

 

ARTICLE VI

 

EARLY AMORTIZATION EVENTS

 

Section
6.1             Series 2008-1 Early
Amortization Events.

 

If any one of the
following events shall occur with respect to the Collateral Certificate:

 

(a)        failure
on the part of (i) Target National Bank duly to
observe or perform in any material respect any covenants or agreements of
Target National Bank set forth in the Bank Purchase Agreement, (ii) TCC duly to observe or perform in any material respect any
covenants or agreements of TCC set forth in the
Receivables Purchase Agreement or (iii) the Transferor (A) to make
any payment or deposit required to be made by the Transferor by the terms of (I) the
Agreement or (II) this Series Supplement, on or before the date
occurring five Business Days after the date such payment or deposit is required
to be made herein, (B) to perform in all material respects the Transferor’s
covenant not to sell, pledge, assign, or transfer to any Person, or grant any
impermissible lien on, any Receivable, or (C) duly to observe or perform
in any material respect any covenants or agreements of the Transferor set forth
in the Agreement or this Series Supplement, which failure has a material
adverse effect on the Collateral Certificateholder
and in the case of any violation of clause (i), (ii) or
(iii)(B) and (C) above, continues unremedied
for a period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Transferor by
the Trustee, or to the Transferor and the Trustee by any Collateral Certificateholder;

 

(b)        any
representation or warranty made by Target National Bank in the Bank Purchase
Agreement, TCC in the Receivables Purchase Agreement
or the Transferor in the Agreement or this Series Supplement (i) shall prove to have been incorrect in any material
respect when made, which continues to be incorrect in any material respect for
a period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Transferor by
the Trustee, or to the Transferor and the Trustee by any Collateral Certificateholder, and (ii) as a result of which the
interests of the Collateral Certificateholder are
materially and adversely affected; provided,
however, that a Series 2008-1 Early Amortization Event pursuant
to this subsection 6.1(b) shall not be deemed to have occurred
hereunder if the Transferor has accepted designation of the related Receivable
as an Ineligible Receivable during such period in accordance with the
provisions of the Agreement;

 

(c)        a failure by TCC or the Transferor
to make an Addition within five Business Days after the Required Designation
Date;

 

(d)        any  Servicer Default shall occur
which would have a material adverse effect on the Collateral Certificateholder;

 

 

(e)        an Event of Default and the acceleration of the Notes
pursuant to the Indenture; or

 

(f)         a Note Purchase Agreement Early Amortization Event;

 

then, the Trustee
shall within five days publish a notice of such early amortization event and in
the case of any event described in subparagraph (a), (b), (c), (d) or (f),
after the applicable grace period, if any, set forth in such subparagraphs, the
Collateral Certificateholder evidencing undivided
interests aggregating more than 50% of the Invested Amount by notice then given
in writing to the Trustee, the Transferor and the Servicer
may declare that an early amortization event (a “Series 2008-1 Early
Amortization Event”) has occurred as of the date of such notice, and in the
case of any event described in subparagraph (e), a Series 2008-1 Early
Amortization Event shall occur without any notice or other action on the part
of the Trustee or the Collateral Certificateholder
immediately upon the occurrence of such event. 
The Trustee shall provide to the Transferor a copy of any notice
received from any Collateral Certificateholder and
the Transferor shall provide to Target National Bank or TCC,
as applicable, a copy of any notice received from the Trustee or any Collateral
Certificateholder under subparagraphs (a) and (b) above
if such notice shall relate to a covenant, agreement, representation or
warranty by Target National Bank or TCC,
respectively.

 

ARTICLE VII

 

OPTIONAL TERMINATION; SERIES
TERMINATION

 

Section 7.1             Optional Termination.

 

The Collateral
Certificate shall be subject to repurchase by the Transferor, at its option, on
any Distribution Date on or after the Distribution Date on which the
outstanding principal amount of the Notes are reduced to an amount less than or
equal to 10% of the highest outstanding principal amount of the Notes at any
time.  The deposit to the Collection
Account required in connection with any such repurchase and final distribution
shall be equal to the outstanding principal balance of the Collateral
Certificate plus any accrued and
unpaid interest payable to the Collateral Certificateholder
for further payment to Noteholders through the day
prior to the Distribution Date on which the repurchase occurs determined as set
forth in Section 4.3.

 

Section
7.2             Series 2008-1
Termination.

 

(a)        If,
on the second Distribution Date prior to the Legal Maturity Date, the Invested
Amount (after giving effect to all changes therein on such date) would be
greater than zero, the Servicer, on behalf of the
Trustee, shall, within 45 days, solicit bids for the sale of Principal
Receivables and the related Finance Charge Receivables (or interests therein)
in the amount specified in subsection 12.2(c) of the Agreement.  Such bids shall require that such sale shall
(subject to subsection 7.2(b)) occur on the Legal Maturity Date.  The Transferor shall be entitled to
participate in, and to receive from the Trustee a copy of each other bid
submitted in connection with, such bidding process.

 

 

(b)        The Servicer, on behalf of the Trustee, shall sell such
Receivables (or interests therein) on the Legal Maturity Date to the bidder who
made the highest cash purchase offer. 
The proceeds of any such sale shall be treated as Collections on the
Receivables and deposited in the Collection Account to be allocated to the
Collateral Certificateholder pursuant to the
Agreement and this Series Supplement; provided, however, that the Servicer
shall determine conclusively the amount of such proceeds which are allocable to
Finance Charge Receivables and the amount of such proceeds which are allocable
to Principal Receivables.  During the
period from the second Distribution Date prior to the Legal Maturity Date to
the Legal Maturity Date, the Servicer shall continue
to collect payments on the Receivables and allocate and deposit such
Collections in accordance with the provisions of the Agreement and this Series Supplement.

 

Section
7.3             Special Reduction of
the Invested Amount.

