Document:

exv4w1

 

[Exhibit 4.1]

NORDSTROM CREDIT CARD MASTER NOTE TRUST II,

as Issuer,

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Indenture Trustee

 

AMENDED AND RESTATED

MASTER INDENTURE

Dated as of May 1, 2007

 

 

 

 

RECONCILIATION AND TIE BETWEEN TRUST INDENTURE

ACT OF 1939 AND INDENTURE PROVISIONS*

	 	 	 	 	 
	Trust Indenture	 	 
	Act Section	 	Indenture Section
	 
	 	 	 	 
	310(a)(1)
	 	 	6.11	 
	(a)(2)
	 	 	6.11	 
	(a)(3)
	 	 	6.10	 
	(a)(4)
	 	Not Applicable
	(a)(5)
	 	 	6.11	 
	(b)
	 	 	6.08, 6.11	 
	(c)
	 	Not Applicable
	311(a)
	 	 	6.12	 
	(b)
	 	 	6.12	 
	(c)
	 	Not Applicable
	312(a)
	 	 	7.01, 7.02	(a)
	(b)
	 	 	7.02	(b)
	(c)
	 	 	7.02	(c)
	313(a)
	 	 	7.04	 
	(b)
	 	 	7.04	 
	(c)
	 	 	7.03, 7.04	 
	(d)
	 	 	7.04	 
	314(a)
	 	 	3.09, 7.03	(a)
	(b)
	 	 	3.06	 
	(c)(1)
	 	 	2.11, 8.09(c), 12.01	(a)
	(c)(2)
	 	 	2.11, 8.09(c), 12.01	(a)
	(c)(3)
	 	 	2.11, 8.09(c), 12.01	(a)
	(d)(1)
	 	 	2.11, 8.09(c), 12.01	(b)
	(d)(2)
	 	Not Applicable
	(d)(3)
	 	Not Applicable
	(e)
	 	 	12.01	(a)
	315(a)
	 	 	6.01	(b)
	(b)
	 	 	6.02	 
	(c)
	 	 	6.01	(c)
	(d)
	 	 	6.01	(d)
	(d)(1)
	 	 	6.01	(d)
	(d)(2)
	 	 	6.01	(d)
	(d)(3)
	 	 	6.01	(d)
	(e)
	 	 	5.14	 
	316(a)(1)(A)
	 	 	5.12	 
	316(a)(1)(B)
	 	 	5.13	 
	316(a)(2)
	 	Not Applicable
	316(b)
	 	 	5.08	 
	317(a)(1)
	 	 	5.04	 
	317(a)(2)
	 	 	5.04	(d)
	317(b)
	 	 	5.04	(a)
	318(a)
	 	 	12.07	 

			
	*	 	This reconciliation and tie shall not, for any purpose, be deemed to be part of the within indenture.

 

 

 

	 	 	 	 	 	 	 
	
ARTICLE ONE
	
DEFINITIONS
	 
	 	 	 	 	 	 
	Section 1.01.
	 	Definitions	 	 	3	 
	Section 1.02.
	 	Other Definitional Provisions	 	 	15	 
	 
	 	 	 	 	 	 
	
ARTICLE TWO
	
THE NOTES
	 
	 	 	 	 	 	 
	Section 2.01.
	 	Form Generally	 	 	17	 
	Section 2.02.
	 	Denominations	 	 	17	 
	Section 2.03.
	 	Execution, Authentication and Delivery	 	 	17	 
	Section 2.04.
	 	Authenticating Agent	 	 	18	 
	Section 2.05.
	 	Registration of and Limitations on Transfer and Exchange of Notes	 	 	19	 
	Section 2.06.
	 	Mutilated, Destroyed, Lost or Stolen Notes	 	 	21	 
	Section 2.07.
	 	Persons Deemed Owners	 	 	21	 
	Section 2.08.
	 	Appointment of Paying Agent	 	 	22	 
	Section 2.09.
	 	Access to List of Noteholders' Names and Addresses	 	 	22	 
	Section 2.10.
	 	Cancellation	 	 	22	 
	Section 2.11.
	 	Release of Collateral	 	 	23	 
	Section 2.12.
	 	New Issuances	 	 	23	 
	Section 2.13.
	 	Book-Entry Notes	 	 	24	 
	Section 2.14.
	 	Notices to Clearing Agency or Foreign Clearing Agency	 	 	25	 
	Section 2.15.
	 	Definitive Notes	 	 	26	 
	Section 2.16.
	 	Global Notes	 	 	26	 
	Section 2.17.
	 	Meetings of Noteholders	 	 	27	 
	Section 2.18.
	 	Uncertificated Classes	 	 	27	 
	 
	 	 	 	 	 	 
	
ARTICLE THREE
	
COVENANTS OF ISSUER
	 
	 	 	 	 	 	 
	Section 3.01.
	 	Payment of Principal and Interest	 	 	28	 
	Section 3.02.
	 	Maintenance of Office or Agency	 	 	28	 
	Section 3.03.
	 	Money for Note Payments to be Held in Trust	 	 	28	 
	Section 3.04.
	 	Existence	 	 	29	 
	Section 3.05.
	 	Protection of Trust	 	 	30	 
	Section 3.06.
	 	Opinions as to Collateral	 	 	30	 
	Section 3.07.
	 	Performance of Obligations; Servicing of Receivables	 	 	31	 
	Section 3.08.
	 	Negative Covenants	 	 	32	 
	Section 3.09.
	 	Statements as to Compliance	 	 	33	 
	Section 3.10.
	 	Issuer May Consolidate, Etc., Only on Certain Terms	 	 	33	 

 

 

 

	 	 	 	 	 	 	 
	Section 3.11.
	 	Successor Substituted	 	 	35	 
	Section 3.12.
	 	No Other Business	 	 	35	 
	Section 3.13.
	 	No Borrowing	 	 	35	 
	Section 3.14.
	 	Servicer's Obligations	 	 	35	 
	Section 3.15.
	 	Guarantees, Loans, Advances and Other Liabilities	 	 	35	 
	Section 3.16.
	 	Capital Expenditures	 	 	35	 
	Section 3.17.
	 	Removal of Administrator	 	 	36	 
	Section 3.18.
	 	Restricted Payments	 	 	36	 
	Section 3.19.
	 	Notice of Events of Default	 	 	36	 
	Section 3.20.
	 	Further Instruments and Acts	 	 	36	 
	Section 3.21.
	 	Representations and Warranties as to the Security Interest of the Indenture Trustee in the Receivables	 	 	36	 
	 
	 	 	 	 	 	 
	
ARTICLE FOUR
	
SATISFACTION AND DISCHARGE
	 
	 	 	 	 	 	 
	Section 4.01.
	 	Satisfaction and Discharge of this Master Indenture	 	 	38	 
	Section 4.02.
	 	Application of Trust Money	 	 	39	 
	 
	 	 	 	 	 	 
	
ARTICLE FIVE
	
PAY OUT EVENTS, DEFAULTS AND REMEDIES
	 
	 	 	 	 	 	 
	Section 5.01.
	 	Pay Out Events	 	 	40	 
	Section 5.02.
	 	Events of Default	 	 	40	 
	Section 5.03.
	 	Acceleration of Maturity; Rescission and Annulment	 	 	41	 
	Section 5.04.
	 	Collection of Indebtedness and Suits for Enforcement by Indenture Trustee	 	 	42	 
	Section 5.05.
	 	Remedies; Priorities	 	 	44	 
	Section 5.06.
	 	Optional Preservation of the Collateral	 	 	46	 
	Section 5.07.
	 	Limitation on Suits	 	 	47	 
	Section 5.08.
	 	Unconditional Rights of Noteholders to Receive Principal and Interest	 	 	47	 
	Section 5.09.
	 	Restoration of Rights and Remedies	 	 	48	 
	Section 5.10.
	 	Rights and Remedies Cumulative	 	 	48	 
	Section 5.11.
	 	Delay or Omission Not Waiver	 	 	48	 
	Section 5.12.
	 	Rights of Noteholders to Direct Indenture Trustee	 	 	48	 
	Section 5.13.
	 	Waiver of Past Defaults	 	 	48	 
	Section 5.14.
	 	Undertaking for Costs	 	 	49	 
	Section 5.15.
	 	Waiver of Stay or Extension Laws	 	 	49	 
	Section 5.16.
	 	Sale of Receivables	 	 	49	 
	Section 5.17.
	 	Action on Notes	 	 	50	 

 

 

 

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	
ARTICLE SIX
	
THE INDENTURE TRUSTEE
	 
	 	 	 	 	 	 
	Section 6.01.
	 	Duties of the Indenture Trustee	 	 	51	 
	Section 6.02.
	 	Notice of Pay Out Event or Event of Default	 	 	53	 
	Section 6.03.
	 	Rights of Indenture Trustee	 	 	53	 
	Section 6.04.
	 	Not Responsible for Recitals or Issuance of Notes	 	 	54	 
	Section 6.05.
	 	May Hold Notes	 	 	54	 
	Section 6.06.
	 	Money Held in Trust	 	 	54	 
	Section 6.07.
	 	Compensation, Reimbursement and Indemnification	 	 	54	 
	Section 6.08.
	 	Replacement of Indenture Trustee	 	 	55	 
	Section 6.09.
	 	Successor Indenture Trustee by Merger	 	 	56	 
	Section 6.10.
	 	Appointment of Co-Indenture Trustee or Separate Indenture Trustee	 	 	56	 
	Section 6.11.
	 	Eligibility; Disqualification	 	 	57	 
	Section 6.12.
	 	Preferential Collection of Claims Against	 	 	58	 
	Section 6.13.
	 	Tax Returns	 	 	58	 
	Section 6.14.
	 	Representations and Covenants of the Indenture Trustee	 	 	58	 
	Section 6.15.
	 	Custody of the Collateral	 	 	58	 
	Section 6.16.
	 	Disqualification of the Indenture Trustee	 	 	59	 
	 
	 	 	 	 	 	 
	
ARTICLE SEVEN
	
NOTEHOLDERS’ LIST AND REPORTS BY INDENTURE TRUSTEE AND ISSUER
	 
	 	 	 	 	 	 
	Section 7.01.
	 	Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders	 	 	60	 
	Section 7.02.
	 	Preservation of Information; Communications to Noteholders	 	 	60	 
	Section 7.03.
	 	Reports by Issuer	 	 	60	 
	Section 7.04.
	 	Reports by Indenture Trustee	 	 	61	 
	 
	 	 	 	 	 	 
	
ARTICLE EIGHT
	
ALLOCATION AND APPLICATION OF COLLECTIONS
	 
	 	 	 	 	 	 
	Section 8.01.
	 	Collection of Money	 	 	62	 
	Section 8.02.
	 	Rights of Noteholders	 	 	62	 
	Section 8.03.
	 	Establishment of Collection Account and Special Funding Account	 	 	62	 
	Section 8.04.
	 	Collections and Allocations	 	 	64	 
	Section 8.05.
	 	Shared Principal Collections	 	 	65	 
	Section 8.06.
	 	Additional Withdrawals from the Collection Account	 	 	66	 
	Section 8.07.
	 	Allocation of Collateral to Series or Groups	 	 	66	 
	Section 8.08.
	 	Excess Finance Charge Collections	 	 	67	 
	Section 8.09.
	 	Release of Collateral; Eligible Loan Documents	 	 	67	 
	Section 8.10.
	 	Opinion of Counsel	 	 	67	 

 

 

 

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	
ARTICLE NINE
	
DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS
	 
	 	 	 	 	 	 
	Section 9.01.
	 	Distributions and Reports to Noteholders	 	 	68	 
	 
	 	 	 	 	 	 
	
ARTICLE TEN
	
SUPPLEMENTAL INDENTURES
	 
	 	 	 	 	 	 
	Section 10.01.
	 	Supplemental Indentures Without Consent of Noteholders	 	 	69	 
	Section 10.02.
	 	Supplemental Indentures with Consent of Noteholders	 	 	70	 
	Section 10.03.
	 	Execution of Supplemental Indentures	 	 	72	 
	Section 10.04.
	 	Effect of Supplemental Indenture	 	 	72	 
	Section 10.05.
	 	Conformity With Trust Indenture Act	 	 	72	 
	Section 10.06.
	 	Reference in Notes to Supplemental Indentures	 	 	72	 
	 
	 	 	 	 	 	 
	
ARTICLE ELEVEN
	
TERMINATION
	 
	 	 	 	 	 	 
	Section 11.01.
	 	Termination of Trust	 	 	73	 
	Section 11.02.
	 	Final Distribution	 	 	73	 
	Section 11.03.
	 	Termination Distributions	 	 	74	 
	Section 11.04.
	 	Defeasance	 	 	74	 
	 
	 	 	 	 	 	 
	
ARTICLE TWELVE
	
MISCELLANEOUS
	 
	 	 	 	 	 	 
	Section 12.01.
	 	Compliance Certificates and Opinions, etc.	 	 	76	 
	Section 12.02.
	 	Form of Documents Delivered to Indenture Trustee	 	 	77	 
	Section 12.03.
	 	Acts of Noteholders	 	 	78	 
	Section 12.04.
	 	Notices, Etc. to Indenture Trustee and Issuer	 	 	79	 
	Section 12.05.
	 	Notices to Noteholders; Waiver	 	 	79	 
	Section 12.06.
	 	Alternate Payment and Notice Provisions	 	 	80	 
	Section 12.07.
	 	Conflict with Trust Indenture Act	 	 	80	 
	Section 12.08.
	 	Effect of Headings and Table of Contents	 	 	80	 
	Section 12.09.
	 	Successors and Assigns	 	 	80	 
	Section 12.10.
	 	Severability	 	 	80	 
	Section 12.11.
	 	Benefits of Indenture	 	 	80	 
	Section 12.12.
	 	Legal Holidays	 	 	80	 
	Section 12.13.
	 	GOVERNING LAW	 	 	80	 
	Section 12.14.
	 	Counterparts	 	 	81	 
	Section 12.15.
	 	Trust Obligations	 	 	81	 
	Section 12.16.
	 	No Petition	 	 	81	 

 

 

 

AMENDED AND RESTATED MASTER INDENTURE

This Amended and Restated Master Indenture, dated as of May 1, 2007, is between Nordstrom
Credit Card Master Note Trust II (formerly known as Nordstrom Private Label Credit Card Master
Trust), a statutory trust organized under the laws of the State of Delaware (herein, together with
its permitted successors and assigns, the “Issuer”), and Wells Fargo Bank, National Association, a
national banking association, as indenture trustee (herein, together with its successors in the
trusts hereunder, the “Indenture Trustee”).

RECITALS

WHEREAS, the Issuer and Wells Fargo Bank, National Association, a national banking
association, as indenture trustee, entered into a Master Indenture, dated as of October 1, 2001
(the “Original Master Indenture”), pursuant to which one or more series of notes were issued
secured by an interest in certain private label credit card receivables (the “Private Label
Receivables”);

WHEREAS, from and after the date hereof, the Issuer will take conveyances of a 90% pari passu
participation interest in certain existing and future amounts owing by Obligors in relation to
certain VISA® revolving credit card accounts (the “Participation” and, together with the
Private Label Receivables, the “Receivables”), and will issue one or more series of notes to
investors secured by an interest in all of the Receivables;

WHEREAS, simultaneously with the delivery of this Master Indenture, the Issuer is entering
into the Amended and Restated Transfer and Servicing Agreement with Nordstrom Credit Card
Receivables II LLC (formerly known as Nordstrom Private Label Receivables LLC), a Delaware limited
liability company, as Transferor (the “Transferor”), Nordstrom fsb, a federal banking association,
as Servicer (the “Servicer”), and the Indenture Trustee pursuant to which (a) the Transferor will
convey to the Issuer all of its right, title and interest in, to and under the Receivables and
certain related assets and (b) the Servicer will agree to service the Receivables and make
collections thereon on behalf of the Noteholders;

WHEREAS, under the Transfer and Servicing Agreement, Receivables arising in Accounts (as
herein defined) from time to time will be conveyed thereunder to the Issuer; and

WHEREAS, the parties hereto desire to amend and restate the Original Master Indenture as more
particularly set forth herein;

NOW, THEREFORE, in consideration of the mutual agreements herein contained, and of other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledge, the parties
hereto agree as follows:

 

 

 

GRANTING CLAUSES

The Issuer hereby Grants to the Indenture Trustee, for the benefit of the Holders of the Notes
and any Series Enhancers under the Series Enhancements as provided in the Indenture Supplements,
all of the Issuer’s right, title and interest, whether now owned or hereafter acquired, in, to and
under (i) the Receivables existing at the close of business on the Initial Cut-Off Date, in the
case of Receivables arising in the Initial Accounts, and on each Addition Cut-Off Date, in the case
of Receivables arising in the Additional Accounts, and in each case thereafter created from time to
time until the termination of the Issuer (including the Receivables conveyed under the
Participation Agreement but not the Retained Interest), (ii) Collections and all Interchange and
Recoveries allocable to the Issuer as provided in the Transfer and Servicing Agreement and all
monies due or to become due and all amounts received or receivable with respect thereto (including
proceeds of the reassignment of the Receivables to the Transferor pursuant to Sections 2.05(a) or
2.06 of the Transfer and Servicing Agreement), (iii) all Eligible Investments and all monies,
investment properties, instruments and other property credited to the Collection Account, the
Series Accounts and the Special Funding Account (including any subaccount of any such account), and
all interest, dividends, earnings, income and other distributions from time to time received,
receivable or otherwise distributed or distributable thereto or in respect thereof (including any
accrued discount realized on liquidation of any investment purchased at a discount), (iv) all
rights, remedies, powers, privileges and claims of the Issuer under or with respect to any Series
Enhancement, the Trust Agreement or the Transfer and Servicing Agreement (whether arising pursuant
to the terms of such Enhancement Agreement, the Trust Agreement or the Transfer and Servicing
Agreement or otherwise available to the Issuer at law or in equity), including the rights of the
Issuer to enforce such Enhancement Agreement, the Trust Agreement or the Transfer and Servicing
Agreement, and to give or withhold any and all consents, requests, notices, directions, approvals,
extensions or waivers under or with respect to such Series Enhancement, the Trust Agreement or the
Transfer and Servicing 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, (v) the
rights of the Seller and the Transferor under the Participation Agreement, the Operating Agreement
and each Receivables Purchase Agreements, if any, (vi) all money, accounts, general intangibles,
chattel paper, instruments, documents, goods, investment property, deposit accounts, certificates
of deposit, letters of credit and advices of credit consisting of, arising from, or related to the
foregoing, (vii) all proceeds of any derivative contracts between the Issuer and a counterparty, as
described in an Indenture Supplement, (viii) all Insurance Proceeds relating to the Receivables,
(ix) all other property of the Issuer, (x) all present and future claims, demands, causes and
choses in action in respect of any or all of the foregoing and (xi) any and all proceeds of the
foregoing; in each case, including any rights of the Owner Trustee and the Issuer pursuant to the
Transaction Documents, but excluding the Transferor Interest and all amounts distributable to the
holders of any Certificates pursuant to the terms of any Transaction Document (collectively, the
“Collateral”); provided, however, that the Collateral shall not include, and the lien of this
Master Indenture shall not extend to, the Residual Interest and the interest in the assets of the
Issuer represented by the Ownership Interest Certificate and the Transferor Certificates and the
amounts distributable with respect thereto.

 

2

 

Such Grants are made in trust to secure the Notes equally and ratably without prejudice,
priority or distinction, except as expressly provided in this Master Indenture and the Indenture
Supplements, between any Note and any other Notes, and to secure the other obligations
hereunder; provided, that unless and to the extent provided for in an Indenture Supplement for any
Series, the security interest granted above in the Series Accounts and Series Enhancement for a
particular Series shall be to secure the Notes for such Series only and, to the extent provided in
the Indenture Supplement for such Series, the Series Enhancers.

LIMITED RECOURSE

The obligation of the Issuer to make payments of principal of, interest on and other amounts
with respect to, the Notes and to the Series Enhancers under the Series Enhancements is limited by
recourse only to the Collateral and only to the extent proceeds and distributions on the Trust
Estate are allocated for their benefit under the terms of this Master Indenture, the Indenture
Supplements and the Series Enhancements.

ARTICLE ONE

DEFINITIONS

Section 1.01. Definitions. Whenever used in this Master Indenture, the following
words and phrases shall have the following meanings:

“Accumulation Period” means, with respect to any Series, or any Class within a Series,
a period following the Revolving Period during which Collections of Principal Receivables are
accumulated in an account for the benefit of the Noteholders of such Series or Class, which shall
be the controlled accumulation period, the principal accumulation period, the early accumulation
period, the optional accumulation period, the limited accumulation period or other accumulation
period, in each case as defined with respect to such Series or Class in the related Indenture
Supplement.

“Act” has the meaning set forth in Section 12.03(a).

“Adjusted Invested Amount” has the meaning set forth in the related Indenture
Supplement.

“Administration Agreement” means the Amended and Restated Administration Agreement,
dated as of May 1, 2007, between the Issuer and the Administrator, as the same may be amended,
supplemented, restated or otherwise modified from time to time.

“Administrator” means Nordstrom fsb in its capacity as Administrator under the
Administration Agreement, and any successor in such capacity.

“Aggregate Investor Percentage” means, with respect to Principal Receivables, Finance
Charge Receivables and Defaulted Receivables, as the case may be, as of any date of determination,
the sum of such series percentages of all Series of Notes issued and Outstanding on such date of
determination; provided, however, that the Aggregate Investor Percentage shall not exceed 100%.

 

3

 

“Amortization Period” means, with respect to any Series, or any Class within a Series,
a period following the Revolving Period during which Collections of Principal Receivables are
distributed to the related Noteholders of such Series or Class, which shall be the controlled
amortization period, the principal amortization period, the optional amortization period, the
limited amortization period, the early amortization period or other amortization period, in each
case as defined with respect to such Series in the related Indenture Supplement.

“Applicants” has the meaning set forth in Section 2.09(a).

“Authorized Officer” means, with respect to:

(i) the Issuer, any officer of the Owner Trustee who is authorized to act for the Owner
Trustee in matters relating to the Issuer and any Vice President or more senior officer of
the Administrator who is authorized to act for the Administrator in matters relating to the
Issuer and to be acted upon by the Administrator pursuant to the Administration Agreement
and who is identified on an Incumbency Certificate;

(ii) the Transferor, any officer of the Transferor who is authorized to act for the
Transferor in matters relating to the Transferor and who is identified on an Incumbency
Certificate;

(iii) the Servicer, any officer of the Servicer who is authorized to act for the
Servicer in matters relating to the Servicer and who is identified on an Incumbency
Certificate; and

(iv) the Seller, any officer of the Seller who is authorized to act for the Seller in
matters relating to the Seller and who is identified on an Incumbency Certificate.

“Bank” means Nordstrom fsb, and its successors and permitted assigns.

“Bearer Notes” means any Series or Class of Notes, together with the Indenture
Trustee’s certificate of authentication related thereto, issued in bearer form.

“Beneficial Owner” means, with respect to a Book-Entry Note, the Person who is the
owner of such Book-Entry Note, as reflected on the books of the Clearing Agency or Foreign Clearing
Agency, or on the books of a Person maintaining an account with such Clearing Agency or Foreign
Clearing Agency (directly as a Clearing Agency Participant or as an Indirect Participant, in
accordance with the rules of such Clearing Agency or Foreign Clearing Agency).

“Book-Entry Notes” means beneficial interests in the Notes, ownership and transfers of
which shall be made through book entries by a Clearing Agency or Foreign Clearing Agency as
described in Section 2.13.

“Class” means, with respect to any Series, any one of the classes of Notes of that
Series.

“Clearing Agency” means an organization registered as a “clearing agency” pursuant to
Section 17A of the Exchange Act, and serving as clearing agency for a Series or Class of Book-Entry
Notes.

 

4

 

“Clearing Agency Participant” means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects book-entry
transfers and pledges of securities deposited with the Clearing Agency.

“Clearstream” means Clearstream Banking, société anonyme, a professional depository
incorporated under the laws of Luxembourg, and its successors.

“Closing Date” means, with respect to any Series, the closing date specified in the
related Indenture Supplement.

“Code” means the Internal Revenue Code of 1986, as amended.

“Collateral” has the meaning set forth in the Granting Clauses.

“Collection Account” has the meaning set forth in Section 8.03.

“Commission” means the Securities and Exchange Commission, and its successors.

“Corporate Trust Office” means the principal office of the Indenture Trustee at which
at any particular time its corporate trust business shall be administered, which office at date of
the execution of this Master Indenture is located at MAC N9311-161, 6th Street and
Marquette Avenue, Minneapolis, Minnesota 55479, Attention: Corporate Trust Services-Asset Backed
Administration, or at such other address as the Indenture Trustee may designate from time to time
by notice to the Noteholders and the Transferor, or the principal corporate trust office of any
successor Indenture Trustee (the address of which the successor Indenture Trustee will notify the
Noteholders and the Transferor).

“Coupon” means, collectively, the interest coupons attached to Bearer Notes.

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

“Defeasance” has the meaning set forth in Section 11.04(a).

“Defeased Series” has the meaning set forth in Section 11.04(a).

“Definitive Notes” means Notes issued in definitive, fully registered form.

“Deposit Date” means each day on which the Servicer deposits Collections in the
Collection Account.

“Determination Date” means, unless otherwise specified in an Indenture Supplement for
a particular Series, the fifth Business Day preceding each Distribution Date.

“Distribution Date” with respect to any Series, has the meaning set forth in the
applicable Indenture Supplement.

“Dollars”, “$” or “U.S. $” means United States dollars.

 

5

 

“DTC” means The Depository Trust Company, and its successors.

“Eligible Institution” means a depository institution organized under the laws of the
United States or any State (or any domestic branch of a foreign bank) which at all times (i) has
either (a) a long-term unsecured debt rating of Aa3 or better by Moody’s or (b) a certificate of
deposit rating of Prime-1 by Moody’s, (ii) has either a long-term unsecured debt rating of AA- or
better or a certificate of deposit rating of A-1+ by Standard & Poor’s and (iii) is a member of the
FDIC. Notwithstanding the previous sentence, any institution the appointment of which satisfies
the Rating Agency Condition shall be considered an Eligible Institution.

“Eligible Investments” means, as of any date of determination, the following
instruments, investment property, or other property:

(i) direct obligations of, or obligations fully guaranteed as to timely payment by, the
United States;

(ii) demand deposits, time deposits or certificates of deposit (having original
maturities of no more than 365 days) of depository institutions or trust companies
incorporated under the laws of the United States or any State (or domestic branches of
foreign banks) and subject to supervision and examination by federal or State banking or
depository institution authorities; provided that at the time of the Trust’s investment or
contractual commitment to invest therein, the debt rating of such depository institution or
trust company shall be the highest short-term debt rating of each Rating Agency, or with
respect to ratings issued by Moody’s, have a long-term debt rating of at least A2 and/or a
short-term debt rating of Prime-1;

(iii) commercial paper or other short-term obligations (having original or remaining
maturities of no more than 30 days) (including short-term obligations of Nordstrom, Inc. and
the Bank) having, at the time of investment or contractual commitment to invest therein, the
highest credit rating for such obligation issued by Standard & Poor’s or a long-term debt
rating of at least A2 and/or a short-term debt rating of Prime-1 issued by Moody’s;

(iv) demand deposits, time deposits and certificates of deposit which (a) are scheduled
to mature on a date occurring no later than the Transfer Date in the Monthly Period
immediately succeeding the Monthly Period in which such investment is made, (b) are fully
insured by the FDIC and (c) have, at the time of the Trust’s investment therein, a rating in
the highest rating category of each Rating Agency;

(v) bankers’ acceptances (having original maturities of no more than 365 days) issued
by any depository institution or trust company referred to in clause (ii) above;

(vi) money market funds having, at the time of the Trust’s investment therein, a rating
in the highest rating category of each Rating Agency (including funds for which the
Indenture Trustee or any of its Affiliates is investment manager or advisor);

 

6

 

(vii) time deposits (other than those referred to in clause (iv) above), with a Person
the commercial paper of which has a credit rating satisfactory to each Rating Agency and
which are scheduled to mature on a date occurring no later than the Transfer Date in the
Monthly Period immediately succeeding the Monthly Period in which such investment is made;

(viii) any other relatively risk-free investments (including guaranteed investment
contracts) having a specified maturity and bearing interest or sold at a discount that
satisfies the Rating Agency Condition.

“Enhancement Agreement” means any agreement, instrument or document governing the
terms of any Series Enhancement or pursuant to which any Series Enhancement is issued or
outstanding.

“Euroclear Operator” means Euroclear Bank S.A./N.V., as operator of the Euroclear
System.

“Event of Default” has the meaning set forth in Section 5.02.

“Excess Allocation Series” means a Series that, pursuant to the related Indenture
Supplement, is entitled to receive certain excess Collections of Finance Charge Receivables, as
more specifically set forth in such Indenture Supplement. If so specified in the Indenture
Supplement for a Group of Series, each such Series may be an Excess Allocation Series only for the
other Series in such Group.

“Excess Finance Charge Collections” means, with respect to a Distribution Date, the
aggregate amount for all Outstanding Series of Collections of Finance Charge Receivables which the
related Indenture Supplements specify are to be treated as “Excess Finance Charge Collections” for
such Distribution Date.

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

“Finance Charge Receivables” has the meaning set forth in the Transfer and Servicing
Agreement.

“Finance Charge Shortfalls” means, with respect to a Distribution Date, the aggregate
amount for all Outstanding Series which the related Indenture Supplements specify are “Finance
Charge Shortfalls” for such Series and such Distribution Date.

“Foreign Clearing Agency” means Clearstream and the Euroclear Operator.

“GAAP” means generally accepted accounting principles in the United States in effect
from time to time.

“Global Note” has the meaning set forth in Section 2.16.

 

7

 

“Grant” means to mortgage, pledge, bargain, 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 the Master Indenture or an Indenture
Supplement. A Grant of the Collateral 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 in respect of the Collateral and all other monies 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.

“Group” means, with respect to any Series, the group of Series, if any, in which the
related Indenture Supplement specifies such Series is to be included.

“Incumbency Certificate” means a list, delivered to the Indenture Trustee on the
Closing Date, of Authorized Officers of the Issuer, the Transferor, the Servicer or the Seller, as
the context may require, setting forth the specimen signatures of such Authorized Officers, as such
list may be modified and supplemented from time to time.

“Indenture Supplement” means, with respect to any Series, a supplement to the Master
Indenture, executed by the parties hereto and delivered in connection with the original issuance of
the Notes of such Series pursuant to Section 10.01, and an amendment to the Master Indenture
executed pursuant to Sections 10.01 or 10.02, and, in either case, including all amendments thereof
and supplements thereto.

“Indenture Trustee” means Wells Fargo Bank, National Association, in its capacity as
trustee under this Master Indenture, and its successors in such capacity.

“Independent” means, when used with respect to any specified Person, that the Person
(i) is in fact independent of the Issuer, any other obligor upon the Notes, the Transferor, the
Seller and any of their respective Affiliates, (ii) does not have any direct financial interest or
any material indirect financial interest in the Issuer, any such other obligor, the Transferor, the
Seller or any of their respective Affiliates and (iii) is not connected with the Issuer, any such
other obligor, the Transferor, the Seller or any of their respective Affiliates 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 12.01, made by an Independent appraiser or other expert
appointed by an Issuer Order, and such opinion or certificate shall state that the signer has read
the definition of “Independent” in this Master Indenture and that the signer is Independent within
the meaning thereof.

“Indirect Participant” means other Persons such as securities brokers and dealers,
banks and trust companies that clear or maintain a custodial relationship with a participant of
DTC, either directly or indirectly.

 

8

 

“Invested Amount” means, with respect to any Series and for any date, an amount equal
to the “Invested Amount” or “Adjusted Invested Amount,” as applicable, specified in the related
Indenture Supplement.

“Investment Company Act” means the Investment Company Act of 1940, as amended.

“Issuer” means the Trust.

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

“Master Indenture” means this Amended and Restated Master Indenture, dated as of May
1, 2007, between the Issuer and the Indenture Trustee, as the same may be amended, supplemented,
restated or otherwise modified from time to time including, with respect to any Series or Class,
the related Indenture Supplement.

“Monthly Period” means, with respect to each Distribution Date, unless otherwise
provided in the related Indenture Supplement, the period from and including the first day of the
preceding calendar month to and including the last day of such calendar month; provided, however,
that the initial Monthly Period with respect to any Series will commence on the Closing Date with
respect to such Series and end on last day of the calendar month preceding the first Distribution
Date.

“New Issuance” has the meaning set forth in Section 2.12(a).

“Note Interest Rate” means, as of any particular date of determination and with
respect to any Series or Class, the interest rate as of such date specified therefor in the related
Indenture Supplement.

“Note Owner” means, with respect to a Book-Entry Note, the Person who is the owner of
such Book-Entry Note, as reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly as a Clearing Agency Participant or as
an Indirect Participant, in accordance with the rules of such Clearing Agency).

“Note Register” has the meaning set forth in Section 2.05(a).

“Noteholder” or “Holder” means the Person in whose name a Note is registered
on the Note Register and, if applicable, the holder of any Bearer Note, Global Note or Coupon, as
the case may be, or such other Person deemed to be a “Noteholder” or “Holder” in any related
Indenture Supplement.

“Notes” means all Series of Notes issued by the Trust pursuant to the Master Indenture
and the related Indenture Supplement.

“Notice of Default” has the meaning set forth in Section 5.02(c).

 

9

 

“Officer’s Certificate” means, unless otherwise specified in this Master Indenture, a
certificate delivered to the Indenture Trustee signed by any Authorized Officer of the Issuer,
Seller, Transferor or the Servicer, as applicable, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 12.01.

“Opinion of Counsel” means a written opinion of counsel, who may be counsel for, or an
employee of, the Person providing the opinion and who shall be reasonably acceptable to the
Indenture Trustee; provided that a Tax Opinion shall be an opinion of nationally recognized tax
counsel.

“Outstanding” means, as of any date of determination, all Notes, or with respect to a
particular Class or Series, all Notes with respect to such Class or Series, theretofore
authenticated and delivered under this Master Indenture and any related Indenture Supplements
except:

(i) Notes theretofore canceled by the Transfer Agent and Registrar or delivered to the
Transfer Agent and Registrar for cancellation;

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

(iii) Notes in exchange for or in lieu of other Notes which have been authenticated and
delivered pursuant to this Master Indenture and the related Indenture Supplement unless
proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a
Protected Purchaser;

provided that, in determining whether the Holders of the requisite principal amount of the
Outstanding Notes have given any request, demand, authorization, direction, notice, consent or
waiver hereunder or under the related Indenture Supplement, Notes owned by the Issuer, any other
obligor upon the Notes, the Transferor, the Servicer or any of their respective Affiliates 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 actually
knows to be 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 that the pledgee is not the
Issuer, any other obligor upon the Notes, the Transferor, the Servicer or any of their respective
Affiliates. In making any such determination, the Indenture Trustee may rely on the
representations of the pledgee and shall not be required to undertake any independent
investigation.

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

 

10

 

“Paired Series” means (i) each Series which has been paired with another Series (which
Series may be prefunded or partially prefunded), such that the reduction of the Invested Amount
or Adjusted Invested Amount of such Series results in the increase of the Invested Amount of
such other Series, as described in the related Indenture Supplements, and (ii) such other Series.

“Pay Out Event” means, with respect to any Series, a Trust Pay Out Event or the
related Series Pay Out Event.

“Paying Agent” means any paying agent appointed pursuant to Section 2.08 and shall
initially be the Indenture Trustee; provided that if the Indenture Supplement for a Series so
provides, a separate or additional Paying Agent may be appointed with respect to such Series.

“Permitted Assignee” means any Person who, if it were to purchase Receivables (or
interests therein) in connection with a sale thereof pursuant to Sections 5.05(a)(iii) and 5.16,
would not cause the Trust to be taxable as a publicly traded partnership for federal income tax
purposes, but shall not include the Transferor and its Affiliates.

“Principal Sharing Series” means a Series that, pursuant to the Indenture Supplement
therefor, is entitled to receive Shared Principal Collections. If so specified in the Indenture
Supplement for a Group of Series, each such Series may be Principal Sharing Series only for the
other Series in such Group.

“Principal Shortfalls” means, with respect to a Distribution Date, the aggregate
amount for all Outstanding Series which the related Indenture Supplements specify are “Principal
Shortfalls” for such Series and for such Distribution Date.

“Principal Terms” means, with respect to any Series, (i) the name or designation; (ii)
the initial principal amount (or method for calculating such amount), the Invested Amount and the
Required Transferor Interest; (iii) the Note Interest Rate for each Class of Notes of such Series
(or method for the determination thereof); (iv) the payment date or dates and the date or dates
from which interest shall accrue; (v) the method for allocating Collections to Noteholders; (vi)
the designation of any Series Accounts and the terms governing the operation of any such Series
Accounts; (vii) the Servicing Fee; (viii) the issuer and terms of any form of Series Enhancements
with respect thereto; (ix) the terms on which the Notes of such Series may be exchanged for Notes
of another Series, repurchased by the Transferor or remarketed to other investors; (x) the Series
Final Maturity Date; (xi) the number of Classes of Notes of such Series and, if more than one
Class, the rights and priorities of each such Class; (xii) the extent to which the Notes of such
Series will be issuable in temporary or permanent global form (and, in such case, the depositary
for such global note or notes, the terms and conditions, if any, upon which such global note may be
exchanged, in whole or in part, for Definitive Notes, and the manner in which any interest payable
on a temporary or global note will be paid); (xiii) whether the Notes of such Series may be issued
in bearer form and any limitations imposed thereon; (xiv) the priority of such Series with respect
to any other Series; (xv) whether such Series will be part of a Group; (xvi) whether such Series
will be a Principal Sharing Series; (xvii) whether such Series will be an Excess Allocation Series;
(xviii) the Distribution Dates; (xix) whether such Series will or may be a Paired Series and the
Series with which it will be paired, if applicable; and (xx) any other terms of such Series.

 

11

 

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

“Protected Purchaser” has the meaning set forth in the New York UCC.

“Qualified Account” means either (i) a segregated account with an Eligible Institution
or (ii) a segregated trust account with the corporate trust department of a depository institution
organized under the laws of the United States or any State (or any domestic branch of a foreign
bank), and acting as a trustee for funds deposited in such account, so long as any of the
unsecured, unguaranteed senior debt securities of such depository institution shall have a credit
rating from each Rating Agency in one of its generic credit rating categories that signifies
investment grade.

“Rating Agency” means, with respect to any Outstanding Series or Class of Notes, each
rating agency, as specified in the applicable Indenture Supplement, selected by the Transferor to
rate the Notes of such Outstanding Series or Class.

“Rating Agency Condition” means, with respect to any action, that each Rating Agency
shall have notified the Transferor and the Indenture Trustee in writing that such action will not
result in a reduction or withdrawal of its then-current rating of any Outstanding Series or Class
with respect to which it is a Rating Agency or, with respect to any Outstanding Series or Class not
rated by any Rating Agency, the Rating Agency Condition with respect to any such action shall be
either defined in the related Indenture Supplement or shall not apply.

“Reallocated Principal Collections” has, with respect to any series, the meaning set
forth in the related Indenture Supplement.

“Receivables Purchase Agreement” means (i) the Amended and Restated Receivables
Purchase Agreement, dated as of May 1, 2007, between Nordstrom Credit, Inc., as seller, and
Nordstrom Credit Card Receivables II LLC (formerly known as Nordstrom Private Label Receivables
LLC), as purchaser, as the same may be amended, supplemented or otherwise modified from time to
time or (ii) any receivables purchase agreement entered into between the Transferor and an Account
Owner, as the same may be amended, supplemented, restated or otherwise modified from time to time.

“Record Date” means, with respect to any Distribution Date, (i) for Definitive Notes,
the last day of the calendar month immediately preceding such Distribution Date or (ii) for
Book-Entry Notes, the Business Day immediately preceding such Distribution Date unless otherwise
specified for a Series in the related Indenture Supplement.

“Redemption Date” means, with respect to any Series, the date or dates, if any,
specified as such in the related Indenture Supplement.

“Registered Notes” means any Series or Class of Notes, together with the Indenture
Trustee’s certificate of authentication related thereto, issued in fully registered form without
interest coupons.

 

12

 

“Required Transferor Interest” means, with respect to any date, an amount equal to the
product of (i) the Required Transferor Percentage and (ii) the aggregate amount of Principal
Receivables.

“Required Transferor Percentage” means 11.0%; provided, however, that the Transferor
may reduce the Required Transferor Percentage upon (i) 30 days’ prior notice to the Indenture
Trustee and each Rating Agency, (ii) satisfaction of the Rating Agency Condition with respect
thereto and (iii) delivery to the Indenture Trustee of a certificate of a Vice President or more
senior officer of the Transferor stating that the Transferor reasonably believes that such
reduction will not, based on the facts known to such officer at the time of such certification,
then or thereafter have an Adverse Effect.

