Nordstrom, Inc.
Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

   
(Mark One)  
x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
  SECURITIES EXCHANGE ACT OF 1934
   
For the fiscal year ended January 31, 2003
   
OR
   
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
  SECURITIES EXCHANGE ACT OF 1934
   
For the transition period from           to           

Commission file number 0-6074

Nordstrom, Inc.

(Exact name of Registrant as specified in its charter)
     
Washington   91-0515058
(State or other jurisdiction of   (IRS employer
incorporation or organization)   Identification No.)
     
1617 Sixth Avenue, Seattle, Washington   98101
(Address of principal executive offices)   (Zip code)

Registrant’s telephone number, including area code: 206-628-2111

Securities registered pursuant to Section 12(b) of the Act:

     
    Name of each exchange
Title of each class   on which registered

 
Common Stock, without par value   New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES    X    NO        

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act 12b-2). YES    X    NO        

     As of July 31, 2002 the aggregate market value of the Registrant’s voting and non-voting stock held by non-affiliates of the Registrant was approximately $1.8 billion using the closing sales price on this day of $18.90.

     On March 17, 2003, 135,457,544 shares of common stock were outstanding.

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DOCUMENTS INCORPORATED BY REFERENCE

1.  Portions of Nordstrom, Inc. Annual Report to Shareholders for fiscal year ended January 31, 2003 are incorporated into Parts I, II and IV

2.  Portions of Proxy Statement for 2003 Annual Meeting of Shareholders scheduled to be held on May 20, 2003 are incorporated into Part III

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TABLE OF CONTENTS

PART I
Item 1. Business.
Item 2. Properties.
Item 3. Legal Proceedings.
Item 4. Submission of Matters to a Vote of Security Holders.
PART II
Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters.
Item 6. Selected Financial Data.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Item 8. Financial Statements and Supplementary Data.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Item 11. Executive Compensation.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Item 13. Certain Relationships and Related Transactions.
Item 14. Controls and Procedures.
Item 15. Principal Accountant Fees and Services.
PART IV
Item 16. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
SIGNATURES
CERTIFICATIONS
INDEPENDENT AUDITORS’ CONSENT AND REPORT ON SCHEDULE
SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS
Exhibit Index
EXHIBIT 3.2
EXHIBIT 10.39
EXHIBIT 10.40
EXHIBIT 10.41
EXHIBIT 10.42
EXHIBIT 10.43
EXHIBIT 10.44
EXHIBIT 13.1
EXHIBIT 21.1
EXHIBIT 99.1
EXHIBIT 99.2


Table of Contents

TABLE OF CONTENTS

           
      Page
     
PART I
       
 
Item 1.Business
    4  
 
Item 2.Properties
    10  
 
Item 3.Legal Proceedings
    11  
 
Item 4.Submission of Matters to a Vote of Security Holders
    11  
PART II
       
 
Item 5.Market for Registrant’s Common Equity and Related Stockholder Matters
    11  
 
Item 6.Selected Financial Data
    12  
 
Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operation
    12  
 
Item 7A.Quantitative and Qualitative Disclosures About Market Risk
    12  
 
Item 8.Financial Statements and Supplementary Data
    14  
 
Item 9.Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
    14  
PART III
       
 
Item 10.Directors and Executive Officers of the Registrant
    14  
 
Item 11.Executive Compensation
    14  
 
Item 12.Security Ownership of Certain Beneficial Owners and Management
    15  
 
Item 13.Certain Relationships and Related Transactions
    15  
 
Item 14.Controls and Procedures
    15  
 
Item 15.Principal Accountant Fees and Services
    15  
PART IV
       
 
Item 16.Exhibits, Financial Statement Schedules, and Reports on Form 8-K
    16  
Signatures
    23  
Certifications
    24  
Independent Auditors’ Consent And Report On Schedule
    26  
Schedule II — Valuation And Qualifying Accounts
    27  
Exhibit Index
    28  

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PART I

Item 1. Business.

We incorporated in the State of Washington in 1946 as the successor to a retail shoe business that started in 1901. As of January 31, 2003, we operated 88 large specialty stores, selling a wide selection of apparel, shoes and accessories for women, men and children.

We also operated 48 stores under the name “Nordstrom Rack” and one clearance store under the name “Last Chance.” The Nordstrom Rack stores purchase merchandise directly from manufacturers, as well as serving, in part, as outlets for clearance merchandise from our large specialty stores.

We also operated one free-standing shoe store under the name “Nordstrom” and five Specialty Boutiques under the name “Façonnable”. As a result of the acquisition of Façonnable, S.A. of Nice, France in October 2000, we also operated 23 Façonnable boutiques located primarily in Europe. Façonnable is a wholesaler and retailer of high quality men’s and women’s apparel and accessories.

In March 2003, we opened one large specialty store in Houston, Texas. In addition, we plan to open large specialty stores in Richmond, Virginia; Austin, Texas and Wellington Green, Florida as well as Nordstrom Rack stores in Chicago, Illinois and Sunrise, Florida during fiscal 2003.

The west coast and the east coast of the United States are the markets in which we have the largest presence. An economic downturn or other significant event within one of these markets may have a material effect on our operating results.

We purchase merchandise from many suppliers, no one of which accounted for more than 2% of 2002 net purchases. We believe that we are not dependent on any one supplier, and consider our relations with our suppliers to be satisfactory.

We have approximately 99 registered trademarks. The loss or abandonment of the Federally registered names “Nordstrom” or “Façonnable” would materially impact our business. The loss or abandonment of the Federally registered trademarks “Brass Plum”, “Baby N”, “Caslon”, “Classiques Entier”, “Frenchi”, “Halogen” and “Rubbish” may impact our business, but not in a material manner. With the exception of the above-mentioned Federally registered trademarks, the loss or abandonment of any particular trademark would have little, if any, impact on our business.

Due to our anniversary sale in July and holidays in December, sales are higher in the second and fourth quarters of the fiscal year than in the first and third quarters. During the fiscal year ended January 31, 2003, we regularly employed on a full or part-time basis an average of approximately 44,000 employees. Due to the seasonal nature of our business, employment increased to approximately 52,000 employees in July 2002 and 48,000 in December 2002.

Our business is highly competitive. Our stores compete with other national, regional and local retail establishments within our operating areas which carry similar lines of merchandise, including department stores, specialty stores, boutiques, and mail order and Internet businesses. Our specific competitors vary from market to market. We believe the principal methods of competing in our industry include customer service, value, quality of product, fashion, advertising, store location and depth of selection.

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Item 1. Business (continued).

We file annual, quarterly and current reports, proxy statements and other documents with the Securities and Exchange Commission (“SEC”). You may read and copy any material we file with the SEC at the SEC’s Public Reference Room at 450 Fifth Street, NW, Washington, DC 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains an Internet website at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

Our Internet website is http://www.nordstrom.com. We make available free of charge on or through our Internet website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. We also expect to post on our website the code of business conduct and ethics that we adopt for our directors, officers and employees, as well as waivers and amendments.

Certain other information required under Item 1 is contained within the following sections of our 2002 Annual Report to Shareholders, which sections are incorporated by reference herein from Exhibit 13.1 of this report:

    Management’s Discussion and Analysis
 
    Note 1: Summary of Significant Accounting Policies in Notes to Consolidated Financial Statements
 
    Note 19: Segment Reporting in Notes to Consolidated Financial Statements
 
    Note 21: Nordstrom.com in Notes to Consolidated Financial Statements
 
    Retail Store Facilities

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Executive Officers of the Registrant

                         
                Officer   Family
Name   Age   Title   Since   Relationship

 
 
 
 
Jammie Baugh     50     Executive Vice President     1990     None
                         
Laurie M. Black     44     Executive Vice President     1997     None
                         
Mark S. Brashear     41     Executive Vice President     2001     None
                         
James H. Bromley     39     Executive Vice President and President of Nordstrom Direct, Inc.     2002     None
                         
Dale Cameron     54     Executive Vice President     1985     None
                         
Robert E. Campbell     47     Vice President and Treasurer     1999     None
                         
Linda Toschi Finn     55     Executive Vice President     1998     None
                         
Kevin T. Knight     47     Executive Vice President, Chairman and Chief Executive Officer of Nordstrom fsb, and President of Nordstrom Credit, Inc.     1998     None
                         
Michael G. Koppel     46     Executive Vice President and Chief Financial Officer     1999     None
                         
Llynn (Len) A. Kuntz     42     Executive Vice President     1998     None
                         
David L. Mackie     54     Vice President     1994     None
                         
Robert J. Middlemas     46     Executive Vice President     1993     None
                         
Blake W. Nordstrom     42     President     1991     Brother of Erik B. and Peter E. Nordstrom; son of Bruce A. Nordstrom, a Director of the Company; and nephew of D. Wayne Gittinger, a Director of the Company.
                         
Bruce A. Nordstrom     69     Chairman of the Board of Directors     1966     Father of Blake W., Erik B. and Peter E. Nordstrom; cousin of John N. Nordstrom, a Director of the Company and Brother-in-law of D. Wayne Gittinger, a Director of the Company.
                         
Erik B. Nordstrom     39     Executive Vice President     1995     Brother of Blake W. and Peter E. Nordstrom; son of Bruce A. Nordstrom, a Director of the Company; and nephew of D. Wayne Gittinger, a Director of the Company.

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Executive Officers of the Registrant (continued)

                         
                Officer   Family
Name   Age   Title   Since   Relationship

 
 
 
 
Peter E. Nordstrom     41     Executive Vice President     1995     Brother of Blake W. and Erik B. Nordstrom; son of Bruce A. Nordstrom, a Director of the Company; and nephew of D. Wayne Gittinger, a Director of the Company.
                         
James R. O’Neal     44     Executive Vice President     1997     None
                         
R. Michael Richardson     46     Vice President and Chief Information Officer     2001     None
                         
K.C. (Karen) Shaffer     49     Executive Vice President     2001     None
                         
Joel T. Stinson     53     Executive Vice President and Chief Administrative Officer     1996     None
                         
Delena M. Sunday     42     Executive Vice President     1998     None
                         
Geevy S.K. Thomas     38     Executive Vice President     1998     None

Jammie Baugh was named Executive Vice President Full-line Stores Human Resources in November 2002. Prior to that, she served as Executive Vice President Human Resources from February 2000 to November 2002, Executive Vice President and Northwest General Manager from May 1997 to February 2000, Executive Vice President and General Manager Southern California from 1991 to May 1997, and Vice President and General Manager Southern California from 1990 to 1991.

Laurie M. Black was named Executive Vice President and President of Nordstrom Rack in December 2001. Prior to that, she served as Vice President and Corporate Merchandise Manager for Specialized from May 2000 to December 2001, as Vice President and Northwest Divisional Merchandise Manager for Specialized and Accessories from April 1999 to April 2000, and as Vice President and Northwest/Southwest Divisional Merchandise Manager for Specialized from February 1997 to March 1999. Prior to that, Ms. Black held various merchandise management positions within the Company since 1988.

Mark S. Brashear was named Executive Vice President and President of Façonnable in December 2001. Prior to that, he served as Executive Vice President and Southwest General Manager of the Full-line Store Group from February 2001 to December 2001, as Division Vice President and Strategic Planning Manager of the Southwest Business Unit from April 1999 to February 2001, and as Strategic Planning Manager for California and the Southwest from February 1998 to April 1999. Prior to that, Mr. Brashear held various store management positions with the Company.

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Executive Officers of the Registrant (continued)

James H. Bromley was named Executive Vice President of the Company on July 16, 2002, and President of Nordstrom Direct, Inc. on July 16, 2002. Prior to that, he served as Executive Vice President and Chief Financial Officer of Nordstrom.com, Inc. from May 2000 to July 2002. Prior to joining Nordstrom, Mr. Bromley served as Senior Vice President, Chief Financial Officer and Treasurer at Multiple Zones International, a supplier of computer products and services, from June 1999 to May 2000. From May 1998 to May 1999, he served as Managing Director at McDonald Investments, and from March 1996 to May 1998 he served as Managing Director at Dain Rauscher.

Dale Cameron was named Executive Vice President in February 1998, and served as Vice President from March 1985 to February 1998. In addition, Ms. Cameron has served as Corporate Cosmetics Merchandise Manager since April 1976. Prior to that, she held various department manager and buyer positions with us.

Robert E. Campbell was named Vice President Strategy and Planning and Treasurer in May 1999. Prior to that, he was involved with corporate strategy and planning and was responsible for the Company’s investor relations function since March 1998, and served as Manager of Financial Analysis since February 1997. Prior to joining us, Mr. Campbell served in a number of financial positions with restaurant and retail companies based on the West Coast.

Linda Toschi Finn was named Executive Vice President Marketing in September 2000. She was promoted to Vice President and Marketing Director for the Full-line Store Group in October 1999. Ms. Finn has been responsible for the development of the Company’s marketing strategies since February 1998 when she was named Vice President of Sales Promotion. Prior to that, she held various management positions with the Company in the areas of corporate advertising and sales promotion.

Kevin T. Knight has been an Executive Vice President of Nordstrom, Inc. since September 2000, and also serves as Chairman and Chief Executive Officer of Nordstrom fsb, President of Nordstrom Credit, Inc., and, as of February 2000, President of Nordstrom Credit Group. Prior to that, he served as Vice President of Nordstrom, Inc. and President of Nordstrom fsb (formerly Nordstrom National Credit Bank), President of Nordstrom Credit, Inc., and General Manager of the credit business unit since April 1998. Prior to joining us, he was Senior Vice President of Retailer Financial Services, a unit of General Electric Capital Corporation, since 1995. Prior to that, he held various positions with General Electric since 1977.

Michael G. Koppel was named Executive Vice President and Chief Financial Officer in May 2001. Prior to that he served as Vice President, Corporate Controller and Principal Accounting Officer from August 1999 to May 2001. Prior to joining us, Mr. Koppel served as Chief Operating Officer of CML Group, a specialty retail holding company. From 1997 through 1998, he was Chief Financial Officer of Lids Corporation, a mall based specialty retailer, and from 1984 through 1997 he held a number of financial positions with the May Department Stores, most recently as Vice President-Controller of its Filenes division.

Llynn (Len) A. Kuntz was named Executive Vice President and Washington/Alaska Regional Manager in November 2001. Prior to that he served as Executive Vice President and Northwest General Manager of the Full-line Store Group from February 2001 to November 2001, as Vice President and Director of the Full-line Store Strategy Group from May 1999 to February 2001, as Vice President and East Coast Regional Manager from February 1998 to May 1999, and as General Manager of the Northeast Region from 1995 to February 1998.