 

Pursuant to Section 2.7 of the Indenture, the Owner Trust or the
Transferor, as depositor of the Owner Trust, may, from time to time, surrender
for cancellation Notes acquired by it for its own account by whatever
means.  Whenever any Notes are so
delivered for cancellation and are cancelled in accordance with the Indenture,
the Invested Amount and the Collateral Certificate principal balance shall each
be reduced by the aggregate principal amount of Notes so cancelled.  The Transferor shall notify the Trustee
whenever Notes are so delivered for cancellation under the Indenture.

 

ARTICLE VIII

 

FINAL DISTRIBUTION

 

Section 8.1             Sale
of Receivables or Collateral Certificateholder’s
Interest pursuant to Section 2.6 or 10.1 of the Agreement and Section 7.1 or
7.2 of this Series Supplement.

 

(a)        The
amount to be paid by the Transferor with respect to Series 2008-1 in
connection with a reassignment of Receivables to the Transferor pursuant to Section 2.6
of the Agreement or a repurchase of the Collateral Certificateholder’s
Interest pursuant to Section 10.1 of the Agreement shall equal the
Reassignment Amount for the first Distribution Date following the Monthly
Period in which the reassignment obligation arises under the Agreement.

 

(b)        With
respect to the Reassignment Amount deposited into the Collection Account
pursuant to Section 7.1 or to subsection 8.1(a) or any
amounts allocable to the Collateral Certificateholder’s
Interest deposited into the Collection Account pursuant to Section 7.2,
the Trustee shall, not later than 10:00 a.m., New York City time, on the
applicable Distribution Date, make deposits or distributions of the following
amounts (in the priority set forth below and, in each case after giving effect
to any deposits and distributions otherwise to be made on such date) in
immediately available funds:  (i) (x) the Invested Amount on such Distribution
Date will be distributed to the Paying Agent for payment to the Collateral Certificateholder and (y) an amount equal to the sum
of (A) Monthly Interest for such Distribution Date, (B) any Monthly
Interest previously due but not distributed to the Collateral Certificateholder on a prior Distribution Date and (C) the
amount of Additional Interest, if any, for such Distribution Date and any
Additional Interest previously due but not distributed to the Collateral

 

 

Certificateholder on any
prior Distribution Date, will be distributed to the
Paying Agent for payment to the Collateral Certificateholder,
(ii) any other amounts payable pursuant to subsection 4.6(a) shall
be paid in accordance therewith and (iii) the balance, if any, will be
distributed to the Holder of the Transferor Certificate.

 

(c)        Notwithstanding
anything to the contrary in this Series Supplement or the Agreement, all
amounts distributed to the Paying Agent pursuant to subsection 8.1(b) for
payment to the Collateral Certificateholder shall be
deemed distributed in full to the Collateral Certificateholder
on the date on which such funds are distributed to the Paying Agent pursuant to
this Section and shall be deemed to be a final distribution pursuant to Section 12.2
of the Agreement.

 

ARTICLE IX

 

MISCELLANEOUS PROVISIONS

 

Section
9.1             Legend on Collateral
Certificate.

 

Each Collateral
Certificate will bear a legend or legends substantially in the following form:

 

EACH PURCHASER OR HOLDER REPRESENTS
AND WARRANTS FOR THE BENEFIT OF TARGET RECEIVABLES CORPORATION AND THE TRUSTEE
THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(e)(1) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) A
GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF ERISA,
SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE PROVISIONS OF SECTION 406 OF ERISA
OR SECTION 4975 OF THE CODE, (IV) AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE
PLAN ASSETS BY REASON OF A PLAN’S INVESTMENT IN THE ENTITY OR (V) A PERSON
INVESTING “PLAN ASSETS” OF ANY SUCH PLAN (INCLUDING FOR PURPOSES OF CLAUSES (IV) AND
(V) ANY INSURANCE COMPANY GENERAL ACCOUNT, BUT EXCLUDING ANY ENTITY
REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED).

 

TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, NEITHER THIS COLLATERAL CERTIFICATE NOR ANY INTEREST HEREIN MAY BE
TRANSFERRED, ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED, EXCEPT IN
ACCORDANCE

 

 

WITH THE POOLING AND SERVICING
AGREEMENT AND RELATED SUPPLEMENT REFERRED TO HEREIN.

 

Each Collateral Certificateholder by virtue
of its beneficial interest in the Collateral Certificate shall be deemed to
have made the representations and warranties stated in such legend.

 

Section
9.2             Ratification of
Agreement.

 

As supplemented by
this Series Supplement, the Agreement is in all respects ratified and
confirmed and the Agreement as so supplemented by this Series Supplement
shall be read, taken, and construed as one and the same instrument.

 

Section 9.3             Counterparts.

 

This Series Supplement
may be executed in any number of counterparts, each of which so executed shall
be deemed to be an original, but all of such counterparts shall together
constitute but one and the same instrument.

 

Section
9.4             Transfer of the
Collateral Certificate.

 

After the Closing
Date, the Collateral Certificate may not be sold, participated, transferred,
assigned, exchanged or otherwise pledged or conveyed in whole or in part except
upon the prior delivery to the Trustee of (i) a
Tax Opinion and (ii) a transferee representation letter (substantially in
the form of Exhibit D).

 

Section
9.5             Jurisdiction; Service.

 

Solely with
respect to the Agreement (as supplemented hereby and as further amended,
modified or supplemented from time to time) and the transactions and other
matters contemplated thereby or relating thereto, each of the parties hereto
hereby irrevocably and unconditionally agrees (a) to be subject to the
jurisdiction of the courts of the State of Delaware and of the federal courts
sitting in the State of Delaware, and (b)(i) to
the extent such party is not otherwise subject to service of process in the
State of Delaware, to appoint and maintain an agent in the State of Delaware as
such party’s agent for acceptance of legal process, and (ii) that service
of process may also be made on such party by prepaid certified mail with a
proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)(i) or (ii) above shall have the same legal force
and effect as if served upon such party personally within the State of
Delaware.  For purposes of implementing
the parties’ foregoing agreement to appoint and maintain an agent for service
of process in the State of Delaware solely in respect of the Agreement and the
transactions and other matters contemplated thereby or relating thereto, each
such party that has not as of the date hereof already duly appointed such an
agent does hereby appoint RL&F Service Corp., One
Rodney Square, 10th Floor, Wilmington, Delaware 19801, as such
agent.