“Responsible Officer” means, when used with respect to the Indenture Trustee, any
officer (i) within the Corporate Trust Office, including any vice president, assistant vice
president, assistant treasurer, assistant secretary, trust officer or any other officer of the
Indenture Trustee customarily performing functions similar to those performed by the individuals
who at the time shall be such officers or to whom any corporate trust matter is referred at the
Corporate Trust Office because of such officer’s knowledge of and familiarity with the particular
subject and (ii) who shall have direct responsibility for the administration of this Master
Indenture and the other Transaction Documents.

“Revolving Period” means, with respect to each Series, the period specified in the
related Indenture Supplement.

“Securities Act” means the Securities Act of 1933, as amended.

“Seller” means Nordstrom Credit, Inc., in its capacity as seller under the Receivables
Purchase Agreement, or any other seller under a Receivables Purchase Agreement, and their
respective successors in such capacity.

“Series” means any series of Notes issued pursuant to this Master Indenture and the
related Indenture Supplement.

“Series Account” means any deposit, trust, securities escrow or similar account
maintained for the benefit of the Noteholders of any Series or Class, as specified in the related
Indenture Supplement.

“Series Enhancement” means the rights and benefits provided to the Trust or the
Noteholders of any Series or Class pursuant to any letter of credit, surety bond, cash collateral
account, collateral invested amount, spread account, reserve account, guaranteed rate agreement,
maturity liquidity facility, tax protection agreement, interest rate swap agreement, interest rate
cap agreement or other similar arrangement. The subordination of any Series or Class to another
Series or Class shall be deemed to be a Series Enhancement.

“Series Enhancer” means the Person or Persons providing any Series Enhancement, other
than (except to the extent otherwise provided with respect to any Series in the related Indenture
Supplement) the Noteholders of any Series or Class which is subordinated to another Series or
Class.

 

13

 

“Series Final Maturity Date” means, with respect to any Series, the final maturity
date for such Series specified in the related Indenture Supplement.

“Series Issuance Date” means, with respect to any Series, the date on which the Notes
of such Series are to be originally issued in accordance with Section 2.12 and the related
Indenture Supplement.

“Series Pay Out Event” has, with respect to any Series, the meaning specified pursuant
to the related Indenture Supplement.

“Shared Excess Finance Charge Collections” means, with respect to any Distribution
Date, the aggregate amount for all Outstanding Series that the related Indenture Supplements
specify are to be treated as “Shared Excess Finance Charge Collections” for such Distribution Date.

“Shared Principal Collections” means, with respect to a Distribution Date, the
aggregate amount for all Outstanding Series of Collections of Principal Receivables which the
related Indenture Supplements specify are to be treated as “Shared Principal Collections” for such
Distribution Date.

“Special Funding Account” has the meaning set forth in Section 8.03.

“Special Funding Amount” means the amount on deposit in the Special Funding Account.

“State” means any state of the United States and the District of Columbia.

“Successor Servicer” has the meaning set forth in the Transfer and Servicing
Agreement.

“Tax Opinion” means, with respect to any action, an Opinion of Counsel to the effect
that, for federal income tax purposes, such action will not, in and of itself, (i) adversely affect
the tax characterization as debt of the Notes of any Outstanding Series or Class that were
characterized as debt at the time of their issuance, (ii) cause the Trust to be deemed to be an
association (or publicly traded partnership) taxable as a corporation and (iii) cause or constitute
an event in which gain or loss would be recognized by any Noteholder.

“Transaction Documents” means, with respect to any Series of Notes, the Certificate of
Trust, the Trust Agreement, the Operating Agreement, the Participation Agreement, each related
Receivables Purchase Agreement, the Transfer and Servicing Agreement, this Master Indenture, the
related Indenture Supplement, any Enhancement Agreement, the Administration Agreement, and such
other documents and certificates delivered in connection therewith.

“Transfer Agent and Registrar” has the meaning set forth in Section 2.05(a).

“Transfer and Servicing Agreement” means the Amended and Restated Transfer and
Servicing Agreement, dated as of May 1, 2007, among the Transferor, the Servicer, the Indenture
Trustee and the Issuer, as the same may be amended, supplemented, restated or otherwise modified
from time to time.

 

14

 

“Transfer Date” means the Business Day immediately preceding each Distribution Date.

“Transferor Interest” means on any date of determination an amount equal to (i) the
sum of (a) an amount equal to the aggregate balance of Principal Receivables plus (b) the Special
Funding Amount, in each case at the end of the day immediately prior to such date of determination,
minus (ii) the aggregated Invested Amounts with respect to all Series of Notes issued and
Outstanding on such date of determination.

“Transferor Percentage” means, on any date of determination, when used with respect to
Principal Receivables, Finance Charge Receivables and Defaulted Receivables, a percentage equal to
100% minus the Aggregate Investor Percentage with respect to such category of Receivables.

“Trust” means the Nordstrom Credit Card Master Note Trust II, and its successors.

“Trust Agreement” means the Second Amended and Restated Trust Agreement relating to
the Trust, dated as of May 1, 2007, between Nordstrom Credit Card Receivables II LLC (formerly
known as Nordstrom Private Label Receivables LLC), as transferor, and the Owner Trustee, as the
same may be amended, supplemented, restated or otherwise modified from time to time.

“Trust Indenture Act” or “TIA” means the Trust Indenture Act of 1939, as amended.

“Trust Pay Out Event” has the meaning set forth in Section 5.01.

“Trustees” means the Indenture Trustee and the Owner Trustee.

“United States” means the United States of America.

Section 1.02. Other Definitional Provisions.

(a) With respect to any Series, capitalized terms used herein that are not otherwise defined
shall have the meanings ascribed thereto in the Trust Agreement, the Transfer and Servicing
Agreement or the related Indenture Supplement, as the case may be.

(b) All terms defined in this Master Indenture shall have the defined meanings when used in
any certificate or other document made or delivered pursuant hereto unless otherwise defined
therein.

(c) As used in this Master Indenture and in any certificate or other document made or
delivered pursuant hereto or thereto, accounting terms not defined in this Master Indenture or in
any such certificate or other document, and accounting terms partly defined in this Master
Indenture or in any such certificate or other document to the extent not defined, shall have the
respective meanings given to them under GAAP. To the extent that the definitions of accounting
terms in this Master Indenture or in any such certificate or other document are inconsistent with
the meanings of such terms under GAAP, the definitions contained in this Master Indenture or in any
such certificate or other document shall control.

 

15

 

(d) Any reference to each Rating Agency shall only apply to any specific rating agency if such
rating agency is then rating any Outstanding Series.

(e) Unless otherwise specified, references to any amount as on deposit or outstanding on any
particular date means such amount at the close of business on such day.

(f) Whenever this Master 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 Master Indenture have the following meanings:

“indenture securities” means the Notes.

“indenture security holder” means a Noteholder.

“indenture to be qualified” means this Master 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 Master 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.

(g) For all purposes of this Master Indenture, except as otherwise expressly provided or
unless the context otherwise requires, (i) terms used herein include, as appropriate, all genders
and the plural as well as the singular, (ii) references to this Master Indenture include all
Exhibits hereto, (iii) references to words such as “herein”, “hereof” and the like shall refer to
this Master Indenture as a whole and not to any particular part, Article or Section within this
Master Indenture, (iv) references to an Article or Section such as “Article One” or “Section 1.01”
and the like shall refer to the applicable Article or Section of this Master Indenture, (v) the
term “include” and all variations thereof shall mean “include without limitation”, (vi) the term
“or” shall include “and/or” and (vii) the term “proceeds” shall have the meaning ascribed to such
term in the UCC.

 

16

 

ARTICLE TWO

THE NOTES

Section 2.01. Form Generally. The Notes of any Series or Class shall be issued as
Registered Notes unless the applicable Indenture Supplement provides, in accordance with the
then-applicable laws, that such Notes shall be issued as Bearer Notes with attached interest
coupons and a special coupon. Such Registered Notes or Bearer Notes, as the case may be, shall be
in substantially the form of the exhibits with respect thereto attached to the applicable
Indenture Supplement with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Master Indenture or such Indenture Supplement, and
may have such letters, numbers or other marks of identification and such legends or endorsements
placed thereon, as may, consistently herewith, be determined by the officers executing such Notes,
as evidenced by their execution of such Notes. Any portion of the text of any Note may be set
forth on the reverse thereof, with an appropriate reference thereto on the face of the Note. The
terms of any Notes set forth in an exhibit to the related Indenture Supplement are part of the
terms of this Master Indenture, as applicable.

The Notes shall be typewritten, printed, lithographed or engraved or produced by any
combination of these methods, all as determined by the officers executing such Notes, as evidenced
by its execution of such Notes. If specified in any Indenture Supplement, the Notes of any Series
or Class shall be issued upon initial issuance as one or more Notes evidencing the aggregate
original principal amount of such Series or Class as described in Section 2.10.

Bearer Notes shall be dated the Series Issuance Date. Each Global Note will be dated the
Closing Date. All Registered Notes shall be dated as of the date of their authentication.

Section 2.02. Denominations. Except as otherwise specified in the related Indenture
Supplement and the Notes, each class of Notes of each Series shall be issued in fully registered
form in minimum amounts of $100,000 and in integral multiples of $1,000 in excess thereof (except
that one Note of each Class may be issued in a different amount, so long as such amount exceeds
the applicable minimum denomination for such Class), and shall be issued upon initial issuance as
one or more Notes in an aggregate original principal amount equal to the applicable Invested
Amount for such Class or Series.

Section 2.03. Execution, Authentication and Delivery. Each Note shall be executed by
manual or facsimile signature on behalf of the Issuer by an Authorized Officer. Notes bearing the
manual or facsimile signature of an individual who was, at the time when such signature was
affixed, authorized to sign on behalf of the Issuer shall not be rendered invalid, notwithstanding
the fact that such individual ceased to be so authorized prior to the authentication and delivery
of such Notes or does not hold such office at the date of issuance of such Notes.

At any time and from time to time after the execution and delivery of this Master Indenture,
the Issuer may deliver Notes executed by the Issuer to the Indenture Trustee for authentication and
delivery, and the Indenture Trustee shall authenticate at the written direction of the Issuer and
deliver such Notes as provided in this Master Indenture or the related Indenture Supplement and not
otherwise.

 

17

 

No Note shall be entitled to any benefit under this Master Indenture or the applicable
Indenture Supplement 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 or in the related
Indenture Supplement executed by or on behalf of the Indenture Trustee by the manual signature of a
duly authorized signatory, and such certificate upon any Note shall be conclusive evidence, and the
only evidence, that such Note has been duly authenticated and delivered hereunder.

Section 2.04. Authenticating Agent.

(a) The Indenture Trustee may appoint one or more authenticating agents 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. Whenever reference is made in this Master Indenture to the authentication of 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. Each authenticating agent must be acceptable to the Issuer and the Servicer.

(b) Any institution succeeding to the corporate trust business of an authenticating agent
shall continue to be an authenticating agent without the execution or filing of any power 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, the Issuer and the Servicer. 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 and the Servicer. 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 and the Servicer, the Indenture Trustee may
promptly appoint a successor authenticating agent. 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 and the
Servicer.

(d) The Issuer agrees to pay to each authenticating agent from time to time reasonable
compensation for its services under this Section.

(e) The provisions of Sections 6.01 and 6.04 shall be applicable to any authenticating agent.

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

 

18

 

This is one of the Notes described in the within-mentioned Indenture.

	 	 	 	 	 
	 

	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	as Authenticating Agent

for the Indenture Trustee
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signatory

Section 2.05. Registration of and Limitations on Transfer and Exchange of Notes.

(a) The Issuer shall cause to be kept at the Corporate Trust Office, a register (the “Note
Register”) in which the entity acting as transfer agent and registrar (the “Transfer Agent and
Registrar”) shall provide for the registration of Notes and the registration of transfers of Notes.
The Indenture Trustee initially shall be the Transfer Agent and Registrar for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any resignation of any Transfer
Agent and Registrar, the Issuer shall promptly appoint a successor or, if it elects not to make
such an appointment, assume the duties of Transfer Agent and Registrar.

If a Person other than the Indenture Trustee is appointed by the Issuer as Transfer Agent and
Registrar, the Issuer will give the Indenture Trustee prompt written notice of the appointment of a
Transfer Agent and Registrar and of the location, and any change in the location, of the Transfer
Agent and Registrar and Note Register. 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 rely upon a certificate executed on behalf of the Transfer Agent and Registrar by
an officer thereof as to the names and addresses of the Noteholders and the principal amounts and
numbers of such Notes.

Upon surrender for registration of transfer of any Note at the office or agency of the
Transfer Agent and Registrar, to be maintained as provided in Section 3.02, if the requirements of
Section 8-401 of the UCC are met, the Issuer shall execute, and upon receipt of such surrendered
Note the Indenture Trustee shall authenticate and deliver to the Noteholder, in the name of the
designated transferee or transferees, one or more new Notes (of the same Series and Class) in any
authorized denominations of like aggregate principal amount.

At the option of a Noteholder, Notes may be exchanged for other Notes (of the same Series and
Class) in any authorized denominations and of like aggregate principal amount, upon surrender of
such Notes to be exchanged at the office or agency of the Transfer Agent and Registrar. Whenever
any Notes are so surrendered for exchange, if the requirements of Section 8-401 of the UCC are met,
the Issuer shall execute, and upon receipt of such surrendered Note the Indenture Trustee shall
authenticate and deliver to the Noteholder, the Notes which the Noteholder making the exchange is
entitled to receive.

 

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All Notes issued upon any registration of transfer or exchange of Notes shall evidence the
same obligations, evidence the same debt and be entitled to the same rights and privileges under
this Master 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 duly
endorsed by, or be accompanied by a written instrument of transfer in a form satisfactory to the
Indenture Trustee duly executed by, the Noteholder thereof or its attorney-in-fact duly authorized
in writing, and by such other documents as the Indenture Trustee may reasonably require.

The registration of transfer of any Note shall be subject to the additional requirements, if
any, set forth in the related Indenture Supplement.

No service charge shall be made for any registration of transfer or exchange of Notes, but the
Issuer and the Transfer Agent and Registrar 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 such Notes.

All Notes surrendered for registration of transfer and exchange shall be canceled by the
Issuer and delivered to the Indenture Trustee for subsequent destruction without liability on the
part of either. The Indenture Trustee shall destroy the Global Note upon its exchange in full for
Definitive Notes and shall deliver a certificate of destruction to the Transferor. Such
certificate shall also state that a certificate or certificates of each Foreign Clearing Agency
referred to in the applicable Indenture Supplement was received with respect to each portion of the
Global Note exchanged for Definitive Notes.

Unless otherwise set forth in an Indenture Supplement, the preceding provisions of this
Section notwithstanding, the Issuer shall not be required to make, and the Transfer Agent and
Registrar need not register, transfers or exchanges of Notes for a period of 20 days preceding the
due date for any payment with respect to the Note.

If and so long as any Series of Notes are listed on the Luxembourg Stock Exchange and such
exchange shall so require, the Indenture Trustee shall appoint a co-transfer agent and co-registrar
in Luxembourg or another European city. Any reference in this Master Indenture to the Transfer
Agent and Registrar shall include any co-transfer agent and co-registrar unless the context
otherwise requires. The Indenture Trustee will enter into any appropriate agency agreement with
any co-transfer agent and co-registrar not a party to this Master Indenture, which will implement
the provisions of this Master Indenture that relate to such agent.

(b) The Transfer Agent and Registrar will maintain at its expense in Minneapolis, Minnesota,
or New York, New York, an office or agency where Notes may be surrendered for registration of
transfer or exchange (except that Bearer Notes may not be surrendered for exchange at any such
office or agency in the United States or its territories and possessions.)

 

20

 

Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes. If (i) any mutilated Note
is surrendered to the Transfer Agent and Registrar, or the Transfer Agent and Registrar receives
evidence to its reasonable satisfaction of the destruction, loss or theft of any Note, and (ii) in
case of destruction, loss or theft there is delivered to the Transfer Agent and Registrar such
security or indemnity as may be required by it to hold the Issuer, the Transferor, the Transfer
Agent and Registrar and the Indenture Trustee harmless, then, in the absence of notice to the
Issuer, the Transferor, the Transfer Agent and Registrar or the Indenture Trustee that such Note
has been acquired by a Protected Purchaser, the Issuer shall execute, and the Indenture Trustee
shall authenticate and the Transfer Agent and Registrar shall deliver (in the case of Bearer
Notes, outside the United States), in exchange for or in lieu of any such mutilated, destroyed,
lost or stolen Note, a replacement Note of the same Series and Class and of like tenor (including
the same date of issuance) and principal amount, bearing a number not contemporaneously
outstanding; provided, however, that if any such mutilated, destroyed, lost or stolen Note shall
have become or within seven days shall be due and payable, or shall have been selected or called
for redemption, instead of issuing a replacement Note, the Issuer may pay such Note without
surrender thereof, except that any mutilated Note shall be surrendered. If, after the delivery of
such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to
the preceding sentence, a Protected Purchaser of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the Issuer and the Indenture
Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to
whom it was delivered or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a Protected Purchaser, and
shall be entitled to recover upon the security or indemnity provided therefor to the extent of any
loss, damage, cost or expense incurred by the Issuer, the Transferor or the Indenture Trustee in
connection therewith.

Upon the issuance of any replacement Note under this Section, the Issuer or the Transfer Agent
and Registrar may require the payment by the Holder of such Note 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 or the Transfer Agent and
Registrar) connected therewith.

Every replacement Note issued pursuant to this Section in replacement of any mutilated,
destroyed, lost or stolen Note shall constitute complete and indefeasible evidence of debt of the
Trust, as if originally issued, whether or not the mutilated, destroyed, lost or stolen Note shall
be found at any time, and shall be entitled to all the benefits of this Master 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 2.07. Persons Deemed Owners. The Issuer, the Indenture Trustee, the Paying
Agent, the Transfer Agent and Registrar, the Transferor, the Issuer and any agent of any of them
may (a) prior to due presentment of a Registered Note for registration of transfer, treat the
Person in whose name any Note is registered as the owner of such Registered Note for the purpose
of receiving distributions pursuant to the terms of the applicable Indenture Supplement and for
all other purposes whatsoever, and (b) treat the bearer of a Bearer Note or coupon for the purpose
of receiving distributions pursuant to the terms of the applicable Indenture Supplement and for
all other purposes whatsoever; and, in any such case, neither the Issuer, the Transferor, the
Indenture Trustee, the Paying Agent, the Transferor nor any agent of any of them shall be affected
by any notice to the contrary.

 

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Section 2.08. Appointment of Paying Agent.

(a) The Issuer reserves the right at any time to vary or terminate the appointment of a Paying
Agent for the Notes, and to appoint additional or other Paying Agents, provided that it will at all
times maintain the Indenture Trustee as a Paying Agent.

Notice of all changes in the identity or specified office of a Paying Agent will be delivered
promptly to the Noteholders by the Indenture Trustee.

(b) The Indenture Trustee shall cause the 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 that it will hold all sums, if any, held by it for payment to the Noteholders in
trust for the benefit of the Noteholders entitled thereto until such sums shall be paid to such
Noteholders and shall agree, and if the Indenture Trustee is the Paying Agent it hereby agrees,
that it shall comply with all requirements of the Code regarding the withholding by the Indenture
Trustee of payments in respect of federal income taxes due from the Beneficial Owners.

Section 2.09. Access to List of Noteholders’ Names and Addresses.

(a) The Indenture Trustee will furnish or cause to be furnished to the Issuer, the Servicer,
any Noteholder or the Paying Agent, within five Business Days after receipt by the Indenture
Trustee of a written request therefor from the Issuer, the Servicer, such Noteholder or the Paying
Agent, respectively, a list of the names and addresses of the Noteholders. Unless otherwise
provided in the related Indenture Supplement, holders of 10% of the principal amount of Outstanding
Notes of any Series (the “Applicants”) may apply in writing to the Indenture Trustee, and if such
application states that the Applicants desire to communicate with other Noteholders of any Series
with respect to their rights under this Master Indenture or under the Notes and is accompanied by a
copy of the communication which such Applicants propose to transmit, then the Indenture Trustee,
after having been adequately indemnified by such Applicants for its costs and expenses, shall
afford or shall cause the Transfer Agent and Registrar to afford such Applicants access during
normal business hours to the most recent list of Noteholders held by the Indenture Trustee and
shall give the Servicer notice that such request has been made, within five Business Days after the
receipt of such application. Such list shall be as of a date no more than 45 days prior to the
date of receipt of such Applicants’ request.

(b) Every Noteholder, by receiving and holding a Note, agrees that none of the Issuer, the
Owner Trustee, the Indenture Trustee, the Transfer Agent and Registrar and the Servicer or any of
their respective agents and employees shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Noteholders hereunder, regardless of the
sources from which such information was derived.

Section 2.10. Cancellation. All Notes surrendered for payment, registration of
transfer, exchange or redemption shall, if surrendered to any Person other than the Indenture
Trustee, be delivered to the Indenture Trustee and shall be promptly canceled by it. Pursuant to
an Issuer Request, the Issuer may at any time deliver to the Indenture Trustee for cancellation
any Notes previously authenticated and delivered hereunder which the Issuer may have acquired in
any lawful manner whatsoever, and all Notes so delivered shall be promptly canceled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes
canceled as provided in this Section, except as expressly permitted by this Master Indenture. All
canceled Notes held by the Indenture Trustee shall be destroyed unless the Issuer shall direct by
a timely order that they be returned to it.

 

22

 

Section 2.11. Release of Collateral. Subject to Section 12.01, the Indenture Trustee
shall release property from the lien of this Master Indenture only upon receipt of an Issuer
Request accompanied by an Officer’s Certificate, an Opinion of Counsel and, if applicable,
Independent Certificates in accordance with TIA Section 314(c) and 314(d) or an Opinion of Counsel
in lieu of such Independent Certificates to the effect that the TIA does not require any such
Independent Certificates.

Section 2.12. New Issuances.

(a) Pursuant to one or more Indenture Supplements, the Transferor may from time to time direct
the Owner Trustee in writing, on behalf of the Issuer, to issue one or more new Series of Notes
(each, a “New Issuance”). The Notes of all Outstanding Series shall be equally and ratably
entitled as provided herein to the benefits of this Master Indenture without preference, priority
or distinction, all in accordance with the terms and provisions of this Master Indenture and the
applicable Indenture Supplement except, with respect to any Series or Class, as provided in the
related Indenture Supplement. Interest on and principal of the Notes of each Outstanding Series
shall be paid on each Distribution Date as specified in the Indenture Supplement relating to such
Outstanding Series.

(b) On or before the Series Issuance Date relating to any new Series of Notes, the parties
hereto will execute and deliver an Indenture Supplement which will specify the Principal Terms of
such Series. The terms of such Indenture Supplement may modify or amend the terms of this Master
Indenture solely as applied to such new Series. The obligation of the Owner Trustee to execute, on
behalf of the Issuer, the Notes of any Series and of the Indenture Trustee to authenticate such
Notes and to execute and deliver the related Indenture Supplement (other than any Series issued
pursuant to an Indenture Supplement dated as of May 1, 2007) is subject to the satisfaction of the
following conditions:

(i) on or before the fifth day immediately preceding the Series Issuance Date, the
Transferor shall have given the Trustees, the Servicer and each Rating Agency notice (unless
such notice requirement is otherwise waived) of such issuance and the Series Issuance Date;

(ii) the Transferor shall have delivered to the Trustees the related Indenture
Supplement, in form satisfactory to the Owner Trustee (as such and in its individual
capacity) and the Indenture Trustee, executed by the parties thereto;

(iii) the Transferor shall have delivered to the Trustees any related Enhancement
Agreement executed by the parties thereto;

(iv) the Transferor shall have delivered to the Trustees (with a copy to each Rating
Agency) a Tax Opinion, dated the Series Issuance Date;

 

23

 

(v) the Rating Agency Condition shall have been satisfied with respect to such
issuance;

(vi) such issuance will not result in any Adverse Effect and the Transferor shall have
delivered to the Trustees an Officer’s Certificate, dated the Series Issuance Date, to the
effect that (A) the Transferor reasonably believes that such issuance will not, based on the
facts known to such officer at the time of such certification, result in an Adverse Effect,
and (B) all conditions precedent to such execution, authentication, and delivery have been
satisfied; and

(vii) the aggregate amount of Principal Receivables shall be greater than the Required
Minimum Principal Balance and the Transferor Interest shall be greater than the Required
Transferor Interest, each as of the Series Issuance Date and after giving effect to such
issuance.

Any Note held by the Transferor at any time after the date of its initial issuance may be
transferred or exchanged only upon the delivery to the Trust and the Indenture Trustee of a Tax
Opinion dated as of the date of such transfer or exchange, as the case may be, with respect to such
transfer or exchange.

(c) Upon satisfaction of the above conditions, pursuant to Section 2.03, the Owner Trustee, on
behalf of the Issuer, shall execute and the Indenture Trustee shall authenticate and deliver the
Notes of such Series as provided in this Master Indenture and the applicable Indenture Supplement.
Notwithstanding the provisions of this Section, prior to the execution of any Indenture Supplement
(other than the Indenture Supplements dated as of May 1, 2007 with respect to the Series 2007-1
Notes and the Series 2007-2 Notes and the Indenture Supplement dated as of May 2, 2007 with respect
to the Series 2007-A Notes), the Indenture Trustee and Owner Trustee shall be entitled to receive
and rely upon an Opinion of Counsel stating that the execution of such Indenture Supplement is
authorized or permitted by this Master Indenture and any Indenture Supplement related to any
outstanding Series. The Indenture Trustee and Owner Trustee may, but shall not be obligated to,
enter into any such Indenture Supplement which adversely affects the Indenture Trustee’s or Owner
Trustee’s (as such or in its individual capacity) own rights, duties, benefits, protections,
privileges or immunities under this Master Indenture.

(d) The Issuer may direct the Indenture Trustee to deposit the net proceeds from any New
Issuance in the Special Funding Account. The Issuer may also specify that on any Transfer Date the
proceeds from the sale of any new Series may be withdrawn from the Special Funding Account and
treated as Shared Principal Collections.

Section 2.13. Book-Entry Notes. Unless otherwise provided in any related Indenture
Supplement, the Notes, upon original issuance, shall be issued in the form of one or more Notes
representing the Book-Entry Notes.

The Notes of each Series representing the Book-Entry Notes shall, unless otherwise provided in
the related Indenture Supplement, initially be registered in the Note Register in the name of the
nominee of the Clearing Agency or Foreign Clearing Agency for such Book-Entry
Notes and shall be delivered to the Indenture Trustee or, pursuant to such Clearing Agency’s
or Foreign Clearing Agency’s instructions, held by the Indenture Trustee’s agent as custodian for
the Clearing Agency or Foreign Clearing Agency.

 

24

 

Unless and until Definitive Notes are issued under the limited circumstances described in
Section 2.15, no Beneficial Owner shall be entitled to receive a Definitive Note representing such
Beneficial Owner’s interest in such Note. Unless and until Definitive Notes have been issued to
the Beneficial Owners pursuant to Section 2.15:

(a) the provisions of this Section shall be in full force and effect with respect to
each such Series;

(b) the Indenture Trustee shall be entitled to deal with the Clearing Agency or Foreign
Clearing Agency and the Clearing Agency Participants for all purposes of this Master
Indenture (including the payment of principal of and interest on the Notes of each such
Series) as the authorized representatives of the Beneficial Owners;

(c) to the extent that the provisions of this Section conflict with any other
provisions of this Master Indenture, the provisions of this Section shall control with
respect to each such Series;

(d) the rights of Beneficial Owners of each such Series shall be exercised only through
the Clearing Agency or Foreign Clearing Agency and the applicable Clearing Agency
Participants and shall be limited to those established by law and agreements between such
Beneficial Owners and the Clearing Agency or Foreign Clearing Agency and/or the Clearing
Agency Participants; pursuant to the depository agreement applicable to a Series, unless and
until Definitive Notes of such Series are issued pursuant to Section 2.15, the initial
Clearing Agency shall make book-entry transfers among the Clearing Agency Participants and
receive and transmit distributions of principal and interest on the Notes to such Clearing
Agency Participants; and

(e) whenever this Master Indenture requires or permits actions to be taken based upon
instructions or directions of the Holders of Notes evidencing a specified percentage of the
principal amount of the Outstanding Notes, the Clearing Agency or Foreign Clearing Agency
shall be deemed to represent such percentage only to the extent that they have received
instructions to such effect from the Beneficial Owners and/or Clearing Agency Participants
owning or representing, respectively, such required percentage of the beneficial interest in
the Notes and has delivered such instructions to a Responsible Officer of the Indenture
Trustee.

Section 2.14. Notices to Clearing Agency or Foreign Clearing Agency. Whenever a
notice or other communication to the Noteholders is required under this Master Indenture, unless
and until Definitive Notes shall have been issued to Beneficial Owners pursuant to Section 2.15,
the Indenture Trustee shall give all such notices and communications specified herein to be given
to Noteholders to the Clearing Agency or Foreign Clearing Agency, as applicable, and shall have no
obligation to the Beneficial Owners.

 

25

 

Section 2.15. Definitive Notes. If Book-Entry Notes have been issued with respect to
any Series or Class and (i) (a) the Issuer advises the Indenture Trustee in writing that the
Clearing Agency or Foreign Clearing Agency is no longer willing or able to discharge properly its
responsibilities as Clearing Agency or Foreign Clearing Agency with respect to the Book-Entry
Notes of a given Class and (b) the Indenture Trustee or Issuer is unable to locate and reach an
agreement on satisfactory terms with a qualified successor, (ii) the Issuer, at its option,
advises the Indenture Trustee in writing that it elects to terminate the book-entry system through
the Clearing Agency or Foreign Clearing Agency with respect to such Class or (iii) after the
occurrence of a Servicer Default or an Event of Default, Beneficial Owners having an aggregate of
a majority of the principal amount of the Outstanding Notes (or such other percentage as specified
in the related Indenture Supplement) of such Series or Class advise the Indenture Trustee and the
applicable Clearing Agency or Foreign Clearing Agency through the applicable Clearing Agency
Participants in writing that the continuation of a book-entry system is no longer in the best
interests of the Beneficial Owners of such Class, the Clearing Agency or Foreign Clearing Agency,
as the case may be, shall notify all Beneficial Owners of such Class of the occurrence of such
event and of the availability of Definitive Notes to Beneficial Owners of such Class requesting
the same. Upon surrender to the Indenture Trustee of the Notes of such Class, accompanied by
registration instructions from the applicable Clearing Agency, the Issuer shall execute and the
Indenture Trustee shall authenticate Definitive Notes of such Class and shall recognize the
registered holders of such Definitive Notes as Noteholders under this Master Indenture. Neither
the Issuer nor the Indenture Trustee shall be liable for any delay in delivery of such
instructions, and the Issuer and the Indenture Trustee may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive Notes of such Series,
all references herein to obligations imposed upon or to be performed by the applicable Clearing
Agency or Foreign Clearing Agency shall be deemed to be imposed upon and performed by the
Indenture Trustee, to the extent applicable with respect to such Definitive Notes to the extent
that the Indenture Trustee is able to so perform, and the Indenture Trustee shall recognize the
registered holders of the Definitive Notes of such Series as Noteholders of such Series hereunder.
Definitive Notes will be transferable and exchangeable at the offices of the Transfer Agent and
Registrar.

Section 2.16. Global Notes. Unless otherwise specified in the related Indenture
Supplement for any Series, Notes may be initially issued in the form of temporary or permanent
Global Notes (each, a “Global Note”) in bearer form, without interest coupons, in the denomination
of the initial Invested Amount and substantially in the form attached to the related Indenture
Supplement. Unless otherwise specified in the related Indenture Supplement, the provisions of
this Section shall apply to such Global Notes. Each Global Note will be authenticated by the
Indenture Trustee upon the same conditions, in substantially the same manner and with the same
effect as the Definitive Notes. The Global Note may be exchanged in the manner described in the
related Indenture Supplement for Registered Notes or Bearer Notes in definitive form. Except as
otherwise specifically provided in the Indenture Supplement, any Notes that are issued in bearer
form pursuant to this Master Indenture shall be issued in accordance with the requirements of Code
Section 163(f)(2).

 

26

 

Section 2.17. Meetings of Noteholders. To the extent provided by the Indenture
Supplement for any Series issued in whole or in part in Bearer Notes, the Servicer or the
Indenture Trustee may at any time call a meeting of the Noteholders of such Series, to be held at
such time and at such place as the Servicer or the Indenture Trustee, as the case may be,
shall determine, for the purpose of approving a modification of or amendment to, or obtaining a
waiver of, any covenant or condition set forth in this Master Indenture with respect to such
Series or in the Notes of such Series, subject to Article Ten.

Section 2.18. Uncertificated Classes. Notwithstanding anything to the contrary
contained in this Article or in Article Eleven, unless otherwise specified in any Indenture
Supplement, any provisions contained in this Article and in Article Eleven relating to the
registration, form, execution, authentication, delivery, presentation, cancellation and surrender
of Notes shall not be applicable to any uncertificated Notes, provided, however, that, except as
otherwise specifically provided in the related Indenture Supplement, any such uncertificated Notes
shall be issued in “registered form” within the meaning of Code Section 163(f)(1).

 

27

 

ARTICLE THREE

COVENANTS OF ISSUER

Section 3.01. Payment of Principal and Interest.

(a) The Issuer will duly and punctually pay principal and interest in accordance with the
terms of the Notes as specified in the relevant Indenture Supplement.

(b) The Noteholders of a Series as of the Record Date in respect of a Distribution Date shall
be entitled to the interest accrued and payable and principal payable on such Distribution Date as
specified in the related Indenture Supplement. All payment obligations under a Note are discharged
to the extent such payments are made to the Noteholder of record.

Section 3.02. Maintenance of Office or Agency. The Issuer will maintain an office or
agency within Minneapolis, Minnesota or New York, New York and such other locations as may be set
forth in an Indenture Supplement where Notes may be presented or surrendered for payment, where
Notes may be surrendered for registration of transfer or exchange and where notices and demands to
or upon the Issuer in respect of the Notes and this Master Indenture may be served. The Issuer
hereby initially appoints the Indenture Trustee at its Corporate Trust Office to serve as its
agent for the foregoing purposes. The Issuer will give prompt written notice to the Indenture
Trustee and the Noteholders 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 presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office, and the Issuer hereby
appoints the Indenture Trustee at its Corporate Trust Office as its agent to receive all such
presentations, surrenders, notices and demands.

Section 3.03. Money for Note Payments to be Held in Trust. As specified in Section
8.03 and in the related Indenture Supplement, all payments of amounts due and payable with respect
to the Notes which are to be made from amounts withdrawn from the Collection Account, any Series
Account or the Special Funding Account shall be made on behalf of the Issuer by the Indenture
Trustee or by the Paying Agent, and no amounts so withdrawn from the Collection Account, any
Series Account or the Special Funding Account shall be paid over to or at the direction of the
Issuer except as provided in this Section and in the related Indenture Supplement.

Whenever the Issuer shall have a Paying Agent in addition to the Indenture Trustee, it will,
on or before the Business Day next preceding each Distribution Date, direct the Indenture Trustee
to deposit with such Paying Agent on or before such Distribution Date an aggregate sum sufficient
to pay the amounts then becoming due, such sum to be (i) held in trust for the benefit of Persons
entitled thereto and (ii) invested, pursuant to an Issuer Order, by the Paying Agent in an Eligible
Investment in accordance with the terms of the related Indenture Supplement. For all investments
made by a Paying Agent under this Section, such Paying Agent shall be entitled to all of the rights
and obligations of the Indenture Trustee under the related Indenture Supplement, such rights and
obligations being incorporated in this paragraph by this reference.

 

28

 

The Issuer will cause each Paying Agent other than the Indenture Trustee 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, in acting as Paying Agent, is an express
agent of the Issuer and, further, 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, immediately 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 by in trust for the payment of Notes if at any time it ceases to meet
the standards required to be met by a 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.

The Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of
this Master Indenture or for any other purpose, by Issuer Order 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 such sums were held by such Paying
Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall
be released from all further liability with respect to such money.

Section 3.04. Existence. 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 Issuer hereunder is or becomes, organized under the laws of any other State or of
the United States, 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 Master Indenture, the Notes, the
Collateral and each other related instrument or agreement.

 

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Section 3.05. Protection of Trust. The Issuer will from time to time prepare, or
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) grant more effectively all or any portion of the Collateral as security for the
Notes;

(b) maintain or preserve the lien (and the priority thereof) of this Master Indenture
or to carry out more effectively the purposes hereof;

(c) perfect, publish notice of, or protect the validity of any Grant made or to be made
under this Master Indenture;

(d) enforce any Grant of the Collateral; or

(e) preserve and defend title to the Collateral securing the Notes and the rights
therein of the Indenture Trustee and the Noteholders secured thereby 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 pursuant to this
Section.

The Issuer shall pay or cause to be paid any taxes levied on all or any part of the Collateral
securing the Notes.

Section 3.06. Opinions as to Collateral.

(a) On the Series Issuance Date relating to any Series of Notes, the Issuer shall furnish to
the Indenture Trustee an Opinion of Counsel (with a copy to each Rating Agency) either stating
that, in the opinion of such counsel, such action has been taken to perfect the lien and the
security interest of this Master Indenture, including with respect to the recording and filing of
this Master 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 so necessary and reciting the details of such action, or stating that, in the opinion of
such counsel, no such action is necessary to maintain the lien and the perfection of such security
interest, and that such perfected security interest is of first priority.

(b) On or before April 30 in each calendar year, beginning in 2008, the Issuer shall furnish
to the Indenture Trustee an Opinion of Counsel (with a copy to each Rating Agency) either stating
that, in the opinion of such counsel, such action has been taken to perfect the lien and security
interest of this Master Indenture, including with respect to the recording, filing, re-recording
and refiling of this Master 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 is so necessary and reciting the details of such action or stating that in the
opinion of such counsel no such action is necessary to maintain the lien and the perfection of such
security interest, and that such perfected security interest is of first priority. Such Opinion of
Counsel shall also describe the recording, filing, re-recording and refiling of this Master
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 Master Indenture until April 30 in the following calendar year.

 

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Section 3.07. Performance of Obligations; Servicing of Receivables.

(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 Collateral 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 expressly provided in this Master
Indenture, the Transfer and Servicing Agreement or other Transaction Documents.

(b) The Issuer may contract with other Persons to assist it in performing its duties under
this Master 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 Master Indenture.

(c) The Issuer will punctually perform and observe all of its obligations and agreements
contained in this Master Indenture, the other Transaction Documents and in the instruments and
agreements relating to the Collateral, including filing or causing to be filed all UCC financing
statements and continuation statements required to be filed by the terms of this Master Indenture
and the Transfer and Servicing 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
Transfer and Servicing Agreement, the Issuer shall cause the Indenture Trustee to promptly notify
the Rating Agencies thereof, and shall cause the Indenture Trustee to specify in such notice the
action, if any, being taken with respect to such default. If a Servicer Default shall arise from
the failure of the Servicer to perform any of its duties or obligations under the Transfer and
Servicing Agreement with respect to the Receivables, the Issuer shall take all reasonable steps
available to it to remedy such failure.

(e) On and after the receipt by the Servicer of a Termination Notice pursuant to Section 7.01
of the Transfer and Servicing Agreement, the Servicer shall continue to perform all servicing
functions under the Transfer and Servicing Agreement until the date specified in the Termination
Notice or otherwise specified by the Indenture Trustee or until a date mutually agreed upon by the
Servicer and the Indenture Trustee. As promptly as possible after the giving of a Termination
Notice to the Servicer, the Indenture Trustee shall appoint a Successor Servicer, and such
Successor Servicer shall accept its appointment by a written assumption in a form acceptable to the
Indenture Trustee. In the event that a Successor Servicer has not been appointed and accepted its
appointment at the time when the Servicer ceases to act as Servicer, the Indenture Trustee without
further action shall automatically be appointed the Successor Servicer. The Indenture Trustee may
delegate any of its servicing obligations to an Affiliate or agent in accordance with Sections
3.01(b) and 5.07 of the Transfer and Servicing Agreement.

 

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Notwithstanding the foregoing, the Indenture Trustee shall, if it is legally unable so to act,
petition at the expense of the Servicer a court of competent jurisdiction to appoint any
established institution qualifying as an Eligible Servicer as the Successor Servicer. The
Indenture Trustee shall give prompt notice to each Rating Agency and each Series Enhancer upon the
appointment of a Successor Servicer. Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions under the Transfer
and Servicing Agreement and shall be subject to all the responsibilities, duties and liabilities
relating thereto placed on the Servicer by the terms and provisions thereof, and all references in
this Master Indenture to the Servicer shall be deemed to refer to the Successor Servicer. In
connection with any Termination Notice, the Indenture Trustee will review any bids which it obtains
from Eligible Servicers and shall be permitted to appoint any Eligible Servicer submitting such a
bid as a Successor Servicer for servicing compensation, subject to the limitations set forth in
Section 7.02 of the Transfer and Servicing Agreement.