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Executive Officers of the Registrant (continued)

David L. Mackie was named Vice President Real Estate and Corporate Secretary in December 2002. Prior to that, he served as Vice President Real Estate and Legal Affairs from February 2002 to November 2002, as Vice President Real Estate from April 1994 to January 2002, as Corporate Manager of Legal, Tax and Real Estate from February 1985 to March 1994, and as Corporate Tax Manager from September 1983 to January 1985.

Robert J. Middlemas was named Executive Vice President and Central States Regional Manager in November 2001. Prior to that he served as Executive Vice President and Central States General Manager from November 1997 to November 2001, and as Vice President and Central States General Manager from 1993 to November 1997.

Blake W. Nordstrom was named President of the Company in August 2000. From February 2000 until his appointment as President, he served as Executive Vice President and President of Nordstrom Rack. Prior to that, he served as Co-President responsible for credit, community relations, operations, shoes and Nordstrom Rack business units since June 1995 and as Vice President and General Manager Washington/Alaska since 1991.

Bruce A. Nordstrom was named Chairman of the Board of Directors in August 2000. He has served as a Director of the Company since 1966, and served as Co-Chairman of the Board of Directors from 1971 until 1995. Mr. Nordstrom is the grandson of our founder and, with his cousins John N. Nordstrom and James F. Nordstrom and his former brother-in-law John A. McMillan, he assumed leadership of the Company from the second generation in 1968.

Erik B. Nordstrom was named Executive Vice President Full-line Stores in August 2000. Prior to that, he served as Executive Vice President and Northwest General Manager since February 2000, as Co-President responsible for Nordstrom Product Group since June 1995 and as Store/Regional Manager — Minnesota since 1992.

Peter E. Nordstrom was named Executive Vice President and President of Full-line Stores in September 2000. Prior to that, he served as Executive Vice President and Director of Full-line Store Merchandise Strategy for children’s apparel, cosmetics, junior apparel, lingerie, hosiery, men’s apparel and women’s active wear since February 2000, as Co-President responsible for sales promotion, human resources, and diversity affairs since June 1995, and as Regional Manager of the Orange County area since 1991.

James R. O’Neal was named Executive Vice President and President of Nordstrom Product Group in December 2001. From August 2000 until December 2001 he served as Executive Vice President and General Manager of the East Coast. Prior to that, he served as Executive Vice President and Southwest General Manager since November 1997, as Vice President — Northern California since February 1997, as General Manager Northern California from 1995 to 1997, and as City Regional Manager from 1993 to 1995.

R. Michael Richardson was named Vice President and Chief Information Officer in February 2001. Prior to that, he served as Chief Information Officer since September 2000. From April 2000 to September 2000 Mr. Richardson was not employed by the Company. Prior to his departure from us, he served as Division Vice President of Enterprise Development and Architecture since October 1998, and as IT Development Manager of the Nordstrom Product Group since October 1997. Mr. Richardson has also served as IT Development Manager for various corporate departments since 1992.

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Executive Officers of the Registrant (continued)

K.C. (Karen) Shaffer was named Executive Vice President and Nordstrom Rack Northwest Regional Manager in December 2001. Prior to that, she served as Executive Vice President and Nordstrom Rack General Merchandise Manager from February 2001 to December 2001, as Division Vice President and Nordstrom Rack Northwest Regional Manager from April 1999 to February 2001, and as Nordstrom Rack Northwest Regional Manager from June 1998 to April 1999. Prior to that, Ms. Shaffer held various management positions with the Company at the department, store and regional levels.

Joel T. Stinson was named Executive Vice President and Chief Administrative Officer in September 2000. Prior to that, he served as Vice President of Operations since May 1995 and as Corporate Operations Manager since 1993. Mr. Stinson is retiring from the Company on May 15, 2003.

Delena M. Sunday was named Executive Vice President Human Resources and Diversity Affairs in November 2002. Prior to that, she served as Executive Vice President of Diversity Affairs from September 2000 to November 2002, Vice President of Diversity Affairs from February 1998 to September 2000, and Director of Diversity Affairs from 1996 to February 1998. Prior to that, Ms. Sunday held various management positions with the Company at the store and regional levels.

Geevy S.K. Thomas was named Executive Vice President and South Regional Manager in November 2001. Prior to that, he served as Executive Vice President and General Merchandise Manager of Full-line Stores from February 2001 to November 2001, as Executive Vice President of Full-line Stores and Director of Merchandising Strategy from February 2000 to February 2001, as Vice President and Director of Merchandising Strategy from May 1999 to February 2000, as Vice President and Regional Manager of Orange County and Los Angeles from February 1998 to May 1999, and as General Manager of Los Angeles from February 1997 to February 1998. Prior to February 1997, Mr. Thomas held various general, regional and store management positions with us.

The officers are appointed annually by the Board of Directors following each year’s Annual Meeting of Shareholders. Officers serve at the discretion of the Board of Directors.

Item 2. Properties.

The following table summarizes the number of retail stores owned or operated by us, and the percentage of total store area represented by each listed category at January 31, 2003:

                 
    Number of   % of total store
    stores   square footage
   
 
Owned stores
    29       25 %
Leased stores
    97       32  
Owned on leased land
    38       41  
Partly owned & partly leased
    2       2  
 
   
     
 
 
    166       100 %
 
   
     
 

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Item 2. Properties. (continued)

We also operate 6 merchandise distribution centers located throughout the U.S., which are utilized by the Retail Stores segment, all of which are owned. The Catalog/Internet segment utilizes one fulfillment center, which is owned on leased land. Our administrative offices in Seattle, Washington are a combination of leased and owned space. We lease the office building in the Denver, Colorado metropolitan area that serves as the principal offices of Nordstrom fsb and Nordstrom Credit, Inc.

Certain other information required under this item is included in the following sections of our 2002 Annual Report to Shareholders, which sections are incorporated by reference herein from Exhibit 13.1 of this report:

    Note 13: Land, Buildings and Equipment in Notes to Consolidated Financial Statements
 
    Note 16: Leases in Notes to Consolidated Financial Statements
 
    Retail Store Facilities

Item 3. Legal Proceedings.

The information required under this item is included in the following section of our 2002 Annual Report to Shareholders, which section is incorporated by reference herein from Exhibit 13.1 of this report:

    Note 23: Contingent Liabilites in Notes to Consolidated Financial Statements

Item 4. Submission of Matters to a Vote of Security Holders.

    None

PART II

Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters.

Our Common Stock, without par value, is traded on the New York Stock Exchange under the symbol “JWN.” The approximate number of holders of Common Stock as of March 17, 2003 was 75,717.

Certain other information required under this item with respect to stock prices and dividends is included in the following sections of our 2002 Annual Report to Shareholders, which sections are incorporated by reference herein from Exhibit 13.1 of this report:

    Consolidated Statements of Shareholders’ Equity
 
    Note 17: Stock-based Compensation in Notes to Consolidated Financial Statement
 
    Note 24: Selected Quarterly Data (unaudited) in Notes to Consolidated Financial Statements

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Item 6. Selected Financial Data.

The information required under this item is included in the following sections of our 2002 Annual Report to Shareholders, which sections are incorporated by reference herein from Exhibit 13.1 of this report:

    Management’s Discussion and Analysis
 
    Note 2: Cumulative Effect of Accounting Change in Notes to Consolidated Financial Statements
 
    Note 3: Acquisition in Notes to Consolidated Financial Statements
 
    Note 20: Restructurings, Impairments, and Other One-Time Charges in Notes to Consolidated Financial Statements
 
    Note 21: Nordstrom.com in Notes to Consolidated Financial Statements
 
    Eleven-Year Statistical Summary

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation.

The information required under this item is included in the following section of our 2002 Annual Report to Shareholders, which section is incorporated by reference herein from Exhibit 13.1 of this report:

    Management’s Discussion and Analysis

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Interest Rate Risk

We are exposed to market risk from changes in interest rates. In seeking to minimize risk, we manage exposure through our regular operating and financing activities. We do not use financial instruments for trading or other speculative purposes and are not party to any leveraged financial instruments.

Interest rate exposure is managed through our mix of fixed and variable rate borrowings. Short-term borrowing and investing activities generally bear interest at variable rates, but because they have maturities of three months or less, we believe that the risk of material loss is low, and that the carrying amount approximated fair value.

In addition, we have outstanding at January 31, 2003 a $250 million 5.625% fixed-rate debt converted to variable rate through the use of an interest rate swap. Subsequent to January 31, 2003, we sold the interest rate swap and received cash of $2.3 million, which will be recognized as interest income evenly over the remaining life of the related debt.

In the third quarter of 2002, we sold the interest rate swap that converted our $300 million, 8.95% fixed-rate debt to variable rate. We received cash of $4.9 million, which will be recognized as interest income evenly over the remaining life of the related debt.

The table below presents information about our financial instruments that are sensitive to changes in interest rates, which consist of debt obligations and interest rate swaps for the year ended January 31, 2003. For debt obligations, the table presents principal amounts, at book value, by maturity date, and related weighted average interest rates. For interest rate swaps, the table presents notional amounts and weighted average interest rates by expected (contractual) maturity dates. Notional amounts are the predetermined dollar principal on which the exchanged interest payments are based.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk (continued)

                                                                     
                                                                Fair value
                                                        Total at   of liabilities
Dollars in                                                   January 31,   January 31,
thousands   2003   2004   2005   2006   2007   Thereafter   2003   2003

 
 
 
 
 
 
 
 
Long-term debt
 
Fixed
$ 5,545     $ 5,032     $ 403,554     $ 303,958     $ 4,045     $ 625,237     $ 1,347,371     $ 1,443,000  
 
Avg. int. rate
    6.1 %     6.6 %     8.4 %     4.9 %     8.4 %     6.6 %     6.7 %        
 
Interest rate swap Fixed to variable
                                $ 250,000     $ 250,000     $ 3,000  
   
Avg. pay rate
                                  3.3 %     3.3 %        
   
Avg. receive rate
                                  5.6 %     5.6 %        

Foreign Currency Exchange Risk

The majority of our revenue, expense and capital expenditures are transacted in United States dollars. However, we periodically enter into foreign currency purchase orders for apparel and shoes denominated in Euros. We use forward contracts to hedge against fluctuations in foreign currency prices. There were no forward contracts outstanding as of January 31, 2003. The use of derivatives is limited to only those financial instruments that have been authorized by our Chief Financial Officer and Treasurer.

In addition, the functional currency of Faconnable, S.A.S. of Nice, France is the Euro. Assets and liabilities of Faconnable are translated into U.S. dollars at the exchange rate prevailing at the end of the period. Income and expenses are translated into U.S. dollars at an average exchange rate during the period. Foreign currency gains and losses from the translation of Faconnable’s balance sheet and income statement are included in other comprehensive earnings. Foreign currency gains or losses from certain intercompany loans are recorded in service charge income and other, net.

We considered the potential impact of a hypothetical 10% adverse change in foreign exchange rates and we believe that such a change would not have a material impact on our cash flows of financial instruments that are sensitive to foreign currency exchange risk. The model measured the change in cash flows arising from the 10% adverse change in foreign exchange rates, and covered long-term debt denominated in Euros.

Certain other information required under this item is included in the following sections of our 2002 Annual Report to Shareholders, which sections are incorporated by reference herein from Exhibit 13.1 of this report:

    Note 1: Summary of Significant Accounting Policies in Notes to Consolidated Financial Statements
 
    Note 7: Investment in Notes to Consolidated Financial Statements
 
    Note 14: Notes Payable in Notes to Consolidated Financial Statements
 
    Note 15: Long-Term Debt in Notes to Consolidated Financial Statements
 
    Note 16: Leases in Notes to Consolidated Financial Statements
 
    Note 22: Vulnerability Due to Certain Concentrations in Notes to Consolidated Financial Statements

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Item 8. Financial Statements and Supplementary Data.

The information required under this item is included in the following sections of our 2002 Annual Report to Shareholders, which sections are incorporated by reference herein from Exhibit 13.1 of this report:

    Consolidated Statements of Earnings
 
    Consolidated Balance Sheets
 
    Consolidated Statements of Shareholders’ Equity
 
    Consolidated Statements of Cash Flows
 
    Notes to Consolidated Financial Statements
 
    Independent Auditors’ Report

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

    None

PART III

Item 10. Directors and Executive Officers of the Registrant.

The information required under this item with respect to our Directors and compliance with Section 16(a) of the Exchange Act is included in the following sections of our Proxy Statement for our 2003 Annual Meeting of Shareholders, which sections are incorporated by reference herein and will be filed within 120 days after the end of our fiscal year:

    Election of Directors
 
    Compliance with Section 16 of the Exchange Act of 1934

The information required under this item with respect to our Executive Officers is incorporated by reference from Part I, Item 1 of this report under “Executive Officers of the Registrant.”

Item 11. Executive Compensation.

The information required under this item is included in the following sections of our Proxy Statement for our 2003 Annual Meeting of Shareholders, which sections are incorporated by reference herein and will be filed within 120 days after the end of our fiscal year:

    Compensation of Executive Officers in the Year Ended January 31, 2003
 
    Compensation and Stock Option Committee Report on the Fiscal Year Ended January 31, 2003
 
    Stock Price Performance
 
    Compensation of Directors

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Item 12. Security Ownership of Certain Beneficial Owners and Management.

The information required under this item is included in the following section of our Proxy Statement for our 2003 Annual Meeting of Shareholders, which sections are incorporated by reference herein and will be filed within 120 days after the end of our fiscal year:

    Security Ownership of Certain Beneficial Owners and Management
 
    Equity Compensation Plan Information

Item 13. Certain Relationships and Related Transactions.

The information required under this item is included in the following sections of our Proxy Statement for our 2003 Annual Meeting of Shareholders, which sections are incorporated by reference herein and will be filed within 120 days after the end of our fiscal year:

    Election of Directors
 
    Certain Relationships and Related Transactions

Item 14. Controls and Procedures.

“Disclosure controls” are controls and other procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to our management, including our President and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. “Internal controls” are procedures that are designed to provide reasonable assurance that our transactions are properly authorized, our assets are safeguarded against unauthorized or improper use and our transactions are properly recorded and reported, all to permit the preparation of our financial statements in conformity with generally accepted accounting principles.

Within the 90-day period prior to the filing of this report, we performed an evaluation under the supervision and with the participation of management, including our President and Chief Financial Officer, of our disclosure controls and procedures. Based upon that evaluation, the President and the Chief Financial Officer concluded that our disclosure controls and procedures are effective in the timely recording, processing, summarizing and reporting of material financial and non-financial information.

We reviewed our internal controls for effectiveness periodically during the period covered by this report. No significant changes were made in our internal controls or in other factors that could significantly affect our internal controls subsequent to the date of their last evaluation.

Item 15. Principal Accountant Fees and Services.