 

 

Section 9.6            GOVERNING
LAW.

 

THIS SERIES
SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.

 

Section
9.7             Article 8.

 

The Collateral
Certificate shall be a security governed by Article 8 of the Delaware
Uniform Commercial Code, as amended from time to time and the Uniform
Commercial Code of any other applicable jurisdiction that currently or
hereafter substantially includes the 1994 revisions to Article 8 thereof
as adopted by the American Law Institute and the National Conference of
Commissioners on Uniform State Laws and approved by the American Bar
Association on February 14, 1995. 
The foregoing declaration shall not be amended, modified, revoked or
otherwise changed during the effectiveness of the Agreement and this Series Supplement
without the prior written consent of the Collateral Certificateholder.

 

Section 9.8             No
Petition.

 

The Transferor,
the Servicer and the Trustee, by entering into this Series Supplement,
and each Collateral Certificateholder, by accepting
the Collateral Certificate, hereby covenant and agree that they will not at any
time institute against the Trust or the Owner Trust, or join in any institution
against the Trust or the Owner Trust of, any bankruptcy proceedings under any
United States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Collateral Certificate, the Agreement or this Series Supplement.

 

Section 9.9             Instructions in Writing.

 

All instructions
or other communications given by the Servicer or any
other person to the Trustee pursuant to this Series Supplement shall be in
writing.

 

Section 9.10           Adjustments.

 

Any adjustment to
the amount of Receivables and Principal Receivables pursuant to Section 3.9
of the Agreement shall be made within two Business Days of the Business Day on
which such adjustment obligation arises.

 

Section 9.11           Eligible Investments.

 

In addition to the
Eligible Investments identified in Section 1.1 of the Agreement, amounts
held in the accounts established for the benefit of the Collateral Certificateholder may be invested in investments in money
market funds having, at the time of the Trust’s investment, a rating in the
highest rating category from each Rating Agency (which for Standard &
Poor’s shall be limited to investments rated AAAm or AAAm-G) or otherwise approved in writing by each Rating
Agency.

 

 

IN WITNESS
WHEREOF, the Transferor, the Servicer and the Trustee
have caused this Series Supplement to be duly executed by their respective
officers as of the day and year first above written.

 

 

	
   

  	
  TARGET
  RECEIVABLES CORPORATION,

  
	
   

  	
    Transferor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Spencer Johnson

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Spencer Johnson

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TARGET
  NATIONAL BANK,

  	
   

  
	
   

  	
    Servicer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Angela Jenks

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Angela Jenks

  
	
   

  	
   

  	
  Title:

  	
  Vice President and
  Cashier

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS
  FARGO BANK,

  
	
   

  	
  NATIONAL
  ASSOCIATION,

  
	
   

  	
    Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Benjamin J. Krueger

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Benjamin J. Krueger

  
	
   

  	
   

  	
  Title: 

  	
  Vice President

  
							

 

 

Series 2008-1 Supplement

 

 

Exhibit A

 

FORM OF COLLATERAL
CERTIFICATE

 

	
  No. 1

  	
   

  	
  $3,825,000,000

  

 

 

 

EACH
PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF TARGET RECEIVABLES
CORPORATION AND THE TRUSTEE THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE
BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE
PROVISIONS OF TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(e)(1) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) A GOVERNMENTAL
PLAN, AS DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE
OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE PROVISIONS OF SECTION 406
OF ERISA OR SECTION 4975 OF THE CODE, (IV) AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN’S INVESTMENT IN THE ENTITY OR (V) A
PERSON INVESTING “PLAN ASSETS” OF ANY SUCH PLAN (INCLUDING FOR PURPOSES OF
CLAUSES (IV) AND (V) ANY INSURANCE COMPANY GENERAL ACCOUNT, BUT
EXCLUDING ANY ENTITY REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS
AMENDED).

 

TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, NEITHER THIS COLLATERAL CERTIFICATE
NOR ANY INTEREST HEREIN MAY BE TRANSFERRED, ASSIGNED, EXCHANGED OR
OTHERWISE PLEDGED OR CONVEYED, EXCEPT IN ACCORDANCE WITH THE POOLING AND
SERVICING AGREEMENT AND RELATED SUPPLEMENT REFERRED TO HEREIN.

 

 

TARGET CREDIT CARD MASTER TRUST

 

COLLATERAL CERTIFICATE

 

Evidencing
an undivided interest in a trust, the corpus of which consists of receivables
generated from time to time in the ordinary course of business from a portfolio
of consumer open-end credit card accounts generated or to be generated by
Target National Bank (“Target National Bank” or the “Servicer”)
and other assets and interests constituting the Trust under the Agreement described
below.

 

 

Not an interest in or a recourse obligation of Target
Corporation, Target National Bank, Target Capital Corporation or Target
Receivables Corporation or any affiliate of any of them.

 

This Investor Certificate certifies that Target
Credit Card Owner Trust 2008-1 (the “Certificateholder”) is the
registered owner of a fractional undivided interest in the Target Credit Card
Master Trust (the “Trust”) issued pursuant to the Amended and Restated
Pooling and Servicing Agreement, dated as of April 28, 2000, as amended by
Amendment No. 1, dated as of August 22, 2001 (as amended,
supplemented or otherwise modified, the “Pooling and Servicing Agreement,”
such term to include any amendment thereto), by and among Target Receivables
Corporation, as Transferor (the “Transferor”), Target National Bank, as
the Servicer, and Wells Fargo Bank, National Association, as Trustee (the “Trustee”),
and the Series 2008-1 Supplement, dated as of May 19, 2008 (the “Series Supplement”),
by and among the Transferor, the Servicer and the Trustee.  The Pooling and Servicing Agreement, as
supplemented by the Series  Supplement, is herein referred to as the “Agreement.”  The corpus of the Trust consists of all of
the Transferor’s right, title and interest in, to and under the Trust Assets
(as defined in the Agreement).