(f) Without derogating from the absolute nature of the assignment granted to the Indenture
Trustee under this Master Indenture or the rights of the Indenture Trustee hereunder, the Issuer
agrees (i) that it will not, without the prior written consent of the Indenture Trustee and holders
of at least 66 2/3% of the principal amount of the Outstanding Notes of each Series, amend, modify,
waive, supplement, terminate or surrender, or agree to any amendment, modification, supplement,
termination, waiver or surrender of, the terms of any Collateral (except to the extent otherwise
provided in the Transfer and Servicing Agreement) or the Transaction Documents (except to the
extent otherwise provided in the Transaction Documents), or waive timely performance or observance
by the Servicer or the Transferor under the Transfer and Servicing Agreement and (ii) that any such
amendment shall not (A) increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on the Receivables or distributions that are required to be made
for the benefit of the Noteholders or (B) reduce the aforesaid percentage of the Notes that is
required to consent to any such amendment, without the consent of the Holders of all the
Outstanding Notes. If any such amendment, modification, supplement or waiver shall be so consented
to by the Indenture Trustee and such Noteholders, the Issuer agrees, promptly following a request
by the Indenture Trustee to do so, to execute and deliver, in its own name and at its own expense,
such agreements, instruments, consents and other documents as the Indenture Trustee may deem
necessary or appropriate in the circumstances and to provide each Rating Agency with notice of such
amendment, modification, supplement or waiver.

(g) The Issuer shall deliver to the Indenture Trustee any computer files or microfiche lists
of Accounts (including Account Schedules) that the Issuer has received from the Transferor pursuant
to the Transfer and Servicing Agreement. Such computer files or microfiche lists of Accounts, as
supplemented or amended from time to time, are hereby incorporated into and made part of this
Master Indenture.

Section 3.08. Negative Covenants. So long as any Notes are Outstanding, the Issuer
will not:

(a) sell, transfer, exchange, or otherwise dispose of any part of the Collateral except
as expressly permitted by this Master Indenture, the related Indenture Supplement, the Trust
Agreement or the Transfer and Servicing Agreement;

 

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(b) claim any credit on, or make any deduction from, the principal and interest payable
in respect of the Notes (other than amounts properly withheld from such payments under the
Code or applicable State law) or assert any claim against any present or former Noteholder
by reason of the payment of any taxes levied or assessed upon any part of the Collateral;

(c) (i) permit the validity or effectiveness of this Master Indenture to be impaired,
or permit the lien of this Master 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 Master 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 Master Indenture) to be created on or
extend to or otherwise arise upon or burden the Collateral or any part thereof or any
interest therein or the proceeds thereof or (iii) permit the Lien of this Master Indenture
not to constitute a valid first priority security interest in the Collateral; or

(d) voluntarily dissolve or liquidate in whole or in part.

Section 3.09. Statements as to Compliance. The Issuer will deliver to the Indenture
Trustee, within 120 days after the end of each fiscal year of the Issuer (commencing within 120
days after the end of the fiscal year 2008), an Officer’s Certificate stating, as to the
Authorized Officer signing such Officer’s Certificate, that

(i) a review of the activities of the Issuer during the 12-month period ending at the
end of such fiscal year (or in the case of the fiscal year ending January 31, 2008, the
period from the effective date of this Master Indenture to January 31, 2008) and of
performance under this Master Indenture has been made and

(ii) based on such review, the Issuer has complied with all conditions and covenants
under this Master Indenture throughout such year, or, if there has been a default in the
compliance of any such condition or covenant, specifying each such default and the nature
and status thereof.

Section 3.10. Issuer May Consolidate, Etc., Only on Certain Terms.

(a) The Issuer shall not consolidate or merge with or into any other Person, unless:

(i) the Person (if other than the Issuer) formed by or surviving such consolidation or
merger (A) shall be a Person organized and existing under the laws of the United States or
any State, (B) shall not be subject to registration under the Investment Company Act and (C)
shall expressly assume, by an indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in a form satisfactory to the Indenture Trustee, the obligation to make
due and punctual payment of the principal of and interest on all Notes and the performance
of every covenant of this Master Indenture on the part of the Issuer to be performed or
observed;

 

33

 

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

(iii) the Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate
and an Opinion of Counsel each stating that (A) such consolidation or merger and such
supplemental indenture comply with this Section, (B) all conditions precedent in this
Section relating to such transaction have been complied with (including any filing required
by the Exchange Act) and (C) such supplemental indenture is duly authorized, executed and
delivered and is valid, binding and enforceable against such Person;

(iv) the Rating Agency Condition shall have been satisfied with respect to such
transaction;

(v) the Issuer shall have received a Tax Opinion and an Opinion of Counsel dated the
date of such consolidation or merger (and shall have delivered copies thereof to the
Indenture Trustee and each Rating Agency) to the effect that such transaction will not have
any material adverse tax consequence to any Noteholder; and

(vi) any action that is necessary to maintain the lien and security interest created by
this Master Indenture shall have been taken.

(b) The Issuer shall not convey or transfer any of its properties or assets, including those
included in the Collateral, substantially as an entirety to any Person, unless:

(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 or any
State, (B) expressly assume, by a supplemental indenture hereto, executed and delivered to
the Indenture Trustee, in form satisfactory to the Indenture Trustee, the obligation to make
due and punctual payment of the principal of and interest on all Notes and the performance
or observance of every agreement and covenant of this Master 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 Holders of the Notes, (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 Master Indenture and the Notes, (E) expressly agree by means of such supplemental
indenture that such Person (or if a group of Persons, then one specified Person) shall make
all filings with the Commission (and any other appropriate Person) required by the Exchange
Act in connection with the Notes and (F) not be an “investment company” as defined in the
Investment Company Act;

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

(iii) the Rating Agency Condition shall have been satisfied with respect to such
transaction;

 

34

 

(iv) the Issuer shall have received a Tax Opinion and 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 any Noteholder;

(v) any action that is necessary to maintain the lien and security interest created by
this Master 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 conveyance or transfer and such
supplemental indenture comply with this Section 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 Substituted. Upon any consolidation or merger, or any
conveyance or transfer of the properties and assets of the Issuer substantially as an entirety in
accordance with Section 3.10, the Person formed by or surviving such consolidation or merger (if
other than the Issuer) or the Person to which such conveyance or transfer is made shall succeed
to, and be substituted for, and may exercise every right and power of, the Issuer under this
Master Indenture with the same effect as if such Person had been named as the Issuer herein. In
the event of any such conveyance or transfer, the Person named as the Issuer in the first
paragraph of this Master Indenture or any successor which shall theretofore have become such in
the manner prescribed in this Section shall be released from its obligations under this Master
Indenture as issued immediately upon the effectiveness of such conveyance or transfer, provided
that the Issuer shall not be released from any obligations or liabilities to the Indenture Trustee
or the Noteholders arising prior to such effectiveness.

Section 3.12. No Other Business. The Issuer shall not engage in any business other
than the activities set forth in Section 2.03 of the Trust Agreement and all activities incidental
thereto or other than as required or authorized by the terms of the Transaction Documents.

Section 3.13. No Borrowing. The Issuer shall not issue, incur, assume, guarantee or
otherwise become liable, directly or indirectly, for any indebtedness except as expressly provided
for pursuant to the terms of the Transaction Documents and the Notes.

Section 3.14. Servicer’s Obligations. The Issuer shall cause the Servicer to comply
with all of its obligations under the Transaction Documents.

Section 3.15. Guarantees, Loans, Advances and Other Liabilities. Except as
contemplated by this Master Indenture or the Transfer and Servicing Agreement, 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 assuring 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).

 

35

 

Section 3.17. Removal of Administrator. So long as any Notes are Outstanding, the
Issuer shall not remove the Administrator without cause unless the Rating Agency Condition shall
have been satisfied in connection with such removal.

Section 3.18. Restricted Payments. The Issuer shall not, directly or indirectly, (i)
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 or to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for
value any such ownership or equity interest or security or (iii) set aside or otherwise segregate
any amounts for any such purpose. Notwithstanding the foregoing, the Issuer may make, or cause to
be made, (a) distributions as contemplated by, and to the extent funds are available for such
purpose under, the Transfer and Servicing Agreement, the Trust Agreement or any other related
Transaction Document and (b) payments to the Indenture Trustee pursuant to Section 6.07. The
Issuer will not, directly or indirectly, make payments to or distributions from the Collection
Account except in accordance with the Transaction Documents.

Section 3.19. Notice of Events of Default. The Issuer agrees to give the Indenture
Trustee and the Rating Agencies prompt written notice of each Event of Default hereunder and,
immediately after obtaining knowledge of any of the following occurrences, written notice of each
default on the part of the Servicer or the Transferor of its obligations under the Transfer and
Servicing Agreement, each default on the part of a Seller of its obligations under the Receivables
Purchase Agreement and any action taken by the Indenture Trustee pursuant to Section 5.05.

Section 3.20. Further Instruments and Acts. Upon request of the Indenture Trustee,
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 Master Indenture.

Section 3.21. Representations and Warranties as to the Security Interest of the Indenture
Trustee in the Receivables. The Transferor on behalf of the Issuer makes the following
representations and warranties to the Indenture Trustee. The representations and warranties speak
as of the execution and delivery of this Master Indenture and as of each Closing Date. Such
representations and warranties shall survive the pledge of the Receivables by the Trust to the
Indenture Trustee and the termination of this Master Indenture and shall not be waived by any
party hereto unless the Rating Agency Condition is satisfied.

(a) This Master Indenture creates a valid and continuing security interest (as defined
in the applicable UCC) in the Collateral in favor of the Indenture Trustee, which security
interest is prior to all other Liens, and is enforceable as such as against creditors of and
purchasers from the Trust.

(b) The Receivables constitute “accounts” or “payment intangibles” within the meaning
of the applicable UCC.

 

36

 

(c) The Trust has rights in or the power to transfer the collateral and its title to
the Collateral is free and clear of any Lien, claim or encumbrance of any Person.

(d) The Trust has caused or will have caused, within ten days of the Closing Date for
the related Series, the filing of all appropriate financing statements in the proper filing
office in the appropriate jurisdictions under applicable law in order to perfect the
security interest in the Collateral granted to the Indenture Trustee hereunder.

(e) Other than the security interest granted to the Indenture Trustee pursuant to this
Master Indenture, the Trust has not pledged, assigned, sold, granted a security interest in,
or otherwise conveyed any of the Collateral. The Trust has not authorized the filing of and
is not aware of any financing statements against the Trust that include a description of
collateral covering the Collateral other than any financing statement relating to the
security interest granted to the Indenture Trustee hereunder or that has been terminated.
The Trust is not aware of any judgment or tax lien filings against the Trust.

 

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ARTICLE FOUR

SATISFACTION AND DISCHARGE

Section 4.01. Satisfaction and Discharge of this Master Indenture. This Master
Indenture shall cease to be of further effect with respect to the Notes except as to (a) rights of
registration of transfer and exchange, (b) substitution of mutilated, destroyed, lost or stolen
Notes, (c) the rights of Noteholders to receive payments of principal thereof and interest
thereon, (d) Sections 3.03, 3.08, 3.09, 3.11, 3.12 and 12.16, (e) the rights and immunities of the
Indenture Trustee hereunder, including the rights of the Indenture Trustee under Section 6.07, and
the obligations of the Indenture Trustee under Section 4.02 and (f) the rights of Noteholders as
beneficiaries hereof with respect to the property so deposited with the Indenture Trustee and
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 Master
Indenture with respect to the Notes when:

(i) either

(A) all Notes theretofore authenticated and delivered (other than (1) Notes
which have been destroyed, lost or stolen and which have been replaced, or paid as
provided in Section 2.06, and (2) Notes for whose full payment (principal and
interest) money has theretofore been deposited in trust or segregated and held in
trust, as provided in Section 3.03) have been delivered to the Indenture Trustee
for cancellation; or

(B) all Notes not theretofore delivered to the Indenture Trustee for
cancellation:

(1) have become due and payable;

(2) will become due and payable at the Series Final Maturity Date for
such Class or Series of Notes; or

(3) are to be called for redemption within one year under arrangements
satisfactory to the Indenture Trustee for the giving of notice of
redemption by the Indenture Trustee in the name, and at the expense, of the
Issuer;

and the Issuer, in the case of (1), (2) or (3) above, 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 (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 indebtedness on such Notes not
theretofore delivered to the Indenture Trustee for cancellation when due at the
Series Final Maturity Date for such Class or Series of Notes or the Redemption Date
(if Notes shall have been called for redemption pursuant to the related Indenture
Supplement), as the case may be;

 

38

 

(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, if applicable, or the Indenture Trustee) an
Independent Certificate from a firm of certified public accountants, each meeting the
applicable requirements of Section 12.01(a) and each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this Master Indenture have
been complied with.

Section 4.02. Application of Trust Money. All monies deposited with the Indenture
Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in accordance with the
provisions of the Notes, this Master Indenture and the applicable Indenture Supplement, to make
payments, either directly or through any Paying Agent, as the Indenture Trustee may determine, to
the Noteholders and for the payment in respect of which such monies have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and interest; but such
monies need not be segregated from other funds except to the extent required herein or in the
Transfer and Servicing Agreement or required by law.

 

39

 

ARTICLE FIVE

PAY OUT EVENTS, DEFAULTS AND REMEDIES

Section 5.01. Pay Out Events. If any one of the following events (each, a “Trust Pay
Out Event”) shall occur:

(a) an Insolvency Event occurs with respect to the Transferor, the Bank, any other
Account Owner or the Servicer; provided, however, that if the Rating Agency Condition is
first satisfied with respect to an Insolvency Event with respect to Nordstrom fsb, such
Insolvency Event shall not be a Pay Out Event;

(b) a Transfer Restriction Event shall occur; or

(c) the Trust shall be required to register as an investment company under the
Investment Company Act;

then a Pay Out Event with respect to all Series of Notes shall occur without any notice or other
action on the part of the Indenture Trustee or the Noteholders immediately upon the occurrence of
such event.

Upon the occurrence of a Pay Out Event, an Amortization Period (or if so provided in the
Indenture Supplement for a Series, an Accumulation Period) shall commence and payment on the Notes
of each Series will be made in accordance with the terms of the related Indenture Supplement.

Section 5.02. Events of Default. “Event of Default”, wherever used herein, means
with respect to any Series 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) default in the payment of the principal of any Note of that Series, if and to the
extent not previously paid, when the same becomes due and payable;

(b) default in the payment of any interest on any Note of that Series when the same
becomes due and payable, and such default shall continue for a period of 35 days;

(c) default in the observance or performance of any covenant or agreement of the Issuer
made in this Master Indenture made in respect of the Notes of such Series (other than a
covenant or agreement, a default in the observance or performance of which is elsewhere in
this Section specifically dealt with) (all of such covenants and agreements in this Master
Indenture which are not expressly stated to be for the benefit of a particular Series being
deemed to be in respect of the Notes of all Series for this purpose), and such default shall
continue or not be cured for a period of 60 days after there shall have been given, by
written registered, certified mail or overnight delivery by a nationally recognized carrier,
return receipt requested to the Issuer by the Indenture Trustee or to the Issuer and the
Indenture Trustee by the Holders of at least 25% of the principal amount of
Outstanding Notes of such Series, a written notice specifying such default and
requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder
and, as a result of such default, the interests of the Holders of the Notes are materially
and adversely affected and will continue to be materially and adversely affected during the
60-day period;

 

40

 

(d) the filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of the Issuer 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, conservator, liquidator, assignee, custodian, trustee, sequestrator or similar
official for the Issuer or ordering the winding-up or liquidation of the Issuer’s affairs,
and such decree or order shall remain unstayed and in effect for a period of 60 consecutive
days;

(e) the commencement by the Issuer 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 the Issuer to the entry of an order for relief in an involuntary case under any such law,
or the consent by the Issuer to the appointment of or the taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator, conservator or similar official of
the Issuer, or the making by the Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay, or the admission in writing by the
Issuer of its inability to pay, its debts as such debts become due, or the taking of action
by the Issuer in furtherance of any of the foregoing; or

(f) the occurrence of any additional events specified in the Indenture Supplement
related to such Series.

The Issuer shall deliver to the Indenture Trustee, within five days after the occurrence
thereof, written notice in the form of an Officer’s Certificate of any event which with the giving
of notice and the lapse of time would become an Event of Default, its status and what action the
Issuer is taking or proposes to take with respect thereto.

Section 5.03. Acceleration of Maturity; Rescission and Annulment. If an Event of
Default described in paragraph (a), (b) or (c) of Section 5.02 should occur and be continuing with
respect to a Series, then and in every such case the Indenture Trustee or the Holders of Notes
representing at least 25% of the principal amount of Outstanding Notes of such Series may declare
all the Notes of such Series to be immediately due and payable, by a notice in writing to the
Issuer (and to the Indenture Trustee if declared by 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, shall become immediately due and payable.

If an Event of Default described in paragraph (d) or (e) of Section 5.02 should occur and be
continuing, then the unpaid principal of the Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall automatically become, and shall be deemed to be
declared, due and payable.

 

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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 provided, the Holders of Notes representing at least 66 2/3% of the
principal amount of the Notes of such Series, by written notice to the Issuer and the Indenture
Trustee and in accordance with Section 5.13, may rescind and annul such declaration and its
consequences; provided, that:

(a) the Issuer has paid or deposited with the Indenture Trustee a sum sufficient to
pay:

(i) all payments of principal of and interest on all Notes and all other
amounts that would then be due hereunder or upon such Notes if the Event of Default
giving rise to such acceleration had not occurred; and

(ii) all sums paid by the Indenture Trustee hereunder and the reasonable
compensation, expenses and disbursements of the Indenture Trustee and its agents and
counsel; and

(b) all Events of Default, other than the nonpayment of the principal of the Notes that
has become due solely by such acceleration, have been cured or waived as provided in Section
5.13.

No such rescission shall affect any subsequent default or impair any right consequent thereto.

Section 5.04. Collection of Indebtedness and Suits for Enforcement by Indenture
Trustee.

(a) The Issuer covenants that if (i) default is made in the payment of any interest on any
Note when the same becomes due and payable, and such default continues for a period of 35 days
following the date on which such interest became due and payable, or (ii) default is made in the
payment of principal of any Note, if and to the extent not previously paid, when the same becomes
due and payable, the Issuer will, upon demand of the Indenture Trustee, pay to it, for the benefit
of the Holders of the Notes of the affected Series, the whole amount then due and payable on such
Notes for principal and interest, with interest upon the overdue principal, and, to the extent
payment at such rate of interest shall be legally enforceable, interest upon overdue installments
of interest, at the applicable Note Interest Rate borne by the Notes of such Series, and in
addition thereto will pay such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses, disbursements and advances
of the Indenture Trustee and its agents and counsel.

(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 monies adjudged or decreed to be payable.

 

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(c) If an Event of Default occurs and is continuing, the Indenture Trustee may, as more
particularly provided in Section 5.05, in its discretion, proceed to protect and enforce its rights
and the rights of the Noteholders of the affected Series, by such appropriate Proceedings as the
Indenture Trustee shall deem necessary to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Master 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 Master Indenture or by law.

(d) In case there shall be pending, relative to the Issuer or any other obligor upon the Notes
of the affected Series, or any Person having or claiming an ownership interest in the Collateral,
Proceedings under Title 11 of the United States Code or any other applicable federal or State
bankruptcy, insolvency or other similar law now or hereafter in effect, or in case a receiver,
conservator, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator,
custodian or other similar official shall have been appointed for or taken possession of the Issuer
or its property or such other obligor or Person, or in case of any other comparable judicial
Proceedings relative to the Issuer or other obligor upon the Notes of such Series, 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 of such Series 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
or bad faith) and of the Noteholders of such Series allowed in such Proceedings;

(ii) unless prohibited by applicable law and regulations, to vote on behalf of the
Holders of Notes of such Series in any election of a trustee, a standby trustee or Person
performing similar functions in any such Proceedings;

(iii) to collect and receive any monies or other property payable or deliverable on any
such claims and to distribute all amounts received with respect to the claims of the
Noteholders of such Series 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 Holders of Notes of
such Series allowed in any judicial Proceedings relative to the Issuer, its creditors and
its property;

 

43

 

and any trustee, receiver, conservator, liquidator, custodian, assignee, sequestrator 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 or bad faith.

(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
Holder thereof 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 Master 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 benefit of the Holders of the Notes of the affected Series
as provided herein.

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

Section 5.05. Remedies; Priorities.

(a) If an Event of Default shall have occurred and be continuing with respect to any Series,
and the Notes of such Series have been accelerated pursuant to Section 5.03, the Indenture Trustee
may do one or more of the following (subject to Sections 5.06 and 12.16):

(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 of the affected Series or under this
Master 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 monies
adjudged due;

(ii) subject to the last paragraph of this Section 5.05(a), take any other appropriate
action to protect and enforce the rights and remedies of the Indenture Trustee and the
Holders of the Notes of the affected Series; and

(iii) at the direction of the Holders of a majority of the principal amount of the
Outstanding Notes of such Series, cause the Issuer to sell Principal Receivables in an
amount equal to the Invested Amount with respect to the accelerated Series and the
related Finance Charge Receivables (or interests therein) in accordance with Section 5.16;

 

44

 

provided, however, that the Indenture Trustee may not exercise the remedy described in subparagraph
(iii) above unless one of the following conditions is satisfied: (A) the Holders of 100% of the
principal amount of Outstanding Notes of the affected Series consent in writing thereto, (B) the
Indenture Trustee determines that any proceeds of such exercise distributable to the Noteholders of
the affected Series are sufficient to discharge in full all amounts then due and unpaid upon the
Notes for principal and interest or (C) the Indenture Trustee determines that the Collateral may
not continue to provide sufficient funds for the payment of principal of and interest on the Notes
as they would have if the Notes had not been declared due and payable, and the Indenture Trustee
obtains the consent of Holders of at least 66 2/3% of the principal amount of Outstanding Notes of
each Class of the Notes of such Series. In determining such sufficiency or insufficiency with
respect to clause (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 Collateral for such purpose.

The remedies provided in this Section are the exclusive remedies provided to the Noteholders
with respect to an Event of Default and each of the Noteholders (by their acceptance of their
respective interests in the Notes) and the Indenture Trustee hereby expressly waive any other
remedy that may be available under the applicable UCC.

(b) If the Indenture Trustee collects any money or property pursuant to this Article following
the acceleration of the maturities of the Notes of the affected Series pursuant to Section 5.03 (so
long as such declaration shall not have been rescinded or annulled), it shall pay the money or
property in the following order:

(i) to the Indenture Trustee for amounts due pursuant to Section 6.07;

(ii) to Holders of the Notes of such Series for amounts due and unpaid on such Notes
for interest, in respect of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind except for preferences or priorities
specified in and in accordance with the related Indenture Supplement, according to the
amounts due and payable on such Notes for interest according to the terms of the related
Indenture Supplement;

(iii) to Holders of the Notes of such Series for amounts due and unpaid on such Notes
for principal, in respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind except for preferences or
priorities specified in and in accordance with the related Indenture Supplement, according
to the amounts due and payable on such Notes for principal according to the terms of the
related Indenture Supplement;

 

45

 

(iv) to the Holders of Notes of such Series for amounts, if any, that remain owing to
such Holders of Notes of such Series after the applications of amounts described in (ii) and
(iii) above, in respect of which or for the benefit of which such money has
been collected, ratably, without preference or priority of any kind except for
preferences or priorities specified in and in accordance with the related Indenture
Supplement, according to the amounts remaining due and payable on such Notes according to
the terms of the related Indenture Supplement;

(v) to any Series Enhancer, if any, for such Series for amounts due and unpaid to such
Series Enhancer under the Series Enhancement, in respect of which or for the benefit of
which such money has been collected, according to the terms of the Series Enhancement; and

(vi) to the Issuer for distribution pursuant to Article Four of the related Indenture
Supplement.

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

(d) In addition to the application of money or property referred to in Section 5.05(b) for an
accelerated Series, amounts then held in the Collection Account, the Special Funding Account or in
any Series Accounts for such Series and any amounts available under the Series Enhancement for such
Series shall be used to make payments to the Holders of the Notes of such Series and the Series
Enhancer for such Series in accordance with the terms of this Master Indenture, the related
Indenture Supplement and the Series Enhancement for such Series. Following the sale of any
Principal Receivables and related Finance Charge Receivables pursuant to Section 5.05(a)(iii) (or
interests therein) for a Series and the application of the proceeds of such sale to such Series and
the application of the amounts then held in the Collection Account, the Special Funding Account and
any Series Accounts for such Series as are allocated to such Series and any amounts available under
the Series Enhancement for such Series, such Series shall no longer be entitled to any allocation
of Collections or other property constituting the Collateral under this Master Indenture and the
Notes of such Series shall no longer be Outstanding.

Section 5.06. Optional Preservation of the Collateral. If the Notes of any Series
have been declared to be due and payable under Section 5.03 following an Event of Default and such
declaration and its consequences have not been rescinded and annulled, and the Indenture Trustee
has not received directions from the Noteholders pursuant to Section 5.12, the Indenture Trustee
may, but need not, elect to maintain possession of the portion of the Collateral which secures
such Notes and apply proceeds of the Collateral to make payments on such Notes to the extent such
proceeds are available therefor. 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 or not to
maintain possession of the Collateral. In determining whether to maintain possession of the
Collateral, 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 Collateral for
such purpose.

 

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Section 5.07. Limitation on Suits. No Noteholder shall have any right to institute
any Proceedings, judicial or otherwise, with respect to this Master Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:

(a) the Holders of not less than 25% of the principal amount of the Outstanding Notes
of any affected Series have made written request to the Indenture Trustee to institute such
proceeding in its own name as indenture trustee;

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

(c) such Noteholder or Noteholders has offered to the Indenture Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in compliance with such
request;

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

(e) no direction inconsistent with such written request has been given to the Indenture
Trustee during such 60-day period by at least 66 2/3% of the principal amount of the
Outstanding Notes of such Series;

it being understood and intended that no one or more Noteholders of the affected Series shall have
any right in any manner whatever by virtue of, or by availing of, any provision of this Master
Indenture to affect, disturb or prejudice the rights of any other Noteholders of such Series or to
obtain or to seek to obtain priority or preference over any other Noteholders of such Series or to
enforce any right under this Master 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 of such affected Series, each representing less
than a majority of the principal amount of the Outstanding Notes of such Series, the Indenture
Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding
any other provisions of this Master Indenture.

Section 5.08. Unconditional Rights of Noteholders to Receive Principal and Interest.
Notwithstanding any other provision in this Master Indenture, each Holder of a Note shall have the
right which is absolute and unconditional to receive payment of the principal of and interest in
respect of such Note as such principal and interest becomes due and payable and to institute suit
for the enforcement of any such payment, and such right shall not be impaired without the consent
of such Noteholder.

 

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Section 5.09. Restoration of Rights and Remedies. If the Indenture Trustee or any
Noteholder has instituted any Proceeding to enforce any right or remedy under this Master
Indenture and such Proceeding has been discontinued or abandoned, 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 Noteholder 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 5.10. Rights and Remedies Cumulative. No right, remedy, power or privilege
herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be
exclusive of any other right, remedy, power or privilege, and every right, remedy, power or
privilege shall, to the extent permitted by law, be cumulative and in addition to every other
right, remedy, power or privilege given hereunder or now or hereafter existing at law or in equity
or otherwise. The assertion or exercise of any right or remedy shall not preclude any other
further assertion or the exercise of any other appropriate right or remedy.

Section 5.11. Delay or Omission Not Waiver. No failure to exercise and no delay in
exercising, on the part of the Indenture Trustee or of any Noteholder or other Person, any right
or remedy occurring hereunder upon any Event of Default shall impair any such right or remedy or
constitute a waiver thereof of any such Event of Default or an acquiescence therein. Every right
and remedy given by this Article 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 5.12. Rights of Noteholders to Direct Indenture Trustee. Holders of at
least 25% of the principal amount of the Outstanding Notes of any affected Series (if an Event of
Default with respect to such Series has occurred and is continuing) 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 with respect to the Notes; provided, however, that subject to Section 6.01 the Indenture
Trustee shall have the right to decline any such direction if :

(a) the Indenture Trustee, after being advised by counsel, determines that the action
so directed is in conflict with any rule of law or with this Master Indenture, and

(b) the Indenture Trustee in good faith shall, by a Responsible Officer of the
Indenture Trustee, determine that the Proceedings so directed would be illegal or involve
the Indenture Trustee in personal liability or be unjustly prejudicial to the Noteholders
not parties to such direction.

Section 5.13. Waiver of Past Defaults. Prior to the declaration of the acceleration
of the maturity of the Notes of the affected Series as provided in Section 5.03, at least 66 2/3%
of the principal amount of the Outstanding Notes of such Series (or with respect to any such
Series with two or more Classes, of each Class) may, on behalf of all such Noteholders, waive by
written notice to the Issuer and the Indenture Trustee any past default with respect to such Notes
and its consequences, except a default:

(a) in the payment of the principal or interest in respect of any Note of such Series,
or

 

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(b) in respect of a covenant or provision hereof that under Section 10.02 cannot be
modified or amended without the consent of the Noteholder of each Outstanding Note affected.

Upon any such written waiver, such default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this Master Indenture;
but no such waiver shall extend to any subsequent or other default or impair any right consequent
thereon. The Servicer shall give each Rating Agency prompt notice of any waiver of an Event of
Default.

Section 5.14. Undertaking for Costs. All parties to this Master Indenture agree, and
each Noteholder by its acceptance thereof 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 Master
Indenture, or in any suit against the Indenture Trustee for any action taken, suffered or omitted
by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys’ fees, against any party litigant in such suit, 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 any suit instituted by the Indenture Trustee, to any
suit instituted by any Noteholder, or group of Noteholders (in compliance with Section 5.08),
holding in the aggregate more than 10% of the principal balance of the Outstanding Notes of the
affected Series, or to any suit instituted by any Noteholder for the enforcement of the payment of
the principal or interest in respect of any Note on or after the Distribution Date on which any of
such amounts was due (or, in the case of redemption, on or after the applicable Redemption Date).

Section 5.15. 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, which may adversely affect the covenants or the performance
of this Master 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 5.16. Sale of Receivables.

(a) The method, manner, time, place and terms of any sale of Receivables (or interests
therein) pursuant to Section 5.05(a)(iii) 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 Receivables pursuant to Section 5.05(a)(iii). 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.

 

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(c) In its exercise of the foreclosure remedy pursuant to Section 5.05(a)(iii), the Indenture
Trustee shall solicit bids from Permitted Assignees for the sale of Principal Receivables in an
amount equal to the product of (i) the Invested Amount with respect to the affected Series of Notes
at the time of sale and (ii) a fraction, the numerator of which is one and the denominator of which
is equal to the difference between one and the Discount Percentage, and the related Finance Charge
Receivables (or interests therein).

Section 5.17. Action on Notes. The Indenture Trustee’s right to seek and recover
judgment on the Notes or under this Master Indenture shall not be affected by the seeking or
obtaining of or application for any other relief under or with respect to this Master Indenture.
Neither the lien of this Master 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 Collateral
or upon any of the assets of the Issuer. Any money or property collected by the Indenture Trustee
shall be applied as specified in the applicable Indenture Supplement.

 

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ARTICLE SIX

THE INDENTURE TRUSTEE

Section 6.01. Duties of the Indenture Trustee.

(a) If an Event of Default has occurred and is continuing with respect to a Series of Notes
and a Responsible Officer shall have actual knowledge or written notice of such Event of Default,
the Indenture Trustee shall, prior to the receipt of directions, if any, from at least 25% of the
principal amount of the Outstanding Notes of such Series, exercise the rights and powers vested in
it by this Master Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of such person’s own
affairs.

(b) Except during the continuance of an Event of Default:

(i) the Indenture Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Master Indenture, and no implied covenants or obligations
shall be read into this Master Indenture against the Indenture Trustee; and

(ii) in the absence of bad faith or negligence on its part, 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 Master Indenture; provided, however, the Indenture
Trustee, upon receipt of any resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments furnished to the Indenture Trustee which are
specifically required to be furnished pursuant to any provision of this Master Indenture or
any Indenture Supplement, shall examine them to determine whether they substantially conform
to the requirements of this Master Indenture or any Indenture Supplement; and the Indenture
Trustee shall give prompt written notice to the Noteholders of such Series and each Rating
Agency of any material lack of conformity of any such instrument to the applicable
requirements of this Master Indenture or any Indenture Supplement discovered by the
Indenture Trustee which would entitle a majority of the principal amount of the Outstanding
Notes of such Series to take any action pursuant to this Master Indenture or any Indenture
Supplement.

(c) In case a Pay Out Event has occurred and is continuing with respect to a Series and a
Responsible Officer shall have actual knowledge or written notice of such Pay Out Event, the
Indenture Trustee shall, prior to the receipt of directions, if any, from a majority of the
principal amount of Outstanding Notes of such Series, exercise such of the rights and powers vested
in it by this Master Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of such person’s own
affairs.

(d) No provision of this Master 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 willful
misconduct, except that:

 

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(i) Section (b) or (d) shall not be construed to limit the effect of Section 6.01(a);

(ii) the Indenture Trustee shall not be liable for any error of judgment made in good
faith, unless it shall be proved that the Indenture Trustee was negligent in ascertaining
the pertinent facts; and

(iii) the Indenture Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with this Master Indenture
and/or the direction of a majority of the principal amount of the Outstanding Notes of each
Series of Notes relating to the time, method and place of conducting any proceeding for any
remedy available to the Indenture Trustee, or for exercising any trust or power conferred
upon the Indenture Trustee, under this Master Indenture; and the Indenture Trustee shall not
be liable for any action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the Servicer, the Transferor or the Trust in compliance
with the terms of this Master Indenture or any Indenture Supplement.

(e) No provision of this Master Indenture shall require the Indenture Trustee to expend or
risk its own funds or otherwise incur any 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 for believing that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.

(f) Every provision of this Master Indenture that in any way relates to the Indenture Trustee
is subject to subsections (a), (b), (c), (d) and (e) of this Section.

(g) Except as expressly provided in this Master Indenture, the Indenture Trustee shall have no
power to vary the Collateral, including by (i) accepting any substitute payment obligation for a
Receivable initially transferred to the Trust under the Transfer and Servicing Agreement, (ii)
adding any other investment, obligation or security to the Trust or (iii) withdrawing from the
Trust any Receivable (except as otherwise provided in the Transfer and Servicing Agreement).

(h) The Indenture Trustee shall have no responsibility or liability for investment losses on
Eligible Investments (other than Eligible Investments on which the institution acting as Indenture
Trustee is an obligor).

(i) The Indenture Trustee shall notify each Rating Agency (i) of any change in any rating of
the Notes by any other Rating Agency of which a Responsible Officer has actual knowledge, (ii)
immediately of the occurrence of any Event of Default or Pay Out Event of which a Responsible
Officer has actual knowledge and (iii) immediately of potential Pay Out Events or Events of Default
of which a Responsible Officer has actual notice from the Servicer.

(j) For all purposes under this Master Indenture, the Indenture Trustee shall not be deemed to
have notice or knowledge of any Event of Default, Pay Out Event or Servicer Default unless a
Responsible Officer has actual knowledge thereof or has received written notice thereof. For
purposes of determining the Indenture Trustee’s responsibility and liability hereunder, any
reference to an Event of Default, Pay Out Event or Servicer Default shall be construed to refer
only to such event of which the Indenture Trustee is deemed to have notice as described in
this subsection.

 

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Section 6.02. Notice of Pay Out Event or Event of Default. Upon the occurrence of
any Pay Out Event or Event of Default of which a Responsible Officer has actual knowledge or has
received notice thereof, the Indenture Trustee shall transmit by mail to all Noteholders as their
names and addresses appear on the Note Register and the Rating Agencies, notice of such Pay Out
Event or Event of Default hereunder known to the Indenture Trustee within 30 days after it occurs
or within ten Business Days after it receives such notice or obtains actual notice, if later.

Section 6.03. Rights of Indenture Trustee. Except as otherwise provided in Section
6.01:

(a) the Indenture Trustee may conclusively rely and shall fully be protected in acting
or refraining from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, note or other paper or document
reasonably believed by it to be genuine and to have been signed or presented by the proper
party or parties;

(b) whenever in the administration of this Master Indenture the Indenture Trustee shall
deem it desirable that a matter be proved or established prior to taking, suffering or
omitting any action hereunder, the Indenture Trustee (unless other evidence is specifically
prescribed herein) may, in the absence of bad faith on its part, rely upon an Officer’s
Certificate of the Issuer;

(c) as a condition to the taking, suffering or omitting of any action by it hereunder,
the Indenture Trustee may consult with counsel and the advice of such counsel or any Opinion
of Counsel shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in-good faith and in reliance thereon;

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

(e) 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, direction, consent, order, bond, note or other paper or document, but the
Indenture Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, 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 and the Servicer, personally or by agent or attorney;

 

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(f) the Indenture Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents, attorneys, custodians or
nominees and the Indenture Trustee shall not be responsible for (i) any misconduct or
negligence on the part of any agent, attorney, custodians or nominees appointed with due
care by it hereunder or (ii) the supervision of such agents, attorneys, custodians or
nominees after such appointment with due care;

(g) the Indenture Trustee shall not be liable for any actions taken, suffered or
omitted by it in good faith and believed by it to be authorized or within the discretion or
rights conferred upon the Indenture Trustee by this Master Indenture; and

(h) in the event that the Indenture Trustee is also acting as Paying Agent and Transfer
Agent and Registrar, the rights and protections afforded to the Indenture Trustee pursuant
to this Article shall also be afforded to such Paying Agent and Transfer Agent and
Registrar.

Section 6.04. Not Responsible for Recitals or Issuance of Notes. The recitals
contained herein and in the Notes, except the certificate of authentication of the Indenture
Trustee, shall be taken as the statements of the Issuer, and the Indenture Trustee assumes no
responsibility for their correctness. The Indenture Trustee makes no representation as to the
validity or sufficiency of this Master Indenture, the Notes, or any related document. The
Indenture Trustee shall not be accountable for the use or application by the Issuer of the
proceeds from the Notes.

Section 6.05. May Hold Notes. The Indenture Trustee, any Paying Agent, the Transfer
Agent and Registrar or any other agent of the Issuer, in its individual or any other capacity, may
become the owner or pledgee of Notes and may otherwise deal with the Issuer with the same rights
it would have if it were not Indenture Trustee, Paying Agent, Transfer Agent and Registrar or such
other agent.

Section 6.06. Money Held in Trust. Money held by the Indenture Trustee in trust
hereunder need not be segregated from other funds held by the Indenture Trustee in trust hereunder
except to the extent required herein or required by law. The Indenture Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise agreed upon in
writing by the Indenture Trustee and the Issuer.

Section 6.07. Compensation, Reimbursement and Indemnification. The Servicer shall
pay to the Indenture Trustee from time to time reasonable compensation for all services rendered
by the Indenture Trustee under this Master Indenture (which compensation shall not be limited by
any law on compensation of a trustee of an express trust). The Servicer shall reimburse the
Indenture Trustee for all reasonable 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. Pursuant to the Transfer and Servicing
Agreement, the Servicer shall indemnify the Indenture Trustee against any and all loss, liability
or expense (including the fees of either in-house counsel or outside counsel, but not both)
incurred by it in connection with the administration of this trust and the performance of its
duties hereunder. The Indenture Trustee shall notify the Issuer and the Servicer promptly

 

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of any claim for which it may seek indemnity. Failure by the Indenture Trustee to so notify
the Issuer and the Servicer shall not relieve the Issuer or the Servicer of its obligations
hereunder unless such loss, liability or expense could have been avoided with such prompt
notification and then only to the extent of such loss, expense or liability which could have been
so avoided. The Servicer shall defend any claim against the Indenture Trustee; the Indenture
Trustee may have separate counsel and, if it does, the Servicer shall pay the fees and expenses of
such counsel. The Servicer need not reimburse any expense or indemnify against any loss,
liability or expense incurred by the Indenture Trustee through the Indenture Trustee’s own willful
misconduct, negligence or bad faith.

The Servicer’s payment obligations to the Indenture Trustee pursuant to this Section shall
survive the discharge of this Master Indenture. When the Indenture Trustee incurs expenses after
the occurrence of a Default specified in Section 5.02(d) or (e) 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 Servicer’s payment obligations pursuant to this Section shall be subject to the provisions
of Section 12.16.

Section 6.08. Replacement of Indenture Trustee. No resignation or removal of the
Indenture Trustee and no appointment of a successor Indenture Trustee shall become effective until
the acceptance of appointment by the successor Indenture Trustee pursuant to this Section. The
Indenture Trustee may resign at any time by giving 30 days’ written notice to the Issuer. Holders
of a majority of the principal amount of the Outstanding Notes, upon delivery of notice of such
removal to the Issuer, may remove the Indenture Trustee by so notifying the Indenture Trustee and
may appoint a successor Indenture Trustee. The Issuer shall remove the Indenture Trustee if:

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

(ii) an Insolvency Event with respect to the Indenture Trustee occurs; or

(iii) the Indenture Trustee otherwise becomes legally unable to act.