The information required under this item is included in the following section of our Proxy Statement for our 2003 Annual Meeting of Shareholders, which section is incorporated by reference herein and will be filed within 120 days after the end of our fiscal year:

    Ratification of Appointment of Auditors

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PART IV

Item 16. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

(a)1.   Financial Statements

The following consolidated financial information and statements and the Independent Auditors’ Report are incorporated by reference herein from Exhibit 13.1 of this report:

    Consolidated Statements of Earnings
 
    Consolidated Balance Sheets
 
    Consolidated Statements of Shareholders’ Equity
 
    Consolidated Statements of Cash Flows
 
    Notes to Consolidated Financial Statements
 
    Independent Auditors’ Report

(a)2.   Financial Statement Schedules
         
    Page
   
Independent Auditors’ Consent and Report on Schedule     26  
Schedule II — Valuation and Qualifying Accounts     27  

    Other schedules for which provision is made in Regulation S-X are not required, are inapplicable, or the information is included in our 2002 Annual Report to Shareholders as incorporated by reference herein from Exhibit 13.1 of this report.

(a)3.   Exhibits

  (3.1)   Articles of Incorporation of the Registrant, as amended and restated on May 21, 2002, are hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2002, Exhibit 3.1.
 
  (3.2)   Bylaws of the Registrant, as amended and restated on February 1, 2003, are filed herein as Exhibit 3.2.
 
  (4.1)   Indenture between Registrant and Norwest Bank Colorado, N.A., as trustee, dated March 11, 1998 is hereby incorporated by reference from Registration No. 333-47035, Exhibit 4.1.
 
  (4.2)   Senior indenture between Registrant and Norwest Bank Colorado, N.A., as trustee, dated January 13, 1999 is hereby incorporated by reference from Registration No. 333-69281, Exhibit 4.3.
 
  (4.3)   Form of Subordinated Indenture between Registrant and Norwest Bank Colorado, N.A., as trustee, dated January 13, 1999 is hereby incorporated by reference from Registration No. 333-69281, Exhibit 4.4.
 
  (10.1)   Merchant Agreement dated August 30, 1991 between Registrant and Nordstrom National Credit Bank is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 1991, Exhibit 10.1.

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(a)3.   Exhibits (continued)

  (10.2)   The Nordstrom Supplemental Retirement Plan is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 1993, Exhibit 10.3.
 
  (10.3)   The 1993 Non-Employee Director Stock Incentive Plan is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 1994, Exhibit 10.4.
 
  (10.4)   Investment Agreement dated October 8, 1984 between the Registrant and Nordstrom Credit, Inc. is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10, Exhibit 10.1.
 
  (10.5)   Master Pooling and Servicing Agreement dated August 14, 1996 between Nordstrom National Credit Bank and Norwest Bank Colorado, N.A., as trustee, is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1996, Exhibit 10.1.
 
  (10.6)   First Amendment to the Master Pooling and Servicing Agreement dated August 14, 1996, between Nordstrom fsb and Wells Fargo Bank West, N.A., as trustee, dated March 1, 2000 is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.4.
 
  (10.7)   Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996 between Nordstrom National Credit Bank, Nordstrom Credit, Inc. and Norwest Bank Colorado, N.A., as trustee, is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1996, Exhibit 10.2.
 
  (10.8)   First amendment to the Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996 between Nordstrom National Credit Bank, Nordstrom Credit, Inc. and Norwest Bank Colorado, N.A., as trustee, dated December 10, 1997 is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 1998, Exhibit 10.13.
 
  (10.9)   Second Amendment to the Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996, between Nordstrom Credit, Inc., Nordstrom National Credit Bank and Norwest Bank Colorado, N.A., as trustee, dated February 25, 1999, is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.1.
 
  (10.10)   Third Amendment to the Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996, between Nordstrom Credit, Inc., Nordstrom National Credit Bank and Norwest Bank Colorado, N.A., as trustee, dated October 1, 2001 is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.11.
 
  (10.11)   Transfer and Administration Agreement dated August 14, 1996 between Nordstrom National Credit Bank, Enterprise Funding Corporation and Nationsbank, N.A. is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1996, Exhibit 10.3.

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(a)3.   Exhibits (continued)

  (10.12)   First Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom National Credit Bank, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated August 19, 1997 is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.1.
 
  (10.13)   Second Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom National Credit Bank, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated July 23, 1998 is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.2.
 
  (10.14)   Third Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom National Credit Bank, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated August 11, 1999 is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.1.
 
  (10.15)   Fourth Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom fsb, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated March 1, 2000 is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.2.
 
  (10.16)   Fifth Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom fsb, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated July 20, 2000 is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.3.
 
  (10.17)   Receivables Purchase Agreement dated August 14, 1996 between Registrant and Nordstrom Credit, Inc. is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 1997, Exhibit 10.12.
 
  (10.18)   The Nordstrom, Inc. 1997 Stock Option Plan is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.4.
 
  (10.19)   The Nordstrom, Inc. Profit Sharing and Employee Deferral Retirement Plan is hereby incorporated by reference from the Registrant’s Report on Form S-8, Registration No. 333-79791 filed on June 2, 1999.
 
  (10.20)   Amended and Restated Revolving Credit Facility between Registrant and a group of commercial banks, dated October 15, 1999 is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended October 31, 1999, Exhibit 10.1.
 
  (10.21)   Commercial Paper Dealer Agreement dated October 2, 1997 between Registrant and Bancamerica Securities, Inc. is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1997, Exhibit 10.1.

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(a)3.   Exhibits (continued)

  (10.22)   Commercial Paper Agreement dated October 2, 1997 between Registrant and Credit Suisse First Boston Corporation is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1997, Exhibit 10.2.
 
  (10.23)   Issuing and Paying Agency Agreement dated October 2, 1997 between Registrant and First Trust of New York, N.A. is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1997, Exhibit 10.3.
 
  (10.24)   Joint Venture Agreement between Nordstrom, Inc. and Nordstorm.com, Inc. dated as of August 24, 1999 is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2000, Exhibit 10.21.
 
  (10.25)   Credit Agreement dated as of February 29, 2000, between 1700 Seventh L.P., several lenders from time to time party thereto, with Bank of America, N.A. as Administrative Agent and as Project Administrative Agent, is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2000, Exhibit 10.22.
 
  (10.26)   Guaranty Agreement dated as of February 29, 2000, between Registrant, Bank of America, N.A., and the Lenders party to the Credit Agreement (described in 10.25 above), is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2000, Exhibit 10.23.
 
  (10.27)   Share Purchase and Contribution Agreement dated as of September 27, 2000 by and among Nordstrom, Inc., Nordstrom European Capital Group, and the Selling Shareholders of Façonnable, S.A., is hereby incorporated by reference to Exhibit 2.1 to the Registrant’s Registration Statement on Form S-3, Registration No. 333-50028 filed on November 15, 2000.
 
  (10.28)   Amendment to the Share Purchase and Contribution Agreement dated as of September 27, 2000 by and among Nordstrom, Inc., Nordstrom European Capital Group, and the Selling Shareholders of Façonnable, S.A., dated October 20, 2000 is hereby incorporated by reference to Exhibit 2.2 to the Registrant’s Registration Statement on Form S-3, Registration No. 333-50028 filed on November 15, 2000.
 
  (10.29)   The Put Agreement dated November 1, 1999 between Nordstrom, Inc. and the holders of the Series C Preferred Stock of Nordstrom.com, Inc. is hereby incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 2000, Exhibit 10.3.
 
  (10.30)   Amended and Restated Revolving Credit Facility between Registrant and a group of commercial banks, dated November 20, 2001 is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2002, Exhibit 10.30.
 
  (10.31)   Receivables Purchase Agreement dated October 1, 2001 between Nordstrom Credit, Inc. and Nordstrom Private Label Receivables, LLC is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.21.

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(a)3.   Exhibits (continued)

  (10.32)   Transfer and Servicing Agreement dated October 1, 2001 between Nordstrom Private Label Receivables, LLC, Nordstrom fsb, Wells Fargo Bank Minnesota, N.A., and Nordstrom Private Label Credit Card Master Note Trust is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.22.
 
  (10.33)   Master Indenture dated October 1, 2001 between Nordstrom Private Label Credit Card Master Note Trust and Wells Fargo Bank Minnesota, N.A., as trustee, is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.23.
 
  (10.34)   Series 2001-1 Indenture Supplement dated October 1, 2001 between Nordstrom Private Label Credit Card Master Note Trust and Wells Fargo Bank Minnesota, N.A., as trustee, is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.24.
 
  (10.35)   Series 2001-2 Indenture Supplement dated December 4, 2001 between Nordstrom Private Label Credit Card Master Note Trust and Wells Fargo Bank Minnesota, N.A., as trustee, is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.25.
 
  (10.36)   Amended and Restated Trust Agreement dated October 1, 2001 between Nordstrom Private Label Receivables, LLC, and Wilmington Trust Company, as trustee, is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.26.
 
  (10.37)   Note Purchase Agreement dated December 4, 2001 between Nordstrom Private Label Receivables, LLC, Nordstrom fsb, Falcon Asset Securitization Corporation, and Bank One, NA, as agent, is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.25.
 
  (10.38)   First Amendment to the Note Purchase Agreement dated December 4, 2001 between Nordstrom Private Label Receivables, LLC, Nordstrom fsb, Falcon Asset Securitization Corporation, and Bank One, NA, as agent, dated December 2, 2002 is hereby incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.26.
 
  (10.39)   Receivables Purchase Agreement dated April 1, 2002 between Nordstrom fsb and Nordstrom Credit Card Receivables LLC is filed herein as an Exhibit.
 
  (10.40)   Administration Agreement dated April 1, 2002 between Nordstrom Credit Card Master Note Trust and Nordstrom fsb is filed herein as an Exhibit.
 
  (10.41)   Amended and Restated Trust Agreement dated April 1, 2002 between Nordstrom Credit Card Receivables LLC and Wilmington Trust Company is filed herein as an Exhibit.
 
  (10.42)   Master Indenture dated April 1, 2002 between Nordstrom Credit Card Master Note Trust and Wells Fargo Bank Minnesota, National Association is filed herein as an Exhibit.

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(a)3.   Exhibits (continued)

  (10.43)   Series 2002-1 Indenture Supplement dated April 1, 2002 between Nordstrom Credit Card Master Note Trust and Wells Fargo Bank Minnesota, National Association is filed herein as an Exhibit.
 
  (10.44)   Transfer and Servicing Agreement dated April 1, 2002 between Nordstrom Credit Card Receivables, LLC, Nordstrom fsb, Wells Fargo Bank Minnesota, National Association and Nordstrom Credit Card Master Note Trust is filed herein as an Exhibit.
 
  (10.45)   Performance Undertaking dated September 28, 2001 between Registrant and Bank One, N.A., is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2002, Exhibit 10.37.
 
  (10.46)   Performance Undertaking dated December 4, 2001 between Registrant and Bank One, N.A., is hereby incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2002, Exhibit 10.38.
 
  (10.47)   Stock Purchase Agreement dated May 13, 2002 between the Registrant and the investors listed on Schedule A thereto, is hereby incorporated by reference from the Registrant’s Form 8-K filed on May 17, 2002, Exhibit 10.1.
 
  (10.48)   Promissory Note dated April 18, 2002 between 1700 Seventh, L.P. and New York Life Insurance Company, is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 2002, Exhibit 10.2.
 
  (10.49)   Promissory Note dated April 18, 2002 between 1700 Seventh, L.P. and Life Investors Insurance Company of America, is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 2002, Exhibit 10.3.
 
  (10.50)   Guaranty Agreement dated April 18, 2002 between Registrant, New York Life Insurance Company and Life Investors Insurance Company of America, is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 2002, Exhibit 10.4.
 
  (10.51)   The 2002 Nonemployee Director Stock Incentive Plan, is hereby incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2002, Exhibit 10.1.
 
  (10.52)   Purchase and Sale Agreement dated December 16, 2002 between Nordstrom Credit, Inc. and Nudo-Weiner Associates, LLC is hereby incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.30.
 
  (10.53)   First Amendment to the Purchase and Sale Agreement dated December 16, 2002 between Nordstrom Credit, Inc. and Nudo-Weiner Associates, LLC, dated December 19, 2002, is hereby incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.31.
 
  (13.1)   The Company’s 2002 Annual Report to Shareholders is filed herein as an Exhibit.
 
  (21.1)   List of the Registrant’s Subsidiaries is filed herein as an Exhibit.
 
  (23.1)   Independent Auditors’ Consent and Report on Schedule is on page 26 of this report.

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(a)3.   Exhibits (continued)

  (99.1)   Certification of Chief Executive Officer regarding periodic report containing financial statements, is filed herein as an Exhibit.
 
  (99.2)   Certification of Chief Financial Officer regarding periodic report containing financial statements, is filed herein as an Exhibit.

    All other exhibits are omitted because they are not applicable, not required, or because the required information is included in our 2002 Annual Report to Shareholders.
 
(b)   Reports on Form 8-K

We filed a Form 8-K on December 9, 2002 to announce the change of our fiscal year under Item 8 of Form 8-K. Beginning February 1, 2003, our fiscal year changed from January 31 to the Saturday closest to January 31.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

     
  NORDSTROM, INC.
(Registrant)
     
  /s/ Michael G. Koppel
 
    Michael G. Koppel
Executive Vice President and
Chief Financial Officer

Date: April 17, 2003

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

         
Principal Financial and Accounting Officer:   Principal Executive Officer:
 
/s/ Michael G. Koppel   /s/ Blake W. Nordstrom

 
    Michael G. Koppel     Blake W. Nordstrom
  Executive Vice President       President
  and Chief Financial Officer      
 
Directors:        
 
/s/   D. Wayne Gittinger   /s/   Enrique Hernandez, Jr.

 
  D. Wayne Gittinger     Enrique Hernandez, Jr.
  Director     Director
 
/s/   John A. McMillan   /s/   Jeanne P. Jackson

 
  John A. McMillan     Jeanne P. Jackson
  Director     Director
 
/s/   Bruce A. Nordstrom   /s/   John N. Nordstrom

 
  Bruce A. Nordstrom     John N. Nordstrom
  Chairman of the Board of Directors     Director
  and Director      
 
/s/   Alfred E. Osborne, Jr.   /s/   William D. Ruckelshaus

 
  Alfred E. Osborne, Jr.     William D. Ruckelshaus
  Director     Director
 
/s/   Stephanie M. Shern   /s/   Bruce G. Willison

 
  Stephanie M. Shern     Bruce G. Willison
  Director     Director
 
/s/   Alison A. Winter      

     
    Alison A. Winter      
    Director      

Date: April 17, 2003

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CERTIFICATIONS

Certification required by Section 302(a) of the Sarbanes-Oxley Act of 2002

I, Blake W. Nordstrom, certify that:

1.  I have reviewed this annual report on Form 10-K of Nordstrom, Inc.;

2.  Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.  Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.  The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.  The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6.  The registrant’s other certifying officers and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

       
Date: April 17, 2003   /s/   Blake W. Nordstrom
   
        Blake W. Nordstrom
      President

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Certification required by Section 302(a) of the Sarbanes-Oxley Act of 2002

I, Michael G. Koppel, certify that:

1.  I have reviewed this annual report on Form 10-K of Nordstrom, Inc.;

2.  Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.  Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.  The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the “Evaluation Date”); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.  The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6.  The registrant’s other certifying officers and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

       
Date: April 17, 2003   /s/   Michael G. Koppel
   
      Michael G. Koppel
      Executive Vice President and
      Chief Financial Officer

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Table of Contents

Exhibit 23.1

INDEPENDENT AUDITORS’ CONSENT AND REPORT ON SCHEDULE

Shareholders and Board of Directors
Nordstrom, Inc.