 

To the extent not defined herein, capitalized terms
used herein have the respective meanings assigned to them in the Agreement.

 

Although a summary of certain provisions of the
Agreement is set forth below, this Investor Certificate is qualified in its
entirety by the terms and provisions of the Agreement and reference is made to
the Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee.

 

This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement, as
amended from time to time, the Certificateholder by virtue of the acceptance
hereof assents and by which the Certificateholder is bound.  This Certificate is a duly authorized
Investor Certificate entitled “Collateral Certificate” (the “Collateral
Certificate”), which represents an undivided interest in the Trust,
including the right to receive the Collections and other amounts allocated to
the Collateral Certificate at the times and in the amounts specified in the
Agreement and to be deposited in the Collection Account, the Note Principal
Funding Account and the Noteholder Reserve Account or paid to the Collateral
Certificateholder.

 

The aggregate interest represented by the Collateral
Certificate at any time in the Principal Receivables in the Trust shall not
exceed an amount equal to the Invested Amount at such time.  As of the Closing Date, the Initial Invested
Amount is $3,825,000,000.

 

The Invested Amount on any date of determination
will be an amount equal to the sum of (a) the Initial Invested Amount, plus (b) the sum of the aggregate
amounts allocated with respect to the reimbursement of Investor Charge-Offs and
available on all prior Distribution Dates, plus
(c) the sum of the aggregate Adjustment Payment Shortfall Reinstatements
on all prior dates of determination, plus
(d) the aggregate amount of any increases in the principal amount of the
Collateral Certificate after the Closing Date, including the principal balance
of any

 

 

Note Purchaser Note
Repurchase, minus (e) the
aggregate amount of principal payments made to the Collateral Certificateholder
prior to such date, minus (f) the
aggregate amount of Investor Charge-Offs for all prior Distribution Dates, minus (g) the Principal Payment
Adjustment for such date or any prior date, and minus (h) the aggregate amount of any reductions in the
Invested Amount as a result of the purchase by the Transferor for cancellation
of a portion of the Notes, including the principal balance of any Transferor
Note Repurchase.

 

The Transferor will retain an undivided interest in
the Trust pursuant to the Agreement.  The
Transferor’s Interest is the interest in the Principal Receivables not
represented by any of the Investor Certificates or Participations issued by the
Trust.  The Transferor’s Interest may be
exchanged by the Transferor pursuant to the Agreement for a newly issued Series of
Investor Certificates and a reduced Transferor’s Interest upon the conditions
set forth in the Agreement.

 

Beginning on June 25, 2008 and on each
Distribution Date thereafter, the Trustee shall distribute to the Collateral
Certificateholder of record as of the last Business Day of the calendar month
preceding such Distribution Date such amounts as are payable pursuant to the
Agreement.   The Series 2008-1
Termination Date is the earlier to occur of (i) the date on which the
Invested Amount is reduced to zero, and (ii) the Legal Maturity Date.  Principal with respect to the Collateral
Certificate will be paid under the circumstances described in the Agreement.

 

Unless the certificate of authentication hereon has
been executed by or on behalf of the Trustee, by manual signature, this
Collateral Certificate shall not be entitled to any benefit under the
Agreement, or be valid for any purpose.

 

This Collateral Certificate shall constitute a “security”
within the meaning of (i) Article 8 of the Uniform Commercial Code
(including Section 8-102(a)(15) thereof) as in effect from time to time in
the State of Delaware and (ii) the Uniform Commercial Code of any other
applicable jurisdiction that currently or hereafter substantially includes the
1994 revisions to Article 8 thereof as adopted by the American Law
Institute and the National Conference of Commissioners on Uniform State Laws
and approved by the American Bar Association on February 14, 1995.

 

This Collateral Certificate shall be governed by and
construed in accordance with the laws of the State of Delaware, without regard
to the conflict of law principles thereof.

 

 

IN WITNESS WHEREOF, the Transferor has caused this
Collateral Certificate to be duly executed under its official seal.

 

 

	
   

  	
  TARGET RECEIVABLES CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Dated:
May 19, 2008

 

 

CERTIFICATE OF AUTHENTICATION

 

 

This is the Collateral Certificate of Target Credit
Card Master Trust, Series 2008-1 referred to in the within-mentioned
Agreement.

 

 

	
   

  	
  WELLS FARGO BANK,

  
	
   

  	
  NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title

  

 

 

Exhibit B

 

FORM OF MONTHLY SERIES
2008-1 COLLATERAL CERTIFICATEHOLDERS’ STATEMENT

 

 

MONTHLY COLLATERAL CERTIFICATEHOLDERS’ STATEMENT

TARGET NATIONAL BANK

TARGET CREDIT CARD MASTER TRUST

SERIES 2008-1

 

Pursuant to the Amended and Restated Pooling
and Servicing Agreement, dated as of April 28, 2000, as amended by
Amendment No. 1 thereto, dated as of August 22, 2001 (as amended,
supplemented or otherwise modified, the “Agreement”), as supplemented by the Series 2008-1
Supplement (as may be amended, from time to time, the “Series Supplement”),
each among Target National Bank, as Servicer, Target Receivables Corporation,
as Transferor, and Wells Fargo Bank, National Association, as Trustee, the
Servicer is required to prepare certain information each month regarding
distributions to Certificateholders and the performance of the Trust.

 

The
information with respect to the applicable Distribution Date and Monthly Period
is set forth below.