If the Indenture Trustee resigns or is removed or if a vacancy exists in the office of 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. The
Issuer shall furnish each Rating Agency with a copy of any notice of resignation or removal of a
retiring Indenture Trustee pursuant to this Section promptly after receiving such notice, in the
case of a resignation by a retiring Indenture Trustee, or delivering such notice, in the case of a
removal of a retiring Indenture Trustee by the Issuer or Holders of a majority of the principal
amount of the Outstanding Notes.

A successor Indenture Trustee shall deliver a written acceptance of its appointment to the
retiring Indenture Trustee, the Administrator and the Issuer. Thereupon the resignation or removal
of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall
have all the rights, powers and duties of the Indenture Trustee under this Master
Indenture. The successor Indenture Trustee shall mail a notice of its succession to all of
the Noteholders and each Rating Agency. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.

 

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If a successor Indenture Trustee does not take office within 60 days after the retiring
Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Issuer or the Holders
of a majority of the principal amount of the Outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.

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.

Notwithstanding the replacement of the Indenture Trustee pursuant to this Section, the
Issuer’s obligations under Section 6.07 shall continue for the benefit of the retiring Indenture
Trustee.

Section 6.09. 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 or banking association without any further act shall be the successor
Indenture Trustee; provided that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. The Indenture Trustee shall give each Rating Agency
notice of any such transaction.

In case at the time such successor or successors by merger, conversion, consolidation or
transfer to the Indenture Trustee shall succeed to the trusts created by this Master 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 to the Indenture Trustee may authenticate such Notes in the name of
the successor to the Indenture Trustee; and in all such cases such certificates shall have the full
force which it is anywhere in the Notes or in this Master Indenture provided that the certificate
of the Indenture Trustee shall have.

Section 6.10. Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.

(a) Notwithstanding any other provisions of this Master Indenture, at any time, for the
purpose of meeting any legal requirement of any jurisdiction in which any part of the Collateral
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 Collateral, and to vest in such Person or
Persons, in such capacity and for the benefit of the Noteholders, such title to the Collateral, or
any part hereof, and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Indenture Trustee may consider necessary or desirable. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 6.11 and no notice to Noteholders of the
appointment of any co-trustee or separate trustee shall be required under Section 6.08.

 

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(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 Collateral 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; 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 Master Indenture and the conditions of this Article. 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 Master Indenture, specifically including
every provision of this Master 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.

(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 Master 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. For all Series of Notes issued
hereunder, there shall at all times be an Indenture Trustee which shall be a “bank” (within the
meaning of Section 2(a)(5) of the Investment Company Act) with an aggregate capital, surplus and
undivided profits of at least $50,000,000, which is authorized under applicable laws to exercise
corporate trust powers and which in all events satisfies the requirements set forth in
Section (a)(4)(i) of Rule 3a-7 promulgated under the Investment Company Act, and its long-term
unsecured debt shall be rated at least Baa3 by Moody’s and at least BBB- by Standard & Poor’s.

 

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

Section 6.13. Tax Returns. In the event the Trust shall be required to file tax
returns, the Servicer shall prepare or shall cause to be prepared such tax returns and shall
provide such tax returns with instruction to the Owner Trustee for signature at least five days
before such tax returns are due to be filed and shall file such returns. The Servicer, in
accordance with the terms of each Indenture Supplement, shall also prepare or shall cause to be
prepared all tax information required by law to be distributed to Noteholders and shall deliver
such information to the Owner Trustee at least five days prior to the date it is required by law
to be distributed to Noteholders. The Owner Trustee, upon written request, will furnish the
Servicer with all such information known to the Owner Trustee as may be reasonably requested and
required in connection with the preparation of all tax returns of the Trust, and shall, upon
request, execute such returns. In no event shall the Owner Trustee be personally liable for any
liabilities, costs or expenses of the Trust or any Noteholder arising under any tax law, including
without limitation, federal, State or local income or excise taxes or any other tax imposed on or
measured by income (or any interest or penalty with respect thereto arising from a failure to
comply therewith).

Section 6.14. Representations and Covenants of the Indenture Trustee. The Indenture
Trustee represents, warrants and covenants that:

(a) it is a national banking association duly organized and validly existing under the
federal laws of the United States;

(b) it has full power and authority to deliver and perform this Master Indenture and
has taken all necessary action to authorize the execution, delivery and performance by it of
this Master Indenture and each other Transaction Document to which it is a party; and

(c) each of this Master Indenture and each other Transaction Document to which it is a
party has been duly executed and delivered by the Indenture Trustee and constitutes its
legal, valid and binding obligation in accordance with its terms.

Section 6.15. Custody of the Collateral. The Indenture Trustee shall hold such of
the Collateral as consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of Minnesota. The Indenture Trustee shall
hold such of the Collateral as constitutes investment property through a securities intermediary,
which securities intermediary shall agree with the Indenture Trustee that (i) such investment
property shall at all times be credited to a securities account of the Indenture Trustee, (ii)
such securities intermediary shall treat the Indenture Trustee as entitled to exercise the rights that

 

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comprise each financial asset credited to such securities account, (iii) all property
credited to such securities account shall be treated as financial assets, (iv) such securities
intermediary shall comply with entitlement orders originated by the Indenture Trustee without the
further consent of any other person or entity, (v) such securities intermediary shall not agree
with any person or entity other than the Indenture Trustee to comply with entitlement orders
originated by any person or entity other than the Indenture Trustee, (vi) such securities accounts
and the property credited thereto shall not be subject to any lien, security interest, right of
set-off, or encumbrance in favor of such securities intermediary or anyone claiming through it
(other than the Indenture Trustee), and (vii) such agreement shall be governed by the laws of the
State of New York. Terms used in this Section that are defined in the New York UCC and not
otherwise defined herein shall have the meaning set forth in the UCC of the State of New York.
Except as permitted by this Section, the Indenture Trustee shall not hold any part of the
Collateral through an agent or a nominee.

Section 6.16. Disqualification of the Indenture Trustee. If the Indenture Trustee
has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, the
Indenture Trustee shall either eliminate such interest or resign to the extent in the manner
provided by and subject to the provisions of this Master Indenture.

 

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ARTICLE SEVEN

NOTEHOLDERS’ LIST AND REPORTS BY INDENTURE TRUSTEE AND ISSUER

Section 7.01. Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders.
The Issuer will furnish or cause to be furnished to the Indenture Trustee (i) upon each transfer of
a Note, a list, in such form as the Indenture Trustee may reasonably require, of the names,
addresses and taxpayer identification numbers of the Noteholders as they appear on the Note
Register as of the most recent Record Date, and (ii) at such other times, as the Indenture Trustee
may request in writing, within ten days after receipt by the Issuer of any such request, a list of
similar form and content as of a date not more than ten days prior to the time such list is
furnished; provided, however, that for so long as the Indenture Trustee is the Transfer Agent and
Registrar, no such list shall be required to be furnished.

Section 7.02. Preservation of Information; Communications to 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 7.01 and the names, addresses and taxpayer identification
numbers of the Noteholders received by the Indenture Trustee in its capacity as Transfer Agent and
Registrar. The Indenture Trustee may destroy any list furnished to it as provided in Section 7.01
upon receipt of a new list so furnished.

(b) Noteholders may communicate, pursuant to TIA Section 312(b), with other Noteholders with
respect to their rights under this Master Indenture or under the Notes.

(c) The Issuer, the Indenture Trustee and the Transfer Agent and Registrar shall have the
protection of TIA Section 312(c).

Section 7.03. Reports by Issuer.

(a) The Issuer shall:

(i) file with the Indenture Trustee, within 15 days after the Issuer is required to
file the same with the Commission, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe) which the Issuer may be
required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act;

(ii) file with the Indenture Trustee and the Commission in accordance with rules and
regulations prescribed from time to time by the Commission such additional information,
documents and reports with respect to compliance by the Issuer with the conditions and
covenants of this Master Indenture as may be required from time to time by such rules and
regulations; and

(iii) supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail
to all Noteholders) such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to clauses (i) and (ii) of this subsection
as may be required by rules and regulations prescribed from time to time by the Commission.

 

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(b) Unless the Issuer otherwise determines, the fiscal year of the Issuer shall end on January
31 of each year.

Section 7.04. Reports by Indenture Trustee. If the TIA is applicable, and such
reports are required by TIA Section 313(a), within 60 days after each March 31 beginning with
March 31, 2008, the Indenture Trustee shall mail to each Noteholder as required by TIA Section
313(c) a brief report dated as of such date that complies with TIA Section 313(a). If the TIA is
applicable, the Indenture Trustee also shall comply with TIA Section 313(b).

 

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ARTICLE EIGHT

ALLOCATION AND APPLICATION OF COLLECTIONS

Section 8.01. Collection of Money. Except as otherwise expressly provided herein and
in the related Indenture Supplement, 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 Master Indenture. The Indenture Trustee shall hold all such money and property
received by it in trust for the Noteholders and shall apply it as provided in this Master
Indenture. Except as otherwise expressly provided in this Master Indenture, if any default occurs
in the making of any payment or performance under the Transfer and Servicing Agreement or any
other Transaction Document, the Indenture Trustee may, and upon the request of at least a majority
of the Holders of the principal amount of the Outstanding Notes of an affected Series shall, 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 Pay Out Event or an Event of Default under this Master Indenture
and to proceed thereafter as provided in Article Five.

Section 8.02. Rights of Noteholders. The Collateral shall secure the obligation of
the Trust to pay to the Holders of the Notes of each Series principal and interest and other
amounts payable pursuant to this Master Indenture and the related Indenture Supplements. Except
as specifically set forth in the Indenture Supplement with respect thereto, the Notes of any
Series or Class shall not have rights to payment from any Series Account or Series Enhancement
allocated for the benefit of any other Series or Class.

Section 8.03. Establishment of Collection Account and Special Funding Account. The
Servicer, for the benefit of the Noteholders, shall establish and maintain with the Indenture
Trustee or its nominee in the name of the Indenture Trustee, on behalf of the Trust, one or more
Qualified Accounts (including any subaccount thereof) bearing a designation clearly indicating that
the funds and other property credited thereto are held for the benefit of the Noteholders
(collectively, the “Collection Account”). The Indenture Trustee shall possess all right, title and
interest in all monies, instruments, investment property, documents, certificates of deposit and
other property credited from time to time to the Collection Account and in all proceeds, earnings,
income, revenue, dividends and distributions thereof for the benefit of the Noteholders.

The Collection Account shall be under the sole dominion and control of the Indenture Trustee
for the benefit of the Noteholders. Except as expressly provided in this Master Indenture and the
Transfer and Servicing Agreement, the Servicer agrees that it shall have no right of setoff or
banker’s lien against, and no right to otherwise deduct from, any funds held in the Collection
Account for any amount owed to it by the Indenture Trustee, the Trust, any Noteholder or any Series
Enhancer. If, at any time, the Collection Account ceases to be a Qualified Account, the Indenture
Trustee (or the Servicer on its behalf) shall within ten Business Days (or such longer period, not
to exceed 30 calendar days, as to which each Rating Agency may consent) establish a new Collection
Account meeting the conditions specified above, transfer any monies, documents, instruments,
investment property, certificates of deposit and other property to such new Collection Account and
from the date such new Collection Account is established, it shall be the

 

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“Collection Account”. Pursuant to the authority granted to the Servicer in Section
3.01(b) of the Transfer and Servicing Agreement, the Servicer shall have the power, revocable by
the Indenture Trustee, to instruct the Indenture Trustee to make withdrawals and payments from the
Collection Account for the purposes of carrying out the Servicer’s or the Indenture Trustee’s
duties hereunder and under the Transfer and Servicing Agreement, as applicable. The Servicer shall
reduce deposits into the Collection Account payable by the Transferor on any Deposit Date to the
extent the Transferor is entitled to receive funds from the Collection Account on such Deposit
Date, but only to the extent such reduction would not reduce the Transferor Interest to an amount
less than the Required Transferor Interest.

Funds on deposit in the Collection Account (other than investment earnings and amounts
deposited pursuant to Section 2.06, 6.01 or 7.01 of the Transfer and Servicing Agreement or Section
11.02 of this Master Indenture) shall at the written direction of the Servicer be invested by the
Indenture Trustee in Eligible Investments selected by the Servicer. All such Eligible Investments
shall be held by the Indenture Trustee for the benefit of the Noteholders pursuant to Section 6.15.
Investments of funds representing Collections collected during any Monthly Period shall be
invested in Eligible Investments that will mature so that such funds will be available no later
than the close of business on each monthly Transfer Date following such Monthly Period. No such
Eligible Investment shall be disposed of prior to its maturity. In the event that the Indenture
Trustee does not receive written direction from the Servicer, funds on deposit in the Collection
Account shall be deposited by the Indenture Trustee in Eligible Investments described in clause
(vi) of the definition thereof. On each Distribution Date, all interest and other investment
earnings (net of losses and investment expenses) on funds on deposit in the Collection Account
shall be paid to the Transferor, except as otherwise specified in any Indenture Supplement. The
Indenture Trustee shall bear no responsibility or liability for any losses resulting from
investment or reinvestment of any funds in accordance with this Section nor for the selection of
Eligible Investments in accordance with the provisions of this Master Indenture and any Indenture
Supplement (other than Eligible Investments on which the institution acting as Indenture Trustee is
an obligor).

The Servicer, for the benefit of the Noteholders, shall establish and maintain with the
Indenture Trustee or its nominee in the name of the Indenture Trustee, on behalf of the Trust, a
Qualified Account (including any subaccounts thereof) bearing a designation clearly indicating that
the funds and other property credited thereto are held for the benefit of the Noteholders (the
“Special Funding Account”). The Indenture Trustee shall possess all right, title and interest in
all monies, instruments, investment property, documents, certificates of deposit and other property
credited from time to time to the Special Funding Account and in all proceeds, dividends,
distributions, earnings, income and revenue thereof for the benefit of the Noteholders. The
Special Funding Account shall be under the sole dominion and control of the Indenture Trustee for
the benefit of the Noteholders. Except as expressly provided in this Master Indenture and the
Transfer and Servicing Agreement, the Servicer shall have no right of setoff or banker’s lien
against, and no right to otherwise deduct from, any funds and other property held in the Special
Funding Account for any amount owed to it by the Indenture Trustee, the Trust, any Noteholder or
any Series Enhancer. If, at any time, the Special Funding Account ceases to be a Qualified
Account, the Indenture Trustee (or the Servicer on its behalf) shall within ten Business Days (or
such longer period, not to exceed 30 calendar days, as to which each Rating Agency may consent)
establish a new Special Funding Account meeting the conditions specified above,
transfer any monies, documents, instruments, investment property, certificates of deposit and
other property to such new Special Funding Account and from the date such new Special Funding
Account is established, it shall be the “Special Funding Account.”

 

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Funds on deposit in the Special Funding Account shall at the written direction of the Servicer
be invested by the Indenture Trustee in Eligible Investments selected by the Servicer. All such
Eligible Investments shall be held by the Indenture Trustee for the benefit of the Noteholders
pursuant to Section 6.15. Funds on deposit in the Special Funding Account on any Distribution Date
will be invested in Eligible Investments that will mature so that such funds will be available no
later than the close of business on the Transfer Date following such Monthly Period. No such
Eligible Investment shall be disposed of prior to its maturity. In the event that the Indenture
Trustee does not receive written direction from the Servicer, funds on deposit in the Collection
Account shall be deposited by the Indenture Trustee in Eligible Investments described in clause
(vi) of the definition thereof. On each Distribution Date, all interest and other investment
earnings (net of losses and investment expenses) on funds on deposit in the Special Funding Account
shall be treated as Collections of Finance Charge Receivables with respect to the last day of the
related Monthly Period except as otherwise specified in the related Indenture Supplement. On each
Business Day on which funds are on deposit in the Special Funding Account and on which no Series is
in an Accumulation Period or Amortization Period, the Servicer shall determine the amount (if any)
by which the Transferor Interest exceeds the Required Transferor Interest on such date and shall
instruct the Indenture Trustee to withdraw any such excess from the Special Funding Account and pay
such amount to the Holders of the Transferor Certificates; provided, however, that, if an
Accumulation Period or Amortization Period has commenced and is continuing with respect to one or
more Outstanding Series, any funds on deposit in the Special Funding Account shall be treated as
Shared Principal Collections and shall be allocated and distributed in accordance with Section 8.05
and the terms of each Indenture Supplement.

Section 8.04. Collections and Allocations.

The Servicer will apply or will instruct the Indenture Trustee to apply all funds on deposit in the
Collection Account as described in this Article and in each Indenture Supplement. Except as
otherwise provided below, the Servicer shall deposit Collections into the Collection Account as
promptly as possible after the Date of Processing of such Collections, but in no event later than
the second Business Day following the Date of Processing. Subject to the terms of any Indenture
Supplement, but notwithstanding anything else in this Master Indenture or the Transfer and
Servicing Agreement to the contrary, provided that an Early Amortization Event has not occurred and
the long term debt rating of Nordstrom is not less than Baa3 by Moody’s, if one or more of the
following conditions is satisfied the Servicer need not make the daily deposits of Collections into
the Collection Account as provided in the preceding sentence, but may make a single deposit in the
Collection Account in immediately available funds not later than 1:00 p.m., New York City time, on
the Transfer Date immediately preceding the Distribution Date following the Monthly Period with
respect to which such deposit relates: (i) (A) Nordstrom fsb remains the Servicer under the
Transfer and Servicing Agreement and a wholly-owned subsidiary of Nordstrom (directly or
indirectly), (B) Nordstrom guarantees the performance of the Servicer’s obligations (unless the
Rating Agencies shall consent to the deletion of such guarantee) and achieves and maintains a
commercial paper rating of not less than A-1 or

 

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 a senior unsecured long term rating of not less than A- by Standard & Poor’s and not less than Prime-1 by
Moody’s, and (C) in the event of a material change in the financial relationship between them, the
Bank notifies each Rating Agency, (ii) at the beginning of each Monthly Period, the Bank deposits
an amount equal to the amount representing its estimated share of Collections of Finance Charge
Receivables for the related Monthly Period, which shall be equal to the sum of the following
amounts for the immediately preceding Distribution Date: (A) 125% of the Class A Monthly Interest
and the Class B Monthly Interest, (B) Monthly Servicing Fee and (C) 150% of the Investor Default
Amount or (iii) any other arrangements are made such that the Rating Agency Condition is satisfied
with respect thereto. Subject to the first proviso in Section 8.05, but notwithstanding anything
else in this Master Indenture or the Transfer and Servicing Agreement to the contrary, with respect
to any Monthly Period, whether the Servicer is required to make deposits of collections pursuant to
the first or the second preceding sentence, (i) the Servicer will only be required to deposit
Collections into the Collection Account up to the aggregate amount of Collections required to be
deposited into any Series Account or, without duplication, distributed on or prior to the related
Distribution Date to Noteholders or to any Series Enhancer pursuant to the terms of any Indenture
Supplement or Enhancement Agreement and (ii) if at any time prior to such Distribution Date the
amount of Collections deposited in the Collection Account exceeds the amount required to be
deposited pursuant to clause (i) above, the Servicer will be permitted to cause the Indenture
Trustee to withdraw the excess from the Collection Account and pay such amounts pursuant to the
terms of the Transaction Documents. Subject to the immediately preceding sentence, the Servicer
may retain its Servicing Fee with respect to a Series and shall not be required to deposit it in
the Collection Account. To the extent that, in accordance with this subsection, the Servicer has
retained amounts which would otherwise be required to be deposited into the Collection Account or
any Series Account with respect to any Monthly Period, the Servicer shall be required to deposit
such amounts in the Collection Account or such Series Account on the related Transfer Date to the
extent necessary to make required distributions on the related Distribution Date, including any
amounts which are required to be applied as Reallocated Principal Collections, and pay any amounts
remaining after making such deposit pursuant to the terms of the Transaction Documents.

(a) Collections of Finance Charge Receivables, Principal Receivables and Defaulted Receivables
will be allocated to each Series of Notes and to the holders of the Transferor Certificates in
accordance with this Article and each Indenture Supplement and amounts so allocated to any Series
will not, except as specified in the related Indenture Supplement, be available to the Noteholders
of any other Series. Allocations of the foregoing amounts between the Holders of the Notes and the
holders of the Transferor Certificates, among the Series and among the Classes in any Series, shall
be set forth in the related Indenture Supplement or Indenture Supplements. In-store payments made
with respect to Finance Charge Receivables and Principal Receivables shall be treated as
Collections and be deemed to be received by the Servicer on the day such payment was made by the
cardholder.

Section 8.05. Shared Principal Collections. On each Distribution Date, (i) the
Servicer shall allocate Shared Principal Collections to each Principal Sharing Series, pro rata,
in proportion to the Principal Shortfalls, if any, with respect to each such Series and (ii) the
Servicer shall cause the Indenture Trustee to withdraw from the Collection Account and pay to the
holders of the Transferor Certificates an amount equal to the excess, if any, of Shared Principal
Collections over Principal Shortfalls; provided, however, that if the Transferor Interest as of
such Distribution Date (determined after giving effect to the Principal Receivables transferred to the

 

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 Trust on such date) is less than the Required Transferor Interest, the
Servicer will not direct the Indenture Trustee to distribute to the holders of the Transferor
Certificates any such amounts that otherwise would be distributed to the holders of the Transferor
Certificates, but shall deposit such funds in the Special Funding Account. The Transferor may, at
its option, instruct the Indenture Trustee to deposit Shared Principal Collections which are
otherwise payable to the holders of the Transferor Certificates pursuant to the provisions set
forth above into the Special Funding Account. Notwithstanding the foregoing, a Group of Series
may specify in their related Indenture Supplements that Shared Principal Collections from such
Series shall be allocated as provided above but only among the Series in such Group.

Section 8.06. Additional Withdrawals from the Collection Account. On or before the
Determination Date with respect to any Monthly Period, the Servicer may direct the Indenture
Trustee in writing to withdraw from the Collection Account any amounts it has determined do not
constitute Trust Assets and were erroneously deposited into the Collection Account, due to an
accounting error or otherwise.

Section 8.07. Allocation of Collateral to Series or Groups. To the extent so
provided in the Indenture Supplement for any Series or in an Indenture Supplement otherwise
executed pursuant to Section 10.01, Receivables conveyed to the Trust pursuant to Section 2.01 of
the Transfer and Servicing Agreement and Receivables conveyed to the Trust pursuant to Section
2.09 of the Transfer and Servicing Agreement, and all Collections received with respect thereto
may be allocated or applied in whole or in part to one or more Series or Groups as may be provided
in such Indenture Supplement; provided, however, that any such allocation or application shall be
effective only upon satisfaction of the following conditions:

(a) on or before the fifth Business Day immediately preceding such allocation, the
Servicer shall have given the Indenture Trustee and each Rating Agency written notice of
such allocation;

(b) the Rating Agency Condition shall have been satisfied with respect to such
allocation; and

(c) the Servicer shall have delivered to the Indenture Trustee an Officer’s
Certificate, dated the date of such allocation, to the effect that the Servicer reasonably
believes that such allocation will not result in an Adverse Effect.

Any such Indenture Supplement may provide that (i) such allocation to one or more particular
Series or Groups may terminate upon the occurrence of certain events specified therein and (ii)
upon the occurrence of any such event, such assets and any Collections with respect thereto, shall
be reallocated to other Series or Groups or to all Series, all as shall be provided in such
Indenture Supplement.

 

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Section 8.08. Excess Finance Charge Collections. On each Distribution Date, the
Servicer shall (i) allocate Excess Finance Charge Collections to each Excess Allocation Series,
pro rata, in proportion to the Finance Charge Shortfalls, if any, with respect to each such Series
and (ii) withdraw from the Collection Account and pay to the Holders of the Transferor
Certificates an amount equal to the excess, if any, of Excess Finance Charge Collections over
Finance Charge Shortfalls; provided, however, that the sharing of Excess Finance Charge
Collections among Series will continue only until such time, if any, at which the Transferor shall
deliver to the Indenture Trustee an Officer’s Certificate to the effect that, in the reasonable
belief of the Transferor, the continued sharing of Excess Finance Charge Collections among Series
would have adverse regulatory implications with respect to an Account Owner. Notwithstanding the
foregoing, a Group of Series may specify in their related Indenture Supplements that Excess
Finance Charge Collections from such Series shall be allocated as provided above but only among
the Series in such Group.

Section 8.09. Release of Collateral; Eligible Loan Documents.

(a) The Indenture Trustee may, and when required by the provisions of this Master Indenture
shall, execute instruments to release property from the lien of this Master Indenture, or convey
the Indenture Trustee’s interest in the same, in a manner and under circumstances which are not
inconsistent with the provisions of this Master Indenture. No party relying upon an instrument
executed by the Indenture Trustee as provided in this Article 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.

(b) In order to facilitate the servicing of the Receivables by the Servicer, the Indenture
Trustee upon Issuer Order shall authorize the Servicer to execute in the name and on behalf of the
Indenture Trustee instruments of satisfaction or cancellation, or of partial or full release or
discharge, and other comparable instruments with respect to the Receivables (and the Indenture
Trustee shall execute any such documents on request of the Servicer), subject to the obligations of
the Servicer under the Transfer and Servicing Agreement.

(c) The Indenture Trustee shall, at such time as there are no Notes Outstanding, release and
transfer, without recourse, all of the Collateral that secured the Notes (other than any cash held
for the payment of the Notes pursuant to Section 4.02). The Indenture Trustee shall release
property from the lien of this Master Indenture pursuant to this Section only upon receipt of an
Issuer Order accompanied by an Officer’s Certificate, an Opinion of Counsel and (if required by the
TIA) Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(1) meeting the
applicable requirements of Section 12.01.

(d) Notwithstanding anything to the contrary in this Master Indenture, the Transfer and
Servicing Agreement and the Trust Agreement, immediately prior to the release of any portion of the
Collateral or any funds on deposit in the Series Accounts pursuant to this Master Indenture, the
Indenture Trustee shall remit to the Transferor for its own account any funds that, upon such
release, would otherwise be remitted to the Issuer.

Section 8.10. Opinion of Counsel. The Indenture Trustee shall receive at least seven
days’ notice when requested by the Issuer to take any action pursuant to Section 8.09(a),
accompanied by copies of any instruments involved, and the Indenture Trustee shall also require,
as a condition to such action, an Opinion of Counsel, in form and substance reasonably
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 conditions precedent to the taking of
such action have been complied with and such action will not materially and adversely impair
the security for the Notes or the rights of the Noteholders in contravention of the
provisions of this Master Indenture; provided, however, that such Opinion of Counsel shall not be
required to express an opinion as to the fair value of the Collateral. The Indenture Trustee and
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.

 

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ARTICLE NINE

DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS

Section 9.01. Distributions and Reports to Noteholders. Distributions shall be made
to, and reports shall be provided to, Noteholders as set forth in the related Indenture
Supplements. The identity of the Noteholders with respect to distributions and reports shall be
determined according to the immediately preceding Record Date.

 

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ARTICLE TEN

SUPPLEMENTAL INDENTURES

Section 10.01. Supplemental Indentures Without Consent of Noteholders.

(a) Without the consent of the Holders of any Notes, but upon satisfaction of the Rating
Agency Condition, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, 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 TIA, if applicable, 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 Master 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 Master
Indenture, or to subject to the lien of this Master Indenture additional property;

(ii) to evidence the succession, in compliance with Section 3.11, of another Person to
the Issuer, and the assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;

(iii) to add to the covenants of the Issuer, for the benefit of the Holders of the
Notes, 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 that 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 Master Indenture or in any supplemental indenture;

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

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

(viii) to provide for the issuance of one or more new Series of Notes, in accordance
with the provisions of Section 2.12.

 

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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.

(b) The Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also
without the consent of any Noteholders of any Series then Outstanding but upon satisfaction of the
Rating Agency Condition with respect to the Notes of all Series, enter into an indenture or
supplemental indentures hereto for the purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of, this Master Indenture or of modifying in any manner
the rights of the Holders of the Notes under this Master Indenture; provided, however that (i) the
Transferor shall have delivered to the Indenture Trustee an Officer’s Certificate, dated the date
of any such action, stating that all requirements for such amendments contained in this Master
Indenture have been met and the Transferor reasonably believes that such action will not result in
an Adverse Effect, (ii) a Tax Opinion shall have been delivered to each Rating Agency and (iii)
such amendment does not affect the rights, duties, permitted activities or obligations of the
Servicer, the Master Indenture Trustee or the Owner Trustee hereunder. Additionally,
notwithstanding the preceding sentence, the Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may, without the consent of any Noteholders of any Series then Outstanding or the
Series Enhancers for any Series, enter into an indenture or supplemental indentures hereto to add,
modify or eliminate such provisions as may be necessary or advisable in order to enable all or a
portion of the Trust to avoid the imposition of State or local income or franchise taxes imposed on
the Trust’s property or its income; provided, however, that (A) the Transferor delivers to the
Indenture Trustee and the Owner Trustee an Officer’s Certificate to the effect that the proposed
amendments meet the requirements set forth in this subsection, (B) the Rating Agency Condition will
have been satisfied and (C) such amendment does not affect the rights, duties or obligations of the
Indenture Trustee or the Owner Trustee hereunder. The amendments which the Transferor may make
without the consent of Noteholders pursuant to the preceding sentence may include the addition of a
sale of Receivables.

Section 10.02. Supplemental Indentures with Consent of Noteholders. The Issuer and
the Indenture Trustee, when authorized by an Issuer Order, also may, upon satisfaction of the
Rating Agency Condition and with the consent of the Holders of at least 66 2/3% of the principal
amount of the Outstanding Notes of each adversely affected Series of Notes, by Act of such Holders
delivered to the Issuer and the Indenture Trustee, enter into an indenture or supplemental
indentures hereto for the purpose of adding any provisions to, changing in any manner or
eliminating any of the provisions of this Master Indenture or of modifying in any manner the
rights of such Noteholders under this Master Indenture; provided, however that no such
supplemental indenture shall, without the consent of the Holder of each Outstanding Note affected
thereby:

(a) change the due date of any installment of principal of or interest on any Note, or
reduce the principal amount thereof, the interest rate specified thereon or the redemption
price with respect thereto or change any place of payment where, or the coin or currency in
which, any Note or any interest thereon is payable;

(b) impair the right to institute suit for the enforcement of the provisions of this
Master Indenture requiring the application of funds available therefor, as provided in
Article Five, 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);

 

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(c) reduce the percentage of the principal amount of the Outstanding Notes of any
Series 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 certain
provisions of this Master Indenture or certain defaults hereunder and their consequences as
provided for in this Master Indenture;

(d) reduce the percentage of the aggregate principal amount of any Notes, the consent
of the Holders of which is required to direct the Indenture Trustee to sell or liquidate the
Collateral if the proceeds of such sale would be insufficient to pay the principal amount
and accrued but unpaid interest on the Outstanding Notes of such Series;

(e) decrease the percentage of the aggregate principal amount of the Notes required to
amend the sections of this Master Indenture which specify the applicable percentage of the
aggregate principal amount of the Notes of such Series necessary to amend the Indenture or
any Transaction Documents which require such consent;

(f) modify or alter the provisions of this Master Indenture prohibiting the voting of
Notes held by the Trust, any other obligor on the Notes, a Seller or any Affiliate thereof;
or

(g) permit the creation of any Lien ranking prior to or on a parity with the lien of
this Master Indenture with respect to any part of the Collateral for any Notes or, except as
otherwise permitted or contemplated herein, terminate the Lien of this Master Indenture on
any such Collateral at any time subject hereto or deprive the Holder of any Note of the
security provided by the Lien of this Master Indenture.

The Indenture Trustee may in its discretion determine whether or not any Notes would be
affected by any supplemental indenture and any such determination shall be conclusive upon the
Holders of all Notes, whether theretofore or 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 Act of Noteholders under this Section to approve the
particular form of any proposed supplemental indenture, but it shall be sufficient if such Act
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 Holders of the Notes to
which such amendment or supplemental indenture relates written 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.

 

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Section 10.03. Execution of Supplemental Indentures. In executing, or permitting the
additional trusts created by, any supplemental indenture permitted by this Article or the
modification thereby of the trusts created by this Master Indenture, the Indenture Trustee shall
be entitled to receive, and subject to Sections 6.01 and 6.02, 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 Master Indenture. The Indenture Trustee or Owner Trustee may, but
shall not be obligated to, enter into any such supplemental indenture that affects the Indenture
Trustee’s or Owner Trustee’s (as such or in its individual capacity) own rights, duties,
liabilities, benefits, protections, privileges or immunities under this Master Indenture or
otherwise.

Section 10.04. Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture under this Article, this Master Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of this Indenture for all purposes,
and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be
bound thereby.

Section 10.05. Conformity With Trust Indenture Act. Every amendment of this Master
Indenture and every supplemental indenture executed pursuant to this Article shall conform to the
requirements of the TIA as then in effect so long as this Master Indenture shall then be required
to be qualified under the TIA.

Section 10.06. Reference in Notes to Supplemental Indentures. Notes authenticated
and delivered after the execution of any supplemental indenture pursuant to this Article 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 shall so
determine, 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 the Outstanding Notes.

 

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ARTICLE ELEVEN

TERMINATION

Section 11.01. Termination of Trust. The Trust and the respective obligations and
responsibilities of the Indenture Trustee created hereby (other than the obligation of the
Indenture Trustee to make payments to Noteholders as hereinafter set forth) shall terminate,
except with respect to the duties described in Section 11.02(b), as provided in the Trust
Agreement.

Section 11.02. Final Distribution.

(a) The Servicer shall give the Indenture Trustee at least 30 days’ prior notice of the
Distribution Date on which the Noteholders of any Series or Class may surrender their Notes for
payment of the final distribution on and cancellation of such Notes (or, in the event of a final
distribution resulting from the application of Section 2.06 or 7.01 of the Transfer and Servicing
Agreement, notice of such Distribution Date promptly after the Servicer has determined that a final
distribution will occur, if such determination is made less than 30 days prior to such Distribution
Date). Such notice shall be accompanied by an Officer’s Certificate setting forth the information
specified in Section 3.05 of the Transfer and Servicing Agreement covering the period during the
then-current calendar year through the date of such notice. Not later than the fifth day of the
month in which the final distribution in respect of such Series or Class is payable to Noteholders,
the Indenture Trustee shall provide notice to Noteholders of such Series or Class specifying (i)
the date upon which final payment of such Series or Class will be made upon presentation and
surrender of Notes of such Series or Class at the office or offices therein designated, (ii) the
amount of any such final payment and (iii) that the Record Date otherwise applicable to such
payment date is not applicable, payments being made only upon presentation and surrender of such
Notes at the office or offices therein specified (which, in the case of Bearer Notes, shall be
outside the United States). The Indenture Trustee shall give such notice to the Transfer Agent and
Registrar and the Paying Agent at the time such notice is given to Noteholders.

(b) Notwithstanding a final distribution to the Noteholders of any Series or Class (or the
termination of the Trust), except as otherwise provided in this paragraph, all funds then on
deposit in the Collection Account and any Series Account allocated to such Noteholders shall
continue to be held in trust for the benefit of such Noteholders and the Paying Agent or the
Indenture Trustee shall pay such funds to such Noteholders upon surrender of their Notes, if
certificated (and any excess shall be paid in accordance with the terms of any Enhancement
Agreement). In the event that all such Noteholders shall not surrender their Notes for
cancellation within six months after the date specified in the notice from the Indenture Trustee
described in Section 11.02(a) the Indenture Trustee shall give a second notice to the remaining
such Noteholders to surrender their Notes for cancellation and receive the final distribution with
respect thereto (which surrender and payment, in the case of Bearer Notes, shall be outside the
United States). If within one year after the second notice all such Notes shall not have been
surrendered for cancellation, the Indenture Trustee may take appropriate steps, or may appoint an
agent to take appropriate steps, to contact the remaining such Noteholders concerning surrender of
their Notes, and the cost thereof shall be paid out of the funds in the Collection Account or
any Series Account held for the benefit of such Noteholders. The Indenture Trustee and the
Paying Agent shall pay to the Issuer any monies held by them for the payment of principal or
interest that remains unclaimed for two years. After payment to the Issuer, Noteholders entitled
to the money must look to the Issuer for payment as general creditors unless an applicable
abandoned property law designates another Person.

 

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Section 11.03. Termination Distributions. Upon the termination of the Issuer
pursuant to the terms of the Trust Agreement, the Indenture Trustee shall assign and convey to the
holders of the Transferor Certificates or any of their designees, without recourse, representation
or warranty, all right, title and interest of the Issuer in the Receivables, whether then existing
or thereafter created, and Recoveries related thereto, all monies due or to become due and all
amounts received or receivable with respect thereto (including all monies then held in the
Collection Account or any Series Account) and all proceeds thereof, except for amounts held by the
Indenture Trustee pursuant to Section 11.02(b). The Indenture Trustee shall execute and deliver
such instruments of transfer and assignment, in each case without recourse, as shall be reasonably
requested by the holders of the Transferor Certificates to vest in the holders of the Transferor
Certificates or any of their designees all right, title and interest which the Indenture Trustee
had in the Collateral and such other property.

Section 11.04. Defeasance. Notwithstanding anything to the contrary in this Master
Indenture and unless otherwise specified with respect to any Series in the applicable Indenture
Supplement:

(a) The Issuer may at its option be discharged from its obligations hereunder with
respect to any Series or all Outstanding Series (each, a “Defeased Series”) on the date the
applicable conditions set forth in Section 11.04(c) are satisfied (a “Defeasance”);
provided, however, that the following rights, obligations, powers, duties and immunities
shall survive with respect to each Defeased Series until otherwise terminated or discharged
hereunder: (i) the rights of the Holders of Notes of the Defeased Series to receive, solely
from the trust fund provided for in Section 11.04(c), payments in respect of principal of
and interest on such Notes when such payments are due; (ii) the Issuer’s obligations with
respect to such Notes under Sections 2.05 and 2.06; (iii) the rights, powers, trusts,
duties, and immunities of the Indenture Trustee, the Paying Agent and the Registrar
hereunder; and (iv) Section 12.16 and this Section.

(b) Subject to Section 11.04(c), the Issuer at its option may cause Collections
allocated to each Defeased Series and available to purchase additional Receivables to be
applied to purchase Eligible Investments rather than additional Receivables.

(c) The following shall be the conditions precedent to any Defeasance under Section
11.04(a):

 

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(i) the Issuer irrevocably shall have deposited or caused to be deposited with
the Indenture Trustee (such deposit to be made from other than the Issuer’s or any
Affiliate of the Issuer’s funds), under the terms of an irrevocable trust agreement
in form and substance satisfactory to the Indenture Trustee, as trust funds in trust
for making the payments described below, (A) Dollars in an
amount equal to, (B) Eligible Investments which through the scheduled payment
of principal and interest in respect thereof will provide, not later than the due
date of payment thereon, money in an amount equal to, or (C) a combination thereof,
in each case sufficient to pay and discharge (without relying on income or gain from
reinvestment of such amount), and which shall be applied by the Indenture Trustee to
pay and discharge, all remaining scheduled interest and principal payments on all
Outstanding Notes of each Defeased Series on the dates scheduled for such payments
in this Master Indenture and the applicable Indenture Supplements and all amounts
owing to the Series Enhancers with respect to each Defeased Series;

(ii) a statement from a firm of nationally recognized independent public
accountants (who may also render other services to the Issuer) to the effect that
such deposit is sufficient to pay the amounts specified in clause (i) above;

(iii) prior to its exercise of its right pursuant to this Section with respect
to any Defeased Series to substitute money or Eligible Investments for Receivables,
the Issuer shall have delivered to the Indenture Trustee an Opinion of Counsel to
the effect contemplated by clause (ii) of the definition of the term “Tax Opinion”
(the preparation and delivery of which shall not be at the expense of the Indenture
Trustee) with respect to such deposit and termination of obligations, and an Opinion
of Counsel to the effect that such deposit and termination of obligations will not
result in the Trust being required to register as an investment company under the
Investment Company Act;

(iv) the Issuer shall have delivered to the Indenture Trustee an Officer’s
Certificate of the Transferor stating that the Transferor reasonably believes that
such deposit and termination of obligations will not, based on the facts known to
such officer at the time of such certification, then cause a Pay Out Event with
respect to any Series or any event that, with the giving of notice or the lapse of
time, would result in the occurrence of a Pay Out Event with respect to any Series;
and

(v) the Rating Agency Condition shall have been satisfied and the Issuer shall
have delivered copies of such written notice to the Servicer and the Indenture
Trustee.