We consent to the incorporation by reference in Registration Statement Nos. 33-18321, 333-63403, 333-40064, 333-40066, 333-79791, and 333-101110 on Form S-8 and in Registration Statement Nos. 333-59840 and 333-69281 on Form S-3 of Nordstrom, Inc. of our reports dated March 28, 2003 (which report expresses an unqualified opinion and includes an explanatory paragraph regarding the change in accounting for goodwill and other intangible assets upon adoption of Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets, for the year ended January 31, 2003, as discussed in Note 2 to the consolidated financial statements), appearing in and incorporated by reference in this Annual Report on Form 10-K of Nordstrom, Inc. and subsidiaries (the Company) for the year ended January 31, 2003.

We have audited the consolidated financial statements of the Company as of January 31, 2003 and 2002, and for each of the three years in the period ended January 31, 2003, and have issued our report thereon dated March 28, 2003 (which report expresses an unqualified opinion and includes an explanatory paragraph regarding the change in accounting for goodwill and other intangible assets upon adoption of Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets, for the year ended January 31, 2003, as discussed in Note 2 to the consolidated financial statements); such financial statements and report are included in the Company’s 2002 Annual Report to Shareholders and are incorporated therein by reference. Our audits also included the consolidated financial statement schedule of the Company, listed in Item 14(a)2. This financial statement schedule is the responsibility of the Company’s management. Our responsibility is to express an opinion based on our audits. In our opinion, such consolidated financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/Deloitte & Touche LLP


Seattle, Washington
April 17, 2003

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Table of Contents

NORDSTROM, INC. AND SUBSIDIARIES

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

(Dollars in thousands)

                                   
Column A   Column B   Column C   Column D   Column E

 
 
 
 
              Additions                
             
               
      Balance at   Charged to           Balance
      beginning   costs and           at end of
Description   of period   expenses   Deductions   period

 
 
 
 
Allowance for doubtful accounts:
                               
Year ended:
                               
 
January 31, 2003
  $ 23,022     $ 29,080     $ 29,717 (A)   $ 22,385  
 
January 31, 2002
  $ 16,531     $ 34,750     $ 28,259 (A)   $ 23,022  
 
January 31, 2001
  $ 15,838     $ 20,369     $ 19,676 (A)   $ 16,531  
Allowance for sales return, net:
                               
Year ended:
                               
 
January 31, 2003
  $ 31,721     $ 520,831     $ 519,268 (B)   $ 33,284  
 
January 31, 2002
  $ 33,702     $ 497,662     $ 499,643 (B)   $ 31,721  
 
January 31, 2001
  $ 25,981     $ 520,080     $ 512,359 (B)   $ 33,702  

  (A)   Deductions consist of write-offs of uncollectible accounts, net of recoveries
 
  (B)   Deductions consist of actual returns net of related costs and commissions

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Table of Contents

NORDSTROM INC. AND SUBSIDIARIES

Exhibit Index

         
    Exhibit   Method of Filing
   
 
3.1  
Articles of Incorporation as amended and restated on May 21, 2002
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2002, Exhibit 3.1
         
3.2  
Bylaws, as amended and restated on February 1, 2003
 
Filed herewith electronically
         
4.1  
Indenture between Registrant and Norwest Bank Colorado, N.A.,as trustee, dated March 11, 1998
 
Incorporated by reference from Registration No. 333-47035, Exhibit 4.1
         
4.2  
Senior indenture between Registrant and Norwest Bank Colorado, N.A., as trustee, dated January 13, 1999
 
Incorporated by reference from Registration No. 333-69281, Exhibit 4.3
         
4.3  
Form of Subordinated Indenture between Registrant and Norwest Bank Colorado, N.A., as trustee, dated January 13, 1999
 
Incorporated by reference from Registration No. 333-69281, Exhibit 4.4
         
10.1  
Merchant Agreement dated August 30, 1991 between Registrant and Nordstrom National Credit Bank
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, 1991, Exhibit 10.1
         
10.2  
Nordstrom Supplemental Retirement Plan
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 1993, Exhibit 10.3
         
10.3  
1993 Non-Employee Director Stock Incentive Plan
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 1994, Exhibit 10.4
         
10.4  
Investment Agreement dated October 8, 1984 between the Registrant and Nordstrom Credit, Inc.
 
Incorporated by reference from the Nordstrom Credit, Inc. Form 10, Exhibit 10.1
         
10.5  
Master Pooling and Servicing Agreement dated August 14, 1996 between Nordstrom National Credit Bank and Norwest Bank Colorado, N.A., as trustee
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1996, Exhibit 10.1
         
10.6  
First Amendment to the Master Pooling and Servicing Agreement dated August 14, 1996, between Nordstrom fsb and Wells Fargo Bank West, N.A., as trustee, dated March 1, 2000
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.4

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Table of Contents

         
    Exhibit   Method of Filing
   
 
10.7  
Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996 between Nordstrom National Credit Bank, Nordstrom Credit, Inc. and Norwest Bank Colorado, N.A., as trustee
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1996, Exhibit 10.2
         
10.8  
First amendment to the Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996 between Nordstrom National Credit Bank, Nordstrom Credit, Inc. and Norwest Bank Colorado, N.A., as trustee, dated December 10, 1997
 
Incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 1998, Exhibit 10.13
         
10.9  
Second Amendment to the Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996, between Nordstrom Credit, Inc., Nordstrom National Credit Bank and Norwest Bank Colorado, N.A., as trustee, dated February 25, 1999
 
Incorporated by reference from the Nordstrom Credit, Inc. Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.1
         
10.10  
Third Amendment to the Series 1996-A Supplement to Master Pooling and Servicing Agreement dated August 14, 1996, between Nordstrom Credit, Inc., Nordstrom National Credit Bank and Norwest Bank Colorado, N.A., as trustee, dated October 1, 2001
 
Incorporated by reference from the Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.11
         
10.11  
Transfer and Administration Agreement dated August 14, 1996 between Nordstrom National Credit Bank, Enterprise Funding Corporation and Nationsbank, N.A
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1996, Exhibit 10.3
         
10.12  
First Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom National Credit Bank, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated August 19, 1997
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.1
         
10.13  
Second Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom National Credit Bank, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated July 23, 1998
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 1999, Exhibit 10.2
         
10.14  
Third Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom National Credit Bank, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank N.A., dated August 11, 1999
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.1

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Table of Contents

         
    Exhibit   Method of Filing
   
 
10.15  
Fourth Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom fsb, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated March 1, 2000
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.2
         
10.16  
Fifth Amendment to the Transfer and Administration Agreement dated August 14, 1996 between Enterprise Funding Corporation, Nordstrom fsb, The Financial Institutions From Time to Time Parties Thereto, and Nationsbank, N.A., dated July 20, 2000
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2000, Exhibit 10.3
         
10.17  
Receivables Purchase Agreement dated August 14, 1996 between Registrant and Nordstrom Credit, Inc. ended
 
Incorporated by reference from the Registrant’s Form 10-K for the year January 31, 1997, Exhibit 10.12
         
10.18  
1997 Nordstrom Stock Option Plan
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter Ended April 30, 1999, Exhibit 10.4
         
10.19  
The Nordstrom, Inc. Profit Sharing and Employee Deferral Retirement Plan
 
Incorporated by reference from the Registrant’s Report on Form S-8, Registration No. 333-79791 filed on June 2, 1999
         
10.20  
Amended and Restated Revolving Credit Facility between Registrant and a group of commercial banks, dated October 15, 1999
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended October 31, 1999, Exhibit 10.1
         
10.21  
Commercial Paper Dealer Agreement dated October 2, 1997 between Registrant and Bancamerica Securities, Inc.
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1997, Exhibit 10.1
         
10.22  
Commercial Paper Agreement dated October 2, 1997 between Registrant and Credit Suisse First Boston Corporation
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1997, Exhibit 10.2
         
10.23  
Issuing and Paying Agency Agreement dated October 2, 1997 between Registrant and First Trust of New York, N.A
 
Incorporated by reference from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended October 31, 1997, Exhibit 10.3
         
10.24  
Joint Venture Agreement between Nordstrom, Inc. and Nordstrom.com, Inc. dated as of August 24, 1999
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2000, Exhibit 10.21

Page  30  of  34


Table of Contents

         
    Exhibit   Method of Filing
   
 
10.25  
Credit Agreement dated as of February 29, 2000, between 1700 Seventh L.P., several lenders from time to time party thereto, with Bank of America, N.A. as Administrative Agent and as Project Administrative Agent
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2000, Exhibit 10.22
         
10.26  
Guaranty Agreement dated as of February 29, 2000, between Registrant, Bank of America, N.A., and the Lenders party to the Credit Agreement (described in 10.25 above)
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2000, Exhibit 10.23
         
10.27  
Share Purchase and Contribution Agreement dated as of September 27, 2000 by and among Nordstrom, Inc., Nordstrom European Capital Group, and the Selling Shareholders of Façonnable, S.A.
 
Incorporated by reference from the Registrant’s Form S-3, Registration No. 333-50028 filed on November 15, 2000, Exhibit 2.1
         
10.28  
Amendment to the Share Purchase and Contribution Agreement dated as of September 27, 2000 by and among Nordstrom, Inc., Nordstrom European Capital Group, and the Selling Shareholders of Façonnable, S.A., dated October 20, 2000
 
Incorporated by reference from the Registrant’s Form S-3, Registration No. 333-50028 filed on November 15, 2000, Exhibit 2.2
         
10.29  
The Put Agreement dated November 1, 1999 between Nordstrom, Inc. and the holders of the Series C Preferred Stock of Nordstrom.com, Inc.
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended October 31, 2000, Exhibit 10.3
         
10.30  
Amended and Restated Revolving Credit Facility between Registrant and a group of commercial banks, dated November 20, 2001
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2002, Exhibit 10.30
         
10.31  
Receivables Purchase Agreement dated October 1, 2001 between Nordstrom, Credit, Inc. and Nordstrom Private Label Receivables, LLC
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.21
         
10.32  
Transfer and Servicing Agreement dated October 1, 2001 between Nordstrom Private Label Receivables, LLC, Nordstrom fsb, Wells Fargo Bank Minnesota, N.A., and Nordstrom Private Label Credit Card Master Note Trust
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.22
         
10.33  
Master Indenture dated October 1, 2001 between Nordstrom Private Label Credit Card Master Note Trust and Wells Fargo Bank Minnesota, N.A., as trustee
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.23

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Table of Contents

         
    Exhibit   Method of Filing
   
 
10.34  
Series 2001-1 Indenture Supplement dated October 1, 2001 between Nordstrom Private Label Credit Card Master Note Trust and Wells Fargo Bank Minnesota, N.A., as trustee
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.24
         
10.35  
Series 2001-2 Indenture Supplement dated December 4, 001 between Nordstrom Private Label Credit Card Master Note Trust and Wells Fargo Bank Minnesota, N.A., as trustee
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.25
         
10.36  
Amended and Restated Trust Agreement dated October 1, 2001 between Nordstrom Private Label Receivables, LLC, and Wilmington Trust Company, as trustee
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2002, Exhibit 10.26
         
10.37  
Note Purchase Agreement dated December 4, 2001 between Nordstrom Private Label Receivables, LLC, Nordstrom fsb, Falcon Asset Securitization Corporation, and Bank One, NA, as agent
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.25
         
10.38  
First Amendment to the Note Purchase Agreement dated December 4, 2001 between Nordstrom Private label Receivables, LLC, Nordstrom fsb, Falcon Asset Securitization Corporation, and Bank One, NA, as agent, dated December 2, 2002
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.26
         
10.39  
Receivables Purchase Agreement dated April 1, 2002 between Nordstrom fsb and Nordstrom Credit Card Receivables LLC
 
Filed herewith electronically
         
10.40  
Administration Agreement dated April 1, 2002 between Nordstrom Credit Card Master Note Trust and Nordstrom fsb
 
Filed herewith electronically
         
10.41  
Amended and Restated Trust Agreement dated April 1, 2002 between Nordstrom Credit Card Receivables LLC and Wilmington Trust Company
 
Filed herewith electronically
         
10.42  
Master Indenture dated April 1, 2002 between Nordstrom Credit Card Master Note Trust and Wells Fargo Bank Minnesota, National Association
 
Filed herewith electronically
         
10.43  
Series 2002-1 Indenture Supplement dated April 1, 2002 between Nordstrom Credit Card Master Note Trust and Wells Fargo Bank Minnesota, National Association
 
Filed herewith electronically

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Table of Contents

         
    Exhibit   Method of Filing
   
 
10.44  
Transfer and Servicing Agreement dated April 1, 2002 between Nordstrom Credit Card Receivables, LLC, Nordstrom fsb, Wells Fargo Bank Minnesota, National Association and Nordstrom Credit Card Master Note Trust
 
Filed herewith electronically
         
10.45  
Performance Undertaking dated September 28, 2001 between Registrant and Bank One, N.A
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2002, Exhibit 10.37
         
10.46  
Performance Undertaking dated December 4, 2001 between Registrant and Bank One, N.A
 
Incorporated by reference from the Registrant’s Form 10-K for the year ended January 31, 2002, Exhibit 10.38
         
10.47  
Stock Purchase Agreement dated May 13, 2002 between the Registrant and the investors listed on Schedule A thereto
 
Incorporated by reference from the Registrant’s Form 8-K filed on May 17, 2002, Exhibit 10.1
         
10.48  
Promissory Note dated April 18, 2002 between 1700 Seventh, L.P. and New York Life Insurance Company
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 2002, Exhibit 10.2
         
10.49  
Promissory Note dated April 18, 2002 between 1700 Seventh, L.P. and Life Investors Insurance Company of America
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 2002, Exhibit 10.3
         
10.50  
Guaranty Agreement dated April 18, 2002 between Registrant, New York Life Insurance Company and Life Investors Insurance Company of America
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended April 30, 2002, Exhibit 10.4
         
10.51  
The 2002 Nonemployee Director Stock Incentive Plan
 
Incorporated by reference from the Registrant’s Form 10-Q for the quarter ended July 31, 2002, Exhibit 10.1
         
10.52  
Purchase and Sale Agreement dated December 16, 2002 between Nordstrom Credit, Inc. and Nudo-Weiner Associates, LLC
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.30
         
10.53  
First Amendment to the Purchase and Sale Agreement dated December 16, 2002 between Nordstrom Credit, Inc. and Nudo-Weiner Associates, LLC, dated December 19, 2002
 
Incorporated by reference from Nordstrom Credit, Inc. Form 10-K for the year ended January 31, 2003, Exhibit 10.31
         
13.1  
2002 Annual Report to Shareholders
 
Filed herewith electronically
         
21.1  
Subsidiaries of the Registrant
 
Filed herewith electronically

Page  33  of  34


Table of Contents

         
    Exhibit   Method of Filing
   
 
23.1  
Independent Auditors’ Consent and Report on Schedule
 
Filed as page 26 of this report
         
99.1  
Certification of Chief Executive Officer regarding periodic report containing financial statements
 
Filed herewith electronically
         
99.2  
Certification of Chief Financial Officer regarding periodic report containing financial statements
 
Filed herewith electronically

Page  34  of  34

<PAGE>

                                                                     EXHIBIT 3.2

                                     BYLAWS
                                       OF
                                 NORDSTROM, INC.