 

	
  Monthly Period:

  	
   

  
	
  Distribution Date:

  	
   

  
	
  No. of days in Monthly Period:

  	
   

  
	
  No. of days in Interest Accrual Period:

  	
   

  
	
  No. of weeks in Monthly Period:

  	
   

  
	
  No. of weeks in Fiscal year:

  	
   

  

 

A.            ORIGINAL
DEAL PARAMETERS

 

(a)           Note Initial
Principal Balance

(b)           Initial Invested
Amount

 

(c)           Interest Rate

(d)           Servicing Fee
Rate

(e)           Program Fee Rate

(f)            Loyalty, Rewards
and TCOE Fee Rate Cap

(g)           Discount Percentage

 

I.              RECEIVABLES
IN THE TRUST

 

(a)           Beginning of the
Period Principal Receivables

(b)           Beginning of the
Period Finance Charge Receivables

(c)           Beginning of the
Period Discounted Receivables

(d)           Beginning of the
Period Total Receivables (a + b + c)

 

(e)           Removed
Principal Receivables

(f)            Removed Finance
Charge Receivables

(g)           Removed Total
Receivables (e + f)

 

(h)           Supplemental
Principal Receivables

(i)            Supplemental
Finance Charge Receivables

(j)            Supplemental
Total Receivables (h + i)

 

(k)           End of Period
Principal Receivables

(l)            End of Period
Finance Charge Receivables

(m)          End of Period
Discounted Receivables

(n)           End of Period
Total Receivables (k + l + m)

 

II.            INVESTED
AMOUNTS

 

(a)           Initial Invested
Amount

 

(b)           Invested Amount
(Beginning of Monthly Period)

(c)           Invested Amount
(End of Monthly Period)

 

(d)           Invested Amount
(End of Revolving Period)

 

(e)           Note Principal
Balance (End of Period)

 

 

III.           ALLOCATION
PERCENTAGES

 

(a)           Floating
Allocation Percentage (II.b/(I.a + V.d)

 

(b)           Principal
Allocation Percentage (II.b/(I.a + V.d)

or (II.d/(I.a + V.d) during Amortization

 

IV.           SERIES
CALCULATIONS

(Formulas shown will be adjusted if there is any amount in the Special
Funding Account)

 

(a)           Servicing Fee (#
of wks in monthly period / # of wks in fiscal year * (II.b * A.d)

(b)           Program Fee (#
of wks in monthly period / # of wks in fiscal year * (II.b * A.e)

 

(c)           Investor
Defaulted Amount (III.a * (VI.o))

 

(d)           Loyalty Rewards
and TCOE Fees for the Monthly Period

(i) Loyalty,
Rewards to guests - new accounts

(ii) Loyalty,
Rewards to guests - ongoing purchases

(iii) Accrued
TCOE payments to schools

 

(e)           Loyalty, Rewards
and TCOE Fees allocated to Series 2008-1 (II.b/I.a * IV.d)

(f)            Loyalty, Rewards
and TCOE Fee Rate Cap (# of wks in monthly period / # of wks in fiscal

year
* (II.b * A.f)

 

(g)           Monthly Loyalty,
Rewards & TCOE fees (lesser of (e) & (f))

 

V.            TRANSFEROR’S
INTEREST, RETAINED INTEREST, AND SPECIAL FUNDING ACCOUNT

 

(a)           Transferor’s
Amount (end of month)

(b)           Required
Retained Transferor Amount (end of month)

(c)           Required
Principal Balance (end of month)

(d)           Funds on deposit
in Special Funding Account (beginning of month)

(e)           Funds on deposit
in Special Funding Account (end of month)

 

VI.           PERFORMANCE
SUMMARY

 

COLLECTIONS:

(a)           Collections of
Principal Receivables

(b)           Collections of
Finance Charge Receivables (from cardholder payments)

(c)           Collections of
Finance Charge Receivables (from merchant fees,

deferred
billing fees, collection account interest, interchange fees)

(d)           Collections of
Discount Option Receivables

(e)           Total Finance
Charge Collections (b + c + d)

(f)            Total
Collections (a + e)

 

DELINQUENCIES
AND LOSSES:

(g)           2 missed
payments

(h)           3 missed payments

(i)            4 missed
payments

(j)            5 missed
payments

(k)           6 missed
payments

 

(l)            Total
delinquencies (g + h + i + j + k)

 

(m)          Gross
Charge-Offs during the month

(n)           Recoveries
during the month

(i) Recoveries
from cardholders

(ii) Recoveries
from asset sales

(o)           Net Charge-Offs
during the month (m - n)

 

VII.         NON-U.S. ACCOUNTS

 

(a)           Non-US Accounts at end of month

(b)           as a percentage of total (a / c)

 

 

(c)           Total number of Accounts in Trust (at
end of month)

 

VIII.        AVAILABLE SERIES 2008-1 FINANCE
CHARGE COLLECTIONS AND APPLICATION OF FUNDS

 

(a)           Floating
Allocation Percentage of Total Finance Charge Collections (III.(a) *
VI.(e))

(b)           Available Series 2008-1
Finance Charge Collections

 

(i)            Monthly
Servicing Fee (IV.a)

 

(ii)           Investor
Defaulted Amount (IV.c)

 

(iii)          Reimbursement of
Investor Charge-Offs

 

(iv)          Monthly Program
Fee (IV.b)

 

(v)           Monthly, Loyalty
Rewards & TCOE fees (IV.g)

 

(vi)          Monthly Interest
and Carryover Interest ((A.c * II.e) * (Days in interest accrual period/360)

 

(vii)         Remaining
Finance Charge Collections (b-i-ii-iii-iv-v-vi)

 

IX.           PORTFOLIO
PERFORMANCE RATES

 

(a)           Series Finance
Charge Yield (((VIII.a / # of wks in monthy period) * # of wks in fiscal
year)/II.b)

(b)           Investor
Defaulted Amount % ((VIII.ii * 12)/II.b)

(c)           Servicing Fee %

(d)           Program Fee %

(e)           Monthly, Loyalty
Rewards and TCOE Fee % ((VIII.v / # of wks in monthly period) * # of wks

in
fiscal year)/ II.b)