 

75

 

ARTICLE TWELVE

MISCELLANEOUS

Section 12.01. 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 Master 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 Master
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 from a firm of
certified public accountants meeting the applicable requirements of this Section, 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 Master Indenture, no additional certificate or
opinion need be furnished.

Except to the extent that the Authorized Officer of the Issuer executes the certificate on
behalf of the Issuer, every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Master 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 or not 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 Master Indenture, the Issuer shall, in addition to any obligation
imposed in Section 12.01(a) or elsewhere in this Master 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.

 

76

 

(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) above, the Issuer shall also deliver to the Indenture
Trustee (if required by the TIA) an Independent Certificate as to the same matters, if the fair
value to the Issuer of the securities to be so deposited and of all other such securities
made the basis of any such withdrawal or release since the commencement of the then-current
fiscal year of the Issuer, as set forth in the certificates delivered pursuant to clause (i)
above and this clause (ii), is 10% or more of the principal amount of the Outstanding Notes,
but 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 is
less than $25,000 or less than 1% of the principal amount of the Outstanding Notes.

(iii) Other than with respect to the release of any Defaulted Receivables and
Receivables in Removed Accounts, whenever any property or securities is to be released from
the lien of this Master Indenture, the Issuer shall also furnish to the Indenture Trustee an
Officer’s Certificate certifying or stating the opinion of each individual signing such
certificate as to the fair value (within 90 days of such release) of the property or
investment property proposed to be released and stating that in the opinion of such person
the proposed release will not impair the security under this Master 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) above, the Issuer shall also furnish to the Indenture Trustee (if
required by the TIA) an Independent Certificate as to the same matters if the fair value of
the property or securities and of all other property, other than Defaulted Receivables and
Receivables in Removed Accounts, or securities released from the lien of this Master
Indenture since the commencement of the then current calendar year, as set forth in the
certificates required by clause (iii) above and this clause, equals 10% or more of the
principal amount of the Outstanding Notes, but 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
principal amount of the Outstanding Notes.

(v) Notwithstanding Section 2.11 or any other provision of this Section, the Issuer may
collect, liquidate, sell or otherwise dispose of Receivables as and to the extent permitted
or required by the Transaction Documents and make cash payments out of the Series Accounts
as and to the extent permitted or required by the Transaction Documents.

Section 12.02. Form of Documents Delivered to 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.

 

77

 

Any certificate or opinion of an Authorized Officer of the Issuer may be based, insofar as it
relates 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 such officer’s 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 Servicer, a Seller, a Transferor, the Issuer
or the Administrator, stating that the information with respect to such factual matters is in the
possession of the Servicer, a Seller, a Transferor, the Issuer or the Administrator, unless such an
Authorized Officer or 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 Master Indenture, they
may, but need not, be consolidated and form one instrument.

Whenever in this Master Indenture, in connection with any application or certificate or report
to the Indenture Trustee, it is provided that the Issuer shall deliver any document as a condition
of the granting of such application, or 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 such 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 Six.

Section 12.03. Acts of Noteholders.

(a) Any request, demand, authorization, direction, notice, consent, waiver or other action
provided by this Master Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in
person or by their agents duly appointed in writing and satisfying any requisite percentages as to
minimum number or dollar value of outstanding principal amount represented by such Noteholders;
and, except as herein otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee, and, where it is hereby expressly
required, to the Issuer. Such instrument or instruments (and the action 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 Master Indenture and conclusive in favor
of the Indenture Trustee and the Issuer, if made in the manner provided in this Section.

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

(c) The ownership of Notes shall be proved by the Note Register.

 

78

 

(d) Any request, demand, authorization, direction, notice, consent, waiver or other action by
the Holder of any Notes shall bind the Holder (and any transferee thereof) of every Note issued
upon the registration thereof in exchange therefor or in lieu thereof, in respect of anything done,
omitted or suffered to be done by the Indenture Trustee or the Issuer in reliance thereon, whether
or not notation of such action is made upon such Note.

Section 12.04. Notices, Etc. to Indenture Trustee and Issuer. Any request, demand,
authorization, direction, notice, consent, waiver or Act of Noteholders or other documents
provided or permitted by this Master 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 made, given, furnished or filed in writing to a Responsible
Officer, by facsimile transmission or by other means acceptable to the Indenture Trustee to
or with the Indenture Trustee at its Corporate Trust Office; or

(b) the Issuer by the Owner Trustee or by any Noteholder shall be sufficient for every
purpose hereunder if in writing and mailed, first-class postage prepaid, to the Issuer
addressed to it c/o Wilmington Trust Company, Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration (facsimile no.
(302) 651-8882), or at any other address previously furnished in writing to the Owner
Trustee by the Issuer; a copy of each notice to the Issuer shall be sent in writing and
mailed, first-class postage prepaid, to the Administrator at 13531 East Caley Avenue,
Centennial, Colorado 80111.

Section 12.05. Notices to Noteholders; Waiver. Where this Master 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 by registered or certified mail or first class
postage prepaid or national overnight courier service to each Noteholder affected by such event,
at its 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 which is mailed in the manner herein provided shall
conclusively be presumed to have been duly given.

Where this Master 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 waiver.

In the event that, 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
Noteholders when such notice is required to be given pursuant to any provision of this Master
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.

 

79

 

Where this Master Indenture provides for notice to any Rating Agency, failure to give such
notice shall not affect any other rights or obligations created hereunder and shall not under any
circumstance constitute a Default or Event of Default.

Section 12.06. Alternate Payment and Notice Provisions. Notwithstanding any
provision of this Master Indenture or any of the Notes to the contrary, the Issuer, with the
consent of the Indenture Trustee, may enter into any agreement with any Holder of a Note providing
for a method of payment, or notice by the Indenture Trustee or any Paying Agent to such Holder,
that is different from the methods provided for in this Master Indenture for such payments or
notices. 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 12.07. Conflict with Trust Indenture Act. In the event that the TIA is
applicable, (i) if any provision hereof limits, qualifies or conflicts with another provision
hereof that is required to be included in this Master Indenture by any of the provisions of the
TIA, such required provision shall control and (ii) the provisions of TIA Section 310 through 317
that impose duties on any person (including the provisions automatically deemed included herein
unless expressly excluded by this Master Indenture) shall be part of and govern this Master
Indenture, whether or not physically contained herein.

Section 12.08. 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 12.09. Successors and Assigns. All covenants and agreements in this Master
Indenture by the Issuer shall bind its successors and assigns, whether so expressed or not.

Section 12.10. Severability. In case any provision in this Master Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality, and enforceability
of the remaining provisions shall not in any way be affected or impaired thereby.

Section 12.11. Benefits of Indenture. Nothing in this Master Indenture or in the
Notes, express or implied, shall give to any Person, other than the parties hereto and their
successors hereunder, the Noteholders, the Servicer and the Transferor, any benefit.

Section 12.12. Legal Holidays. In any case where the date on which any payment is
due shall not be a Business Day, then (notwithstanding any other provision of the Notes or this
Master Indenture) payment need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the date on which nominally due, and no
interest shall accrue for the period from and after any such nominal date.

Section 12.13. GOVERNING LAW. THIS MASTER INDENTURE SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER
THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

80

 

Section 12.14. Counterparts. This Master 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 12.15. Trust Obligations. 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 Master Indenture or any certificate or other writing delivered in connection
herewith or therewith, against (i) 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, agent, 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 capacity) 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 Master Indenture, in the performance of any duties or obligations hereunder, the
Owner Trustee (as such or in its individual capacity) shall be subject to, and entitled to the
benefits of, the terms and provisions of the Trust Agreement.

Section 12.16. No Petition. The Indenture Trustee, by entering into this Master
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree that they will not
at any time institute against the Issuer or the Transferor, or join in instituting against the
Issuer or the Transferor, prior to the date which is one year and one day after the termination of
this Master Indenture, acquiesce, petition or otherwise invoke or cause the Issuer or the
Transferor to invoke the process of any Governmental Authority for the purpose of commencing or
sustaining a case against the Issuer or the Transferor under any Debtor Relief Law or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the
Issuer or Transferor or any substantial part of its property or ordering the winding-up or
liquidation of the affairs of the Issuer or Transferor.

 

81

 

IN WITNESS WHEREOF, the undersigned have caused this Master Indenture to be duly executed and
delivered by their respective duly authorized officers as of the day and year first above written.

	 	 	 	 	 
	 	NORDSTROM CREDIT CARD MASTER

NOTE TRUST II,

as Issuer

 	 
	 	By:  	WILMINGTON TRUST COMPANY,
 	 
	 	 	not in its individual capacity, 	 
	 	 	but solely as Owner Trustee 	 
	 
	 	 	 
	 	By:  	              /s/ James P. Lawler
 	 
	 	 	James P. Lawler 	 
	 	 	Vice President 	 
	 
	 	WELLS FARGO BANK, NATIONAL

ASSOCIATION,

as Indenture Trustee

 	 
	 	By:  	/s/ Melissa Philibert
 	 
	 	 	Melissa Philibert 	 
	 	 	Vice President 	 
	 

 

 

 

Acknowledged and Accepted:

NORDSTROM CREDIT CARD

RECEIVABLES II LLC,

as Transferor

	 	 	 	 	 
	 	 	 
	By:  	/s/ Marc A. Anacker
 	 	 
	 	Marc A. Anacker 	 	 
	 	Treasurer 	 	 
	 

NORDSTROM fsb,

as Servicer

	 	 	 	 	 
	 	 	 
	By:  	/s/ Kevin T. Knight
 	 	 
	 	Kevin T. Knight 	 	 
	 	Chairman and CEOexv4w2

 

[Exhibit 4.2]

NORDSTROM CREDIT CARD MASTER NOTE TRUST II,

as Issuer,

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Indenture Trustee

SERIES 2007-1 INDENTURE SUPPLEMENT

Dated as of May 1, 2007

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	ARTICLE ONE

	 
	 	 	 	 	 	 
	DEFINITIONS

	 
	 	 	 	 	 	 
	Section 1.01.
	 	Definitions	 	 	2	 
	Section 1.02.
	 	Other Definitional Provisions.	 	 	2	 
	ARTICLE TWO

	 
	 	 	 	 	 	 
	CREATION OF THE SERIES 2007-1 NOTES

	 
	 	 	 	 	 	 
	Section 2.01.
	 	Designation.	 	 	2	 
	Section 2.02.
	 	Forms of Series 2007-1 Notes.	 	 	2	 
	Section 2.03.
	 	Registration; Registration of Transfer and Exchange.	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE THREE

	 
	 	 	 	 	 	 
	SERVICING FEE

	 
	 	 	 	 	 	 
	Section 3.01.
	 	Servicing Fee.	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE FOUR

	RIGHTS OF SERIES 2007-1 NOTEHOLDERS AND

	ALLOCATION AND APPLICATION OF COLLECTIONS

	 
	 	 	 	 	 	 
	Section 4.01.
	 	Collections and Allocations.	 	 	2	 
	Section 4.02.
	 	Determination of Monthly Interest, Monthly Principal and Interest Rate.	 	 	2	 
	Section 4.03.
	 	Application of Available Finance Charge Collections and Available Principal Collections	 	 	2	 
	Section 4.04.
	 	Investor Charge-Offs	 	 	2	 
	Section 4.05.
	 	Reallocated Principal Collections	 	 	2	 
	Section 4.06.
	 	Excess Finance Charge Collections	 	 	2	 
	Section 4.07.
	 	Shared Principal Collections	 	 	2	 
	Section 4.08.
	 	Principal Funding Account.	 	 	2	 
	Section 4.09.
	 	Reserve Account.	 	 	2	 
	Section 4.10.
	 	Eligible Investments.	 	 	2	 

 

 

 

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	 	 	 	 	 	 
	ARTICLE FIVE

	 
	 	 	 	 	 	 
	DELIVERY OF SERIES 2007-1 NOTES; DISTRIBUTIONS;

	REPORTS TO SERIES 2007-1 NOTEHOLDERS

	 
	 	 	 	 	 	 
	Section 5.01.
	 	Delivery and Payment for the Series 2007-1 Notes	 	 	2	 
	Section 5.02.
	 	Distributions.	 	 	2	 
	Section 5.03.
	 	Reports and Statements to Series 2007-1 Noteholders.	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE SIX

	 
	 	 	 	 	 	 
	SERIES 2007-1 PAY OUT EVENTS

	 
	 	 	 	 	 	 
	Section 6.01.
	 	Series 2007-1 Pay Out Events	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE SEVEN

	 
	 	 	 	 	 	 
	REDEMPTION OF SERIES 2007-1 NOTES;

	 
	 	 	 	 	 	 
	FINAL DISTRIBUTIONS; SERIES TERMINATION

	 
	 	 	 	 	 	 
	Section 7.01.
	 	Optional Redemption of Series 2007-1 Notes; Final Distributions.	 	 	2	 
	Section 7.02.
	 	Series Termination	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE EIGHT

	 
	 	 	 	 	 	 
	MISCELLANEOUS PROVISIONS

	 
	 	 	 	 	 	 
	Section 8.01.
	 	Ratification of Master Indenture; Amendments	 	 	2	 
	Section 8.02.
	 	Counterparts	 	 	2	 
	Section 8.03.
	 	GOVERNING LAW	 	 	2	 
	Section 8.04.
	 	Limitation of Liability	 	 	2	 

	 	 	 	 	 	 	 
	EXHIBITS

	 
	 	 	 	 	 	 
	EXHIBIT A-1
	 	Form of Class A Note	 	 	A-1-1	 
	EXHIBIT A-2
	 	Form of Class B Note	 	 	A-2-1	 
	EXHIBIT A-3
	 	Form of Class C Note	 	 	A-3-1	 
	EXHIBIT B
	 	Form of Monthly Payment Instructions and Notification to the Indenture Trustee	 	 	B-1	 
	EXHIBIT C
	 	Form of Monthly Statement	 	 	C-1	 
	EXHIBIT D
	 	Form of Monthly Servicer's Certificate	 	 	D-1	 
	EXHIBIT E
	 	Form of Investment Letter for Transfer of Class A or Class B Notes	 	 	E-1	 
	EXHIBIT F
	 	Form of Investment Letter for Transfer of Class C Notes	 	 	F-1	 

 

 

 

SERIES 2007-1 INDENTURE SUPPLEMENT

This Series 2007-1 Indenture Supplement, dated as of May 1, 2007 (the “2007-1 Indenture
Supplement”), is between Nordstrom Credit Card Master Note Trust II (formerly known as Nordstrom
Private Label Credit Card Master Note Trust), a statutory trust organized and existing under the
laws of the State of Delaware (the “Issuer” or the “Trust”), and Wells Fargo Bank, National
Association, a national banking association, not in its individual capacity, but solely as
indenture trustee under the Master Indenture (together with its successors in the trusts thereunder
as provided in the Amended and Restated Master Indenture, dated as of May 1, 2007 (the “Master
Indenture”), between the Issuer and Wells Fargo Bank, National Association, the “Indenture
Trustee”).

RECITALS

Section 2.12 of the Master Indenture provides that the Issuer may, pursuant to one or more
Indenture Supplements, direct the Indenture Trustee, on behalf of the Issuer, to issue one or more
Series of Notes and to set forth the Principal Terms of such Series; and

WHEREAS, pursuant to this Series 2007-1 Indenture Supplement, the Issuer and the Indenture
Trustee shall create a new Series of Notes and specify the Principal Terms thereof.

ARTICLE ONE

DEFINITIONS

Section 1.01. Definitions. Whenever used in this Indenture Supplement, the following
words and phrases shall have the following meanings:

“Accumulation Period Factor” means, with respect to any Monthly Period, a fraction,
the numerator of which is equal to the sum of the initial invested amounts of all outstanding
Series, and the denominator of which is equal to the sum of (i) the Initial Invested Amount, (ii)
the initial invested amounts of all outstanding Series (other than Series 2007-1) which are not
expected to be in their revolving period, and (iii) the initial invested amounts of all other
outstanding Series which are not allocating Shared Principal Collections to other Series and are in
their revolving periods; provided, however, that this definition may be changed at any time if the
Rating Agency Condition is satisfied.

“Accumulation Period Length” has the meaning set forth in Section 4.03(f).

“Accumulation Shortfall” means, with respect to (i) a Distribution Date prior to the
Controlled Accumulation Period, zero (ii) the first Distribution Date during the Controlled
Accumulation Period, the excess, if any, of the Controlled Accumulation Amount over the amount
deposited in the Principal Funding Account on that Distribution Date and (iii) each subsequent
Distribution Date during the Controlled Accumulation Period, the excess, if any, of the Controlled
Deposit Amount for the prior Distribution Date over the amount deposited in the Principal Funding
Account pursuant to Section 4.03(c) on such Distribution Date.

 

 

 

“Additional Interest” means, with respect to any Distribution Date, Class A Additional
Interest, Class B Additional Interest and Class C Additional Interest.

“Adjusted Invested Amount” means, for any Determination Date, an amount equal to the
Invested Amount, minus the amount on deposit in the Principal Funding Account, in each case as of
the Determination Date.

“Available Finance Charge Collections” means, with respect to any Monthly Period and
the related Distribution Date, an amount equal to the sum of (i) the Investor Finance Charge
Collections, (ii) the Excess Finance Charge Collections allocated to Series 2007-1, (iii) the
Reserve Account Draw Amount and (iv) Principal Funding Investment Proceeds, if any.

“Available Principal Collections” means, with respect to any Monthly Period and the
related Distribution Date, an amount equal to the (i) Investor Principal Collections minus (ii) the
amount of Reallocated Principal Collections which pursuant to Section 4.05 are required to be
applied on such Distribution Date, plus (iii) any Shared Principal Collections that are allocated
to Series 2007-1 in accordance with Section 8.05 of the Master Indenture and Section 4.07 hereof,
plus (iv) the aggregate amount to be treated as Available Principal Collections pursuant to
Sections 4.03(a)(v), (vi) and to the extent applicable (vii) for such Distribution Date.

“Base Rate” means, with respect to any Monthly Period, the sum of (i) the Servicing
Fee Rate and (ii) the weighted average of the Class A Note Interest Rate and the Class B Note
Interest Rate.

“Benefit Plan” means an employee benefit plan, as defined in Section 3(3) of ERISA,
that is subject to Title I of ERISA, a plan, as defined in Section 4975(e)(1) of the Code, that is
subject to Section 4975 of the Code, and any entity deemed to hold plan assets of any of the
foregoing by reason of an employee benefit plan’s or plan’s investment in the entity or otherwise
under ERISA.

“Benefit Plan Investor” has the meaning set forth in Section 2.03(f)(i).

“Class” means the Class A Notes, Class B Notes or Class C Notes, as applicable.

“Class A Additional Interest” means, with respect to any Distribution Date, an amount
equal to the product of (i) a fraction, the numerator of which is 30, and the denominator of which
is 360, (ii) the Class A Note Interest Rate in effect with respect to the related Interest Period
and (iii) the Class A Interest Shortfall for the preceding Distribution Date (which shall be zero
in the case of the first Distribution Date). Notwithstanding anything to the contrary herein,
Class A Additional Interest shall be payable or distributed to the Class A Noteholders only to the
extent permitted by applicable law.

“Class A Covered Amount” equals for any Distribution Date, the product of (i) the
Class A Note Interest Rate for the related Interest Period, (ii) a fraction, the numerator of which
is 30, and the denominator of which is 360 and (iii) the balance on deposit in the Principal
Funding Account on the first day of such Interest Period, up to the Class A Note Principal Balance
as of the related Record Date.

 

2

 

“Class A Interest Shortfall” means, with respect to any Distribution Date, the excess,
if any, as determined by the Servicer, of (i) the amount described in Section 4.03(a)(ii) over (ii)
the sum of (a) the aggregate amount of Available Finance Charge Collections allocated and paid for
such amounts on such Distribution Date and (b) the Reallocated Principal Amount applied to fund a
deficiency in the amount distributed pursuant to Section 4.03(a)(ii) on such Distribution Date.

“Class A Monthly Interest” means, with respect to any Distribution Date, an amount of
monthly interest distributable from the Collection Account with respect to the Class A Notes on
such Distribution Date equal to the product of (i) a fraction, the numerator of which is 30 and the
denominator of which is 360, (ii) the Class A Note Interest Rate and (iii) the Class A Note
Principal Balance as of the close of business on the last day of the related Monthly Period (or,
with respect to the initial Distribution Date, the Class A Note Initial Principal Balance).

“Class A Note Initial Principal Balance” means $325,500,000.

“Class A Note Interest Rate” means 4.92% per annum.

“Class A Note Principal Balance” means, on any date of determination, an amount equal
to (i) the Class A Note Initial Principal Balance, minus (ii) the aggregate amount of principal
payments made to the Class A Noteholders on or prior to such date.

“Class A Noteholder” means the Person in whose name a Class A Note is registered in
the Note Register.

“Class A Notes” means any one of the Notes executed by the Issuer and authenticated by
or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-1.

“Class A Reallocated Principal Amount” means, with respect to any Distribution Date,
the lesser of:

(i) the excess of the amounts described in Sections 4.03(a)(i) and (ii) over the amount
actually distributed pursuant to such Sections; and

(ii) the greater of (a)(1) the product of (A) 13.50% and (B) the Initial Invested
Amount minus (b) the amount of unreimbursed Investor Charge-Offs (after giving effect to
Investor Charge-Offs for the related Monthly Period) and unreimbursed Reallocated Principal
Collections (as of the preceding Distribution Date or $0, in the case of the first
Distribution Date) and (ii) zero.

“Class B Additional Interest” means, with respect to any Distribution Date, an amount
equal to the product of (i) a fraction, the numerator of which is 30 and the denominator of which
is 360, (ii) the Class B Note Interest Rate in effect with respect to the related Interest Period
and (iii) the Class B Interest Shortfall for the preceding Distribution Date (which shall be zero
in the case of the first Distribution Date. Notwithstanding anything to the contrary herein, Class
B Additional Interest shall be payable or distributed to the Class B Noteholders only to the extent
permitted by applicable law.

 

3

 

“Class B Covered Amount” equals for any Distribution Date, the product of (i) the
Class B Interest Rate for the related Interest Period, (ii) a fraction, the numerator of which is
30, and whose denominator is 360 and (iii) the balance of the Principal Funding Account on the
first day of the related Interest Period in excess of the Class A Note Principal Balance as of the
related Record Date, up to the Class B Note Principal Balance as of the related Record Date.

“Class B Interest Shortfall” means, with respect to any Distribution Date, the excess,
if any, as determined by the Servicer, of (i) the amount described in Section 4.03(a)(iii) over
(ii) the sum of (a) the aggregate amount of Available Finance Charge Collections allocated and paid
for such amounts on such Distribution Date and (b) the Reallocated Principal Amount applied to fund
a deficiency in the amount distributed pursuant to Section 4.03(a)(iii) on such Distribution Date.

“Class B Monthly Interest” means, with respect to any Distribution Date, the amount of
monthly interest distributable from the Collection Account with respect to the Class B Notes on
such Distribution Date and which shall be an amount equal to the product of (i) a fraction, the
numerator of which is 30, and the denominator of which is 360, (ii) the Class B Note Interest Rate
in effect with respect to the related Interest Period and (iii) the Class B Note Principal Balance
as of the close of business on the last day of the preceding Monthly Period (or, with respect to
the initial Distribution Date, the Class B Note Initial Principal Balance).

“Class B Note Initial Principal Balance” means $24,500,000.

“Class B Note Interest Rate” means 5.02% per annum.

“Class B Note Principal Balance” means, on any date of determination, an amount equal
to (i) the Class B Note Initial Principal Balance, minus (ii) the aggregate amount of principal
payments made to the Class B Noteholders on or prior to such date.

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

“Class B Notes” means any one of the Notes executed by the Issuer and authenticated by
or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-2.

“Class B Reallocated Principal Amount” means, with respect to any Distribution Date,
the lesser of:

(i) the excess of the amount described in Section 4.03(a)(iii) over the amount actually
distributed pursuant to such Section; and

(ii) the greater of (a)(1) the product of (A) 7.0% and (B) the Initial Invested Amount
minus (b) the amount of unreimbursed Investor Charge-Offs (after giving effect to Investor
Charge-Offs for the related Monthly Period) and unreimbursed Reallocated Principal
Collections (as of the preceding Distribution Date, or $0 in the case of the first
Distribution Date) and (ii) zero.

 

4

 

“Class C Additional Interest” means, with respect to any Distribution Date, an amount
equal to the product of (i) a fraction, the numerator of which is 30, and the denominator of which
is 360, (ii) the Class C Note Interest Rate in effect with respect to such Interest Period and
(iii) the Class C Interest Shortfall for the preceding Distribution Date. Notwithstanding anything
to the contrary herein, Class C Additional Interest shall be payable or distributed to the Class C
Noteholders only to the extent permitted by applicable law.

“Class C Interest Shortfall” means, with respect to any Distribution Date, the excess,
if any, as determined by the Servicer, of (i) the amount described in Section 4.03(a)(iv) over (ii)
the aggregate amount of Available Finance Charge Collections allocated and paid for such amounts on
such Distribution Date.

“Class C Monthly Interest” means, with respect to any Distribution Date, the amount of
monthly interest distributable from the Collection Account with respect to the Class C Notes on
such Distribution Date and which shall be an amount equal to the product of (i) a fraction, the
numerator of which is 30, and the denominator of which is 360, times (ii) the Class C Note Interest
Rate in effect with respect to the related Interest Period and (iii) the Class C Note Principal
Balance as of the close of business on the last day of the related Monthly Period (or, with respect
to the initial Distribution Date, the Class C Note Initial Principal Balance).

“Class C Note Initial Principal Balance” means $26,400,000.

“Class C Note Interest Rate” means a per annum rate of 0.00% or the rate specified by
the Transferor pursuant to Section 4.02(b).

“Class C Note Principal Balance” means on any date of determination, an amount equal
to (i) the Class C Note Initial Principal Balance, minus (ii) the aggregate amount of principal
payments made to the Class C Noteholders on or prior to such date.

“Class C Noteholder” means the Person in whose name a Class C Note is registered in
the Note Register.

“Class C Notes” means any one of the Notes executed by the Issuer and authenticated by
or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-3.

“Closing Date” means May 1, 2007.

“Controlled Accumulation Amount” means, for any Distribution Date with respect to the
Controlled Accumulation Period, $43,750,000; provided, however, that if the Accumulation Period
Length is determined to be less than eight months pursuant to Section 4.03(f), the Controlled
Accumulation Amount for each Distribution Date with respect to the Controlled Accumulation Period
will be equal to (i) the product of (a) the Offered Note Initial Principal Balance and (b) the
Accumulation Period Factor for the related Monthly Period divided by (ii) the Required Accumulation
Factor Number.

“Controlled Accumulation Period” means, unless a Pay Out Event shall have occurred
prior thereto, the period commencing at the close of business on August 1, 2009 or such later date
as is determined in accordance with Section 4.03(f), and ending on the first to occur of (i)
the commencement of the Early Amortization Period, (ii) the payment in full of the Offered
Notes and (iii) the Expected Principal Payment Date.

 

5

 

“Controlled Deposit Amount” means, for any Distribution Date with respect to the
Controlled Accumulation Period, an amount equal to the sum of the Controlled Accumulation Amount
and any existing Accumulation Shortfall.

“Defaulted Amount” means, with respect to a Distribution Date, the total amount of
Defaulted Receivables for the related Monthly Period.

“Determination Date” means, for each series of Notes, the fifth Business Day preceding
the Distribution Date.

“Dilution Amount” means the amount of the required reduction in the amount of
Principal Receivables used in the calculation of the Transferor Interest described in the first two
sentences of Section 3.09(a) of the Transfer and Servicing Agreement.

“Disqualified Transferee” has the meaning set forth in Section 2.03(k).

“Distribution Date” means June 15, 2007 and the fifteenth day of each calendar month
thereafter, or if such fifteenth day is not a Business Day, the next succeeding Business Day, and
with respect to the Series 2007-1 Final Maturity Date, May 15, 2013.

“Early Amortization Period” means the period commencing on the Business Day
immediately preceding the day on which a Pay Out Event with respect to Series 2007-1 is deemed to
have occurred, and ending on the first to occur of (i) the payment in full of the Note Principal
Balance and (ii) the Series 2007-1 Final Maturity Date.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Excess Reserve Account Investment Earnings” means, as of any Distribution Date,
interest and other investment income, net of losses and investment expenses, earned on amounts on
deposit in the Reserve Account less the amount, if any, required to be retained in the Reserve
Account so that the amount therein equals the Required Reserve Account Amount.

“Expected Final Principal Payment Date” means the April 15, 2010 Distribution Date.

“Finance Charge Shortfall” means, with respect to any Distribution Date and the
related Monthly Period, an amount equal to the excess, if any, of (i) the full amount required to
be paid, without duplication, pursuant to Sections 4.03(a)(i) through (ix) on such Distribution
Date over (ii) the Investor Finance Charge Collections.

“Fixed Investor Percentage” means, with respect to any day during a Monthly Period,
the percentage equivalent (which percentage shall never exceed 100%) of a fraction, (i) the
numerator of which is the Invested Amount as of the close of business on the last day of the
Revolving Period unless the numerator is reset as described in the proviso below and (ii) the
denominator of which is calculated each Reset Date and which is equal to the greater of (a) the
total amount of Principal Receivables in the Trust as of the close of business on the Reset Date

 

6

 

and (b) the sum of the numerators used to calculate the investor percentages for allocations
with respect to Principal Receivables for all Series outstanding as of such Reset Date; provided,
however, that if, after the commencement of the Controlled Accumulation Period or the Early
Amortization Period, a Pay Out Event occurs with respect to another Series that was designated in
the Indenture Supplement therefor as a Series that is a Paired Series with respect to Series
2007-1, the Transferor may, by written notice delivered to the Indenture Trustee and the Servicer,
designate a different numerator for the foregoing fraction; provided that (1) such numerator is not
less than the Adjusted Invested Amount as of the last day of the Revolving Period for such Paired
Series, (2) such action shall be taken only upon satisfaction of the Rating Agency Condition and
(3) the Transferor shall have delivered to the Indenture Trustee an Officer’s Certificate to the
effect that, based on the facts known to such officer at that time, in the reasonable belief of the
Transferor, such designation will not cause a Pay Out Event or an event that, after the giving of
notice or the lapse of time, would constitute a Pay Out Event, to occur with respect to Series
2007-1.

“Floating Investor Percentage” means, with respect to any day during a Monthly Period,
the percentage equivalent (which percentage shall never exceed 100%) of a fraction, (i) the
numerator of which is equal to the Adjusted Invested Amount as of the close of business on the last
day of the preceding Monthly Period (or with respect to the first Monthly Period, the Initial
Invested Amount) and (ii) the denominator of which is calculated each Reset Date and which is equal
to (a) with respect to allocations of Uncovered Dilution Amounts only, the sum of the numerators
used to calculate the Investor Percentage for allocating the Uncovered Dilution Amount on the Reset
Date or (ii) for all other purposes, the greater of (a) the aggregate amount of Principal
Receivables in the Trust as of the close of business on such Reset Date and (b) the sum of the
numerators used to calculate the investor percentages for allocations with respect to Finance
Charge Receivables, Defaulted Amounts or Principal Receivables, as applicable, for all Series
outstanding as of the date as to which such determination is being made.

“Group One” means Series 2007-1 and each other Series hereafter specified in the
related Indenture Supplement to be included in Group One.

“Indenture” means the Master Indenture, as supplemented by this Series 2007-1
Indenture Supplement, as the same may be amended, supplemented, restated or otherwise modified from
time to time.

“Indenture Supplement” has the meaning specified in the Master Indenture.

“Initial Invested Amount” means $376,400,000.

“Interest Period” means, with respect to any Distribution Date, the period from and
including the preceding Distribution Date (or, in the case of the first Distribution Date, from and
including the Closing Date) to but excluding the current Distribution Date.

“Invested Amount” means, as of any date of determination, an amount equal to the
initial principal amount of the Series 2007-1 Notes minus the sum of (i) amount of principal
previously paid to the Series 2007-1 Noteholders and (ii) the excess, if any, of the aggregate
amount of
Investor Charge-Offs and Reallocated Principal Collections over the reimbursements of such
amounts pursuant to Section 4.03(a)(vi) prior to such date.

 

7

 

“Investor Charge-Off” has the meaning set forth in Section 4.04.

“Investor Default Amount” means, with respect to any Distribution Date, an amount
equal to the product of the Defaulted Amount for the related Monthly Period and the Floating
Investor Percentage.

“Investor Finance Charge Collections” means, with respect to any Monthly Period, an
amount equal to the Investor Percentage for such Monthly Period of Collections of Finance Charge
Receivables (including Recoveries, any Excess Reserve Account Investment Earnings and Interchange
treated as Collections of Finance Charge Receivables) deposited in the Collection Account for such
Monthly Period pursuant to Section 8.04 of the Master Indenture.

“Investor Percentage” means, for any Monthly Period, with respect to (i) Finance
Charge Receivables, Defaulted Amounts and Uncovered Dilution Amounts at any time and Principal
Receivables during the Revolving Period, the Floating Investor Percentage for such Monthly Period
and (ii) Principal Receivables during the Controlled Accumulation Period or the Early Amortization
Period, the Fixed Investor Percentage for such Monthly Period.

“Investor Principal Collections” means, with respect to any Monthly Period, the
aggregate amount retained in the Collection Account for Series 2007-1 Noteholders pursuant to
Section 4.01(c)(ii) for such Monthly Period.

“Investor Uncovered Dilution Amount” means, with respect to any Monthly Period, an
amount equal to the product of the weighted average Floating Investor Percentage for such Monthly
Period and the Uncovered Dilution Amount.

“Master Indenture” means the Amended and Restated Master Indenture, dated as of May 1,
2007, between the Trust and the Indenture Trustee, as the same may be amended, supplemented,
restated or otherwise modified from time to time.

“Monthly Interest” means, with respect to any Distribution Date, the sum of the Class
A Monthly Interest, the Class B Monthly Interest and the Class C Monthly Interest.

“Monthly Period” has the meaning set forth in the Master Indenture; provided, however,
that the initial Monthly Period will commence on the Closing Date and end on the last day of
calendar month preceding the first Distribution Date; provided, however, that for the purposes of
calculating Portfolio Yield which includes the month of May 2007, the Monthly Period will be the
period from and including the Closing Date to and including May 31, 2007.

“Monthly Principal” means, with respect to any Distribution Date, an amount equal to
the least of (i) the Available Principal Collections on deposit in the Collection Account with
respect to such Distribution Date, (ii) for each Distribution Date with respect to the Controlled
Accumulation Period, the Controlled Deposit Amount for such Distribution Date, (iii) the excess of
the Offered Note Initial Principal Balance over the amount on deposit in the Principal Funding
Account without taking into account deposits thereto on such Distribution Date and (iv) the
Adjusted Invested Amount (after taking into account any adjustments to be made on such
Distribution Date) prior to any deposit into the Principal Funding Account on such Distribution
Date.

 

8

 

“Monthly Principal Reallocation Amount” means, with respect to any Monthly Period, an
amount equal to the sum of the Class A Reallocated Principal Amount and the Class B Reallocated
Principal Amount.

“Monthly Servicing Fee” has the meaning set forth in Section 3.01(a).

“Note Principal Balance” means, on any date of determination, an amount equal to the
sum of the Class A Note Principal Balance, the Class B Note Principal Balance and the Class C Note
Principal Balance.

“Noteholders” means the holders of Class A Notes, Class B Notes and the Class C Notes.

“Offered Note Initial Principal Balance” means the sum of the Class A Note Initial
Principal Balance and the Class B Note Initial Principal Balance.

“Offered Note Principal Balance” means, as of any date, the sum of the Class A Note
Principal Balance and the Class B Note Principal Balance.

“Offered Notes” means the Class A Notes and the Class B Notes.

“Portfolio Adjusted Yield” means, with respect to any Monthly Period, the Portfolio
Yield minus the Base Rate.

“Portfolio Yield” means, with respect to any Monthly Period, the annualized percentage
equivalent of a fraction, (i) the numerator of which is equal to the sum of (a) Investor Finance
Charge Collections with respect to such Monthly Period and (b) the Principal Funding Investment
Proceeds and any Reserve Account Draw Amount deposited into the Collection Account on the related
Distribution Date, such sum to be calculated on a cash basis after subtracting the Investor Default
Amount and the Investor Uncovered Dilution Amount, and (ii) the denominator of which is the Note
Principal Balance as of the first day of such Monthly Period; provided, however, that Excess
Finance Charge Collections that are allocated to Series 2007-1 with respect to such Monthly Period
may be added to the numerator if the Transferor shall have provided ten Business Days’ prior
written notice of such action to each Rating Agency and the Transferor, the Servicer and the
Indenture Trustee has not received notification in writing that such action will not result in any
such Rating Agency reducing or withdrawing its            then-existing rating of the Class A Notes
or any outstanding Series or Class; provided further that the Portfolio Yield for the month of
March 2007 shall equal ___%.

“Principal Funding Account” has the meaning set forth in Section 4.08(a).

“Principal Funding Account Balance” means, with respect to any date of determination,
the principal amount, if any, on deposit in the Principal Funding Account on such date.

 

9

 

“Principal Funding Investment Proceeds” means, with respect to any Distribution Date,
the investment earnings on funds in the Principal Funding Account (net of investment expenses and
losses) for the related Interest Period.

“Principal Funding Investment Shortfall” means, with respect to any Distribution Date,
the excess of the Class A Covered Amount and the Class B Covered Amount over the Principal Funding
Investment Proceeds.

“QIB” means a Qualified Institutional Buyer under Rule 144A.

“Rating Agency” means each of Standard & Poor’s and Moody’s.

“Reallocated Principal Collections” means, with respect to any Distribution Date,
Investor Principal Collections applied in accordance with Section 4.05 in an amount not to exceed
the Monthly Principal Reallocation Amount for the related Monthly Period.

“Reassignment Amount” means, 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 Note Principal Balance on such Distribution Date, (ii) Monthly Interest and any Monthly
Interest due on one or more prior Distribution Dates but not distributed to the Series 2007-1
Noteholders on one or more prior Distribution Dates, and (iii) the amount of Additional Interest
and any Additional Interest due but not distributed to the Series 2007-1 Noteholders on one or more
prior Distribution Dates.

“Required Accumulation Factor Number” means a fraction, rounded upwards to the nearest
whole number, the numerator of which is one and the denominator of which is equal to the lowest
monthly principal payment rate on the Accounts, expressed as a decimal, for the 12 months preceding
the date of such calculation; provided, however, that this definition may be changed at any time if
the Rating Agency Condition is satisfied.

“Required Reserve Account Amount” means zero or, for any Distribution Date on or after
the Reserve Account Funding Date, an amount equal to (i) 0.50% of the Offered Note Principal
Balance or (ii) any other amount designated by the Servicer; provided, however, the Servicer may
only designate a lesser amount if the Rating Agency Condition remains satisfied and the Servicer
certifies to the Indenture Trustee that, based on the facts known to the certifying officer at the
time, in its reasonable belief, such designation will not cause a Pay Out Event to occur for the
Series 2007-1 Notes.

“Reserve Account” means the account established pursuant to Section 4.09.

“Reserve Account Draw Amount” means, with respect to any Distribution Date, an amount
equal to the lesser of (i) the amount then on deposit in the Reserve Account with respect to such
Distribution Date and (ii) the Principal Funding Investment Shortfall.

“Reserve Account Funding Date” means the Distribution Date with respect to the Monthly
Period which commences no later than four months prior to the Controlled Accumulation Period,
provided that the Reserve Account Funding Date shall be accelerated to (i) the Distribution Date
with respect to the Monthly Period which commences no later than four

 

10

 

months prior to the Controlled Accumulation Period if the average of the Portfolio Adjusted
Yields for any three consecutive Monthly Periods shall be less than 6.00%; (ii) the Distribution
Date with respect to the Monthly Period which commences no later than six months prior to the
Controlled Accumulation Period if the average of the Portfolio Adjusted Yields for any three
consecutive Monthly Periods shall be less than 3.00%; or (iii) the Distribution Date which
commences no later than nine months prior to the Controlled Accumulation Period if the average of
the Portfolio Adjusted Yields for any three consecutive Monthly Periods shall be less than 2.00%.

“Reset Date” means (i) the close of business on the last day of each calendar month,
(ii) each Removal Date, (iii) each date the Trust issues a new series of Notes or class of Notes
relating to a multiple issuance series, (iv) each date there is an increase in the invested amount
with respect to any series of Notes issued by the Trust and (v) each Addition Date that
Supplemental Accounts are designated to the Trust.

“Revolving Period” means the period beginning on the Closing Date and ending on the
earlier of the close of business on the day immediately preceding the day the Controlled
Accumulation Period commences or the Early Amortization Period commences.

“Rule 144A” means Rule 144A under the Securities Act.

“Rule 144A Global Note” has the meaning set forth in Section 2.02.

“Series 2007-1” means the Series of Notes the terms of which are specified in this
Series 2007-1 Indenture Supplement.