                  (Amended and Restated as of February 1, 2003)

                                    ARTICLE I
                                     Offices

         The principal office of the corporation in the state of Washington
shall be located in the city of Seattle. The corporation may have such other
offices, either within or without the state of Washington, as the Board of
Directors may designate or as the business of the corporation may require from
time to time.

         The registered office of the corporation required by the Washington
Business Corporation Act to be maintained in the state of Washington may be, but
need not be, identical with the principal office in the state of Washington and
the address of the registered office may be changed from time to time by the
Board of Directors or by officers designated by the Board of Directors.

                                   ARTICLE II
                                  Shareholders

         Section 1. Annual Meetings. The annual meeting of the shareholders
shall be held on the third Tuesday in the month of May each year, at the hour of
11:00 a.m., unless the Board of Directors shall have designated a different hour
and day in the month of May to hold said meeting. The meeting shall be for the
purpose of electing directors and the transaction of such other business as may
come before the meeting. If the
 day fixed for the annual meeting shall be a
legal holiday in the state of Washington and if the Board of Directors has not
designated some other day in the month of May for such meeting, such meeting
shall be held at the same hour and place on the next succeeding business day not
a holiday. The failure to hold an annual meeting at the time stated in these
Bylaws does not affect the validity of any corporate action. If the election of
directors shall not be held on the day designated herein or by the Board of
Directors for any annual meeting of the shareholders, or at any adjournment
thereof, the Board of Directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as conveniently may be.

         Section 2. Special Meetings. Special meetings of the shareholders may
be called for any purpose or purposes, unless otherwise prescribed by statute,
at any time by the Chairman (or any Co-Chairman) of the Board of Directors, by
the President (or any Co-President) if there is not then a Chairman (or
Co-Chairman) of the Board of Directors or by the Board of Directors and shall be
called by the Chairman (or any Co-Chairman) of the Board of Directors or the
President (or any Co-President) at the request of holders of not less than 15%
of all outstanding shares of

<PAGE>
the corporation entitled to vote on any issue proposed to be considered at the
meeting. Only business within the purpose or purposes described in the meeting
notice may be conducted at a special shareholder's meeting.

         Section 3. Place of Meeting. The Board of Directors may designate any
place, either within or without the state of Washington, as the place of meeting
for any annual meeting or for any special meeting of the corporation. If no such
designation is made, the place of meeting shall be the principal offices of the
corporation in the state of Washington.

         Section 4. Notice of Meetings. Written notice of annual or special
meetings of shareholders stating the place, day and hour of the meeting and, in
the case of a special meeting, the purpose or purposes for which the meeting is
called, shall be given by the Secretary, or persons authorized to call the
meeting, to each shareholder of record entitled to vote at the meeting, not less
than ten (10) nor more than sixty (60) days prior to the date of the meeting,
unless otherwise prescribed by statute.

         Section 5. Waiver of Notice. Notice of the time, place and purpose of
any meeting may be waived in writing (either before or after such meeting) and
will be waived by any shareholder by attendance of the shareholder in person or
by proxy, unless the shareholder at the beginning of the meeting objects to
holding the meeting or transacting business at the meeting. Any shareholder
waiving notice of a meeting shall be bound by the proceedings of the meeting in
all respects as if due notice thereof had been given.

         Section 6. Record Date. For the purpose of determining shareholders
entitled to notice of or to vote at any meeting of shareholders, or any
adjournment thereof, or shareholders entitled to receive payment of any
dividend, or to make a determination of shareholders for any other proper
purpose, the Board of Directors may fix in advance a record date for any such
determination of shareholders, such date to be not more than seventy (70) days
and, in the case of a meeting of shareholders, not less than ten (10) days,
prior to the date on which the particular action requiring such determination of
shareholders is to be taken. If no record date is fixed for the determination of
shareholders entitled to notice of or to vote at a meeting of shareholders, or
shareholders entitled to receive payment of a dividend, the day before the date
on which notice of the meeting is mailed or the date on which the resolution of
the Board of Directors declaring such dividend is adopted, as the case may be,
shall be the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in this Section, the determination shall apply to any
adjournment thereof, unless the Board of Directors fixes a new record date,
which it must do if the meeting is adjourned more than one hundred twenty (120)
days after the date fixed for the original meeting.

          Section 7. Voting Lists. After fixing a record date for a
shareholders' meeting, the corporation shall prepare an alphabetical list of the
names of all shareholders on the record date who are entitled to notice of the
shareholders' meeting. The list shall show the address of and number of shares
held by each shareholder. A shareholder, shareholder's agent, or a shareholder's
attorney may inspect the shareholder list, at the shareholder's expense,
beginning ten days prior to the shareholders' meeting and continuing through the
meeting, at the

                                       2

<PAGE>
corporation's principal office or at a place identified in the meeting notice in
the city where the meeting will be held during regular business hours. The
shareholder list shall be kept open for inspection at the time and place of such
meeting or any adjournment.

         Section 8. Quorum and Adjourned Meetings. Unless the Articles of
Incorporation or applicable law provide otherwise, a majority of the outstanding
shares of the corporation entitled to vote, represented in person or by proxy,
shall constitute a quorum at a meeting of shareholders. Once a share is
represented at a meeting, other than to object to holding the meeting or
transacting business, it is deemed to be present for the remainder of the
meeting and any adjournment thereof unless a new record date is set or is
required to be set for the adjourned meeting. A majority of the shares
represented at a meeting, even if less than a quorum, may adjourn the meeting
from time to time without further notice. At a reconvened meeting at which a
quorum shall be present or represented, any business may be transacted which
might have been transacted at the original meeting. Business may continue to be
conducted at a duly organized meeting and at any adjournment of such meeting
(unless a new record date is or must be set for the adjourned meeting),
notwithstanding the withdrawal of enough shares from either meeting to leave
less than a quorum.

         Section 9. Proxies. At all meetings of shareholders, a shareholder may
vote by proxy executed in writing by the shareholder or by the shareholder's
duly authorized attorney in fact. Such proxy shall be filed with the Secretary
of the corporation before or at the time of the meeting. No proxy shall be valid
after eleven (11) months from the date of its execution, unless otherwise
provided in the proxy.

         Section 10. Voting of Shares. Every shareholder of record shall have
the right at every shareholders' meeting to one vote for every share standing in
the shareholder's name on the books of the corporation. If a quorum exists,
action on a matter, other than election of directors, is approved by the
shareholders if the votes cast favoring the action exceed the votes cast
opposing the action, unless the Articles of Incorporation or applicable law
require a greater number of affirmative votes. Notwithstanding the foregoing,
shares of the corporation may not be voted if they are owned, directly or
indirectly, by another corporation and the corporation owns, directly or
indirectly, a majority of shares of the other corporation entitled to vote for
directors of the other corporation.

         Section 11. Acceptance of Votes. If the name signed on a vote, consent,
waiver or proxy appointment does not correspond to the name of a shareholder of
the corporation, the corporation may accept the vote, consent, waiver or proxy
appointment and give effect to it as the act of the shareholder if: (i) the
shareholder is an entity and the name signed purports to be that of an officer,
partner or agent of the entity; (ii) the name signed purports to be that of an
administrator, executor, guardian or conservator representing the shareholder;
(iii) the name signed purports to be that of a receiver or trustee in bankruptcy
of the shareholder; (iv) the name signed purports to be that of a pledgee,
beneficial owner or attorney-in-fact of the shareholder; or (v) two or more
persons are the shareholder as co-tenants or fiduciaries and the name signed
purports to be the name of at least one of the co-owners and the person signing
appears to be acting on behalf of all co-owners.

                                       3

<PAGE>
         Section 12. Nomination of Directors. Only persons who are nominated in
accordance with the following procedures shall be eligible for election as
directors of the corporation. Nominations of persons for election to the Board
of Directors may be made at any annual meeting of shareholders (a) by or at the
direction of the Board of Directors (or any duly authorized committee thereof)
or (b) by any shareholder of the corporation (i) who is a shareholder of record
on the date of the giving of the notice provided for in this Section 10 and on
the record date for the determination of shareholders entitled to vote at the
annual meeting and (ii) who timely complies with the notice procedures and form
of notice set forth in this Section 12.

         To be timely, a shareholder's notice must be given to the Secretary of
this corporation and must be delivered to or mailed and received at the
principal executive offices of the corporation not less than ninety (90) days
nor more than one hundred twenty (120) days prior to the anniversary of the
immediately preceding annual meeting of shareholders; provided, however, that in
the event that the annual meeting is called for a date that is not within thirty
(30) days before or after the anniversary date, or no annual meeting was held in
the immediately preceding year, notice by the shareholder in order to be timely
must be so received no later than the close of business on the tenth (10th) days
following the day on which the notice of the annual meeting date was mailed to
shareholders.

         To be in the proper form, a shareholder's notice must be in written
form and must set forth (a) as to each person whom the shareholder proposes to
nominate for election as a director (i) the name, age, business address and
residence address of the person, (ii) the principal occupation or employment of
the person, (iii) the class or series and number of shares of capital stock of
the corporation which are owned beneficially or of record by the person and (iv)
any other information relating to the person that would be required to be
disclosed in a proxy statement or other filings required to be made in
connection with solicitations proxies for election of director pursuant to
Section 14 of the Securities Exchange Act of 1934, as amended (the "Act") and
the rules and regulations promulgated thereunder and (b) as to the shareholder
giving the notice (i) the name and record address of the shareholder, (ii) the
class or series and number of shares of capital stock of the corporation which
are owned beneficially or by record by the shareholder, (iii) a description of
all arrangements or understandings between the shareholder and each proposed
nominee and any other person or persons (including their names) pursuant to
which the nomination(s) are to be made by the shareholder, (iv) a representation
that the shareholder intends to appear in person or by proxy at the meeting to
nominate the person named in its notice, and (v) any other information relating
to the shareholder that would be required to be disclosed in a proxy statement
or other filings required to be made in connection with solicitations of proxies
for election of directors pursuant to Section 14 of the Exchange Act and the
rules and regulations promulgated thereunder. The notice must be accompanied by
a written consent of each proposed nominee to be named as a nominee and to serve
as a director if elected.

         No person shall be eligible for election as a director of the
corporation unless nominated in accordance with the procedures set forth in this
Section 12. If the chairman of the annual meeting determines that a nomination
was not made in accordance with the foregoing procedures, the chairman shall
declare to the meeting that the nomination was defective and the defective
nomination shall be disregarded.

                                       4

<PAGE>
         Section 13. Business at Annual Meetings. No business may be transacted
at an annual meeting of shareholders, other than business that is either (a)
specified in the notice of meeting (or any supplement thereto) given by or at
the direction of the Board of Directors (or any duly authorized committee
thereof), (b) otherwise properly brought before the annual meeting by or at the
direction of the Board of Directors (or any duly authorized committee thereof),
or (c) otherwise properly brought before the annual meeting by any shareholder
of the corporation (i) who is a shareholder of record on the date of the giving
of the notice provided for in this Section 13 and on the record date for the
determination of shareholders of record on the date for the determination of
shareholders entitled to vote at the annual meeting and (ii) who timely complies
with the notice procedures and form of notice set forth in this Section 13.

         To be timely, a shareholder's notice must be given to the Secretary of
the corporation and must be delivered to or mailed and received at the principal
executive offices of the corporation not less than ninety (90) days nor more
than one hundred twenty (120) days prior to the anniversary date of the
immediately preceding annual meeting of shareholders; provided, however, that in
the event that the annual meeting is called for a date that is not within thirty
(30) days before or after the anniversary date, notice by the shareholder in
order to be timely must be so received no later than the close of business on
the tenth (10th) day following the day on which the notice of the annual meeting
date was mailed to shareholders.

         To be in proper form, a shareholder's notice must be in written form
and must set forth as to each matter the shareholder proposes to bring before
the annual meeting (i) a brief description of the business desired to be brought
before the annual meeting and the reasons for documenting the business at the
annual meeting, (ii) the name and record address of the shareholder, (iii) the
number of shares of capital stock of the corporation which are owned
beneficially or of record by each shareholder, (iv) a description of all
arrangements or understandings between the shareholder and any other person or
persons (including their names) in connection with the proposal of the business
and (v) a representation that the shareholder intends to appear in person or by
proxy at the annual meeting to bring such business before the meeting.

         No business shall be conducted at the annual meeting of shareholders
except business brought before the annual meeting in accordance with the
procedures set forth in this Section 13; provided, however, that, once the
business has been properly brought before the annual meeting in accordance with
such procedures, nothing in this Section 13 shall be deemed to preclude
discussion by any shareholder of any such business. If the chairman of the
annual meeting determines that business was not properly brought before the
annual meeting in accordance with the foregoing procedures, the chairman shall
declare to the meeting that the business was not properly brought before the
meeting and the business shall not be transacted.

                                   ARTICLE III
                               Board of Directors

         Section 1. General Powers. All corporate powers shall be exercised by
or under the authority of, and the business and affairs of the corporation shall
be managed under the direction


                                       5

<PAGE>
of, its Board of Directors, except as may be otherwise provided in these Bylaws,
the Amended and Restated Articles of Incorporation or the Washington Business
Corporation Act.

         Section 2. Number, Tenure and Qualifications. The number of directors
of the corporation shall be eleven (11). Each director shall hold office until
the next annual meeting of shareholders and until his successors shall have been
elected and qualified. Directors need not be residents of the state of
Washington or shareholders of the corporation.