	
  (f)

  	
   

  	
  Interest
  Rate for the period (A.c)

  	
   

  	
   

  

 

(g)           Excess Spread %
(a-b-c-d-e-f)

(h)           Excess Spread %
(prior month)

(i)            Excess Spread %
(2 months ago)

 

(j)            3 Month Average
Excess Spread %

 

(k)           Monthly Payment
Rate ((VI.a+VI.b) / I.d) * (30 / # of days in monthly period))

 

(l)            Cap Test
Percentage (II.c/(I.k + V.e)

(m)          Cap Test
Percentage (prior month)

(n)           Cap Test
Percentage (2 months ago)

 

(o)           Transferor Note
Repurchase

 

(p)           [RESERVED]

 

X.            PRINCIPAL
COLLECTIONS

(a)           Series 2008-1
Principal (lesser of (v) and (vi))

	
  (i) Principal
  Allocation percentage of Principal Collections

  
	
  (III.b
  * VI.a)

  
	
  (ii) Investor
  Defaulted Amount (VIII.ii)

  
	
  (iii) Reimbursement
  of Investor Charge-offs (VIII.iii)

  
	
  (iv) Allocable
  amounts in Special Funding Account

  	
   

  	
   

  
	
  (v) Available
  Series 2008-1 Principal Collections (i+ii+iii+iv)

  
	
   

  
	
  (vi) Invested
  Amount (End of Period) (II.c)

  

 

 

(b)           Special Shared
Principal Collections

 

XI.           INVESTOR
CHARGE-OFFS

 

INVESTOR
CHARGE-OFFS

(a)           Investor
Charge-Offs (current month)

 

 

(b)           Aggregate
Investor Charge-Offs

(c)           Aggregate amount
reimbursed in respect of Investor Charge-Offs

(d)           Aggregate
Adjustment Payment Shortfall Reinstatement

(e)           The amount, if
any, by which the Note Principal Balance exceeds the

Invested
Amount after giving effect to all transactions on such Distribution

Date

 

XII.         PRINCIPAL PAYMENT ADJUSTMENT

 

(a)           Principal
Payment adjustment for current or any prior Distribution Date

 

 

	
   

  	
  TARGET NATIONAL BANK,

  	
   

  
	
   

  	
    as Servicer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: /s/

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
				

 

 

Exhibit C

 

FORM OF MONTHLY
SERVICER’S CERTIFICATE

 

TARGET NATIONAL BANK

 

TARGET CREDIT CARD MASTER TRUST

SERIES 2008-1

 

The undersigned, a duly authorized representative of
Target National Bank, as Servicer (“Target National Bank” or the “Servicer”),
pursuant to the Amended and Restated Pooling and Servicing Agreement, dated as
of April 28, 2000, as amended by Amendment No. 1, dated as of August 22,
2001 (as amended, supplemented or otherwise modified, the “Agreement”),
as supplemented by the Series 2008-1 Supplement (as amended and
supplemented, the “Series Supplement”), dated as of May 19,
2008, by and among Target National Bank, Target Receivables Corporation and
Wells Fargo Bank, National Association, does hereby certify as follows:

 

1. 
Capitalized terms used in this Certificate have their respective
meanings as set forth in the Agreement or the Series Supplement, as
applicable.

 

2.  Target
National Bank is, as of the date hereof, the Servicer under the Agreement.

 

3.  The
undersigned is a Servicing Officer.

 

4.  This
Certificate relates to the Distribution Date occurring on                     
    ,         
(the “                
      Distribution Date”).

 

5.  As of the
date hereof, to the best knowledge of the undersigned, the Servicer has
performed in all material respects all its obligations under the Agreement
through the Monthly Period preceding such Distribution Date [or, if there has
been a default in the performance of any such obligation, set forth in detail (i) the
nature of such default, (ii) the action taken by the Servicer, if any, to
remedy such default and (iii) the current status of each such default; if
applicable, insert “None.”]

 

6.  As of the
date hereof, to the best knowledge of the undersigned, no Early Amortization
Commencement Date occurred on or prior to such Distribution Date.

 

 

IN WITNESS WHEREOF, the undersigned has duly
executed and delivered this Certificate this         
day of                       
        .

 

	
   

  	
   

  
	
   

  	
  TARGET NATIONAL BANK,

  
	
   

  	
    as Servicer

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Exhibit D

 

FORM OF TRANSFEREE
REPRESENTATION LETTER

 

[DATE]

 

Target
Receivables Corporation

1000
Nicollet Mall

Minneapolis,
Minnesota 55403

 

Wells
Fargo Bank, National Association

Sixth
Street and Marquette Avenue

MAC
N9311-161

Minneapolis,
Minnesota 55479

 

Re:  Target Credit Card Master
Trust, Series 2008-1

 

Ladies
and Gentlemen:

 

In connection with the proposed purchase of $                              
in principal amount of the Target Credit Card Master Trust, Series 2008-1
Collateral Certificate (the “Collateral Certificate”), the undersigned
(the “Purchaser”) confirms in this letter (the “Transferee
Representation Letter”) that:

 

I.              The
Purchaser has received such information and documentation as the Purchaser
deems necessary in order to make its investment decision.  The Purchaser understands that such
information and documentation speaks only as of its date and that the
information contained therein may not be correct or complete as of any time subsequent
to such date.

 

II.            The
Purchaser agrees to be bound by the restrictions and conditions relating to the
Collateral Certificate set forth in the Amended and Restated Pooling and
Servicing Agreement, dated as of April 28, 2000, as amended by Amendment No. 1,
dated as of August 22, 2001 (as amended, supplemented or otherwise
modified, the “Pooling and Servicing Agreement,” such term to include
any amendment thereto), by and among Target Receivables Corporation, as
Transferor (the “Transferor”), Target National Bank, as the Servicer,
and Wells Fargo Bank, National Association, as Trustee (the “Trustee”),
and the Series 2008-1 Supplement, dated as of May 19, 2008 (the “Series Supplement”),
by and among the Transferor, the Servicer and the Trustee.  The Pooling and Servicing Agreement, as
supplemented by the Series Supplement, is herein referred to as the “Agreement.”  The Purchaser agrees to be bound by, and 

 

 

not to reoffer, resell,
pledge or otherwise transfer (any such act, a “Transfer”) the Collateral
Certificate except in compliance with such restrictions and conditions
including but not limited to those in Section 9.4 of the Series Supplement.