“Series 2007-1 Final Maturity Date” means the earlier to occur of (i) the Distribution
Date on which the Note Principal Balance is paid in full and (ii) the May 2013 Distribution Date.

“Series 2007-1 Indenture Supplement” means this Series 2007-1 Indenture Supplement, as
the same may be amended, supplemented, restated or otherwise modified from time to time.

“Series 2007-1 Note” means a Class A Note, a Class B Note or a Class C Note.

“Series 2007-1 Noteholder” means a Class A Noteholder, a Class B Noteholder or a Class
C Noteholder.

“Series 2007-1 Pay Out Event” has the meaning set forth in Section 6.01.

“Series 2007-1 Principal Shortfall” means an amount equal to, with respect to any
Distribution Date during (i) the Revolving Period, zero, (ii) the Controlled Accumulation Period,
the excess, if any, of the Controlled Deposit Amount with respect to such Distribution Date over
the amount of Available Principal Collections for such Distribution Date (excluding any portion
thereof attributable to Shared Principal Collections), and (iii) the Early Amortization Period, the
excess, if any, of the Adjusted Invested Amount over the amount of Available Principal Collections
for such Distribution Date (excluding any portion thereof attributable to Shared Principal
Collections).

 

11

 

“Servicing Fee” has the meaning set forth in the Transfer and Servicing Agreement.

“Servicing Fee Rate” means 2.0% per annum.

“Successor Servicer” has the meaning set forth in the Transfer and Servicing
Agreement.

“Transfer and Servicing Agreement” means the Amended and Restated Transfer and
Servicing Agreement, dated as of May 1, 2007, among the Bank, the Purchaser and the Trust, as
amended, supplemented, restated or otherwise modified from time to time.

“Transferor Certificate” has the meaning set forth in the Trust Agreement.

“Transferor Percentage” has the meaning set forth in the Master Indenture.

“Transition Expenses” means any documented expenses and costs reasonably incurred by a
Successor Servicer in connection with the transition of servicing duties under the Transaction
Documents relating to Series 2007-1 to the Successor Servicer. The aggregate amount of Transition
Expenses shall not exceed $100,000.

“Trust Agreement” means the Second Amended and Restated Trust Agreement, dated as of
May 1, 2007, between the Owner Trustee and the Transferor, as the same may be amended,
supplemented, restated or otherwise modified from time to time.

“Uncovered Dilution Amount” means, with respect to any Distribution Date, that portion
of the Dilution Amount for the related Monthly Period which would cause the Transferor Interest to
fall below the Required Transferor Interest after giving effect to any deposits to the Special
Funding Account by the Transferor or addition of Principal Receivables transferred to the Trust by
the Transferor.

Section 1.02. Other Definitional Provisions.

(a) Each capitalized term defined herein shall relate to the Series 2007-1 Notes and no other
Series of Notes issued by the Trust, unless the context otherwise requires. All capitalized terms
used herein and not otherwise defined herein have the meanings ascribed to them in the Trust
Agreement, the Master Indenture or the Transfer and Servicing Agreement. In the event that any term
or provision contained herein shall conflict with or be inconsistent with any term or provision
contained in the Trust Agreement, the Master Indenture or the Transfer and Servicing Agreement, the
terms and provisions of this Series 2007-1 Indenture Supplement shall govern.

(b) As used in this Series 2007-1 Indenture Supplement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not defined in this Series
2007-1 Indenture Supplement or in any such certificate or other document, and accounting terms
partly defined in this Series 2007-1 Indenture Supplement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to them under GAAP.
To the extent that the definitions of accounting terms in this Series 2007-1 Indenture Supplement
or in any such certificate or other document are inconsistent with the meanings of
such terms under GAAP, the definitions contained in this Master Indenture or in any such
certificate or other document shall control.

 

12

 

(c) Unless otherwise specified, references to any amount as on deposit or outstanding on any
particular date means such amount at the close of business on such day.

(d) The words “hereof,” “herein,” “hereunder” and words of similar import when used in this
Series 2007-1 Indenture Supplement shall refer to this Series 2007-1 Indenture Supplement as a
whole and not to any particular provision of this Series 2007-1 Indenture Supplement; references to
any Article, subsection, Section, Schedule or Exhibit are references to Articles, subsections,
Sections, Schedules and Exhibits in or to this Series 2007-1 Indenture Supplement unless otherwise
specified; and the term “including” means “including without limitation.”

 

13

 

ARTICLE TWO

CREATION OF THE SERIES 2007-1 NOTES

Section 2.01. Designation.

(a) There is hereby created and designated a Series of Notes to be issued pursuant to the
Master Indenture and this Series 2007-1 Indenture Supplement to be known as “Nordstrom Credit Card
Master Note Trust, Asset-Backed Notes, Series 2007-1” or the “Series 2007-1 Notes.” The Series
2007-1 Notes shall be issued in three Classes, the first of which shall be known as the “Series
2007-1 4.92% Asset Backed Notes, Class A”, the second of which shall be known as the “Series 2007-1
5.02% Asset Backed Notes, Class B”, and the third of which shall be known as the “Series 2007-1
Asset Backed Notes, Class C”. The Series 2007-1 Notes shall be due and payable on the Series
2007-1 Final Maturity Date.

(b) Series 2007-1 shall be included in Group One and shall be a Principal Sharing Series with
respect to Group One only. Series 2007-1 shall be an Excess Allocation Series with respect to
Group One only. Series 2007-1 shall not be subordinated to any other Series.

(c) In the event that any term or provision contained herein shall conflict with or be
inconsistent with any term or provision contained in the Master Indenture, the terms and provisions
of this Series 2007-1 Indenture Supplement shall be controlling.

Section 2.02. Forms of Series 2007-1 Notes.

(a) The form of each of the Class A Notes, the Class B Notes and the Class C Notes shall be
substantially as set forth in Exhibits A-1, A-2 and A-3 hereto.

(b) The Offered Notes offered and sold in reliance on the exemption from registration under
Rule 144A (except for any sale directly from the Issuer) shall be issued initially in the form of
one or more permanent global notes in definitive, fully registered form without interest coupons
with the applicable legend set forth in Exhibit A-1, Exhibit A-2 and Exhibit A-3 hereto, added to
the form of the Class A Notes (“Class A Rule 144A Global Notes”), the Class B Notes (“Class B Rule
144A Global Notes”) and the Class C Notes (the “Class C Rule 144A Global Notes” and, together with
the Class A Rule 144A Global Notes and the Class B Rule 144A Global Notes, the “Rule 144A Global
Notes”). The Offered Notes each shall be registered in the name of the nominee of DTC and
deposited with the Indenture Trustee, at its Corporate Trust Office, as custodian for DTC, duly
executed by the Issuer and authenticated by the Indenture Trustee as hereinafter provided. The
Class C Notes will not be registered with the DTC and will be retained by the Transferor. The
aggregate principal amount of the Class A Rule 144A Global Notes and the Class B Rule 144A Global
Notes may from time to time be increased or decreased by adjustments made on the records of the
Indenture Trustee or DTC or its nominee, as the case may be, as hereinafter provided.

Section 2.03. Registration; Registration of Transfer and Exchange.

(a) No Series 2007-1 Note may be sold or transferred (including by pledge or hypothecation)
unless such sale or transfer is exempt from the registration requirements of the
Securities Act and is exempt from the registration requirements under applicable State
securities laws and the representations deemed to be made by the transferee pursuant to Section
2.03(g) are true and correct.

 

14

 

(b) No Offered Note may be offered, sold, resold or delivered, within the United States except
in accordance with Section 2.03(e) and in accordance with Rule 144A to QIBs purchasing for their
own account or for the accounts of one or more QIBs, for which the purchaser is acting as fiduciary
or agent.

(c) Upon final payment due on a Series 2007-1 Note, the Holder thereof shall present and
surrender such Series 2007-1 Note at the Corporate Trust Office or at the office of the Paying
Agent.

(d) Notwithstanding any provision to the contrary herein, so long as a Global Note remains
outstanding and is held by or on behalf of DTC, transfers of a Global Note, in whole or in part,
shall only be made in accordance with this Section 2.03(e).

(i) Subject to clauses (ii) through (iv) of this Section 2.03(e), a transfer of a
Global Note shall be limited to transfers of such Global Note in whole, but not in part, to
nominees of DTC or to a successor of DTC or such successor’s nominee.

(ii) In the event that a Global Note is exchanged for a Note of the same Class in
definitive form, such Offered Notes may be exchanged for one another only in accordance with
such procedures as are substantially consistent with the provisions above (including
certification requirements intended to ensure that such transfers are to a QIB, or otherwise
comply with Rule 144A) and as may be from time to time adopted by the Issuer and the
Indenture Trustee.

(e) Each transferee of an Offered Note shall be deliver to the Indenture Trustee an Investment
Letter substantially in the form of Exhibit E, in the case of the Class A Notes or Class B Notes,
or Exhibit F, in the case of Class C Notes, and shall be deemed to represent and agree as follows:

(i) The transferee is aware that the sale of such Offered Notes to it is being made in
reliance on Rule 144A.

(ii) The transferee understands that (A) the Offered Notes have not been and will not
be registered under the Securities Act or any State securities laws, and may not be
reoffered, resold, pledged or otherwise transferred except (1) to a Person whom the seller
reasonably believes is a QIB in a transaction meeting the requirements of Rule 144A or (2)
in a transaction complying with the provisions of Rule 903 or 904 under the Securities Act,
in accordance with any applicable securities laws of any State of the United States or any
other applicable jurisdictions and that (B) the transferee will, and each subsequent holder
is required to, notify any subsequent purchaser of such Offered Notes from it of the resale
restrictions referred to in (A) above.

 

15

 

(iii) The transferee agrees that if in the future it should offer, sell or otherwise
transfer such Offered Note, it will do so only pursuant to Rule 144A to a Person who the
seller reasonably believes is a QIB in a transaction meeting the requirements of Rule
144A, purchasing for its own account or for the account of a QIB, whom the holder has
informed that such offer, sale or other transfer is being made in reliance on Rule 144A.

(iv) Each Offered Note will bear a legend to the following effect, unless the
Transferor and the Indenture Trustee determine otherwise in accordance with applicable law:

“THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAW. THE HOLDER HEREOF, BY
PURCHASING THIS NOTE, AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY
(I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM
THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A AND (II) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTIONS.

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.

NO RESALE OR OTHER TRANSFER OF ANY NOTE SHALL BE MADE TO ANY TRANSFEREE UNLESS: (A) SUCH
TRANSFEREE IS NOT, AND WILL NOT ACQUIRE THE NOTE ON BEHALF OR WITH PLAN ASSETS OF, AN
“EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR ANY OTHER “PLAN” AS DEFINED IN SECTION
4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “INTERNAL REVENUE CODE”),
THAT IS SUBJECT TO ERISA OR SECTION 4975 OF THE INTERNAL REVENUE CODE OR ANY ENTITY DEEMED
TO HOLD PLAN ASSETS OF ANY OF THE FOREGOING BY REASON OF AN EMPLOYEE BENEFIT PLAN’S OR
PLAN’S INVESTMENT IN THE ENTITY (EACH, A

 

16

 

“BENEFIT PLAN”) OR (B) THE ACQUISITION AND HOLDING OF THE NOTE BY SUCH TRANSFEREE ARE
ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER PTCE 84-14, PTCE 90-1, PTCE 91-38, PTCE
95-60, PTCE 96-23 OR A SIMILAR EXEMPTION. EACH PURCHASER OR TRANSFEREE OF A NOTE, BY ITS
ACCEPTANCE OF SUCH NOTE, WILL BE DEEMED TO HAVE MADE THE REPRESENTATION SET FORTH IN CLAUSE
(A) OR (B) ABOVE.

THE PRINCIPAL OF THIS NOTE IS PAYABLE 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.

TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX TRANSFER
DOCUMENTATION AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE MASTER INDENTURE.

THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO TREAT THIS NOTE AS
DEBT SOLELY OF THE TRUST FOR UNITED STATES FEDERAL, STATE AND LOCAL INCOME, SINGLE BUSINESS
AND FRANCHISE TAX PURPOSES.”

(v) If the transferee is acquiring any Offered Note, or any interest or participation
therein, as a fiduciary or agent for one or more investor accounts, it has sole investment
discretion with respect to each such account and that it has full power to make the
acknowledgments, representations and agreements contained herein on behalf of such account.

(vi) (A) The transferee is not acquiring and will not acquire the Offered Notes on
behalf of or with plan assets of any Benefit Plan or (B) its acquisition and holding of the
Offered Note are eligible for the exemptive relief available under PTCE 84-14, PTCE 90-1,
PTCE 91-38, PTCE 95-60, PTCE 96-23 or a similar exemption. By its acceptance of a Offered
Note each transferee will be deemed to have made the representation set forth in clause (A)
or (B).

(vii) The transferee agrees that if at some time in the future it wishes to transfer or
exchange any of the Offered Notes, it will not transfer or exchange any of the Offered Notes
unless such transfer or exchange is in accordance with the Master Indenture. The purchaser
understands that any purported transfer of any Offered Note (or any interest therein) in
contravention of any of the restrictions and conditions in the Master Indenture shall be
void, and the purported transferee in such transfer shall not be recognized by the Trust or
any other Person as a Noteholder for any purpose.

(f) Any purported transfer of a Series 2007-1 Note not in accordance with this Section 2.03 or
Section 2.05 of the Master Indenture shall be null and void and shall not be given effect for any
purpose hereunder or under the Master Indenture.

 

17

 

(g) If the Indenture Trustee determines or is notified by the Issuer, the Transferor or the
Servicer that (i) a transfer or attempted or purported transfer of any interest in any Series
2007-1 Note was consummated in compliance with the provisions of this Section on the basis of
a materially incorrect certification from the transferee or purported transferee, (ii) a transferee
failed to deliver to the Indenture Trustee any certification required to be delivered hereunder or
(iii) the holder of any interest in a Series 2007-1 Note is in breach of any representation or
agreement set forth in any certification or any deemed representation or agreement of such holder,
the Indenture Trustee shall not register such attempted or purported transfer and if a transfer has
been registered, such transfer shall be absolutely null and void ab initio and shall vest no rights
in the purported transferee (such purported transferee, a “Disqualified Transferee”) and the last
preceding holder of such interest in such Series 2007-1 Note that was not a Disqualified Transferee
shall be restored to all rights as a Holder thereof retroactively to the date of transfer of such
Series 2007-1 Note by such Holder.

 

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ARTICLE THREE

SERVICING FEE

Section 3.01. Servicing Fee.

(a) Servicing Compensation. The share of the Servicing Fee allocable to the Series
2007-1 Noteholders with respect to any Distribution Date (the “Monthly Servicing Fee”) shall be
equal to one-twelfth of the product of (i) the Servicing Fee Rate and (ii) (A) the Adjusted
Invested Amount for the related Monthly Period, minus (B) the product of the average daily amount,
if any, on deposit in the Special Funding Account during the Monthly Period and the Investor
Percentage with respect to such Monthly Period. The remainder of the Servicing Fee shall be paid
by the Holders of the Transferor Certificates or the Noteholders of other Series (as provided in
the related Indenture Supplements) and in no event shall the Trust, the Indenture Trustee or the
Series 2007-1 Noteholders be liable for the share of the Servicing Fee to be paid by the Holders of
the Transferor Certificates or the Noteholders of any other Series. To the extent that the Monthly
Servicing Fee is not paid in full pursuant to the preceding provisions of this Section and Section
4.03, it shall be paid by the Holders of the Transferor Certificates.

(b) Interchange. On or before each Determination Date, the Servicer shall notify the
Transferor of the amount of Interchange to be included as Investor Finance Charge Collections with
respect to the preceding Monthly Period as determined pursuant to this Section. Such amount of
Interchange shall be equal to the product of (i) the amount of Interchange attributable to the
Accounts, as reasonably estimated by the Servicer, and (ii) the Investor Percentage with regard to
Finance Charge Receivables. On each Transfer Date, the Transferor shall deposit into the
Collection Account, in immediately available funds, the amount of Interchange to be so included as
Investor Finance Charge Collections with respect to the preceding Monthly Period and such
Interchange shall be treated as a portion of Investor Finance Charge Collections for all purposes
of this Series 2007-1 Indenture Supplement, the Master Indenture and the Transfer and Servicing
Agreement.

 

19

 

ARTICLE FOUR

RIGHTS OF SERIES 2007-1 NOTEHOLDERS

AND ALLOCATION AND APPLICATION OF COLLECTIONS

Section 4.01. Collections and Allocations.

(a) Allocations. Collections of Finance Charge Receivables, Principal Receivables and
Defaulted Receivables allocated to Series 2007-1 pursuant to Article Eight of the Master Indenture
shall be allocated and distributed as set forth in this Article.

(b) Payments to the Transferor. The Servicer shall on each Deposit Date direct the
Indenture Trustee to withdraw from the Collection Account and pay to the Holders of the Transferor
Certificates (or to the Successor Servicer to the extent that the Successor Servicer is owed
Transition Expenses pursuant to Section 4.03(a)(ix)) the following amounts:

(i) an amount equal to the Transferor Percentage for the related Monthly Period of
Collections of Finance Charge Receivables; and

(ii) an amount equal to the Transferor Percentage for the related Monthly Period of
Collections of Principal Receivables deposited in the Collection Account, if the Transferor
Interest (determined after giving effect to any Principal Receivables transferred to the
Trust on such Deposit Date) exceeds the Required Transferor Interest.

;provided, that, during the Revolving Period, the amount of Reallocated Principal Collections
payable with respect to interest on the Series 2007-1 Notes on any Distribution Date will be paid
by the Servicer from the amount of Collections of Receivables otherwise payable to the Transferor.

The withdrawals to be made from the Collection Account pursuant to this Section do not apply
to deposits into the Collection Account that do not represent Collections, including payment of the
purchase price for the Receivables or the Notes pursuant to, respectively, Section 2.06 or 7.01 of
the Transfer and Servicing Agreement or Section 11.04 of the Master Indenture and payment of the
purchase price for the Series 2007-1 Notes pursuant to Section 7.01 of this Series 2007-1 Indenture
Supplement.

(c) Allocations to the Series 2007-1 Noteholders. The Servicer shall, prior to the
close of business on any Deposit Date, allocate to the Series 2007-1 Noteholders the following
amounts:

(i) Allocations of Finance Charge Collections. The Servicer shall allocate to
the Series 2007-1 Noteholders and retain in the Collection Account for application as
provided herein an amount equal to the product of (A) the Investor Percentage and (B) the
aggregate amount of Collections of Finance Charge Receivables deposited in the Collection
Account.

 

20

 

(ii) Allocations of Principal Collections. The Servicer shall allocate to the
Series 2007-1 Noteholders the following amounts:

(A) Allocations During the Revolving Period. During the Revolving
Period, an amount equal to the product of (1) the Investor Percentage and (2) the
aggregate amount of Collections of Principal Receivables deposited in the Collection
Account on such Deposit Date shall be allocated to the Series 2007-1 Noteholders and
shall be first, if any other Principal Sharing Series in Group One is outstanding
and in its amortization period or accumulation period, retained in the Collection
Account for application, to the extent necessary, as Shared Principal Collections to
other Series in Group One on the related Distribution Date, and second paid to the
Holders of the Transferor Certificates if the Transferor Interest on such Deposit
Date is greater than the Required Transferor Interest (after giving effect to all
Principal Receivables transferred to the Trust on such day) and otherwise shall be
deposited in the Special Funding Account.

(B) Allocations During the Controlled Accumulation Period. During the
Controlled Accumulation Period an amount equal to, the product of (1) the Investor
Percentage and (2) the aggregate amount of Collections of Principal Receivables
deposited in the Collection Account on such Deposit Date shall be allocated to the
Series 2007-1 Noteholders and deposited in the Principal Funding Account until
applied as provided herein; provided, however, that if such amount along with all
other allocations to the Series 2007-1 Noteholders of Principal Receivables during
the related Monthly Period exceeds the Controlled Deposit Amount for the related
Distribution Date, then such excess shall be first, if any other Principal Sharing
Series in Group One is outstanding and in its amortization period or accumulation
period, retained in the Collection Account for application, to the extent necessary,
as Shared Principal Collections to other Series in Group One on the related
Distribution Date, and second paid to the Holders of the Transferor Certificates if
the Transferor Interest on such Deposit Date is greater than the Required Transferor
Interest (after giving effect to all Principal Receivables transferred to the Trust
on such day) and otherwise shall be deposited in the Special Funding Account.

(C) Allocations During the Early Amortization Period. During the Early
Amortization Period, an amount equal to the product of (1) the Investor Percentage
and (2) the aggregate amount of Collections of Principal Receivables deposited in
the Collection Account on such Deposit Date, shall be allocated to the Series 2007-1
Noteholders and retained in the Collection Account until applied as provided herein;
provided, however, that after the date on which an amount of such Collections equal
to the Adjusted Invested Amount has been deposited into the Collection Account and
allocated to the Series 2007-1 Noteholders, such amount shall be first, if any other
Principal Sharing Series in Group One is outstanding and in its amortization period
or accumulation period, retained in the Collection Account for application, to the
extent necessary, as Shared Principal Collections to other Series in Group One on
the related Distribution Date, and second paid to the Holders of the Transferor
Certificates
only if the Transferor Interest on such date is greater than the Required
Transferor Interest (after giving effect to all Principal Receivables transferred to
the Trust on such day) and otherwise shall be deposited in the Special Funding
Account.

 

21

 

Section 4.02. Determination of Monthly Interest, Monthly Principal and Interest Rate.

(a) On each Determination Date, the Servicer shall calculate all amounts necessary to make the
required distributions to the Series 2007-1 Noteholders on the related Distribution Date,
including, the following amounts in respect of such Distribution Date and the related Monthly
Period: (i) the Class A Monthly Interest; (ii) the Class A Interest Shortfall; (iii) the Class A
Additional Interest; (iv) the Class B Monthly Interest; (v) the Class B Interest Shortfall; (vi)
the Class B Additional Interest; (vii) the Class C Monthly Interest; (viii) the Class C Interest
Shortfall; (ix) the Class C Additional Interest; and (x) the Monthly Principal.

(b) The Class C Note Interest Rate may be increased by the Issuer upon satisfaction of the
Rating Agency Condition. The Issuer will give the Rating Agencies 30 days’ prior written notice of
the proposed increase to the Class C Note Interest Rate

Section 4.03. Application of Available Finance Charge Collections and Available Principal
Collections. The Servicer shall apply, or shall cause the Indenture Trustee to apply by
written instruction to the Indenture Trustee in the form of Exhibit B attached hereto, on each
Distribution Date, Available Finance Charge Collections and Available Principal Collections, as the
case may be, on deposit in the Collection Account with respect to the related Monthly Period or
such Distribution Date to make the following distributions:

(a) On each Distribution Date, an amount equal to the Available Finance Charge Collections
will be distributed or deposited in the following amounts and priority:

(i) an amount equal to the Monthly Servicing Fee, plus the amount of any Monthly
Servicing Fee previously due but not distributed to the Servicer on one or more prior
Distribution Dates, shall be distributed to the Servicer (unless such amount has been netted
against deposits to the Collection Account in accordance with Section 8.04 of the Master
Indenture);

(ii) an amount equal to the Class A Monthly Interest for such Distribution Date, plus
the amount of any Class A Monthly Interest previously due but not distributed to Class A
Noteholders on one or more prior Distribution Dates, plus the amount of any Class A
Additional Interest for such Distribution Dates, plus the amount of any Class A Additional
Interest previously due but not distributed to Class A Noteholders on one or more prior
Distribution Dates, shall be distributed to the Paying Agent for payment to Class A
Noteholders on such Distribution Date;

(iii) an amount equal to the Class B Monthly Interest for such Distribution Date, plus
the amount of any Class B Monthly Interest previously due but not distributed to Class B
Noteholders on one or more prior Distribution Dates, plus the amount of any Class B
Additional Interest for such Distribution Dates, plus the amount of any Class B Additional
Interest previously due but not distributed to Class B Noteholders on one or
more prior Distribution Dates, shall be distributed to the Paying Agent for payment to
Class B Noteholders on such Distribution Date;

 

22

 

(iv) an amount equal to the Class C Monthly Interest for such Distribution Date, plus
the amount of any Class C Monthly Interest previously due but not distributed to the Class C
Noteholders on one or more prior Distribution Dates, plus the amount of any Class C
Additional Interest for such Distribution Dates, plus the amount of any Class C Additional
Interest previously due but not distributed to the Class C Noteholders on one or more prior
Distribution Dates shall be distributed to the Paying Agent for payment to the Class C
Noteholders on such Distribution Date;

(v) an amount equal to the Investor Default Amount and the Investor Uncovered Dilution
Amount, if any, for such Distribution Date shall be treated as a portion of Available
Principal Collections for such Distribution Date;

(vi) an amount equal to the sum of the aggregate amount of Investor Charge-Offs and the
amount of Reallocated Principal Collections which have not been previously reimbursed
pursuant to this subparagraph shall be treated as a portion of Available Principal
Collections for such Distribution Date;

(vii) upon the occurrence of an Event of Default with respect to Series 2007-1 and
acceleration of the maturity of the Series 2007-1 Notes, the balance, if any, up to the
outstanding principal amount of the Series 2007-1 Notes will be treated as Available
Principal Collections for that Distribution Date for distribution to the Series 2007-1
Noteholders;

(viii) on each Distribution Date from and after the Reserve Account Funding Date, but
prior to the date on which the Reserve Account terminates pursuant to Section 4.09(e), an
amount up to the excess, if any, of the Required Reserve Account Amount over the amount then
on deposit in the Reserve Account will be deposited into the Reserve Account;

(ix) an amount equal to any Transition Expenses and other amounts the Trust may be
liable for from time to time that are not otherwise provided for above will be applied by
the Indenture Trustee as directed by the Servicer; and

(x) the balance, if any, will constitute a portion of Excess Finance Charge Collections
for such Distribution Date and will be available for allocation to other Series in Group One
or to the Holder of the Transferor Certificates as described in Section 8.07 of the Master
Indenture and Section 4.01.

(b) On each Distribution Date with respect to the Revolving Period, an amount equal to the
Available Principal Collections shall be treated as Shared Principal Collections and applied in
accordance with Section 8.05 of the Master Indenture.

(c) On each Distribution Date with respect to the Controlled Accumulation Period, Available
Principal Collections deposited in the Collection Account for the related Monthly Period shall be
deposited in an amount up to the Monthly Principal for such Distribution Date
into the Principal Funding Account and any Available Principal Collections remaining after the
deposit of the Monthly Principal into the Principal Funding Account shall be treated as Shared
Principal Collections and applied in accordance with Section 8.05 of the Master Indenture.

 

23

 

(d) On each Distribution Date with respect to the Early Amortization Period, an amount equal
to the Available Principal Collections deposited in the Collection Account for the related Monthly
Period shall be distributed or deposited in the following order of priority:

(i) an amount equal to the Available Principal Collections for such Distribution Date
shall be distributed to the Paying Agent for payment to the Class A Noteholders on such
Distribution Date and on each subsequent Distribution Date until the Class A Note Principal
Balance has been reduced to zero;

(ii) after giving effect to the distribution referred to in clause (i) above, an amount
equal to any remaining Available Principal Collections shall be distributed to the Paying
Agent for payment to the Class B Noteholders on such Distribution Date and on each
subsequent Distribution Date until the Class B Note Principal Balance has been reduced to
zero;

(iii) after giving effect to the distributions referred to in clauses (i) and (ii)
above, an amount equal to any remaining Available Principal Collections shall be distributed
to the Paying Agent for payment to the Class C Noteholders on such Distribution Date and on
each subsequent Distribution Date until the Class C Note Principal Balance has been reduced
to zero; and

(iv) the balance of such Available Principal Collections remaining after application in
accordance with clauses (i) through (iii) above shall be treated as Shared Principal
Collections and applied in accordance with Section 8.05 of the Master Indenture.

(e) On the earlier to occur of (i) the first Distribution Date with respect to the Early
Amortization Period and (ii) the Expected Final Principal Payment Date, the Indenture Trustee,
acting in accordance with instructions from the Servicer, shall withdraw from the Principal Funding
Account and distribute to the Paying Agent for payment to the (i) Class A Noteholders, the amounts
deposited into the Principal Funding Account pursuant to Section 4.03(d)(i) until the Class A Notes
are paid in full and then (ii) Class B Noteholders, any remaining amounts deposited into the
Principal Funding Account pursuant to Section 4.03(d)(ii) until the Class B Notes are paid in full.

(f) The Controlled Accumulation Period is scheduled to commence on August 1, 2009; provided,
however, that, if the Accumulation Period Length (determined as described below) is less than eight
months, the date on which the Controlled Accumulation Period actually commences will be delayed to
the first Business Day of the month that is the number of whole months prior to the Expected Final
Principal Payment Date at least equal to the Accumulation Period Length and, as a result, the
number of Monthly Periods in the Controlled Accumulation Period will at least equal the
Accumulation Period Length. On the Determination Date immediately preceding the July 2009
Distribution Date, and each Determination Date thereafter

 

24

 

until the Controlled Accumulation Period begins, the Servicer will determine the “Accumulation
Period Length”, which will equal the number of whole months such that the sum of the Accumulation
Period Factors for each month during such period will be equal to or greater than the Required
Accumulation Factor Number; provided, however, that the Accumulation Period Length will not be
determined to be less than one month; provided further, however, that the determination of the
Accumulation Period Length may be changed at any time if the Rating Agency Condition is satisfied.

Section 4.04. Investor Charge-Offs and Investor Uncovered Dilution. On each
Determination Date, the Servicer shall calculate the Investor Default Amount and the Investor
Uncovered Dilution Amount, if any, for the related Distribution Date. If the Investor Default
Amount exceeds the amount of Available Finance Charge Collections allocated with respect thereto
pursuant to Section 4.03(a)(v) with respect to such Distribution Date, then the Invested Amount
will be reduced by the amount of the excess as an Investor Charge-Off. If the Investor Uncovered
Dilution Amount exceeds the amount of Available Finance Charge Collections allocated with respect
thereto pursuant to Section 4.03(a)(v) (after giving effect to the allocation to cover the Investor
Default Amount) with respect to such Distribution Date, and the Transferor Interest is zero, then
the Invested Amount will be reduced by the amount by which the Transferor Interest would fall below
zero if the Investor Uncovered Dilution Amount was deducted from the Transferor Interest. In no
event, however, will the Invested Amount be reduced below zero.

Section 4.05. Reallocated Principal Collections. On each Distribution Date, the
Servicer shall apply, or shall cause the Indenture Trustee to apply, Reallocated Principal
Collections with respect to such Distribution Date, to fund any deficiency pursuant to and in the
priority set forth in Sections 4.03(a)(i) through (iii). On each Distribution Date following the
termination of the Revolving Period the Invested Amount shall be reduced by the amount of
Reallocated Principal Collections for such Distribution Date.

Section 4.06. Excess Finance Charge Collections. Series 2007-1 shall be an Excess
Allocation Series with respect to Group One only. Subject to Section 8.07 of the Master Indenture,
Excess Finance Charge Collections with respect to the Excess Allocation Series in Group One for any
Distribution Date will be allocated to Series 2007-1 in an amount equal to the product of (i) the
aggregate amount of Excess Finance Charge Collections with respect to all the Excess Allocation
Series in Group One for such Distribution Date and (ii) a fraction, the numerator of which is the
Finance Charge Shortfall for Series 2007-1 for such Distribution Date and the denominator of which
is the aggregate amount of Finance Charge Shortfalls for all the Excess Allocation Series in Group
One for such Distribution Date.

Section 4.07. Shared Principal Collections. Subject to Section 8.05 of the Master
Indenture, Shared Principal Collections with respect to the Series in Group One for any
Distribution Date will be allocated to Series 2007-1 in an amount equal to the product of (i) the
aggregate amount of Shared Principal Collections with respect to all Principal Sharing Series in
Group One for such Distribution Date and (ii) a fraction, the numerator of which is the Series
2007-1 Principal Shortfall for such Distribution Date and the denominator of which is the aggregate
amount of Principal Shortfalls for all the Series which are Principal Sharing Series in Group One
for such Distribution Date.

 

25

 

Section 4.08. Principal Funding Account.

(a) The Indenture Trustee shall establish and maintain with an Eligible Institution, which may
be the Indenture Trustee in the name of the Trust, for the benefit of the Series 2007-1
Noteholders, a segregated trust account with the corporate trust department of such Eligible
Institution (the “Principal Funding Account”), bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the Series 2007-1 Noteholders. The Indenture
Trustee shall possess all right, title and interest in all funds on deposit from time to time in
the Principal Funding Account and in all proceeds thereof. The Principal Funding Account shall be
under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2007-1
Noteholders. If at any time the institution holding the Principal Funding Account ceases to be an
Eligible Institution, the Transferor shall notify the Indenture Trustee, and the Indenture Trustee
upon being notified (or the Transferor on its behalf) shall, within ten Business Days, establish a
new Principal Funding Account meeting the conditions specified above with an Eligible Institution,
and shall transfer any cash or any investments to such new Principal Funding Account. The
Indenture Trustee, at the direction of the Servicer, shall (i) make withdrawals from the Principal
Funding Account from time to time, in the amounts and for the purposes set forth in this Series
2007-1 Indenture Supplement, and (ii) on each Distribution Date (from and after the commencement of
the Controlled Accumulation Period) prior to the termination of the Principal Funding Account, make
deposits into the Principal Funding Account in the amounts specified in, and otherwise in
accordance with, Section 4.03(c).

(b) Funds on deposit in the Principal Funding Account shall be invested at the direction of
the Servicer by the Indenture Trustee in Eligible Investments. Funds on deposit in the Principal
Funding Account on any Distribution Date, after giving effect to any withdrawals from the Principal
Funding Account on such Distribution Date, shall be invested in such investments that will mature
so that such funds will be available for withdrawal prior to the following Distribution Date.

On each Distribution Date with respect to the Controlled Accumulation Period and on the first
Distribution Date with respect to the Early Amortization Period, the Indenture Trustee, acting at
the Servicer’s direction given on or before such Distribution Date, shall transfer from (i) the
Principal Funding Account the Principal Funding Investment Proceeds on deposit in the Principal
Funding Account to the Collection Account and (ii) from the Reserve Account any Reserve Account
Draw Amount for application as Available Finance Charge Collections in accordance with Section
4.03.

Principal Funding Investment Proceeds (including reinvested interest) shall not be considered
part of the amounts on deposit in the Principal Funding Account for purposes of this Series 2007-1
Indenture Supplement.

Section 4.09. Reserve Account.

(a) On or before the Reserve Account Funding Date, the Indenture Trustee shall establish and
maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust
for the benefit of the Noteholders, a segregated trust account with the corporate trust department
of such Eligible Institution (the “Reserve Account”), bearing a

 

26

 

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 Reserve Account and in all proceeds thereof. The Reserve Account
shall be under the sole dominion and control of the Indenture Trustee for the benefit of the
Noteholders. If at any time the institution holding the Reserve Account ceases to be an Eligible
Institution, the Servicer shall notify the Indenture Trustee, and the Indenture Trustee upon being
notified (or the Servicer on its behalf) shall, within ten Business Days, establish a new Reserve
Account meeting the conditions specified above with an Eligible Institution, and shall transfer any
cash or any investments to such new Reserve Account. The Indenture Trustee, at the direction of
the Servicer, shall (i) make withdrawals from the Reserve Account from time to time in an amount up
to the Available Reserve Account Amount at such time, for the purposes set forth in this Series
2007-1 Indenture Supplement, and (ii) on each Distribution Date (from and after the Reserve Account
Funding Date) prior to termination of the Reserve Account, make a deposit into the Reserve Account
in the amount specified in, and otherwise in accordance with, Section 4.03(a)(viii).

(b) Funds on deposit in the Reserve Account shall be invested at the direction of the Servicer
by the Indenture Trustee in Eligible Investments. Funds on deposit in the Reserve Account on any
Distribution Date, after giving effect to any withdrawals from the Reserve Account on such
Distribution Date, shall be invested in such investments that will mature so that such funds will
be available for withdrawal prior to the following Distribution Date.

On each Distribution Date, all interest and earnings (net of losses and investment expenses)
accrued since the preceding Distribution Date on funds on deposit in the Reserve Account shall be
retained in the Reserve Account (to the extent that the amount on deposit in the Reserve Account is
less than the Required Reserve Account Amount) and the balance, if any, shall be deposited into the
Collection Account and included in Available Finance Charge Collections for such Distribution Date.
For purposes of determining the availability of funds or the balance in the Reserve Account for
any reason under this Series 2007-1 Indenture Supplement, except as otherwise provided in the
preceding sentence, investment earnings on such funds shall be deemed not to be available or on
deposit.

(c) In the event that on any Distribution Date the Reserve Account Draw Amount is greater than
zero, the Reserve Account Draw Amount shall be withdrawn from the Reserve Account by the Indenture
Trustee (acting in accordance with the instructions of the Servicer) and deposited into the
Collection Account for application as Available Finance Charge Collections for such Distribution
Date.

(d) In the event that the amount on deposit in the Reserve Account on any Distribution Date,
after giving effect to all deposits to and withdrawals from the Reserve Account with respect to
such Distribution Date, is greater than the Required Reserve Account Amount, the Indenture Trustee,
acting in accordance with the instructions of the Servicer, shall withdraw from the Reserve Account
an amount equal to the excess of the amount on deposit in the Reserve Account over the Required
Reserve Account Amount, and distribute such excess to the holders of the Transferor Certificates.

 

27

 

(e) Upon the earliest to occur of (i) the termination of the Trust pursuant to the Trust
Agreement, (ii) the first Distribution Date relating to the Early Amortization Period and (iii) the
Expected Final Principal Payment Date, the Indenture Trustee, acting in accordance with the
instructions of the Servicer, after the prior payment of all amounts owing to the Noteholders that
are payable from the Reserve Account as provided herein, shall withdraw from the Reserve Account
all amounts, if any, on deposit in the Reserve Account and distribute any such amounts remaining to
the holders of the Transferor Certificates. The Reserve Account shall thereafter be deemed to have
terminated for purposes of this Series 2007-1 Indenture Supplement.

Section 4.10. Eligible Investments.

(a) The Indenture Trustee shall hold funds on deposit in the Principal Funding Account and the
Reserve Account invested pursuant to Sections 4.08(b) and 4.09(b), respectively, in Eligible
Investments. The Indenture Trustee shall hold such of the Eligible Investments as constitutes
investment property through a securities intermediary, which securities intermediary shall agree
with the Indenture Trustee that (i) such investment property shall at all times be credited to a
securities account of the Indenture Trustee, (ii) such securities intermediary shall treat the
Indenture Trustee as entitled to exercise the rights that comprise each financial asset credited to
such securities account, (iii) all property credited to such securities account shall be treated as
a financial asset, (iv) such securities intermediary shall comply with entitlement orders
originated by the Indenture Trustee without the further consent of any other Person or entity, (v)
such securities intermediary will not agree with any Person or entity other than the Indenture
Trustee to comply with entitlement orders originated by such other Person or entity, (vi) such
securities accounts and the property credited thereto shall not be subject to any lien, security
interest or right of set-off in favor of such securities intermediary or anyone claiming through it
(other than the Indenture Trustee) and (vii) such agreement shall be governed by the laws of the
State of New York. Terms used in the preceding sentence that are defined in the New York UCC and
not otherwise defined herein has the meaning set forth in the New York UCC.

(b) Any investment instructions required to be given to the Indenture Trustee pursuant to the
terms hereof must be given to the Indenture Trustee no later than 11:00 a.m., New York City time,
on the date such investment is to be made. In the event the Indenture Trustee receives such
investment instruction later than such time, the Indenture Trustee may, but shall have no
obligation to, make such investment. In the event the Indenture Trustee is unable to make an
investment required in an investment instruction received by the Indenture Trustee after 11:00
a.m., New York City time, on such day, such investment shall be made by the Indenture Trustee on
the next succeeding Business Day. In no event shall the Indenture Trustee be liable for any
investment not made pursuant to investment instructions received after 11:00 a.m., New York City
time, on the day such investment is requested to be made.

 

28

 

ARTICLE FIVE

DELIVERY OF SERIES 2007-1 NOTES;

DISTRIBUTIONS; REPORTS TO SERIES 2007-1 NOTEHOLDERS

Section 5.01. Delivery and Payment for the Series 2007-1 Notes. The Issuer shall
execute and issue, and the Indenture Trustee shall authenticate, the Series 2007-1 Notes in
accordance with Section 2.03 of the Master Indenture. The Indenture Trustee shall deliver the
Series 2007-1 Notes to or upon the order of the Trust when so authenticated.

Section 5.02. Distributions.

(a) On each Distribution Date, the Paying Agent shall distribute to each Class A Noteholder of
record on the related Record Date (other than as provided in Section 11.02 of the Master Indenture)
such Class A Noteholder’s pro rata share of the amounts held by the Paying Agent that are allocated
and available on such Distribution Date to pay interest and principal on the Class A Notes pursuant
to this Series 2007-1 Indenture Supplement.