         Section 3. Regular Meeting. A regular meeting of the Board of Directors
shall be held without other notice than this Bylaw immediately after and at the
same place as, the annual meeting of shareholders. Regular meetings of the Board
of Directors shall be held at such place and on such day and hour as shall from
time to time be fixed by the Chairman (or any Co-Chairman) of the Board of
Directors, the President (or any Co-President) or the Board of Directors. No
other notice of regular meeting of the Board of Directors shall be necessary.

         Section 4. Special Meetings. Special meetings of the Board of Directors
may be called by or at the request of the Chairman (or any Co-Chairman) of the
Board of Directors, the President (or any Co-President) or any two directors.
The person or persons authorized to call special meetings of the Board of
Directors may fix any place, either within or without the state of Washington,
as the place for holding any special meeting of the Board of Directors called by
them.

         Section 5. Notice. Notice of any special meeting shall be given at
least two days previously thereto by either oral or written notice. Any director
may waive notice of any meeting. The attendance of a director at a meeting shall
constitute a waiver of notice of such meeting, except where a director attends a
meeting for the express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
Board of Directors need be specified in the notice or waiver of notice of such
meeting.

         Section 6. Quorum. A majority of the number of directors fixed by
Section 2 of this Article III shall constitute a quorum for the transaction of
business at any meeting of the Board of Directors, but if less than such
majority is present at a meeting, a majority of the directors present may
adjourn the meeting from time to time without further notice.

      Section 7. Manner of Acting. The act of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the Board
of Directors.

         Section 8. Vacancies. Any vacancy occurring in the Board of Directors
may be filled by the affirmative vote of a majority of the remaining directors
though less than a quorum of the Board of Directors. A director elected to fill
a vacancy shall be elected for the unexpired term of his predecessor in office.
A vacancy on the Board of Directors created by reason of an increase in the
number of directors may be filled by election by the Board of Directors for a
term of the office continuing only until the next election of directors by the
shareholders.

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<PAGE>
         Section 9. Compensation. By resolution of the Board of Directors, each
director may be paid his expenses, if any, of attendance at each meeting of the
Board of Directors and at each meeting of a committee of the Board of Directors
and may be paid a stated salary as director, a fixed sum for attendance at each
such meeting, or both. No such payment shall preclude any director from serving
the corporation in any other capacity and receiving compensation therefor.

         Section 10. Presumption of Assent. A director of the corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless
his dissent shall be entered in the minutes of the meeting, or unless he shall
file his written dissent to such action with the person acting as the secretary
of the meeting before the adjournment thereof, or shall forward such dissent by
registered mail to the Secretary of the corporation immediately after the
adjournment of the meeting. Such right to dissent shall not apply to a director
who voted in favor of such action.

         Section 11. Committees. The Board of Directors, by resolution adopted
by the greater of a majority of the Board of Directors then in office and the
number of directors required to take action in accordance these Bylaws, may
create standing or temporary committees, including an Executive Committee, and
appoint members form its own number and invest such committees with such powers
as it may see fit, subject to such conditions as may be prescribed by the Board
of Directors, the Articles of Incorporation, these Bylaws and applicable law.
Each committee must have two or more members, who shall serve at the pleasure of
the Board of Directors.

                  Section 11.1. Authority of Committees. Except for the
executive committee which, when the Board of Directors is not in session, shall
have and may exercise all of the authority of the Board of Directors except to
the extent, if any, that such authority shall be limited by the resolutions
appointing the executive committee, each committee shall have and may exercise
all of the authority of the Board of Directors to the extent provided in the
resolution of the Board of Directors creating the committee and any subsequent
resolutions adopted in like manner, except that no such committee shall have the
authority to: (1) authorize or approve a distribution except according to a
general formula or method prescribed by the Board of Directors, (2) approve or
propose to shareholders sections or proposal required by the Washington Business
Corporation Act to be approved by shareholders, (3) fill vacancies on the Board
or any committee thereof, (4) amend the Articles of Incorporation pursuant to
RCW 23B.10.020, (5) adopt, amend or repeal Bylaws, (6) approve a plan of merger
not requiring shareholder approval, or (7) authorize or approve the issuance or
sale or contact for sale of shares, or determine the designation and relative
rights, preferences and limitations of a class or series of shares except that
the Board may authorize a committee or a senior executive officer of the
corporation to do so within limits specifically prescribed by the Board.

                  Section 11.2. Removal. The Board of Directors may remove any
member of any committee elected or appointed by it but only by the affirmative
vote of the greater of a majority of the directors then in office and the number
of directors required to take action in accordance with these Bylaws.

                  Section 11.3. Minutes of Meetings. All committees shall keep
regular minutes of their meetings and shall cause them to be recorded in books
kept for that purpose.

                                       7

<PAGE>
                                   ARTICLE IV
                        Special Measures Applying to Both
                        Shareholder and Director Meetings

         Section 1. Actions by Written Consent. Any corporate action required or
permitted by the Articles of Incorporation, Bylaws, or the laws under which the
corporation is formed, to be voted upon or approved at a duly called meeting of
the directors, committee of directors, or shareholders may be accomplished
without a meeting if one or more unanimous written consents of the respective
directors or shareholders, setting forth the actions so taken, shall be signed,
either before or after the action taken, by all the directors, committee members
or shareholders, as the case may be. Action taken by unanimous written consent
of the directors or a committee of the Board of Directors is effective when the
last director or committee member signs the consent, unless the consent
specifies a later effective date. Action taken by unanimous written consent of
the shareholders is effective when all consents have been delivered to the
corporation, unless the consent specifies a later effective date.

         Section 2. Meetings by Conference Telephone. Members of the Board of
Directors, members of a committee of directors, or shareholders may participate
in their respective meetings by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other at the same time; participation in a meeting by such
means shall constitute presence in person at such meeting.

         Section 3. Written or Oral Notice. Oral notice may be communicated in
person, or by telephone, wire or wireless equipment, which does not transmit a
facsimile of the notice. Oral notice is effective when communicated. Written
notice may be transmitted by mail, private carrier, or personal delivery;
telegraph or teletype; or telephone, wire or wireless equipment which transmits
a facsimile of the notice. Written notice to a shareholder is effective when
mailed, if mailed with first class postage prepaid and correctly addressed to
the shareholder's address shown in the corporation's current record of
shareholders. In all other instances, written notice is effective on the
earliest of the following: (a) when dispatched to the person's address,
telephone number, or other number appearing on the records of the corporation by
telegraph, teletype or facsimile equipment; (b) when received; (c) five days
after deposit in the United States mail, as evidenced by the postmark, if mailed
with first class postage, prepaid and correctly addressed; or (d) on the date
shown on the return receipt, if sent by registered or certified mail, return
receipt requested and the receipt is signed by or on behalf of the addressee. In
addition, notice may be given in any manner not inconsistent with the foregoing
provisions and applicable law.

                                    ARTICLE V
                                    Officers

         Section 1. Number. The offices and officers of the corporation shall be
as designated from time to time by the Board of Directors. Such offices may
include a Chairman or two or

                                       8

<PAGE>
more Co-Chairmen of the Board of Directors, a President or two or more
Co-Presidents, one or more Vice Presidents, a Secretary and a Treasurer. Such
other officers and assistant officers as may be deemed necessary may be elected
or appointed by the Board of Directors. Any two or more offices may be held by
the same persons.

                  Section 2. Election and Term of Office. The officers of the
corporation shall be elected annually by the Board of Directors at the first
meeting of the Board of Directors held after each annual meeting of
shareholders. If the election of officers shall not be held at such meeting,
such election shall be held as soon thereafter as conveniently may be. Each
officer shall hold office until a successor shall have been duly elected and
qualified, or until the officer's death or resignation, or the officer has been
removed in the manner hereinafter provided.

         Section 3. Removal. Any officer or agent may be removed by the Board of
Directors whenever in its judgment, the best interests of the corporation will
be served thereby, but such removal shall be without prejudice to the contract
rights, if any, of the person so removed. Election or appointment of an officer
or agent shall not of itself create contract rights.

         Section 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the Board
of Directors for the unexpired portion of the term.

         Section 5. Chairman of the Board of Directors. The Chairman or
Co-Chairmen of the Board of Directors, subject to the authority of the Board of
Directors, shall preside at meetings of shareholders and directors and, together
with the President and Co-Presidents, shall have general supervision and control
over the business and affairs of the corporation. The Chairman or a Co-Chairman
of the Board of Directors may sign any and all documents, deeds, mortgages,
bonds, contracts, leases, or other instruments in the ordinary course of
business with or without the signature of a second corporate officer, may sign
certificates for shares of the corporation with the Secretary or Assistant
Secretary of the corporation and may sign any documents which the Board of
Directors has authorized to be executed, except in cases where the signing and
execution thereof shall be expressly delegated by the Board of Directors or by
these Bylaws to some other officer or agent of the corporation, or shall be
required by law to be otherwise signed or executed; and in general may perform
all duties which are normally incident to the office of Chairman of the Board of
Directors or President and such other duties, authority and responsibilities as
may be prescribed by the Board of Directors from time to time.

         Section 6. President. The President or Co-Presidents, together with the
Chairman or Co-Chairmen of the Board of Directors, shall have general
supervision and control over the business and affairs of the corporation subject
to the authority of the Chairman or Co-Chairmen of the Board of Directors and
the Board of Directors. The President or a Co-President may sign any and all
documents, mortgages, bonds, contracts, leases, or other instruments in the
ordinary course of business with or without the signature of a second corporate
officer, may sign certificates for shares of the corporation with the Secretary
or Assistant Secretary of the corporation and may sign any documents which the
Board of Directors has authorized to be executed, except in cases where the
signing and execution thereof shall be expressly delegated by the Board of
Directors or by these Bylaws to some other officer or agent of the corporation,
or

                                       9

<PAGE>
shall be required by law to be otherwise signed or executed; and in general
shall perform all duties incident to the office of President and such other
duties, authority and responsibilities as may be prescribed by the Chairman or
Co-Chairmen of the Board of Directors or the Board of Directors from time to
time.

         Section 7. The Vice President. In the absence of the President and all
Co-Presidents, or in the event of their death, inability or refusal to act, the
Executive Vice President, if one is designated and otherwise the Vice Presidents
in the order designated at the time of their election or in the absence of any
designation, then in the order of their election, shall perform the duties of
the President and when so acting, shall have all the powers of and be subject to
all the restrictions upon the President. Any Vice President may sign, with the
Secretary or an Assistant Secretary, certificates for shares of the corporation;
and shall perform such other duties as from time to time may be assigned to the
Vice President by the Chairman or Co-Chairmen of the Board of Directors,
President or any Co-President, or by the Board of Directors.

         Section 8. The Secretary. The Secretary shall: (a) keep the minutes of
the proceedings of the shareholders and of the Board of Directors in one or more
books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these Bylaws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents and the execution
of which on behalf of the corporation under its seal is duly authorized; (d)
keep a register of the post office address of each shareholder which shall be
furnished to the Secretary by such shareholders; (e) sign with the Chairman or
Co-Chairmen of the Board of Directors, President or a Co-President, or with a
Vice President, certificates for shares of the corporation, or contracts, deeds
or mortgages the issuance or execution of which shall have been authorized by
resolution of the Board of Directors; (f) have general charge of the stock
transfer books of the corporation subject to the authority delegated to a
transfer agent or registrar if appointed; and (g) in general perform all duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to the Secretary by the Chairman or Co-Chairmen of the Board of
Directors, President or any Co-President, or by the Board of Directors.

         Section 9. The Treasurer. The Treasurer shall: (a) have charge and
custody of and be responsible for all funds and securities of the corporation;
(b) receive and give receipts for monies due and payable to the corporation from
any source whatsoever and deposit all such monies in the name of the corporation
in such banks, trust companies or other depositories as shall be selected in
accordance with the provisions of Article VII of these Bylaws; and (c) in
general perform all of the duties incident to the office of Treasurer and such
other duties as from time to time may be assigned to the Treasurer by the
Chairman or Co-Chairmen of the Board of Directors, President or any
Co-President, or by the Board of Directors. If required by the Board of
Directors, the Treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the Board of Directors
shall determine.

         Section 10. Assistant Secretaries and Assistant Treasurers. The
Assistant Secretaries, when authorized by the Board of Directors, may sign with
the Chairman or Co-Chairmen of the Board of Directors, President or a
Co-President, or with a Vice President, certificates for shares of the
corporation or contracts, deeds or mortgages, the issuance or execution of which
shall have

                                       10

<PAGE>
been authorized by a resolution of the Board of Directors. The Assistant
Treasurers shall respectively, if required by the Board of Directors, give bonds
for the faithful discharge of their duties in such sums and with such sureties
as the Board of Directors shall determine. The Assistant Secretaries and
Assistant Treasurers, in general, shall perform such duties as shall be assigned
to them by the Secretary or the Treasurer, respectively, or by the Chairman or
Co-Chairmen of the Board of Directors, President or any Co-President, or by the
Board of Directors.

                                   ARTICLE VI

                      Contracts, Loans, Checks and Deposits

         Section 1. Contracts. The Board of Directors may authorize any officer
or officers, agent or agents, to enter into any contract or execute and deliver
any instrument in the name of and on behalf of the corporation and such
authority may be general or confined to specific instances.

         Section 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name unless
authorized by the Board of Directors. Such authority may be general or confined
to specific instances.

         Section 3. Checks. Drafts. etc. All checks, drafts or other orders for
the payment of money, notes or other evidences of indebtedness issued in the
name of the corporation, shall be signed by such officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
the Board of Directors.

         Section 4. Deposits. All funds of the corporation not otherwise
employed shall be deposited from time to time to the credit of the corporation
in such banks, trust companies or other depositories as the Board of Directors
may select.

                                   ARTICLE VII
                   Certificates for Shares and Their Transfer

         Section 1. Certificates for Shares. Certificates representing shares of
the corporation shall be in such form as shall be determined by the Board of
Directors. Such certificates shall be signed by the Chairman (or any
Co-Chairman) of the Board of Directors, the President (or any Co-President) or a
Vice President and by the Secretary or an Assistant Secretary and sealed with
the corporate seal or a facsimile thereof. The signatures of such officers upon
a certificate may be facsimiles if the certificate is countersigned by a
transfer agent, or registered by a registrar, other than the corporation itself
or one of its employees. If any officer who signed a certificate, either
manually or in facsimile, no longer holds such office when the certificate is
issued, the certificate is nevertheless valid. All certificates for shares shall
be consecutively numbered or otherwise identified. The name and address of the
person to whom the shares represented thereby are issued, with the number of
shares and date of issue, shall be entered on the stock transfer books of the
corporation. All certificates surrendered to the corporation for transfer shall
be canceled and no new certificate shall be issued until the former certificate
for a like number of shares shall have been surrendered and canceled, except
that in case of a lost, destroyed or


                                       11

<PAGE>
mutilated certificate a new one may be issued therefor upon such terms and
indemnity to the corporation as the Board of Directors may prescribe.