 

III.           The
Purchaser agrees that the Collateral Certificate may be reoffered, resold,
pledged or otherwise transferred only in compliance with the Securities Act of
1933, as amended (the “Securities Act”) and other applicable laws and
only (i) to the Transferor or (ii) to a limited number of
institutional “accredited investors” (as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act) and in a transaction exempt
from the registration requirements of the Securities Act (upon delivery of the
documentation required by the Pooling and Servicing Agreement and, if the
Trustee so requires, an opinion of counsel satisfactory to the Trustee).

 

IV.           The
Purchaser certifies that this Transferee Representation Letter has been duly
executed and delivered and constitutes the legal, valid and binding obligation
of the Purchaser, enforceable against the Purchaser in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws or equitable principles affecting
the enforcement of creditors’ rights generally and general principles of
equity.

 

V.            The
Purchaser is, for federal income tax purposes, either (i) a citizen or
resident of the United States, (ii) a corporation or partnership organized
in or under the laws of the United States or any state thereof or the District
of Columbia which, if such entity is a tax-exempt entity, recognizes that
payments with respect to the Collateral Certificate may constitute unrelated
business taxable income, (iii) an estate the income of which is includible
in gross income for U.S. federal income tax purposes regardless of its source,
or (iv) either (x) a trust for which a court within the United States
is able to exercise primary supervision over its administration and for which
one or more persons described in this paragraph are able to control all
substantial decisions or (y) a trust for which a valid election has been
made to be treated as a United States person. 
The Purchaser will furnish to the Person from whom it is acquiring any
interest in the Collateral Certificate, the Servicer and the Trustee, a
properly executed U.S. Internal Revenue Service Form W-9 (and will furnish
a new Form W-9, or any successor applicable form, upon the expiration or
obsolescence of any previously delivered form) and such other certifications,
representations or Opinions of Counsel as may be requested by the Trustee.

 

VI.           The
Purchaser has not acquired and it will not Transfer any interest in the
Collateral Certificate, or cause an interest in the Collateral Certificate to
be marketed, on or through an “established securities market” within the meaning
of Section 7704(b)(1) of the Code and any Treasury regulations
thereunder, including, without limitation, an over the counter market or an
interdealer quotation system that regularly disseminates firm buy or sell
quotations.  In addition, (i) the
Purchaser is not and will not become (and, if it is disregarded as an entity
separate from its owner within the meaning of Treasury Regulations Section 301.7701-3(a) (a
“DRE”), its owner is not and will not become), for so long as the
Purchaser holds an interest in the Collateral Certificate, a partnership,
Subchapter S corporation or grantor trust for U.S. federal income tax purposes
(a “Flow-Thru Entity”) or (ii) if the Purchaser (or, if the
assignee is a DRE, 

 

 

its owner) is, or becomes, a
Flow-Thru Entity, for so long as the Purchaser (or, if the Purchaser is a DRE,
its owner) is a Flow-Thru Entity and the Purchaser holds an interest in the
Collateral Certificate, not more than 50% of the value of any interests in the
Purchaser (or, if the Purchaser is a DRE, its owner) will be attributable to
interests in the Trust held by the Purchaser. 
The opinion of tax counsel to the effect that the Trust will not be
treated as an association or as a publicly traded partnership taxable as a
corporation is dependent in part on the accuracy of the Purchaser’s
certifications described in this paragraph.

 

VII.          The
Purchaser understands that a subsequent Transfer of the Collateral Certificate
will be void if such Transfer would cause the number of Targeted Holders (as
defined in the Series Supplement) to exceed ninety-five.

 

VIII.        The
Purchaser understands that the opinion of tax counsel that the Trust is not a
publicly traded partnership taxable as a corporation is dependent in part on
the accuracy of the representations in paragraphs V and VI.

 

IX.           The
Purchaser is an institutional “accredited investor” (as defined in Rule 501(a)(1),
(2), (3), or (7) of Regulation D under the Securities Act) and has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of its investment in the Collateral
Certificate, and the Purchaser and any account for which the Purchaser is
acting are each able to bear the economic risk of its investment.

 

X.            The
Purchaser is acquiring the Collateral Certificate purchased by it for its own
account or for a single account (each of which is an institutional accredited
investor) as to which the Purchaser exercises sole investment discretion.

 

XI.           The
Purchaser represents and warrants for the benefit of Target Receivables
Corporation and the Trustee that such Purchaser is not (i) an employee
benefit plan (as defined in section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”)) that is subject to the
provisions of Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of
the Internal Revenue Code of 1986, as amended (the “Code”), (iii) a
Governmental Plan, as defined in section 3(32) of ERISA, subject to any
federal, state or local law which is, to a material extent, similar to the
provisions of Section 406 of ERISA or Section 4975 of the Code, (iv) an
entity whose underlying assets include plan assets by reason of a plan’s
investment in the entity or (v) a Person investing “plan assets” of any
such plan (including for purposes of clauses (iv) and (v) any
insurance company general account, but excluding any entity registered under
the Investment Company Act of 1940, as amended).

 

XII.         The
Purchaser understands that any purported Transfer of any portion of the Collateral
Certificate in contravention of the restrictions and conditions in paragraphs I
through XI above (including any violation of the representation in paragraph V
by an investor who continues to hold an interest in the Collateral Certificate
occurring any time after the Transfer in which it acquired such Collateral
Certificate) shall be null and void and the purported Purchaser shall not be
recognized by the Trust or any other person as a Collateral Certificateholder
for any purpose.