(b) On each Distribution Date, the Paying Agent shall distribute to each Class B Noteholder of
record on the related Record Date (other than as provided in Section 11.02 of the Master Indenture)
such Class B Noteholder’s pro rata share of the amounts held by the Paying Agent that are allocated
and available on such Distribution Date to pay interest and principal on the Class B Notes pursuant
to this Series 2007-1 Indenture Supplement.

(c) On each Distribution Date, the Paying Agent shall distribute to each Class C Noteholder of
record on the related Record Date (other than as provided in Section 11.02 of the Master Indenture)
such Class C Noteholder’s pro rata share of the amounts held by the Paying Agent that are allocated
and available on such Distribution Date to pay interest and principal on the Class C Notes pursuant
to this Series 2007-1 Indenture Supplement.

(d) The distributions to be made pursuant to this Section are subject to the provisions of
Sections 2.06, 6.01 and 7.01 of the Transfer and Servicing Agreement, Section 11.02 of the Master
Indenture and Section 7.01 of this Series 2007-1 Indenture Supplement.

(e) Except as provided in Section 11.02 of the Master Indenture with respect to a final
distribution, distributions to Series 2007-1 Noteholders hereunder shall be made by (i) check
mailed to each Series 2007-1 Noteholder (at such Noteholder’s address as it appears in the Note
Register), except that with respect to any Series 2007-1 Notes registered in the name of the
nominee of a Clearing Agency, such distribution shall be made in immediately available funds and
(ii) without presentation or surrender of any Series 2007-1 Note or the making of any notation
thereon.

Section 5.03. Reports and Statements to Series 2007-1 Noteholders.

(a) On each Distribution Date, the Paying Agent, on behalf of the Indenture Trustee, shall
forward to each Series 2007-1 Noteholder a statement substantially in the form of Exhibit C
prepared by the Servicer.

 

29

 

(b) Not later than the Determination Date preceding each Distribution Date, the Servicer shall
deliver to the Owner Trustee, the Indenture Trustee, the Paying Agent and each Rating Agency (i) a
statement substantially in the form of Exhibit C prepared by the Servicer and (ii) a certificate of
an Authorized Officer substantially in the form of Exhibit D; provided that the Servicer may amend
the form of Exhibit C and Exhibit D, from time to time, with the consent of the Indenture Trustee.

(c) A copy of this Series 2007-2 Indenture Supplement, as well as each statement or
certificate provided pursuant to Section 5.03(a) or (b), the Transfer and Servicing Agreement and
the Trust Agreement may be obtained by any Series 2007-1 Noteholder by a request in writing to the
Servicer.

(d) On or before January 31 of each calendar year, beginning with calendar year 2008, the
Paying Agent, on behalf of the Indenture Trustee, shall furnish or cause to be furnished to each
Person who at any time during the preceding calendar year was a Series 2007-1 Noteholder, a
statement prepared by the Servicer containing the information which is required to be contained in
the statement to Series 2007-1 Noteholders, as set forth in Section 5.03(a), aggregated for such
calendar year or the applicable portion thereof during which such Person was a Series 2007-1
Noteholder, together with other information as is required to be provided by an issuer of
indebtedness under the Code. Such obligation of the Paying Agent 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.

(e) The Paying Agent on behalf of the Indenture Trustee, may make available, via the Paying
Agent’s internet website, any statement required to be forwarded to the Series 2007-1 Noteholders
under Section 5.03(a) and the statement required to be forwarded to the Series 2007-1 Noteholders
under Section 5.03(d) and, with the consent or at the direction of the Servicer, such other
information regarding the Notes or the Receivables as the Paying Agent may have in its possession,
but only with the use of a password provided by the Paying Agent or its agent to such Person.
Neither the Paying Agent nor the Indenture Trustee will make any representation or warranties as to
the accuracy or completeness of such documents and will assume no responsibility therefor.

The Paying Agent’s internet website shall be initially located at “www.CTSLink.com” or at such
other address as shall be specified by the Indenture Trustee from time to time in writing to the
Series 2007-1 Noteholders. In connection with providing access to the Paying Agent’s internet
website, the Indenture Trustee may require registration and the acceptance of a disclaimer.
Neither the Paying Agent nor the Indenture Trustee shall be liable for the dissemination of
information in accordance with this Series 2007-2 Indenture Supplement.

 

30

 

ARTICLE SIX

SERIES 2007-1 PAY OUT EVENTS

Section 6.01. Series 2007-1 Pay Out Events. If any one of the following events shall
occur with respect to the Series 2007-1 Notes:

(a) failure on the part of the Transferor (i) to make any payment or deposit required
to be made by the Transferor by the terms of the Transfer and Servicing Agreement, the
Master Indenture or this Series 2007-1 Indenture Supplement on or before the date occurring
five Business Days after the date such payment or deposit is required to be made therein or
herein or (ii) duly to observe or perform any other covenants or agreements of the
Transferor set forth in the Transfer and Servicing Agreement, the Master Indenture or this
Series 2007-1 Indenture Supplement, which failure has a material adverse effect on the
Series 2007-1 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 Transferor by the Indenture Trustee, or to the Transferor and the
Indenture Trustee by any Holder of the Series 2007-1 Notes;

(b) any representation or warranty made by the Transferor in the Transfer and Servicing
Agreement, or any information contained in a computer file or microfiche list required to be
delivered by the Transferor pursuant to Section 2.01 or Section 2.09 of the Transfer and
Servicing Agreement shall prove to have been incorrect in any material respect when made or
when delivered, 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 Indenture Trustee, or to the
Transferor and the Indenture Trustee by any Holder of the Series 2007-1 Notes and as a
result of which the interests of the Series 2007-1 Noteholders are materially and adversely
affected for such period; provided, however, that a Series 2007-1 Pay Out Event pursuant to
this Subsection shall not be deemed to have occurred hereunder if the Transferor has
accepted reassignment of the related Receivable, or all of such Receivables, if applicable,
during such period in accordance with the provisions of the Transfer and Servicing
Agreement;

(c) a failure by the Transferor to convey Receivables in Supplemental Accounts or
Participation Interests to the Trust within five Business Days after the day on which it is
required to convey such Receivables pursuant to Section 2.09(a) of the Transfer and
Servicing Agreement (including the failure of the Account Owner to transfer the
Receivables);

(d) any Servicer Default shall occur;

(e) the average of the Portfolio Adjusted Yield for any three consecutive Monthly
Periods is less than zero;

 

31

 

(f) the Offered Note Principal Balance shall not be paid in full on the Expected Final
Principal Payment Date;

(g) an Insolvency Event occurs with respect to the Transferor (including any additional
Transferor), the Bank, the Seller, any other Account Owner or the Servicer;

(h) the Transferor is unable for any reason to transfer Receivables to the Trust in
accordance with the Transfer and Servicing Agreement or the Seller is unable for any reason
to transfer Receivables to the Transferor in accordance with the Receivables Purchase
Agreement;

(i) the Trust becomes required to register as an “investment company” under the
Investment Company Act; or

(j) without limiting the foregoing, the occurrence of an Event of Default with respect
to Series 2007-1 and acceleration of the maturity of the Series 2007-1 Notes pursuant to
Section 5.03 of the Master Indenture;

then, in the case of any event described in subparagraph (a), (b) or (d), after the applicable
grace period, if any, set forth in such subparagraphs, either the Indenture Trustee or the Holders
of Series 2007-1 Notes evidencing at least 25% of the aggregate unpaid principal amount of Series
2007-1 Notes by notice then given in writing to the Transferor and the Servicer (and to the
Indenture Trustee if given by the Series 2007-1 Noteholders) may declare that a “Series Pay Out
Event” with respect to Series 2007-1 (a “Series 2007-1 Pay Out Event”) has occurred as of the date
of such notice, and, in the case of any event described in subparagraph (c), (e), (f), (g), (h),
(i) or (j), a Series 2007-1 Pay Out Event shall occur without any notice or other action on the
part of the Indenture Trustee or the Series 2007-1 Noteholders immediately upon the occurrence of
such event.

 

32

 

ARTICLE SEVEN

REDEMPTION OF SERIES 2007-1 NOTES; FINAL DISTRIBUTIONS; SERIES TERMINATION

Section 7.01. Optional Redemption of Series 2007-1 Notes; Final Distributions.

(a) On any day occurring on or after the date on which the outstanding principal balance of
the Series 2007-1 Notes is reduced to 10% or less of the initial Note Principal Balance, the
Servicer shall have the option to redeem the Series 2007-1 Notes if it has determined, in its sole
estimation, that the cost of servicing the related Receivables is unduly burdensome in relation to
the benefit, at a purchase price equal to (i) if such day is a Distribution Date, the Reassignment
Amount for such Distribution Date or (ii) if such day is not a Distribution Date, the Reassignment
Amount for the Distribution Date following such day.

(b) The Servicer shall give the Indenture Trustee at least 30 days’ prior written notice of
the date on which the Servicer intends to exercise such redemption. Not later than 12:00 noon, New
York City time, on such date the Servicer shall deposit into the Collection Account in immediately
available funds the excess of the Reassignment Amount over the amount, if any, on deposit in the
Principal Funding Account. Such redemption option is subject to payment in full of the
Reassignment Amount. Following such deposit into the Collection Account in accordance with the
foregoing, the Invested Amount for Series 2007-1 shall be reduced to zero and the Series 2007-1
Noteholders shall have no further security interest in the Receivables. The Reassignment Amount
shall be distributed as set forth in Section 7.01(d).

Section 7.02. Sale of the Receivables or Redemption of the Notes pursuant to Section 2.06
or 7.01 of the Transfer and Servicing Agreement and Section 5.05 and 5.16 of the Master Indenture
and Section 7.01.

(a) (i) The amount to be paid by the Transferor with respect to Series 2007-1 in connection
with a reassignment of Receivables to the Transferor pursuant to Section 2.06 of the Transfer and
Servicing Agreement shall equal the Reassignment Amount for the first Distribution Date following
the Monthly Period in which the reassignment obligation arises under the Transfer and Servicing
Agreement.

(ii) The amount to be paid by the Transferor with respect to Series 2007-1 in
connection with a purchase of the Notes pursuant to Section 7.01 of the Transfer and
Servicing Agreement shall equal the Reassignment Amount for the Distribution Date of such
repurchase

(b) With respect to the Reassignment Amount deposited into the Collection Account pursuant to
Section 7.01 or any amounts allocable to the Series 2007-2 Notes deposited into the Collection
Account pursuant to Section 5.05 and 5.16 of the Master Indenture, the Indenture Trustee shall, in
accordance with the written direction of the Servicer, not later than 12:00 noon, New York City
time, on the related 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:

 

33

 

(i)(A) the Class A Note Principal Balance on such Distribution Date will be distributed to the
Paying Agent for payment to the Class A Noteholders and (B) an amount equal to the sum of (1) Class
A Monthly Interest for such Distribution Date, (2) any Class A Monthly Interest previously due but
not distributed to the Class A Noteholders on a prior Distribution Date and (3) the amount of Class
A Additional Interest, if any, for such Distribution Date and any Class A Additional Interest
previously due but not distributed to the Class A Noteholders on any prior Distribution Date, will
be distributed to the Paying Agent for payment to the Class A Noteholders, (ii) (A) the Class B
Note Principal Balance on such Distribution Date will be distributed to the Paying Agent for
payment to the Class B Noteholders and (B) an amount equal to the sum of (1) Class B Monthly
Interest for such Distribution Date, (2) any Class B Monthly Interest previously due but not
distributed to the Class B Noteholders on a prior Distribution Date and (3) the amount of Class B
Additional Interest, if any, for such Distribution Date and any Class B Additional Interest
previously due but not distributed to the Class B Noteholders on any prior Distribution Date, will
be distributed to the Paying Agent for payment to the Class B Noteholders, (iii) (A) the Class C
Note Principal Balance on such Distribution Date will be distributed to the Paying Agent for
payment to the Class C Noteholders and (B) an amount equal to the sum of (1) Class C Monthly
Interest for such Distribution Date, (2) any Class C Monthly Interest previously due but not
distributed to the Class C Noteholders on a prior Distribution Date and (3) the amount of Class C
Additional Interest, if any, for such Distribution Date and any Class C Additional Interest
previously due but not distributed to the Class C Noteholders on any prior Distribution Date, will
be distributed to the Paying Agent for payment to the Class C Noteholders and (iv) any excess shall
be released to the Transferor.

(c) Notwithstanding anything to the contrary in this Series 2007-1 Indenture Supplement, the
Master Indenture or the Transfer and Servicing Agreement, all amounts distributed to the Paying
Agent pursuant to Section 7.01(d) for payment to the Series 2007-1 Noteholders shall be deemed
distributed in full to the Series 2007-1 Noteholders 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 11.02 of the Master Indenture.

Section 7.03. Series Termination. On the Series 2007-1 Final Maturity Date, the right
of the Series 2007-1 Noteholders to receive payments from the Issuer will be limited solely to the
right to receive payments pursuant to Section 5.05 of the Master Indenture.

 

34

 

ARTICLE EIGHT

MISCELLANEOUS PROVISIONS

Section 8.01. Ratification of Master Indenture; Amendments. As supplemented by this
Series 2007-1 Indenture Supplement, the Master Indenture is in all respects ratified and confirmed
and the Master Indenture as so supplemented by this Series 2007-1 Indenture Supplement shall be
read, taken and construed as one and the same instrument. This Series 2007-1 Indenture Supplement
may be amended only by an Indenture Supplement entered into in accordance with the terms of Section
10.01 or 10.02 of the Master Indenture. For purpose of the application of Section 10.02 to any
amendment of this Series 2007-1 Indenture Supplement, the Series 2007-1 Noteholders shall be the
only Noteholders whose vote shall be required. Notwithstanding the foregoing, upon satisfaction of
the Rating Agency Condition, the provisions of this Series 2007-1 Indenture Supplement may be
amended by the parties hereto without consent of Class A Noteholders if the amendment is to
restrict the Transfer of Class B and/or Class C Notes and such amendment is in the Opinion of
Counsel necessary to ensure that the Trust would not be treated as an association or publicly
traded partnership taxable as a corporation.

Section 8.02. Counterparts. This Series 2007-1 Indenture Supplement may be executed
in two or more counterparts, and by different parties on separate counterparts, each of which shall
be an original, but all of which shall constitute one and the same instrument.

Section 8.03. GOVERNING LAW. THIS SERIES 2007-1 INDENTURE SUPPLEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT
OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

Section 8.04. Limitation of Liability. Notwithstanding any other provision herein or
elsewhere, this Series 2007-2 Indenture Supplement has been executed and delivered by Wilmington
Trust Company, not in its individual capacity, but solely in its capacity as Owner Trustee of the
Trust, in no event shall Owner Trustee in its individual capacity have any liability in respect of
the representations, warranties, or obligations of the Trust hereunder or under any other document,
as to all of which recourse shall be had solely to the assets of the Trust, and for all purposes of
this Series 2007-2 Indenture Supplement and each other document, the Owner Trustee (as such or in
its individual capacity) shall be subject to, and entitled to the benefits of, the terms and
provisions of the Trust Agreement.

 

35

 

IN WITNESS WHEREOF, the undersigned have caused this Series 2007-1 Indenture Supplement to be
duly executed and delivered by their respective duly authorized officers on the day and year first
above written.

	 	 	 	 	 
	 	 	NORDSTROM CREDIT CARD MASTER
	 	 	NOTE TRUST II,
	 	 	as Issuer
	 
	 	 	 	 
	 

	 	By:
	 	WILMINGTON TRUST COMPANY,
	 

	 	 	 	not in its individual capacity
	 

	 	 	 	but solely as Owner Trustee
	 
	 	 	 	 
	 

	 	By:
	 	/s/ James P. Lawler
	 

	 	 	 	 
	 

	 	 	 	James P. Lawler
	 

	 	 	 	Vice President
	 
	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
	 	 	as Indenture Trustee
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Melissa Philibert
	 

	 	 	 	 
	 

	 	 	 	Melissa Philibert
	 

	 	 	 	Vice President

Acknowledged and Accepted:

NORDSTROM CREDIT CARD

RECEIVABLES II LLC,

as Transferor

	 	 	 	 	 
	By:

	 	/s/ Marc A. Anacker
 

Marc A. Anacker
	 	 
	 

	 	Treasurer	 	 

NORDSTROM fsb,

as Servicer

	 	 	 	 	 
	By:

	 	/s/ Kevin T. Knight
 

Kevin T. Knight
	 	 
	 

	 	Chairman and CEO	 	 

 

 

 

EXHIBIT A-1

FORM OF SERIES 2007-1 4.92%

ASSET BACKED NOTE, CLASS A

RULE 144A GLOBAL NOTE

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS
NOTE, AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (I) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR ITS OWN
ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OF THE
SECURITIES ACT AND (II) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTIONS.

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION (“DTC”), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

NO RESALE OR OTHER TRANSFER OF ANY NOTE SHALL BE MADE TO ANY TRANSFEREE UNLESS: (A) SUCH
TRANSFEREE IS NOT, AND WILL NOT ACQUIRE THE NOTE ON BEHALF OR WITH PLAN ASSETS OF, AN “EMPLOYEE
BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (“ERISA”), OR ANY OTHER “PLAN” AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE “INTERNAL REVENUE CODE”), THAT IS SUBJECT TO ERISA OR SECTION 4975 OF
THE INTERNAL REVENUE CODE OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE FOREGOING BY
REASON OF AN EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY (EACH, A “BENEFIT PLAN”) OR
(B) THE ACQUISITION AND HOLDING OF THE NOTE BY SUCH TRANSFEREE ARE ELIGIBLE FOR THE EXEMPTIVE
RELIEF AVAILABLE UNDER PTCE 84-14, PTCE 90-1, PTCE 91-38, PTCE 95-60, PTCE 96-23 OR A SIMILAR
EXEMPTION. EACH PURCHASER OR TRANSFEREE OF A NOTE, BY ITS ACCEPTANCE OF SUCH NOTE, WILL BE
DEEMED TO HAVE MADE THE REPRESENTATION SET FORTH IN CLAUSE (A) OR (B) ABOVE.

 

A-1-1

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE 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.

TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX TRANSFER DOCUMENTATION
AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE MASTER INDENTURE.

THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO TREAT THE NOTES AS
DEBT SOLELY OF THE TRUST FOR UNITED STATES FEDERAL, STATE AND LOCAL INCOME, SINGLE BUSINESS AND
FRANCHISE TAX PURPOSES.”

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

 

			
	No. 144A/R-1
	 	Up to $325,500,000

CUSIP NO. 65566VAA8

Class A Note Rate: 4.92%

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1 4.92% ASSET BACKED NOTE, CLASS A

Nordstrom Credit Card Master Note Trust II (herein referred to as the “Trust”), a Delaware
statutory trust governed by a Second Amended and Restated Trust Agreement, dated as of May 1, 2007
(the “Trust Agreement”), between Nordstrom Credit Card Receivables II LLC, as transferor (the
“Transferor”), and Wilmington Trust Company, as owner trustee (the “Owner Trustee”), for value
received, hereby promises to pay to DTC, or its registered assigns, subject to the following
provisions, the principal sum of                                        , or such greater or lesser amount as
determined in accordance with the Master Indenture, referred to herein, on the Series 2007-1 Final
Maturity Date (which is the earlier to occur of (a) the Distribution Date on which the Note
Principal Balance is paid in full and (b) the May 15, 2013 Distribution Date), except as otherwise
provided below or in the Master Indenture. The Trust will pay interest on the unpaid principal
amount of this Note at the rate specified above on each Distribution Date until the principal
amount of this Note is paid in full. Interest on this Note will

 

A-1-2

 

accrue for each Distribution Date from and including the preceding Distribution Date (or in
the case of the initial Distribution Date, from and including the Closing Date) to but excluding
the current Distribution Date. Interest will be computed on the basis of 30 days in such Interest
Period and a 360-day year. Principal of this Note shall be paid in the manner specified on the
reverse hereof.

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.

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 or on behalf of the
Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the
Master Indenture or the Series 2007-1 Indenture Supplement referred to on the reverse hereof, or be
valid for any purpose.

 

A-1-3

 

IN WITNESS WHEREOF, the Trust has caused this Class A Note to be duly executed.

	 	 	 	 	 
	 	 	NORDSTROM CREDIT CARD MASTER NOTE TRUST II,
	 	 	as Trust
	 
	 	 	 	 
	 

	 	By:
	 	WILMINGTON TRUST COMPANY,
	 

	 	 	 	not in its individual capacity but solely as
	 

	 	 	 	Owner Trustee under the Trust Agreement
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

Dated: _________, _____

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Class A Notes described in the within-mentioned Indenture.

	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
	 	 	as Indenture Trustee
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signatory

 

A-1-4

 

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1 4.92% ASSET BACKED NOTE, CLASS A

Summary of Terms and Conditions

This Class A Note is one of a duly authorized issue of Notes of the Trust, designated as
Nordstrom Credit Card Master Note Trust II, Series 2007-1 (the “Series 2007-1 Notes”), issued under
an Amended and Restated Master Indenture, dated as of May 1, 2007 (the “Master Indenture”) between
the Trust and Wells Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”), as supplemented by the Series 2007-1 Indenture Supplement, dated as of May 1, 2007 (the
“Series 2007-1 Indenture Supplement” and, together with the Master Indenture, the “Master
Indenture”), between the Trust and the Indenture Trustee and representing the right to receive
certain payments from the Trust. The Notes are subject to all of the terms of the Master
Indenture. All terms used in this Note that are defined in the Master Indenture has the meanings
assigned to them in or pursuant to the Master Indenture. In the event of any conflict or
inconsistency between the Master Indenture and this Note, the Master Indenture shall control. This
Class A Note does not purport to summarize the Master Indenture and reference is made to the Master
Indenture for the interests, rights and limitations of rights, benefits, obligations and duties
evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

The Class B Notes and the Class C Notes will also be issued under the Master Indenture.

The Noteholder, by its acceptance of this Class A Note, agrees that it will look solely to the
property of the Trust allocated to the payment of this Class A Note for payment hereunder and that
the Indenture Trustee is not liable to the Noteholders for any amount payable under the Note or the
Master Indenture or, except as expressly provided in the Master Indenture, subject to any liability
under the Master Indenture.

The Expected Final Principal Payment Date is the April 15, 2010 Distribution Date, but
principal with respect to the Class A Notes may be paid earlier or later under certain
circumstances described in the Master Indenture. If for one or more months during the Controlled
Accumulation Period there are not sufficient funds to deposit into the Principal Funding Account
the Controlled Deposit Amount, then to the extent that excess funds are not available on subsequent
Distribution Dates with respect to the Controlled Accumulation Period to make up for such
shortfalls, the final payment of principal of the Notes will occur later than the Expected Final
Principal Payment Date. Payments of principal of the Notes shall be payable in accordance with the
provisions of the Master Indenture.

Subject to the terms and conditions of the Master Indenture, the Transferor may, from time to
time, direct the Owner Trustee, on behalf of the Trust, to issue one or more new Series of Notes.

On each Distribution Date, the Paying Agent shall distribute to each Class A Noteholder of
record on the related Record Date (except for the final distribution in respect of this Class A
Note) such Class A Noteholder’s pro rata share of the amounts held by the Paying Agent that are
allocated and available on such Distribution Date to pay interest and principal on the Class A
Notes pursuant to the Series 2007-1 Indenture Supplement. Except as provided in the Master
Indenture with respect to a final distribution, distributions to Series 2007-1 Noteholders shall be

 

A-1-5

 

made by (i) check mailed to each Series 2007-1 Noteholder (at such Noteholder’s address as it
appears in the Note Register), except that with respect to any Series 2007-1 Notes registered in
the name of the nominee of a Clearing Agency, such distribution shall be made in immediately
available funds and (ii) without presentation or surrender of any Series 2007-1 Note or the making
of any notation thereon. Final payment of this Class A Note will be made only upon presentation
and surrender of this Class A Note at the office or agency specified in the notice of final
distribution delivered by the Indenture Trustee to the Series 2007-1 Noteholders in accordance with
the Master Indenture.

On any day occurring on or after the date on which the outstanding principal balance of the
Series 2007-1 Notes is reduced to 10% or less of the initial Note Principal Balance, the Servicer
shall have the option to redeem the Series 2007-1 Notes, at a purchase price equal to (i) if such
day is a Distribution Date, the Reassignment Amount for such Distribution Date or (ii) if such day
is not a Distribution Date, the Reassignment Amount for the Distribution Date following such day.

THIS CLASS A NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE TRANSFEROR,
NORDSTROM FSB OR ANY AFFILIATE OF ANY OF THEM AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

Each Noteholder, by accepting a Note, hereby covenants and agrees that it will not at any time
institute against the Trust or the Transferor, or join in instituting against the Trust or the
Transferor, prior to the date which is one year and one day after the termination of this Master
Indenture, acquiesce, petition or otherwise invoke or cause the Issuer or the Transferor to invoke
the process of any Governmental Authority for the purpose of commencing or sustaining a case
against the Issuer or the Transferor under any Debtor Relief Law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Issuer or
Transferor or any substantial part of its property or ordering the winding up or liquidation of the
affairs of the Issuer or Transferor.

Except as otherwise provided in the Indenture Supplement, the Class A Notes are issuable only
in minimum denominations of $100,000 and integral multiples of $1,000. The transfer of this Class
A Note shall be registered in the Note Register upon surrender of this Class A Note for
registration of transfer at any office or agency maintained by the Transfer Agent and Registrar
accompanied by a written instrument of transfer, in a form satisfactory to the Indenture Trustee or
the Transfer Agent and Registrar, duly executed by the Class A Noteholder or such Class A
Noteholder’s attorney, and duly authorized in writing with such signature guaranteed, and thereupon
one or more new Class A Notes in any authorized denominations of like aggregate principal amount
will be issued to the designated transferee or transferees.

As provided in the Master Indenture and subject to certain limitations therein set forth,
Class A Notes are exchangeable for new Class A Notes in any authorized denominations and of like
aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of
the Transfer Agent and Registrar. No service charge may be imposed for any such
exchange but the Trust or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection therewith.

 

A-1-6

 

The Trust, the Transferor, the Indenture Trustee and any agent of the Trust, Transferor or the
Indenture Trustee shall treat the person in whose name this Class A Note is registered as the owner
hereof for all purposes, and neither the Trust, the Transferor, the Indenture Trustee nor any agent
of the Trust, Transferor or the Indenture Trustee shall be affected by notice to the contrary.

THIS CLASS A NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

A-1-7

 

ASSIGNMENT

	 	 	 
	Social Security or other identifying number of assignee

	 	 
	 

	 	 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

(name and address of assignee)

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

	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	1
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	Signature Guaranteed:

 

			
	1	 	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.

 

A-1-8

 

SCHEDULE OF EXCHANGES IN GLOBAL SECURITY

The following exchanges of a part of this Global Security have been made:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Signature of
	 	 	Amount of	 	Amount of	 	Principal Amount of	 	authorized officer
	 	 	Decrease in Principal	 	Increase in Principal	 	this Global Security	 	of Trustee or
	 	 	Amount of this Global	 	Amount of this	 	following such	 	securities
	Date of Exchange	 	Security	 	Global Security	 	decrease (or increase)	 	Custodian
	 

	 	 
	 	 
	 	 
	 	 

 

A-1-9

 

EXHIBIT A-2

FORM OF SERIES 2007-1 5.02%

ASSET BACKED NOTE, CLASS B

RULE 144A GLOBAL NOTE

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS
NOTE, AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (I) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR ITS OWN
ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OF THE
SECURITIES ACT AND (II) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTIONS.

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION (“DTC”), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

NO RESALE OR OTHER TRANSFER OF ANY NOTE SHALL BE MADE TO ANY TRANSFEREE UNLESS: (A) SUCH
TRANSFEREE IS NOT, AND WILL NOT ACQUIRE THE NOTE ON BEHALF OR WITH PLAN ASSETS OF, AN “EMPLOYEE
BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (“ERISA”), OR ANY OTHER “PLAN” AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE “INTERNAL REVENUE CODE”), THAT IS SUBJECT TO ERISA OR SECTION 4975 OF
THE INTERNAL REVENUE CODE OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE FOREGOING BY
REASON OF AN EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY (EACH, A “BENEFIT PLAN”) OR
(B) THE ACQUISITION AND HOLDING OF THE NOTE BY SUCH TRANSFEREE ARE ELIGIBLE FOR THE EXEMPTIVE
RELIEF AVAILABLE UNDER PTCE 84-14, PTCE 90-1, PTCE 91-38, PTCE 95-60, PTCE 96-23 OR A SIMILAR
EXEMPTION. EACH PURCHASER OR TRANSFEREE OF A NOTE, BY ITS
ACCEPTANCE OF SUCH NOTE, WILL BE DEEMED TO HAVE MADE THE REPRESENTATION SET FORTH IN CLAUSE
(A) OR (B) ABOVE.

 

A-2-1

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE 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.

TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX TRANSFER DOCUMENTATION
AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE MASTER INDENTURE.

THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO TREAT THE NOTES AS
DEBT SOLELY OF THE TRUST FOR UNITED STATES FEDERAL, STATE AND LOCAL INCOME, SINGLE BUSINESS AND
FRANCHISE TAX PURPOSES.”

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

 

			
	No. 144A/R-1
	 	Up to $24,500,000

CUSIP NO. 65566VAB6

Class B Note Rate: 5.02%

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1 5.02% ASSET BACKED NOTE, CLASS B

Nordstrom Credit Card Master Note Trust II (herein referred to as the “Trust”), a Delaware
statutory trust governed by a Second Amended and Restated Trust Agreement, dated as of May 1, 2007
(the “Trust Agreement”), between Nordstrom Credit Card Receivables II LLC, as transferor (the
“Transferor”), and Wilmington Trust Company, as owner trustee (the “Owner Trustee”), for value
received, hereby promises to pay to DTC, or its registered assigns, subject to the following
provisions, the principal sum of                     , or such greater or lesser amount as
determined in accordance with the Master Indenture, on the Series 2007-1 Final Maturity Date (which
is the earlier to occur of (a) the Distribution Date on which the Note Principal Balance is paid in
full and (b) the May 15, 3013 Distribution Date), except as otherwise provided below or in the
Master Indenture. The Trust will pay interest on the unpaid principal amount of this Note at the
rate specified above on each Distribution Date until the principal amount of this Note is paid in
full. Interest on this Note will accrue for each Distribution Date from and including the
preceding Distribution Date (or in the case of the initial Distribution
Date, from and including the Closing Date) to but excluding the current Distribution Date.
Interest will be computed on the basis of 30 days in such Interest Period and a 360-day year.
Principal of this Note shall be paid in the manner specified on the reverse hereof.

 

A-2-2

 

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.

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 or on behalf of the
Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the
Master Indenture or the Series 2007-1 Indenture Supplement referred to on the reverse hereof, or be
valid for any purpose.

THIS CLASS B NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENT ON THE CLASS A NOTES
TO THE EXTENT SPECIFIED IN THE SERIES 2007-1 INDENTURE SUPPLEMENT.

 

A-2-3

 

IN WITNESS WHEREOF, the Trust has caused this Class B Note to be duly executed.

	 	 	 	 	 
	 	 	NORDSTROM CREDIT CARD MASTER NOTE TRUST II,
	 	 	as Trust
	 
	 	 	 	 
	 

	 	By:
	 	WILMINGTON TRUST COMPANY,
	 

	 	 	 	not in its individual capacity but solely as
	 

	 	 	 	Owner Trustee under the Trust Agreement
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

Dated: _________, _____

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Class B Notes described in the within-mentioned Indenture.

	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
	 	 	as Indenture Trustee
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signatory

 

A-2-4

 

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1 5.02% ASSET BACKED NOTE, CLASS B

Summary of Terms and Conditions

This Class B Note is one of a duly authorized issue of Notes of the Trust, designated as
Nordstrom Credit Card Master Note Trust II, Series 2007-1 (the “Series 2007-1 Notes”), issued under
an Amended and Restated Master Indenture, dated as of May 1, 2007 (the “Master Indenture”), between
the Trust and Wells Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”), as supplemented by the Series 2007-1 Indenture Supplement, dated as of May 1, 2007 (the
“Series 2007-1 Indenture Supplement”), between the Trust and the Indenture Trustee, and
representing the right to receive certain payments from the Trust. The term “Indenture,” unless
the context otherwise requires, refers to the Master Indenture as supplemented by the Series 2007-1
Indenture Supplement. The Notes are subject to all of the terms of the Master Indenture. All
terms used in this Note that are defined in the Master Indenture has the meanings assigned to them
in or pursuant to the Master Indenture. In the event of any conflict or inconsistency between the
Master Indenture and this Note, the Master Indenture shall control.

The Class A Notes and the Class C Notes will also be issued under the Master Indenture.

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the
property of the Trust allocated to the payment of this Note for payment hereunder and that the
Indenture Trustee is not liable to the Noteholders for any amount payable under the Note or the
Master Indenture or, except as expressly provided in the Master Indenture, subject to any liability
under the Master Indenture.

This Class B Note does not purport to summarize the Master Indenture and reference is made to
the Master Indenture for the interests, rights and limitations of rights, benefits, obligations and
duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

The Class B Note Initial Principal Balance is $24,500,000. The Class B Note Principal Balance
on any date of determination will be an amount equal to (a) the Class B Note Initial Principal
Balance, minus (b) the aggregate amount of principal payments made to the Class B Noteholders on or
prior to such date.

The Expected Final Principal Payment Date is the April 15, 2010 Distribution Date, but
principal with respect to the Class B Notes may be paid earlier or later under certain
circumstances described in the Master Indenture. If for one or more months during the Controlled
Accumulation Period there are not sufficient funds to deposit into the Principal Funding Account
the Controlled Deposit Amount, then to the extent that excess funds are not available on subsequent
Distribution Dates with respect to the Controlled Accumulation Period to make up for such
shortfalls, the final payment of principal of the Class B Notes will occur later than the Expected
Final Principal Payment Date. Payments of principal of the Class B Notes shall be payable in
accordance with the provisions of the Master Indenture.

 

A-2-5

 

Subject to the terms and conditions of the Master Indenture, the Transferor may, from time to
time, direct the Owner Trustee, on behalf of the Trust, to issue one or more new Series of Notes.

On each Distribution Date, the Paying Agent shall distribute to each Class B Noteholder of
record on the related Record Date (except for the final distribution in respect of this Class B
Note) such Class B Noteholder’s pro rata share of the amounts held by the Paying Agent that are
allocated and available on such Distribution Date to pay interest and principal on the Class B
Notes pursuant to the Indenture Supplement. Except as provided in the Master Indenture with
respect to a final distribution, distributions to Series 2007-1 Noteholders shall be made by (i)
check mailed to each Series 2007-1 Noteholder (at such Noteholder’s address as it appears in the
Note Register), except that with respect to any Series 2007-1 Notes registered in the name of the
nominee of a Clearing Agency, such distribution shall be made in immediately available funds and
(ii) without presentation or surrender of any Series 2007-1 Note or the making of any notation
thereon. Final payment of this Class B Note will be made only upon presentation and surrender of
this Class B Note at the office or agency specified in the notice of final distribution delivered
by the Master Indenture Trustee to the Series 2007-1 Noteholders in accordance with the Master
Indenture.

On any day occurring on or after the date on which the outstanding principal balance of the
Series 2007-1 Notes is reduced to 10% or less of the initial Note Principal Balance, the Servicer
shall have the option to redeem the Series 2007-1 Notes, at a purchase price equal to (i) if such
day is a Distribution Date, the Reassignment Amount for such Distribution Date or (ii) if such day
is not a Distribution Date, the Reassignment Amount for the Distribution Date following such day.

THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE TRANSFEROR,
NORDSTROM FSB OR ANY AFFILIATE OF ANY OF THEM AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

Each Noteholder, by accepting a Note, hereby covenants and agrees that it will not at any time
institute against the Trust or the Transferor, or join in instituting against the Trust or the
Transferor, prior to the date which is one year and one day after the termination of this Master
Indenture, acquiesce, petition or otherwise invoke or cause the Issuer or the Transferor to invoke
the process of any Governmental Authority for the purpose of commencing or sustaining a case
against the Issuer or the Transferor under any Debtor Relief Law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Issuer or
Transferor or any substantial part of its property or ordering the winding up or liquidation of the
affairs of the Issuer or Transferor.

Except as otherwise provided in the Indenture Supplement, the Class B Notes are issuable only
in minimum denominations of $100,000 and integral multiples of $1,000. The transfer of this Class
B Note shall be registered in the Note Register upon surrender of this Class B Note for
registration of transfer at any office or agency maintained by the Transfer Agent and Registrar
accompanied by a written instrument of transfer, in a form satisfactory to the Indenture Trustee

 

A-2-6

 

or the Transfer Agent and Registrar, duly executed by the Class B Noteholder or such Class B
Noteholder’s attorney, and duly authorized in writing with such signature guaranteed, and thereupon
one or more new Class B Notes in any authorized denominations of like aggregate principal amount
will be issued to the designated transferee or transferees.

As provided in the Master Indenture and subject to certain limitations therein set forth,
Class B Notes are exchangeable for new Class B Notes in any authorized denominations and of like
aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of
the Transfer Agent and Registrar. No service charge may be imposed for any such exchange but the
Trust or Transfer Agent and Registrar may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection therewith.

The Trust, the Transferor, the Indenture Trustee and any agent of the Trust, Transferor or the
Indenture Trustee shall treat the person in whose name this Class B Note is registered as the owner
hereof for all purposes, and neither the Trust, the Transferor, the Indenture Trustee nor any agent
of the Trust, Transferor or the Indenture Trustee shall be affected by notice to the contrary.

THIS CLASS B NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

A-2-7

 

ASSIGNMENT

	 	 	 
	Social Security or other identifying number of assignee
	 	 
	 

	 	 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

(name and address of assignee)

the within certificate and all rights thereunder, and hereby irrevocably constitutes and
appoints                                         , attorney, to transfer said certificate 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.

 

A-2-8

 

SCHEDULE OF EXCHANGES IN GLOBAL SECURITY

The following exchanges of a part of this Global Security have been made:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Signature of
	 	 	Amount of	 	Amount of	 	Principal Amount of	 	authorized officer
	 	 	Decrease in Principal	 	Increase in Principal	 	this Global Security	 	of Trustee or
	 	 	Amount of this Global	 	Amount of this	 	following such	 	securities
	Date of Exchange	 	Security	 	Global Security	 	decrease (or increase)	 	Custodian
	 

	 	 
	 	 
	 	 
	 	 

 

A-2-9

 

EXHIBIT A-3

FORM OF SERIES 2007-1

ASSET BACKED NOTE, CLASS C

RULE 144A GLOBAL NOTE

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS
NOTE, AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (I) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR ITS OWN
ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OF THE
SECURITIES ACT AND (II) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTIONS.

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION (“DTC”), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

NO RESALE OR OTHER TRANSFER OF ANY NOTE SHALL BE MADE TO ANY TRANSFEREE UNLESS: (A) SUCH
TRANSFEREE IS NOT, AND WILL NOT ACQUIRE THE NOTE ON BEHALF OR WITH PLAN ASSETS OF, AN “EMPLOYEE
BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (“ERISA”), OR ANY OTHER “PLAN” AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE “INTERNAL REVENUE CODE”), THAT IS SUBJECT TO ERISA OR SECTION 4975 OF
THE INTERNAL REVENUE CODE OR ANY ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE FOREGOING BY
REASON OF AN EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY (EACH, A “BENEFIT PLAN”) OR
(B) THE ACQUISITION AND HOLDING OF THE NOTE BY SUCH TRANSFEREE ARE ELIGIBLE FOR THE EXEMPTIVE
RELIEF AVAILABLE UNDER PTCE 84-14, PTCE 90-1, PTCE 91-38, PTCE 95-60, PTCE 96-23 OR A SIMILAR
EXEMPTION. EACH PURCHASER OR TRANSFEREE OF A NOTE, BY ITS
ACCEPTANCE OF SUCH NOTE, WILL BE DEEMED TO HAVE MADE THE REPRESENTATION SET FORTH IN CLAUSE
(A) OR (B) ABOVE.

 

A-3-1

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE 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.

TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX TRANSFER DOCUMENTATION
AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE MASTER INDENTURE.

THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO TREAT THE NOTES AS
DEBT SOLELY OF THE TRUST FOR UNITED STATES FEDERAL, STATE AND LOCAL INCOME, SINGLE BUSINESS AND
FRANCHISE TAX PURPOSES.”