         Section 2. Transfer of Shares. Transfer of shares of the corporation
shall be made only on the stock transfer books of the corporation by the holder
of record thereof or by his legal representative, who shall furnish proper
evidence of authority to transfer or by his attorney thereunto authorized by
power of attorney duly executed and filed with the Secretary of the corporation,
or with its transfer agent, if any, and on surrender for cancellation of the
certificate for such shares. The person in whose name shares stand on the books
of the corporation shall be deemed by the corporation to be the owner thereof
for all purposes.

                                  ARTICLE VIII
                                   Fiscal Year

         The fiscal year of the corporation shall begin in January or February
and end in January or February each year, based upon the 4-5-4 calendar as
defined by the National Retail Federation ("NRF").

                                   ARTICLE IX
                                    Dividends

         The Board of Directors may, from time to time, declare and the
corporation may pay dividends on its outstanding shares in the manner and upon
the terms and conditions provided by law and its articles of incorporation.

                                    ARTICLE X
                                 Corporate Seal

             The Board of Directors shall provide a corporate seal which shall
be circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words, "Corporate Seal."

                                   ARTICLE XI
                Indemnification of Directors, Officers and Others

         Section 1. Right to Indemnification. Each person (including a person's
personal representative) who was or is made a party or is threatened to be made
a party to or is otherwise involved (including, without limitation, as a
witness) in any threatened, pending, or completed action, suit or proceeding,
whether civil, criminal, administrative, investigative or by or in the right of
the corporation, or otherwise (hereinafter a "proceeding") by reason of the fact
that he or she (or a person of whom he or she is a personal representative) is
or was a director or officer of the corporation or an officer of a division of
the corporation, or is or was acting at the request of


                                       12

<PAGE>
the corporation as a director, officer, partner, trustee, employee, agent or in
any other relationship or capacity whatsoever, of any other foreign or domestic
corporation, partnership, joint venture, employee benefit plan or trust or other
trust, enterprise or other private or governmental entity, agency, board,
commission, body or other unit whatsoever (hereinafter an "indemnitee"), whether
the basis of such proceeding is alleged action or inaction in an official
capacity as a director, officer, partner, trustee, employee, agent or in any
other relationship or capacity whatsoever, shall be indemnified and held
harmless by the corporation to the fullest extent not prohibited by the
Washington Business Corporation Act, as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment does not prohibit the corporation from providing broader
indemnification rights than prior to the amendment), against all expenses,
liabilities and losses (including but not limited to attorneys' fees, judgments,
claims, fines, ERISA and other excise and other taxes and penalties and other
adverse effects and amounts paid in settlement), reasonably incurred or suffered
by the indemnitee; provided, however, that no such indemnity shall indemnify any
person from or on account of acts or omissions of such person finally adjudged
to be intentional misconduct or a knowing violation of law, or from or on
account of conduct of a director finally adjudged to be in violation of RCW
23B.08.310, or from or on account of any transaction with respect to which it
was finally adjudged that such person personally received a benefit in money,
property, or services to which the person was not legally entitled; and further
provided, however, that except as provided in Section 2 of this Article with
respect to suits relating to rights to indemnification, the corporation shall
indemnify any indemnitee in connection with a proceeding (or part thereof)
initiated by the indemnitee only if such proceeding (or part thereof) was
authorized by the Board of Directors of the corporation.

         The right to indemnification granted in this Article is a contract
right and includes the right to payment by, and the right to receive
reimbursement from, the corporation of all expenses as they are incurred in
connection with any proceeding in advance of its final disposition (hereinafter
an "advance of expenses"); provided, however, that an advance of expenses
received by an indemnitee in his or her capacity as a director or officer of the
corporation, as an officer of a division of the corporation, or, acting at the
request of the corporation, as director or officer of any other foreign or
domestic corporation, partnership, joint venture, employee benefit plan or trust
or other trust, enterprise or other private or governmental entity, agency,
board, commission, body or other unit whatsoever (and not in any other capacity
in which service was or is rendered by such indemnitee unless such service was
authorized by the Board of Directors) shall be made only upon (i) receipt by the
corporation of a written undertaking (hereinafter an "undertaking") by or on
behalf of such indemnitee, to repay advances of expenses if and to the extent it
shall ultimately be determined by order of a court having jurisdiction (which
determination shall become final upon expiration of all rights to appeal),
hereinafter a "final adjudication", that the indemnitee is not entitled to be
indemnified for such expenses under this Article, (ii) receipt by the
corporation of written affirmation by the indemnitee of his or her good faith
belief that he or she has met the standard of conduct applicable (if any) under
the Washington Business Corporation Act necessary for indemnification by the
corporation under this Article, and (iii) a determination of the Board of
Directors, in its good faith belief, that the indemnitee has met the standard of
conduct applicable (if any) under the Washington Business Corporation Act
necessary for indemnification by the corporation under this Article.

                                       13

<PAGE>
         Section 2. Right of Indemnitee to Bring Suit. If any claim for
indemnification under Section 1 of this Article is not paid in full by the
corporation within sixty days after a written claim has been received by the
corporation, except in the case of a claim for an advance of expenses, in which
case the applicable period shall be twenty days, the indemnitee may at any time
thereafter bring suit against the corporation to recover the unpaid amount of
the claim. If the indemnitee is successful in whole or in part in any such suit,
or in any suit in which the corporation seeks to recover an advance of expenses,
the corporation shall also pay to the indemnitee all the indemnitee's expenses
in connection with such suit. The indemnitee shall be presumed to be entitled to
indemnification under this Article upon the corporation's receipt of
indemnitee's written claim (and in any suits relating to rights to
indemnification where the required undertaking and affirmation have been
received by the corporation) and thereafter the corporation shall have the
burden of proof to overcome that presumption. Neither the failure of the
corporation (including its Board of Directors, independent legal counsel, or
shareholders) to have made a determination prior to other commencement of such
suit that the indemnitee is entitled to indemnification, nor an actual
determination by the corporation (including its Board of Directors, independent
legal counsel or shareholders) that the indemnitee is not entitled to
indemnification, shall be a defense to the suit or create a presumption that the
indemnitee is not so entitled. It shall be a defense to a claim for an amount of
indemnification under this Article (other than a claim for advances of expenses
prior to final disposition of a proceeding where the required undertaking and
affirmation have been received by the corporation) that the claimant has not met
the standards of conduct applicable (if any) under the Washington Business
Corporation Act to entitle the claimant to the amount claimed, but the
corporation shall have the burden of proving such defense. If requested by the
indemnitee, determination of the right to indemnity and amount of indemnity
shall be made by final adjudication (as defined above) and such final
adjudication shall supersede any determination made in accordance with RCW
23B.08.550.

         Section 3. Non-Exclusivity of Rights. The rights to indemnification
(including, but not limited to, payment, reimbursement and advances of expenses)
granted in this Article shall not be exclusive of any other powers or
obligations of the corporation or of any other rights which any person may have
or hereafter acquire under any statute, the common law, the corporation's
Articles of Incorporation or Bylaws, agreement, vote of shareholders or
disinterested directors, or otherwise. Notwithstanding any amendment to or
repeal of this Article, any indemnitee shall be entitled to indemnification in
accordance with the provisions hereof with respect to any acts or omissions of
such indemnitee occurring prior to such amendment or repeal.

         Section 4. Insurance, Contracts and Funding. The corporation may
purchase and maintain insurance, at its expense, to protect itself and any
person (including a person's personal representative) who is or was a director,
officer, employee or agent of the corporation or who is or was a director,
officer, partner, trustee, employee, agent, or in any other relationship or
capacity whatsoever, of any other foreign or domestic corporation, partnership,
joint venture, employee benefit plan or trust or other trust, enterprise or
other private or governmental entity, agency, board, commission, body or other
unit whatsoever, against any expense, liability or loss, whether or not the
power to indemnify such person against such expense, liability or loss is now or
hereafter granted to the corporation under the Washington Business Corporation
Act. The corporation may enter into contracts granting indemnity, to any such
person whether or not in furtherance of the provisions of this Article and may
create trust funds, grant security interests

                                       14

<PAGE>
and use other means (including, without limitation, letters of credit) to secure
and ensure the payment of indemnification amounts.

         Section 5. Indemnification of Employees and Agents. The corporation
may, by action of the Board of Directors, provide indemnification and pay
expenses in advance of the final disposition of a proceeding to employees and
agent of the corporation with the same scope and effect as the provisions of
this Article with respect to the indemnification and advancement of expenses of
directors and officers of the corporation or pursuant to rights granted under,
or provided by, the Washington Business Corporation Act or otherwise.

         Section 6. Separability of Provisions. If any provision or provisions
of this Article shall be held to be invalid, illegal or unenforceable for any
reason whatsoever (i) the validity, legality and enforceability of the remaining
provisions of this Article (including without limitation, all portions of any
sections of this Article containing any such provision held to be invalid,
illegal or unenforceable, that are not themselves invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby, and (ii) to
the fullest extent possible, the provisions of this Article (including, without
limitation, all portions of any paragraph of this Article containing any such
provision held to be invalid, illegal or unenforceable, that are not themselves
invalid, illegal or unenforceable) shall be construed so as to give effect to
the intent manifested by the provision held invalid, illegal or unenforceable.

         Section 7. Partial Indemnification. If an indemnitee is entitled to
indemnification by the corporation for some or a portion of expenses,
liabilities or losses, but not for the total amount thereof, the corporation
shall nevertheless indemnify the indemnitee for the portion of such expenses,
liabilities and losses to which the indemnitee is entitled.

         Section 8. Successors and Assigns. All obligations of the corporation
to indemnify any indemnitee: (i) shall be binding upon all successors and
assigns of the corporation (including any transferee of all or substantially all
of its assets and any successor by merger or otherwise by operation of law),
(ii) shall be binding on and inure to the benefit of the spouse, heirs, personal
representatives and estate of the indemnitee, and (iii) shall continue as to any
indemnitee who has ceased to be a director, officer, partner, trustee, employee
or agent (or other relationship or capacity).

                                   ARTICLE XII
                                Books and Records

         Section 1. Books of Accounts, Minutes and Share Register. The
corporation shall keep as permanent records minutes of all meetings of its
shareholders and Board of Directors, a record of all actions taken by the
shareholders or Board of Directors without a meeting and a record of all actions
taken by a committee of the Board of Directors exercising the authority of the
Board of Directors on behalf of the corporation. The corporation shall maintain
appropriate accounting records. The corporation or its agent shall maintain a
record of its shareholders, in a form that permits preparation of a list of the
names and addresses of all shareholders, in alphabetical order showing the
number and class of shares held by each. The corporation shall keep a copy of
the


                                       15

<PAGE>
following records at its principal office: the Articles or Restated Articles
of Incorporation and all amendments currently in effect; the Bylaws or Restated
Bylaws and all amendments currently in effect; the minutes of all shareholders'
meetings and records of all actions taken by shareholders without a meeting, for
the past three years; its financial statements for the past three years,
including balance sheets showing in reasonable detail the financial condition of
the corporation as of the close of each fiscal year and an income statement
showing the results of its operations during each fiscal year prepared on the
basis of generally accepted accounting principles or, if not, prepared on a
basis explained therein; all written communications to shareholders generally
within the past three years; a list of the names and business addresses of its
current directors and officers; and its most recent annual report delivered to
the Secretary of State of the State of Washington.

         Section 2. Copies of Resolutions. Any person dealing with the
corporation may rely upon a copy of any of the records of the proceedings,
resolutions, or votes of the Board of Directors or shareholders, when certified
by the Chairman (or any Co-Chairman) of the Board of Directors, President (or
any Co-President) or Secretary.

                                  ARTICLE XIII
                               Amendment of Bylaws

         These Bylaws may be amended, altered, or repealed by the affirmative
vote of a majority of the full Board of Directors at any regular or special
meeting of the Board of Directors.

                                       16


<PAGE>
                                                                   Exhibit 10.39

                                 NORDSTROM fsb,
                                   as Seller,

                                       and

                     NORDSTROM CREDIT CARD RECEIVABLES LLC,
                                  as Purchaser

                         RECEIVABLES PURCHASE AGREEMENT
                            Dated as of April 1, 2002

<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>

                                   ARTICLE ONE

                                   DEFINITIONS

Section 1.01.Definitions....................................................................................     2
Section 1.02.Other Definitional Provisions..................................................................     6



                                   ARTICLE TWO

                     PURCHASE AND CONVEYANCE OF RECEIVABLES

Section 2.01.Purchase.......................................................................................     7
Section 2.02.Additional Accounts............................................................................     8
Section 2.03.Delivery of Documents..........................................................................     9
Section 2.04.Representations and Warranties as to the Security Interest of the Purchaser in the Receivables.    10


                                  ARTICLE THREE

                            CONSIDERATION AND PAYMENT

Section 3.01.Purchase Price.................................................................................    11
Section 3.02.Adjustments to Purchase Price..................................................................    11
Section 3.03.Capital Contribution...........................................................................    11


                                  ARTICLE FOUR

                         REPRESENTATIONS AND WARRANTIES

Section 4.01.Representations and Warranties of the Seller...................................................    12
Section 4.02.Representations and Warranties as to the Agreement and the Receivables.........................    13
Section 4.03.Representations and Warranties of the Purchaser................................................    15


                                  ARTICLE FIVE

                                    COVENANTS

Section 5.01.Covenants of the Seller........................................................................    17
Section 5.02.Covenants of the Seller with Respect to Receivables Purchase Agreements........................    18
</TABLE>

                                       i

<PAGE>

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
                                   ARTICLE SIX

                              REPURCHASE OBLIGATION

Section 6.01.Reassignment
 of Ineligible Receivables.........................................................    20
Section 6.02.Reassignment...................................................................................    20


                                  ARTICLE SEVEN

                              CONDITIONS PRECEDENT

Section 7.01.Conditions to the Purchaser's Obligations Regarding Initial Receivables........................    22
Section 7.02.Conditions Precedent to the Seller's Obligations...............................................    22


                                  ARTICLE EIGHT

                          TERM AND PURCHASE TERMINATION

Section 8.01.Term...........................................................................................    24
Section 8.02.Purchase Termination...........................................................................    24


                                  ARTICLE NINE

                            MISCELLANEOUS PROVISIONS

Section 9.01.Amendment......................................................................................    25
Section 9.02.Governing Law..................................................................................    25
Section 9.03.Notices........................................................................................    25
Section 9.04.Severability of Provisions.....................................................................    25
Section 9.05.Merger, Consolidation of, or Assignment of Obligations of Seller...............................    26
Section 9.06.Acknowledgement and Agreement of the Seller....................................................    27
Section 9.07.Further Assurances.............................................................................    27
Section 9.08.No Waiver; Cumulative Remedies.................................................................    27
Section 9.09.Counterparts...................................................................................    27
Section 9.10.Third-Party Beneficiaries......................................................................    28
Section 9.11.Merger and Integration.........................................................................    28
Section 9.12.Effect of Headings and Table of Contents.......................................................    28
Section 9.13.Schedules and Exhibits.........................................................................    28
Section 9.14.Survival of Representations and Warranties.....................................................    28
Section 9.15.Nonpetition Covenant...........................................................................    28

</TABLE>


                                       ii

<PAGE>

<TABLE>
<CAPTION>
                                                                                  Page
                                                                                  ----
<S>                                                                             <C>
                                    EXHIBITS

Exhibit A -  Form of Supplemental Conveyance....................................  A-1


                                    SCHEDULES

Schedule I - List of Accounts...................................................  S-1
</TABLE>


                                      iii

<PAGE>
                         RECEIVABLES PURCHASE AGREEMENT

         This Receivables Purchase Agreement, dated as of April 1, 2002, is
between Nordstrom fsb (the "Bank"), a federal savings bank (the "Seller"), and
Nordstrom Credit Card Receivables LLC, a Delaware limited liability company (the
"Purchaser").