 

 

XIII.        The
Purchaser further understands that, on any proposed reoffer, resale, pledge or
other transfer of the Collateral Certificate, the Purchaser will be required to
furnish to the Trustee and the Transfer Agent and Registrar, such
certifications and other information as the Trustee or the Transfer Agent and
Registrar may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions and with the restrictions and conditions of the
Collateral Certificate and the Agreement pursuant to which the Collateral
Certificate was issued and the Purchaser agrees that if the Purchaser
determines to Transfer the Collateral Certificate, the Purchaser will cause its
proposed Purchaser to provide the Transferor, the Servicer and the Trustee with
a letter substantially in the form of this Transferee Representation
Letter.  The Purchaser further
understands that the Collateral Certificate purchased by it will bear a legend
to the foregoing effect.

 

XIV.        The
person signing this Transferee Representation Letter on behalf of the ultimate
beneficial purchaser of the Collateral Certificate has been duly authorized by
such beneficial purchaser of the Collateral Certificate to do so.

 

You are entitled to rely upon this Transferee
Representation Letter and are irrevocably authorized to produce this Transferee
Representation Letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Full Legal Name of Purchaser]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Exhibit E

 

Adjustment Payment Schedule*

 

	
  DISTRIBUTION DATE

  	
   

  	
   

  	
  ADJUSTMENT

  PERCENTAGE

  
	
  June 2008

  	
   

  	
   

  	
  6.90%

  
	
  July 2008

  	
   

  	
   

  	
  6.80%

  
	
  August 2008

  	
   

  	
   

  	
  6.70%

  
	
  September 2008

  	
   

  	
   

  	
  6.60%

  
	
  October 2008

  	
   

  	
   

  	
  6.50%

  
	
  November 2008

  	
   

  	
   

  	
  6.39%

  
	
  December 2008

  	
   

  	
   

  	
  6.29%

  
	
  January 2009

  	
   

  	
   

  	
  6.19%

  
	
  February 2009

  	
   

  	
   

  	
  6.08%

  
	
  March 2009

  	
   

  	
   

  	
  5.98%

  
	
  April 2009

  	
   

  	
   

  	
  5.87%

  
	
  May 2009

  	
   

  	
   

  	
  5.77%

  
	
  June 2009

  	
   

  	
   

  	
  5.66%

  
	
  July 2009

  	
   

  	
   

  	
  5.55%

  
	
  August 2009

  	
   

  	
   

  	
  5.45%

  
	
  September 2009

  	
   

  	
   

  	
  5.34%

  
	
  October 2009

  	
   

  	
   

  	
  5.23%

  
	
  November 2009

  	
   

  	
   

  	
  5.12%

  
	
  December 2009

  	
   

  	
   

  	
  5.01%

  
	
  January 2010

  	
   

  	
   

  	
  4.90%

  
	
  February 2010

  	
   

  	
   

  	
  4.79%

  
	
  March 2010

  	
   

  	
   

  	
  4.68%

  
	
  April 2010

  	
   

  	
   

  	
  4.57%

  
	
  May 2010

  	
   

  	
   

  	
  4.45%

  
	
  June 2010

  	
   

  	
   

  	
  4.34%

  
	
  July 2010

  	
   

  	
   

  	
  4.23%

  
	
  August 2010

  	
   

  	
   

  	
  4.11%

  
	
  September 2010

  	
   

  	
   

  	
  4.00%

  
	
  October 2010

  	
   

  	
   

  	
  3.88%

  
	
  November 2010

  	
   

  	
   

  	
  3.77%

  
	
  December 2010

  	
   

  	
   

  	
  3.65%

  
	
  January 2011

  	
   

  	
   

  	
  3.53%

  
	
  February 2011

  	
   

  	
   

  	
  3.42%

  
	
  March 2011

  	
   

  	
   

  	
  3.30%

  

 

* Intended to produce a yield to the Note Purchaser
of LIBOR + 2.28%.

 

 

	
  DISTRIBUTION DATE

  	
   

  	
   

  	
  ADJUSTMENT

  PERCENTAGE

  
	
  April 2011

  	
   

  	
   

  	
  3.18%

  
	
  May 2011

  	
   

  	
   

  	
  3.06%

  
	
  June 2011

  	
   

  	
   

  	
  2.94%

  
	
  July 2011

  	
   

  	
   

  	
  2.82%

  
	
  August 2011

  	
   

  	
   

  	
  2.70%

  
	
  September 2011

  	
   

  	
   

  	
  2.57%

  
	
  October 2011

  	
   

  	
   

  	
  2.45%

  
	
  November 2011

  	
   

  	
   

  	
  2.33%

  
	
  December 2011

  	
   

  	
   

  	
  2.21%

  
	
  January 2012

  	
   

  	
   

  	
  2.08%

  
	
  February 2012

  	
   

  	
   

  	
  1.96%

  
	
  March 2012

  	
   

  	
   

  	
  1.83%

  
	
  April 2012

  	
   

  	
   

  	
  1.70%

  
	
  May 2012

  	
   

  	
   

  	
  1.58%

  
	
  June 2012

  	
   

  	
   

  	
  1.45%

  
	
  July 2012

  	
   

  	
   

  	
  1.32%

  
	
  August 2012

  	
   

  	
   

  	
  1.19%

  
	
  September 2012

  	
   

  	
   

  	
  1.06%

  
	
  October 2012

  	
   

  	
   

  	
  0.93%

  
	
  November 2012

  	
   

  	
   

  	
  0.80%

  
	
  December 2012

  	
   

  	
   

  	
  0.67%

  
	
  January 2013

  	
   

  	
   

  	
  0.54%

  
	
  February 2013

  	
   

  	
   

  	
  0.40%

  
	
  March 2013

  	
   

  	
   

  	
  0.27%

  
	
  April 2013

  	
   

  	
   

  	
  0.13%

  
	
  May 2013
  and thereafter

  	
   

  	
   

  	
  0.00%

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]