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

 

			
	No. 144A/R-1
	 	Up to $26,400,000

Class C Note Rate: 0.00%

NORDSTROM CREDIT CARD MASTER NOTE II TRUST

SERIES 2007-1 ASSET BACKED NOTE, CLASS C

Nordstrom Credit Card Master Note Trust II (herein referred to as the “Trust”), a Delaware
statutory trust governed by a Second Amended and Restated Trust Agreement, dated as May 1, 2007
(the “Trust Agreement”), between Nordstrom Credit Card Receivables II LLC, as transferor (the
“Transferor”), and Wilmington Trust Company, as owner trustee, (the “Owner Trustee”), for value
received, hereby promises to pay to Nordstrom Credit Card Receivables II LLC, or registered
assigns, subject to the following provisions, the principal sum of                     , or such
greater or lesser amount as determined in accordance with the Master Indenture, on the Series
2007-1 Final Maturity Date (which is the earlier to occur of (a) the Distribution Date on which the
Note Principal Balance is paid in full and (b) the                      Distribution Date), except as
otherwise provided below or in the Master Indenture. The Trust will pay interest on the unpaid
principal amount of this Note at the Class C Note Interest Rate on each Distribution Date until the
principal amount of this Note is paid in full. Interest on this Note will accrue for each
Distribution Date from and including the most recent Distribution Date on which interest has been
paid to but excluding such Distribution Date or, for the initial Distribution Date, from and
including the Closing Date to but excluding such
Distribution Date. Interest will be computed on the basis of 30 days in such Interest Period
and a 360-day year. Principal of this Note shall be paid in the manner specified on the reverse
hereof.

“Class C Note Interest Rate” means a per annum rate of 0.00% or the rate specified by
the Transferor pursuant to Section 4.02 of the Series 2007-1 Indenture Supplement.

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.

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 or on behalf of the
Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the
Master Indenture or the Series 2007-1 Indenture Supplement referred to on the reverse hereof, or be
valid for any purpose.

THIS CLASS C NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A
NOTES AND THE CLASS B NOTES TO THE EXTENT SPECIFIED IN THE SERIES 2007-1 INDENTURE SUPPLEMENT.

 

A-3-2

 

IN WITNESS WHEREOF, the Trust has caused this Class C Note to be duly executed.

	 	 	 	 	 
	 	 	NORDSTROM CREDIT CARD MASTER NOTE II TRUST,
	 	 	as Trust
	 
	 	 	 	 
	 

	 	By:
	 	WILMINGTON TRUST COMPANY,
	 

	 	 	 	not in its individual capacity but solely as
	 

	 	 	 	Owner Trustee under the Trust Agreement
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

Dated:                     , ___

 

A-3-3

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Class C Notes described in the within-mentioned Indenture.

	 	 	 	 	 
	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
	 	 	as Indenture Trustee
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Authorized Signatory

 

A-3-4

 

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1 ASSET BACKED NOTE, CLASS C

Summary of Terms and Conditions

This Class C Note is one of a duly authorized issue of Notes of the Trust, designated as
Nordstrom Credit Card Master Note Trust II, Series 2007-1 (the “Series 2007-1 Notes”), issued under
an Amended and Restated Master Indenture, dated as of May 1, 2007 (the “Master Indenture”), between
the Trust and Wells Fargo Bank, National Association, as indenture trustee (the “Indenture
Trustee”), as supplemented by the Series 2007-1 Indenture Supplement, dated as of May 1, 2007 (the
“Series 2007-1 Indenture Supplement”), between the Trust and the Indenture Trustee and representing
the right to receive certain payments from the Trust. The term “Indenture,” unless the context
otherwise requires, refers to the Master Indenture as supplemented by the Series 2007-1 Indenture
Supplement. The Notes are subject to all of the terms of the Master Indenture. All terms used in
this Note that are defined in the Master Indenture has the meanings assigned to them in or pursuant
to the Master Indenture. In the event of any conflict or inconsistency between the Master
Indenture and this Note, the Master Indenture shall control.

The Class A Notes and the Class B Notes will also be issued under the Master Indenture.

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the
property of the Trust allocated to the payment of this Note for payment hereunder and that the
Indenture Trustee is not liable to the Noteholders for any amount payable under the Note or the
Master Indenture or, except as expressly provided in the Master Indenture, subject to any liability
under the Master Indenture.

This Note does not purport to summarize the Master Indenture and reference is made to the
Master Indenture for the interests, rights and limitations of rights, benefits, obligations and
duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

The Class C Note Initial Principal Balance is $26,400,000. The Class C Note Principal Balance
on any date of determination will be an amount equal to (a) the Class C Note Initial Principal
Balance, minus (b) the aggregate amount of principal payments made to the Class C Noteholders on or
prior to such date.

Subject to the terms and conditions of the Master Indenture, the Transferor may, from time to
time, direct the Owner Trustee, on behalf of the Trust, to issue one or more new Series of Notes.

On each Distribution Date, the Paying Agent shall distribute to each Class C Noteholder of
record on the related Record Date (except for the final distribution in respect of this Class C
Note) such Class C Noteholder’s pro rata share of the amounts held by the Paying Agent that are
allocated and available on such Distribution Date to pay interest and principal on the Class C
Notes pursuant to the Indenture Supplement. Except as provided in the Master Indenture with
respect to a final distribution, distributions to Series 2007-1 Noteholders shall be made by (i)

 

A-3-5

 

check mailed to each Series 2007-1 Noteholder (at such Noteholder’s address as it appears in
the Note Register), except that with respect to any Series 2007-1 Notes registered in the name of
the nominee of a Clearing Agency, such distribution shall be made in immediately available funds
and (ii) without presentation or surrender of any Series 2007-1 Note or the making of any notation
thereon. Final payment of this Class C Note will be made only upon presentation and surrender of
this Class C Note at the office or agency specified in the notice of final distribution delivered
by the Indenture Trustee to the Series 2007-1 Noteholders in accordance with the Master Indenture.

On any day occurring on or after the date on which the outstanding principal balance of the
Series 2007-1 Notes is reduced to 10% or less of the initial Note Principal Balance, the Servicer
shall have the option to redeem the Series 2007-1 Notes, at a purchase price equal to (i) if such
day is a Distribution Date, the Reassignment Amount for such Distribution Date or (ii) if such day
is not a Distribution Date, the Reassignment Amount for the Distribution Date following such day.

THIS NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE TRANSFEROR, NORDSTROM
FSB OR ANY AFFILIATE OF ANY OF THEM AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

Each Noteholder, by accepting a Note, hereby covenants and agrees that it will not at any time
institute against the Trust or the Transferor, or join in instituting against the Trust or the
Transferor, prior to the date which is one year and one day after the termination of this Master
Indenture, acquiesce, petition or otherwise invoke or cause the Issuer or the Transferor to invoke
the process of any Governmental Authority for the purpose of commencing or sustaining a case
against the Issuer or the Transferor under any Debtor Relief Law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Issuer or
Transferor or any substantial part of its property or ordering the winding up or liquidation of the
affairs of the Issuer or Transferor.

Except as otherwise provided in the Indenture Supplement, the Class C Notes are issuable only
in minimum denominations of $100,000 and integral multiples of $1,000. The transfer of this Class
C Note shall be registered in the Note Register upon surrender of this Class C Note for
registration of transfer at any office or agency maintained by the Transfer Agent and Registrar
accompanied by a written instrument of transfer, in a form satisfactory to the Indenture Trustee or
the Transfer Agent and Registrar, duly executed by the Class C Noteholder or such Class C
Noteholder’s attorney, and duly authorized in writing with such signature guaranteed, and thereupon
one or more new Class C Notes in any authorized denominations of like aggregate principal amount
will be issued to the designated transferee or transferees.

As provided in the Master Indenture and subject to certain limitations therein set forth,
Class C Notes are exchangeable for new Class C Notes in any authorized denominations and of like
aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of
the Transfer Agent and Registrar. No service charge may be imposed for any such
exchange but the Trust or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection therewith.

 

A-3-6

 

The Trust, the Transferor, the Indenture Trustee and any agent of the Trust, the Transferor or
the Indenture Trustee shall treat the person in whose name this Class C Note is registered as the
owner hereof for all purposes, and neither the Trust, the Transferor, the Indenture Trustee nor any
agent of the Trust, the Transferor or the Indenture Trustee shall be affected by notice to the
contrary.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS
LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

 

A-3-7

 

ASSIGNMENT

	 	 	 
	Social Security or other identifying number of assignee

	 	 
	 

	 	 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

(name and address of assignee)

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

	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	3
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	Signature Guaranteed:

 

			
	3	 	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.

 

A-3-8

 

EXHIBIT B

FORM OF MONTHLY PAYMENT INSTRUCTIONS AND

NOTIFICATION TO THE INDENTURE TRUSTEE

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1

The undersigned, a duly authorized representative of Nordstrom fsb, as Servicer (the
“Servicer”) pursuant to the Amended and Restated Transfer and Servicing Agreement, dated as of May
___, 2007 (the “Transfer and Servicing Agreement”), among the Servicer, Nordstrom Credit Card
Receivables II LLC, as Transferor, Nordstrom Credit Card Master Note Trust II (the “Trust”), as
issuer and Wells Fargo Bank, National Association, as Indenture Trustee, does hereby certify as
follows:

1. Capitalized terms used in this Certificate have their respective meanings set forth in the
Transfer and Servicing Agreement or the Amended and Restated Master Indenture, dated as of May 1,
2007 (the “Master Indenture”), between the Trust and Wells Fargo Bank, National Association, as
indenture trustee (the “Indenture Trustee”) as supplemented by the Series 2007-1 Indenture
Supplement, dated as of May 1, 2007, between the Trust and the Indenture Trustee (as amended and
supplemented, the “Series 2007-1 Indenture Supplement”), as applicable.

2. Nordstrom fsb is the Servicer.

3. The undersigned is an Authorized Officer of the Servicer.

I. Instruction to Make a Withdrawal

Pursuant to Section 4.03(a) of the Series 2007-1 Indenture Supplement, the Servicer does
hereby instruct the Indenture Trustee (i) to make withdrawals from the Collection Account on
___, ___, which date is a Distribution Date under the Series 2007-1 Indenture Supplement,
in the aggregate amounts as set forth below in respect of the following amounts and (ii) to apply
the proceeds of such withdrawals in accordance with Sections 3.01(a) and 4.03(a):

	 	(A)	 	Pursuant to Section 4.03(a)(i):

	 	(1)	 	The Monthly Servicing Fee for such Distribution
Date $___
	 
	 	(2)	 	Accrued and unpaid Monthly Servicing Fees $___

	 	(B)	 	Pursuant to Section 4.03(a)(ii):

(1) Interest at the Class A Note Interest Rate for the
related Interest Period on the outstanding principal
balance of the Class A Notes $___

 

B-1

 

	 	(2)	 	Class A Monthly Interest previously due but not
paid $___
	 
	 	(3)	 	Class A Additional Interest and any Class A
Additional Interest previously due but not paid $___

	 	(C)	 	Pursuant to Section 4.03(a)(iii):

	 	(1)	 	Interest at the Class B Note Interest Rate for the
related Interest Period on the outstanding principal
balance of the Class B Notes $___
	 
	 	(2)	 	Class B Monthly Interest previously due but not
paid $___
	 
	 	(3)	 	Class B Additional Interest and any Class B
Additional Interest previously due but not paid $___

	 	(D)	 	Pursuant to Section 4.03(a)(iv):

	 	(1)	 	Interest at the Class C Note Interest Rate for the
related Interest Period on the outstanding principal
balance of the Class C Notes $___
	 
	 	(2)	 	Class C Monthly Interest previously due but not
paid $___
	 
	 	(3)	 	Class C Additional Interest and any Class C
Additional Interest previously due but not paid $___

	 	(E)	 	Pursuant to Section 4.03(a)(v):

	 	(1)	 	Investor Default Amount and Investor Uncovered
Dilution Amount for such Distribution Date to be
treated as Available Principal Collections $___

	 	(F)	 	Pursuant to Section 4.03(a)(vi):

	 	(1)	 	Aggregate amount of Investor Charge-Offs and
Reallocated Principal Collections not previously
reimbursed to be treated as Available Principal
Collections $___

	 	(G)	 	Pursuant to Section 4.03(a)(vii):

 

B-2

 

	 	(1)	 	Balance, if any, up to the outstanding principal
amount of the Series 2007-1 Notes to be treated as
Available Principal Collections $___

	 	(H)	 	Pursuant to Section 4.03(a)(viii):

	 	 	
(1) An amount equal to the amount to be deposited in
the Reserve Account $___

	 	(I)	 	Pursuant to Section 4.03(a)(ix):

	 	(1)	 	An amount equal to the Transition Expenses $___

	 	(J)	 	Pursuant to Section 4.03(a)(x):

	 	(1)	 	Balance, if any, to constitute a portion of Excess
Finance Charge Collections and to be available for
allocation to other Series in Group One or to the
Holder of the Transferor Certificates $___

Pursuant to Sections 4.03(b), (c) and (d), the Servicer hereby instructs the Indenture Trustee
(i) to make withdrawals from the Collection Account on                     , which date is a Distribution
Date under the Series 2007-1 Indenture Supplement, in the aggregate amounts (equal to the Available
Principal Collections) as set forth below in respect of the following amounts and (ii) to apply the
proceeds of such withdrawals in accordance with Sections 4.03(b), (c)and (d):

	 	(A)	 	Pursuant to Section 4.03(b):

	 	(1)	 	During the Revolving Period,
amount equal to Available Principal
Collections to be treated as Shared
Principal Collections $___

	 	(B)	 	Pursuant to Section 4.03(c):

	 	(1)	 	During Controlled Accumulation
Period, Available Principal
Collections deposited in the
Collection Account for the related
Monthly Period deposited in an amount
up to the Monthly Principal for such
Distribution Date into the Principal
Funding Account $___

	 	(C)	 	Pursuant to Section 4.03(d)(i):

	 	(1)	 	During Early Amortization Period,
Available Principal Collections for
such Distribution Date to Class A
Notes until Class A Notes paid in
full $___

	 	(D)	 	Pursuant to Section 4.03(d)(ii):

 

B-3

 

	 	(1)	 	After giving effect to clause (C)
above, during Early Amortization
Period, if any remaining Available
Principal Collections, to Class B
Notes until Class B Notes paid in
full $___

	 	(E)	 	Pursuant to Section 4.03(d)(iii):

	 	(1)	 	After giving effect to clauses
(C) and (D) above, during Early
Amortization Period, if any remaining
Available Principal Collections, to
Class C Notes until Class C Notes
paid in full $___

	 	(F)	 	Pursuant to Section 4.03(d)(iv):

	 	(1)	 	Amount, if any, remaining after
giving effect to clauses (C), (D) and
(E) above, to be treated as Shared
Principal Collections $___

	 	(G)	 	Pursuant to Section 4.03(e):

	 	(1)	 	Amount to be withdrawn from the
Principal Funding Account and
distributed to the Paying Agent for
payment to the (i) Class A
Noteholders and then (ii) Class B
Noteholders $___

Pursuant to Section 4.05, the Servicer does hereby instruct the Indenture Trustee to apply on
___, which is a Distribution Date under the Series 2007-1 Indenture Supplement, any
Reallocated Principal Collections for such Distribution Date in amount equal to $___.

INSTRUCTION TO MAKE CERTAIN PAYMENTS

Pursuant to Section 5.02, the Servicer does hereby instruct the Indenture Trustee or the
Paying Agent, as the case may be, to pay in accordance with Section 5.02 from the Collection
Account or the Principal Funding Account, as applicable, on ___, which date is a
Distribution Date under the Series 2007-1 Indenture Supplement, the following amounts as set forth
below:

	 	(A)	 	Pursuant to Section 5.02(a):
Interest to be distributed to Class A Noteholders $___
	 
	 	(B)	 	Pursuant to Section 5.02(a):
Principal to be distributed to Class A Noteholders $___
	 
	 	(C)	 	Pursuant to Section 5.02(b):
Interest to be distributed to Class B Noteholders $___

 

B-4

 

	 	(D)	 	Pursuant to Section 5.02(b):
Principal to be distributed to Class B Noteholders $___
	 
	 	(E)	 	Pursuant to Section 5.02(c):
Interest to be distributed to Class C Noteholders $___
	 
	 	(F)	 	Pursuant to Section 5.02(c):
Principal to be distributed to Class C Noteholders $___

 

B-5

 

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this ___day of
___, ___.

	 	 	 	 	 
	 	 	NORDSTROM fsb,
	 	 	as Servicer
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

 

B-6

 

EXHIBIT C

FORM OF MONTHLY STATEMENT

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1

Pursuant to the Amended and Restated Master Indenture, dated as of May 1, 2007 (as amended,
supplemented or modified from time to time, the “Master Indenture”), between Nordstrom Credit Card
Master Note Trust II (the “Trust”) and Wells Fargo Bank, National Association, as indenture trustee
(the “Indenture Trustee”), as supplemented by the Series 2007-1 Indenture Supplement, dated as of
May 1, 2007 (the “Series 2007-1 Indenture Supplement”), between the Trust and the Indenture
Trustee, Nordstrom fsb, as Servicer (the “Servicer”) under the Amended and Restated Transfer and
Servicing Agreement, dated as of May ___, 2007 (the “Transfer and Servicing Agreement”), among
Nordstrom Credit Card Receivables II LLC, as Transferor, the Servicer, the Trust and Wells Fargo
Bank, National Association, as Indenture Trustee, is required to prepare certain information each
month regarding current distributions to the Series 2007-1 Noteholders and the performance of the
Trust during the previous month. The information which is required to be prepared with respect to
the Distribution Date of ___, and with respect to the performance of the Trust during the
month of ___is set forth below. Capitalized terms used in this Monthly Statement have
their respective meanings set forth in the Master Indenture and the Series 2007-1 Indenture
Supplement.

 

C-1

 

	 	(A)	 	Information regarding distributions in respect
of the Class A Notes

	 	(1)	 	The total amount of the
distribution in respect of Class A
Notes $___
	 
	 	(2)	 	The amount of the distribution
set forth in paragraph 1 above in
respect of interest on the Class A
Notes $___
	 
	 	(3)	 	The amount of the distribution
set forth in paragraph 1 above in
respect of principal of the Class A
Notes $___
	 
	 	(4)	 	The amount of the distribution
set forth in paragraph 1 above to be
treated as Shared Principal
Collections $___

	 	(B)	 	Information regarding distributions in respect
of the Class B Notes

	 	(1)	 	The total amount of the
distribution in respect of Class B
Notes $___

 

C-2

 

	 	(2)	 	The amount of the distribution
set forth in paragraph 1 above in
respect of interest on the Class B
Notes $___
(3) The amount of the distribution
set forth in paragraph 1 above in
respect of principal of the Class B
Notes $___
(4) The amount of the distribution
set forth in paragraph 1 above to be
treated as Shared Principal
Collections $___

	 	(C)	 	Information regarding distributions in respect
of the Class C Notes

	 	(1)	 	The total amount of the
distribution in respect of Class C
Notes $___
(2) The amount of the distribution
set forth in paragraph 1 above in
respect of interest on the Class C
Notes $___
(3) The amount of the distribution
set forth in paragraph 1 above in
respect of principal of the Class C
Notes $___
(4) The amount of the distribution
set forth in paragraph 1 above to be
treated as Shared Principal
Collections $___

	 	(D)	 	The Uncovered Dilution Amount $___

Receivables —

	 	 	 	 	 
	Beginning of the Month Principal Receivables:
	 	$	 	 
	 
	 	 	 
	Beginning of the Month Finance Charge Receivables:
	 	$	 	 
	 
	 	 	 
	Beginning of the Month Total Receivables:
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Removed Principal Receivables:
	 	$	 	 
	 
	 	 	 
	Removed Finance Charge Receivables:
	 	$	 	 
	 
	 	 	 
	Removed Total Receivables:
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Additional Principal Receivables:
	 	$	 	 
	 
	 	 	 
	Additional Finance Charge Receivables:
	 	$	 	 
	 
	 	 	 
	Additional Total Receivables:
	 	$	 	 
	 
	 	 	 	 
	Discounted Receivables Generated this Period:
	 	$	 	 
	 
	 	 	 
	Net Recoveries for month of , 200_
	 	$	 	 
	 
	 	 	 
	Interchange
	 	$	 	 
	 
	 	 	 
	End of the Month Principal Receivables:
	 	$	 	 
	 
	 	 	 
	End of the Month Finance Charge Receivables:
	 	$	 	 
	 
	 	 	 
	End of the Month Total Receivables:
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Special Funding Account Balance:
	 	$	 	 
	 
	 	 	 
	End of the Month Transferor Interest:
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Delinquencies And Losses —
	 	 	 	 
	 
	 	 	 	 
	End of the Month Delinquencies:
	 	Receivables
	31-60 Days Delinquent
	 	$	 	 
	 
	 	 	 
	61-90 Days Delinquent
	 	$	 	 
	 
	 	 	 
	91+ Days Delinquent
	 	$	 	 
	Total 31+ Days Delinquent
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Defaulted Receivables During the Month
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Note Principal Balances —
	 	 	 	 
	Class A Note Principal Balance
	 	$	 	 
	 
	 	 	 
	Class B Note Principal Balance
	 	$	 	 
	 
	 	 	 
	Class C Note Principal Balance
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Initial Invested Amount
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Investor Default Amount
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Investor Charge-Offs
	 	$	 	 
	 
	 	 	 

 

C-3

 

	 	 	 	 	 
	Series 2007-1
	 	 	 	 
	Floating Investor Percentage
	 	 	%	 
	 
	 	 	 
	Fixed Investor Percentage
	 	 	%	 
	 
	 	 	 
	Available Finance Charge Collections
	 	$	 	 
	 
	 	 	 
	Investor Default Amount
	 	$	 	 
	 
	 	 	 
	Monthly Servicing Fees
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Available Principal Collections
	 	$	 	 
	 
	 	 	 
	Required Transferor Interest
	 	$	 	 
	 
	 	 	 
	Excess Finance Charge Collections
	 	$	 	 
	 
	 	 	 
	Shared Principal Collections
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Application Of Collections —
	 	 	 	 
	Monthly Servicing Fee
	 	$	 	 
	 
	 	 	 
	Class A Monthly Interest
	 	$	 	 
	 
	 	 	 
	Class B Monthly Interest
	 	$	 	 
	 
	 	 	 
	Class C Monthly Interest
	 	$	 	 
	 
	 	 	 
	Investor Default Amount
	 	$	 	 
	 
	 	 	 
	Investor Charge Offs and Reallocated Principal Collections not
previously reimbursed
	 	$	 	 
	 
	 	 	 
	Amounts To Be Deposited In The Reserve Account
	 	$	 	 
	 
	 	 	 
	Reserve Account Draw Amount
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Excess Finance Charges Collections
	 	 	 	 
	 
	 	 	 	 
	Total Excess Finance Charge Collections for all allocation series
	 	$	 	 
	 
	 	 	 
	 
	 	 	 	 
	Yield And Base Rate —
Base Rate (Current Month)
	 	 	%	 
	 
	 	 	 
	Base Rate (Prior Month)
	 	 	%	 
	 
	 	 	 
	Base Rate (Two Months Ago)
	 	 	%	 
	 
	 	 	 
	 
	 	 	 	 
	Three Month Average Base Rate
	 	 	%	 
	 
	 	 	 
	Portfolio Yield (Current Month)
	 	 	%	 
	 
	 	 	 
	Portfolio Yield (Prior Month)
	 	 	%	 
	 
	 	 	 
	Portfolio Yield (Two Months Ago)
	 	 	%	 
	 
	 	 	 
	 
	 	 	 	 
	Three Month Average Portfolio Adjusted Yield
	 	 	%	 
	 
	 	 	 
	 
	 	 	 	 
	Principal Collections —
	 	 	 	 
	Principal Funding Account Balance at Month End
	 	 	 	 
	Series 2007-1 Principal Shortfall
	 	$	 	 
	 
	 	 	 
	Shared Principal Collections Allocable from other Principal
Sharing Series
	 	$	 	 
	 
	 	 	 
	Investor Charge Offs and Reductions
	 	 	 	 
	Investor Charge Offs
	 	$	 	 
	 
	 	 	 
	Reductions in Invested Amount (other than by Principal Payments)
	 	$	 	 
	 
	 	 	 
	Previous Reductions In Invested Amount Reimbursed
	 	$	 	 
	 
	 	 	 

	 	 	 	 	 
	 	 	NORDSTROM fsb,
	 	 	as Servicer
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

 

C-4

 

EXHIBIT D

FORM OF MONTHLY SERVICER’S CERTIFICATE

NORDSTROM CREDIT CARD MASTER NOTE TRUST II

SERIES 2007-1

The undersigned, a duly authorized representative of Nordstrom fsb, as Servicer (the
“Servicer”) pursuant to the Amended and Restated Transfer and Servicing Agreement, dated as of May
___, 2007 (the “Transfer and Servicing Agreement”), among the Servicer, Nordstrom Credit Card
Receivables II LLC, as Transferor, Nordstrom Credit Card Master Note Trust II (the “Trust”) and
Wells Fargo Bank, National Association, as Indenture Trustee (the “Indenture Trustee”), does hereby
certify as follows:

	 	1.	 	Capitalized terms used in this Certificate have their respective meanings set
forth in the Transfer and Servicing Agreement or the Amended and Restated Master
Indenture, dated as of May 1, 2007 (as amended or supplemented, the “Master
Indenture”), between the Trust and the Indenture Trustee as supplemented by the Series
2007-1 Indenture Supplement, dated as of May 1, 2007, between the Trust and the
Indenture Trustee (the “Series 2007-1 Indenture Supplement” and together with the
Master Indenture, the “Indenture”), as applicable.
	 
	 	2.	 	Nordstrom fsb is, as of the date hereof, the Servicer under the Transfer and
Servicing Agreement.
	 
	 	3.	 	The undersigned is an Authorized Officer of the Servicer. This Certificate
relates to the Distribution Date occurring on ___, 200. 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 Transfer and Servicing Agreement and
the Master Indenture 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 the (i) 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.”
	 
	 	4.	 	As of the date hereof, to the best knowledge of the undersigned, no Pay Out
Event occurred on or prior to such Distribution Date.

 

D-1

 

IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Certificate this ___
day of ___, ___.

	 	 	 	 	 
	 	 	NORDSTROM fsb,
	 	 	as Servicer
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

 

D-2

 

EXHIBIT E

FORM OF INVESTMENT LETTER

(Transfer pursuant to §2.03(e) of the Series 2007-1 Indenture Supplement)

 

_________, ____

Wells Fargo Bank, National Association,

   as Indenture Trustee

625 Marquette Avenue

MAC N9311-161

Minneapolis, Minnesota 55479

Attn: Corporate Trust Services-Asset Backed Administration

Attention:                     

			
	    Re:	 	Nordstrom Credit Card Master Note Trust II, Series 2007-1 Asset-Backed Notes

Dear Sirs:

This letter is delivered by the undersigned (the “Transferee”) pursuant to Section 2.03(e) of
the Series 2007-1 Indenture Supplement (the “2007-1 Indenture Supplement”), dated as of May 1,
2007, among Nordstrom Credit Card Master Note Trust II, as issuer (the “Trust”) and Wells Fargo
Bank, National Association, as indenture trustee (the “Indenture Trustee”), in connection with our
proposed purchase of $___aggregate principal amount of Asset-Backed Notes, Class A (the
“Class A Notes”), $___aggregate principal amount of Asset-Backed Notes, Class B (the
“Class B Notes”) and $___aggregate principal amount of Asset-Backed Notes, Class C (the
“Class C Notes”, and together with the Class A Notes and Class B Notes, the “Offered Notes”),
representing obligations of the Nordstrom Credit Card Master Note Trust II (the “Trust”).
Capitalized terms used herein without definition shall have the meanings set forth in the 2007-2
Indenture Supplement. The investor on whose behalf the undersigned is executing this letter (the
“Transferee”) confirms that:

1. Reference is made to the offering circular, as supplemented by the offering circular
supplement, each dated as of April 25, 2007 (collectively the “Offering Circular”), relating to the
Offered Notes. Capitalized terms used herein that are not otherwise defined shall have the
meanings ascribed thereto in the Offering Circular. The Transferee has received a copy of the
Offering Circular and such other information as the Transferee deems necessary in order to make its
investment decision and the Transferee has been provided the opportunity to ask questions of, and
receive answers from, the Servicer and Nordstrom Credit Card Receivables II LLC, as Transferor,
concerning the Servicer, the Transferor and the terms and conditions of the offering described in
the Offering Circular. The Transferee has received and understands the above, and understands that
substantial risks are involved in an investment in the Offered Notes.

 

E-1

 

2. The Transferee is aware that the sale of such Offered Notes to it is being made in reliance
on Rule 144 A.

3. The Transferee is (i) a “Qualified Institutional Buyer” (as defined in Rule 144A under the
Securities Act of 1933, as amended (the “Securities Act”)) (“QIB”) and (ii) acquiring the Offered
Notes for its own account or for the account of an investor of the type described in clause (i)(a)
above as to each of which the Transferee exercises sole investment discretion. The Transferee is
purchasing the Offered Notes for investment purposes and not with a view to, or for, the offer or
sale in connection with, a public distribution or in any other manner that would violate the
Securities Act or the securities laws of any State.

4. The Transferee understands that (i) the Offered Notes have not been and will not be
registered under the Securities Act or any State securities laws, and may not be reoffered, resold,
pledged or otherwise transferred except (a) to a person whom the seller reasonably believes is a
QIB in a transaction meeting the requirements of Rule 144A or (b) in a transaction complying with
the provisions of Rule 903 or 904 under the Securities Act, in each case, in accordance with any
applicable securities laws of any State of the United States or any other applicable jurisdictions,
and that (ii) the Transferee will, and each subsequent holder is required to, notify any subsequent
Transferee of such Offered Notes from it of the resale restrictions referred to in (i) above.

5. The Transferee agrees that if in the future it should offer, sell or otherwise transfer
such Offered Note, it will do so only pursuant to Rule 144A to a person who the seller reasonably
believes is a QIB in a transaction meeting the requirements of Rule 144A, purchasing for its own
account or for the account of a QIB, whom the holder has informed that such offer, sale or other
transfer is being made in reliance on Rule 144A.

6. The Transferee acknowledges that the Offered Notes offered in reliance on Rule 144A will be
represented by a Rule 144A Global Note.

7. Each Offered Note will bear a legend to the following effect, unless the Transferor and the
Indenture Trustee determine otherwise in accordance with applicable law:

“THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
LAW. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT THIS NOTE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (I) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR
THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE
REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A AND (II) IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTIONS.

 

E-2

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE TRUST OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

NO RESALE OR OTHER TRANSFER OF ANY NOTE SHALL BE MADE TO ANY TRANSFEREE
UNLESS: (A) SUCH TRANSFEREE IS NOT, AND WILL NOT ACQUIRE THE NOTE ON BEHALF
OR WITH PLAN ASSETS OF, AN “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION
3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
(“ERISA”), OR ANY OTHER “PLAN” AS DEFINED IN SECTION 4975(e)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “INTERNAL REVENUE CODE”),
THAT IS SUBJECT TO ERISA OR SECTION 4975 OF THE INTERNAL REVENUE CODE OR ANY
ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE FOREGOING BY REASON OF AN
EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY (EACH, A “BENEFIT
PLAN”) OR (B) THE ACQUISITION AND HOLDING OF THE NOTE BY SUCH TRANSFEREE ARE
ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER PTCE 84-14, PTCE 90-1,
PTCE 91-38, PTCE 95-60, PTCE 96-23 OR A SIMILAR EXEMPTION. EACH PURCHASER
OR TRANSFEREE OF A NOTE, BY ITS ACCEPTANCE OF SUCH NOTE, WILL BE DEEMED TO
HAVE MADE THE REPRESENTATION SET FORTH IN CLAUSE (A) OR (B) ABOVE.

THE PRINCIPAL OF THIS NOTE IS PAYABLE 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.

TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX
TRANSFER
DOCUMENTATION AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE MASTER
INDENTURE.

 

E-3

 

THE HOLDER, BY ACCEPTANCE OF THIS NOTE, SHALL BE DEEMED TO HAVE AGREED TO
TREAT THE NOTE AS DEBT SOLELY OF THE TRUST FOR UNITED STATES FEDERAL, STATE
AND LOCAL INCOME, SINGLE BUSINESS AND FRANCHISE TAX PURPOSES.”

8. (a) The Transferee is not acquiring and will not acquire the Offered Notes on behalf of or
with plan assets of any “employee benefit plan”, as defined in Section 3(3) of ERISA, that is
subject to the requirements of Title I of ERISA or any other “plan” as defined in Section
4975(e)(1) of the Internal Revenue Code that is subject to Section 4975 of the Internal Revenue
Code or any entity deemed to hold plan assets of any of the foregoing by reason of an employee
benefit plan’s or plan’s investment in the entity (each, a “Benefit Plan”) or (b) its acquisition
and holding of the Offered Note are eligible for the exemptive relief available under PTCE 84-14,
PTCE 90-1, PTCE 91-38, PTCE 95-60, PTCE 96-23 or a similar exemption. By its acceptance of an
Offered Note each Transferee will be deemed to have made the representation set forth in clause (i)
or (ii).

9. The Transferee agrees that if at some time in the future it wishes to transfer or exchange
any of the Offered Notes, it will not transfer or exchange any of the Offered Notes unless such
transfer or exchange is in accordance with the Master Indenture and the Indenture Supplement. The
Transferee understands that any purported transfer of any Offered Note (or any interest therein) in
contravention of any of the restrictions and conditions in the Master Indenture and the Indenture
Supplement shall be void, and the purported transferee in such transfer shall not be recognized by
the Trust or any other Person as an Offered Noteholder for any purpose.

The Transferee hereby irrevocably requests for you to arrange for Offered Notes to be
purchased by the Transferee and to be recorded on the books of the Indenture Trustee as follows:

	 	 	 
	Principal Amount	 	 
	of Offered Notes	 	Recorded in Name of:
	 

	 	 

 

E-4

 

9. You and the Indenture Trustee are entitled to rely upon this letter and are irrevocably
authorized to produce this 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,
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

 

E-5

 

EXHIBIT F

FORM OF TRANSFER CERTIFICATE

FOR INITIAL AND SUBSEQUENT TRANSFER OF A CLASS C NOTE

(Transfer pursuant to §2.03(e) of the Indenture Supplement)

_________, ____

Wells Fargo Bank, National Association,

   as Indenture Trustee

625 Marquette Avenue

MAC N9311-161

Minneapolis, Minnesota 55479

Attn: Corporate Trust Services-Asset Backed Administration

Attention:                                         

			
	    Re:	 	Nordstrom Credit Card Master Note Trust II, Series 2007-1, Class C Notes

Dear Sirs:

In connection with our proposed purchase of $___aggregate principal amount of Asset
Backed Notes, Class C (the “Class C Notes”), representing obligations of the Nordstrom Credit Card
Master Note Trust II (the “Trust”), the investor on whose behalf the undersigned is executing this
letter (the “Transferee”) confirms that:

1. Reference is made to the amended and restated master indenture, as supplemented by the
indenture supplement, each dated as of May 1, 2007, as the same may be amended, supplemented or
otherwise modified from time to time (collectively, the “Indenture”), relating to the Class C
Notes. Capitalized terms used herein that are not otherwise defined shall have the meanings
ascribed thereto in the Master Indenture. The Transferee has received a copy of the Master
Indenture and such other information as the Transferee deems necessary in order to make its
investment decision and the Transferee has been provided the opportunity to ask questions of, and
receive answers from, the Servicer and Nordstrom Credit Card Receivables II LLC, as Transferor,
concerning the Servicer, the Transferor and the terms and conditions of the offering described in
the Master Indenture. The Transferee has received and understands the above, and understands that
substantial risks are involved in an investment in the Class C Notes. The Transferee represents
that in making its investment decision to acquire the Class C Notes, the Transferee has not relied
on representations, warranties, opinions, projections, financial or other information or analysis,
if any, supplied to it by any person, including you, the Transferor, the Servicer or the Owner
Trustee or any of your or their affiliates, except as expressly contained in the Master Indenture
and in the other written information, if any, discussed above. The Transferee has such knowledge
and experience in financial and business matters as to be capable of evaluating the merits and
risks of an investment in the Class C Notes, and the Transferee is able to bear the substantial
economic risks of such an investment. The Transferee has relied
upon its own tax, legal and financial advisors in connection with its decision to purchase the
Class C Notes.

 

F-1

 

2. The Transferee is (a) a “Qualified Institutional Buyer” (as defined in Rule 144A under the
Securities Act of 1933, as amended (the “Securities Act”)) and (b) acquiring the Class C Notes for
its own account or for the account of an investor of the type described in clause (a) above as to
each of which the Transferee exercises sole investment discretion or. The Transferee is purchasing
the Class C Notes for investment purposes and not with a view to, or for, the offer or sale in
connection with, a public distribution or in any other manner that would violate the Securities Act
or the securities laws of any State.

3. The Transferee understands that (i) the Class C Notes have not been and will not be
registered under the Securities Act or any State securities law, and may not be reoffered, resold,
pledged or otherwise transferred except (a) to a person whom the seller reasonably believes is a
QIB in a transaction meeting the requirements of Rule 144A, (b) in a transaction complying with the
provisions of Rule 903 or 904 under the Securities Act, in each case, in accordance with any
applicable securities laws of any State of the United States or any other applicable jurisdictions,
and that (ii) the Transferee will, and each subsequent holder is required to, notify any subsequent
Transferee of such Class C Notes from it of the resale restrictions referred to in (i) above.

4. The Transferee agrees that if in the future it should offer, sell or otherwise transfer
such Class C Note, it will do so only pursuant to Rule 144A to a person who the seller reasonably
believes is a QIB in a transaction meeting the requirements of Rule 144A, purchasing for its own
account or for the account of a QIB, whom the holder has informed that such offer, sale or other
transfer is being made in reliance on Rule 144A.

5. The Transferee, if it is a QIB, it acknowledges that the Class C Notes offered in reliance
on Rule 144A will be represented by a Rule 144A Global Note.

6. Each Class C Note will bear a legend to the following effect, unless the Transferor and the
Indenture Trustee determine otherwise in accordance with applicable law:

“NO CLASS C NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED OR CONVEYED (EACH A
“TRANSFER”) UNLESS THE INDENTURE TRUSTEE AND THE TRANSFEROR ARE PROVIDED
WITH AN OPINION OF COUNSEL THAT SUCH TRANSFER WILL NOT CAUSE THE TRUST TO BE
TREATED AS AN ASSOCIATION OR PUBLICLY TRADED PARTNERSHIP TAXABLE AS A
CORPORATION FOR FEDERAL INCOME TAX PURPOSES.

THIS CLASS C NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY
STATE SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CLASS C NOTE,
AGREES THAT THIS CLASS C NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE

 

F-2

 

TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING
FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE
HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A AND (II) IN ACCORDANCE WITH
ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTIONS.

UNLESS THIS CLASS C NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE TRUST OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CLASS C
NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THIS CLASS C NOTE MAY NOT BE PURCHASED BY OR TRANSFERRED TO ANY “EMPLOYEE
BENEFIT PLAN” WITHIN THE MEANING OF SECTION 3(3) OF ERISA (WHETHER OR NOT
SUBJECT TO ERISA, AND INCLUDING, WITHOUT LIMITATION, FOREIGN AND
GOVERNMENTAL PLANS) OR ANY “PLAN” DESCRIBED IN SECTION 4975(E)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “INTERNAL REVENUE CODE”), OR
ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” OF ANY OF THE
FOREGOING BY REASON OF A PLAN’S INVESTMENT IN SUCH ENTITY.

THE PRINCIPAL OF THIS CLASS C NOTE IS PAYABLE AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CLASS C NOTE AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

TRANSFERS OF THE CLASS C NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE
TAX TRANSFER
DOCUMENTATION AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE MASTER
INDENTURE.

 

F-3

 

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

7. The Transferee is not acquiring and will not acquire the Class C Notes on behalf of or with
plan assets of any “employee benefit plan”, as defined in Section 3(3) of ERISA, whether or not
subject to ERISA (including, without limitation, foreign and governmental plans), any “plan” of the
Internal Revenue Code or any entity deemed to include plan assets of any of the foregoing by reason
of an employee benefit plan’s or plan’s investment in the entity (each, a “Benefit Plan”).

8. The Transferee agrees that if at some time in the future it wishes to transfer or exchange
any of the Class C Notes, it will not transfer or exchange any of the Class C Notes unless such
transfer or exchange is in accordance with the Master Indenture and the Indenture Supplement. The
Transferee understands that any purported transfer of any Class C Note (or any interest therein) in
contravention of any of the restrictions and conditions in the Master Indenture and the Indenture
Supplement shall be void, and the purported transferee in such transfer shall not be recognized by
the Trust or any other Person as a Class C Noteholder for any purpose.

The Transferee hereby irrevocably requests for you to arrange for Class C Notes to be
purchased by the Transferee and to be recorded on the books of the Indenture Trustee as follows:

	 	 	 	 	 
	Principal Amount	 	 	 
	of Class C Notes	 	Recorded in Name of:	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 

9. You and the Indenture Trustee are entitled to rely upon this letter and are irrevocably
authorized to produce this 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,
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

 

F-4

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