         WHEREAS, in the regular course of its business, the Seller has
originated, and in the future may originate or acquire, certain credit card
accounts and the related receivables;

         WHEREAS, the Purchaser desires to purchase, from time to time, certain
Receivables; and

         WHEREAS, the Seller desires to sell and assign, from time to time, the
Receivables to the Purchaser upon the terms and conditions hereinafter set
forth.

         NOW, THEREFORE, in consideration of the mutual terms and covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

<PAGE>
                                  ARTICLE ONE

                                   DEFINITIONS

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

         "Account" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Account Owner" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Addition Cut-Off Date" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Addition Date" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Addition Notice Date" has the meaning specified in Section 2.02(a).

         "Additional Account" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Adverse Effect" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Agreement" means this Receivables Purchase Agreement, as amended or
supplemented from time to time.

         "Bank" means Nordstrom fsb, a federal savings bank, and its successors.

         "Bankruptcy Code" means Title 11 of the United States Code, as amended.

         "Closing Date" means May 1, 2002.

         "Collection Account" has the meaning set forth in the Indenture.

         "Collections" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Conveyance" has the meaning specified in Section 2.01(a).

         "Conveyance Papers" has the meaning specified in Section 4.01(a)(iii).

         "Credit Adjustment" means, with respect to one or more Receivables
previously conveyed by the Seller to the Purchaser, an amount equal to the
aggregate of (i) the reduction in the principal balance of the related
Receivables described in Section 3.02 multiplied by the quotient (expressed as a
percentage) of (ii) the Purchase Price for Principal Receivables payable on the
related Distribution Date divided by the aggregate of the Principal Receivables
transferred to the Purchaser on such Addition Date.

         "Credit Card Agreement" has the meaning set forth in the Transfer and
Servicing Agreement.

                                       2

<PAGE>
         "Credit Card Guidelines" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Date of Processing" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Debtor Relief Laws" means (i) the Bankruptcy Code and (ii) all other
applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, suspension of payments, readjustment
of debt, marshalling of assets or similar debtor relief laws of the United
States, any state or any foreign country from time to time in effect affecting
the rights of creditors generally.

         "Determination Date" has the meaning set forth in the related Indenture
Supplement.

         "Distribution Date" has the meaning set forth in the related Indenture
Supplement.

         "Document Delivery Date" has the meaning set forth in Section 2.03.

         "Eligible Account" has the meaning set forth in the Transfer and
Servicing Agreement, except that the word "Seller" shall be substituted for each
occurrence of the word "Transferor", the word "Purchaser" shall be substituted
for each occurrence of the word "Trust" and all references to the Notes shall be
ignored.

         "Eligible Receivable" has the meaning set forth in the Transfer and
Servicing Agreement, except that the word "Seller" shall be substituted for each
occurrence of the word "Transferor", the word "Purchaser" shall be substituted
for each occurrence of the word "Trust" and all references to the Notes shall be
ignored.

         "Event of Default" has the meaning set forth in the Indenture.

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

         "Governmental Authority" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Indenture" means the Master Indenture, as supplemented by the related
Indenture Supplement, as the same may be amended, supplemented or modified from
time to time.

         "Indenture Supplement" means the indenture supplement pursuant to which
a Series is issued.

         "Indenture Trustee" means Wells Fargo Bank Minnesota, National
Association, as trustee under the Indenture, and its successors.

         "Ineligible Receivables" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Initial Account" has the meaning set forth in the Transfer and
Servicing Agreement.

                                       3

<PAGE>
         "Initial Cut-Off Date" means the close of business on February 28,
2002.

         "Insolvency Event" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Interchange" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Lien" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Master Indenture" means the master indenture, dated as of April 1,
2002, between the Trust, as Issuer, and the Indenture Trustee, as acknowledged
and agreed by the Transferor and the Servicer, as the same may be amended,
supplemented or otherwise modified from time to time.

         "Monthly Period" has the meaning set forth in the related Indenture
Supplement.

         "Noteholder" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Obligor" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Offered Notes" has the meaning set forth in the related Indenture.

         "Owner Trustee" means Wilmington Trust Company, as trustee under the
Trust Agreement, and its successors.

         "Pay Out Event" has the meaning set forth in the related Indenture.

         "Periodic Rate Finance Charges" has the meaning set forth in the Credit
Card Agreement applicable to each Account for finance charges (due to periodic
rate) or any similar term.

         "Principal Receivables" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Purchase Price" means, with respect to (i) Receivables transferred to
the Purchaser on the Closing Date, an amount equal $254,490,213, which amount
includes $199,388,450 from the net cash proceeds from the private placement by
the Purchaser of the Offered Notes and $55,101,763 from the capital contribution
from the Seller to the Purchaser made pursuant to Section 3.03, and (ii)
Receivables transferred to the Purchaser after the Closing Date, an amount equal
to 100% of the aggregate balance of Principal Receivables in the related
Accounts as of the Addition Cut-Off Date or an amount determined to be the fair
market value of such Receivables and the related Purchased Assets.

         "Purchased Assets" has the meaning set forth in Section 2.01.

         "Purchaser" means Nordstrom Credit Card Receivables LLC, in its
capacity as purchaser of the Receivables under this Agreement, and its
successors.

         "Rating Agency" has the meaning set forth in the related Indenture.

         "Rating Agency Condition" has the meaning set forth in the related
Indenture.

                                       4

<PAGE>
         "Receivables" means all amounts shown on the Bank's records as amounts
payable by Obligors on any Account from time to time including amounts payable
for Principal Receivables and Finance Charge Receivables.

         "Receivables Purchase Agreement" means (i) this Agreement or (ii) any
receivables purchase agreement entered into between the Transferor and an
Account Owner, as the same may be amended, supplemented or otherwise modified
from time to time.

         "Removed Accounts" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Requirements of Law" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Securities" means any one of the Notes (as such term is defined in the
Indenture) or the Certificates (as such term is defined in the Trust Agreement).

         "Seller" means Nordstrom fsb, in its capacity as seller of the
Receivables under this Agreement, and its successors.

         "Series" has the meaning set forth in the Indenture.

         "Servicer" means Nordstrom fsb, in its capacity as servicer under the
Transfer and Servicing Agreement, and its successors.

         "Supplemental Accounts" has the meaning set forth the Transfer and
Servicing Agreement.

         "Supplemental Conveyance" has the meaning set forth in Section 2.03.

         "Tax Opinion" has the meaning set forth in the Indenture.

         "Transfer Date" has the meaning set forth in the Indenture.

         "Transfer and Servicing Agreement" means the transfer and servicing
agreement, dated as of April 1, 2002, among the Bank, the Purchaser and the
Trust, as amended or supplemented from time to time.

         "Transferor" means Nordstrom Credit Card Receivables LLC, in its
capacity as Transferor under the Transfer and Servicing Agreement, and its
successors.

         "Trust" means the Nordstrom Credit Card Master Note Trust.

         "Trust Agreement" means the trust agreement, dated as of April 1, 2002,
between the Purchaser, as Transferor, and the Owner Trustee, as amended or
supplemented from time to time.

         "UCC" means the Uniform Commercial Code, as amended from time to time,
as in effect in the applicable jurisdiction.

                                       5

<PAGE>
         Section 1.02. Other Definitional Provisions.

         (a) Except as otherwise specified herein or as the context may
otherwise require, for all purposes of this Agreement, capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed thereto
in the Transfer and Servicing Agreement, the Trust Agreement or the Indenture,
as the case may be.

         (b) For all purposes of this Agreement, 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 Agreement include all Exhibits hereto, (iii) references
to words such as "herein", "hereof" and the like shall refer to this Agreement
as a whole and not to any particular part, Article or Section within this
Agreement, (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 Agreement, (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.

         (c) All determinations of the principal or finance charge balance of
Receivables, and of any collections thereof, shall be made in accordance with
the Transfer and Servicing Agreement and the Indenture.

                                       6

<PAGE>
                                  ARTICLE TWO

                     PURCHASE AND CONVEYANCE OF RECEIVABLES

         Section 2.01. Purchase.

         (a) The Seller hereby sells, transfers, assigns, sets over and
otherwise conveys to the Purchaser (collectively, the "Conveyance"), without
recourse except as provided herein, all its right, title and interest 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 this Agreement pursuant to Article Eight, (ii) Collections and
all Interchange and Recoveries allocable to the Purchaser as provided herein 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 Seller pursuant to Sections 6.01(b) and 6.02), (iii) the rights of the
Seller in the Receivables Purchase Agreements, (iv) all Insurance Proceeds
relating to the Receivables, (v) 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, (vi) all present and
future claims, demands, causes and choses in action in respect of any or all of
the foregoing and (vii) any and all proceeds of the foregoing (collectively, the
"Purchased Assets").

         (b) In connection with such Conveyance, the Seller agrees (i) to record
and file, at its own expense, any financing statements (and continuation
statements with respect to such financing statements when applicable) with
respect to the Receivables existing as of the Initial Cut-Off Date and
thereafter created in the Initial Accounts, and existing as of the Addition
Cut-Off Date and thereafter created in the Additional Accounts, meeting the
requirements of applicable state law in such manner and in such jurisdictions as
are necessary to perfect the first priority nature of the Purchaser's interest
in the Receivables and other Purchased Assets, and maintain perfection of, the
Conveyance of such Receivables and other Purchased Assets from the Seller to the
Purchaser, (ii) that such financing statements shall name the Seller, as seller,
and the Purchaser, as purchaser, of the Receivables and other Purchased Assets
and (iii) to deliver a file-stamped copy of such financing statements or other
evidence of such filings to the Purchaser as soon as is practicable after
filing.

         (c) In connection with such Conveyance, the Seller further agrees that
it will, at its own expense, (i) on or prior to (A) the Closing Date, in the
case of Initial Accounts, (B) the applicable Addition Date, in the case of
Additional Accounts, and (C) the applicable Removal Date, in the case of Removed
Accounts, indicate in its computer files that, in the case of the Initial
Accounts or the Additional Accounts, Receivables created in connection with such
Accounts have been conveyed to the Purchaser in accordance with this Agreement
and have been conveyed by the Purchaser to the Trust pursuant to the Transfer
and Servicing Agreement and have been pledged by the Trust to the Indenture
Trustee pursuant to the Indenture for the benefit of the Noteholders by
indicating in such computer files the transfer of the Receivables to the
Purchaser, or in the case of a Removed Account related to the Receivables, that
such Receivables have been reassigned to the Purchaser and (ii) on or prior to
(A) the Closing Date, in the case of


                                       7

<PAGE>
the Initial Accounts, (B) the applicable Addition Date, in the case of
designation of Supplemental Accounts and (C) the applicable Removal Date, in the
case of Removed Accounts, and (iii) to deliver to the Purchaser a computer file
or microfiche list containing a true and complete list of all such Accounts
specifying for each such Account, as of the Initial Cut-Off Date, in the case of
the Initial Accounts, the applicable Addition Cut-Off Date, in the case of
Supplemental Accounts and the applicable Removal Date, in the case of Removed
Accounts, (1) its account number, (2) the aggregate amount outstanding in such
Account and (3) the aggregate amount of Principal Receivables in such Account.
Each such computer file or microfiche list, as supplemented from time to time to
reflect Additional Accounts or Removed Accounts, shall be marked as Schedule 1
to this Agreement, shall be delivered to the Purchaser and is hereby
incorporated into and made a part of this Agreement. The Seller further agrees
not to alter the computer code referenced in clause (i) of this paragraph with
respect to any Account during the term of this Agreement unless and until such
Account becomes a Removed Account.

         (d) The parties hereto intend that the conveyance of the Seller's
right, title and interest in and to the Purchased Assets shall constitute an
absolute sale, conveying good title free and clear of any Liens or rights of
others from the Seller to the Purchaser. It is the intention of the parties
hereto that the arrangements with respect to the Purchased Assets shall
constitute a purchase and sale of such Purchased Assets and not a loan. In the
event, however, that it were to be determined that the transactions evidenced
hereby constitute a loan and not a purchase and sale, it is the intention of the
parties hereto that this Agreement shall constitute a security agreement under
applicable law, and that the Seller shall be deemed to have granted and does
hereby grant to the Purchaser a first priority perfected security interest, in
all of the Seller's right, title and interest, whether owned on the Initial
Cut-Off Date or thereafter acquired, in, to and under the Purchased Assets and
all money, accounts, payment 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
Purchased Assets and all proceeds thereof to secure the obligations of the
Seller hereunder.

         Section 2.02. Additional Accounts.

         (a) If the Purchaser becomes obligated to designate Supplemental
Accounts pursuant to Section 2.09(a)(i) of the Transfer and Servicing Agreement,
then the Purchaser may, at its option, give the Seller written notice thereof on
or before the tenth Business Day (the "Addition Notice Date") prior to the
Addition Date therefor, and upon receipt of such notice the Seller shall on or
before the Addition Date, designate sufficient Eligible Accounts to be included
as Supplemental Accounts so that after the inclusion thereof the Purchaser will
be in compliance with the requirements of Section 2.09(a)(i) of the Transfer and
Servicing Agreement. Additionally, subject to Sections 2.09(b) and (c) of the
Transfer and Servicing Agreement and Section 2.02(b), from time to time Eligible
Accounts may be designated to be included as Supplemental Accounts, upon the
mutual agreement of the Purchaser and the Seller. In either event, the Seller
shall have sole responsibility for selecting such Supplemental Accounts.

         (b) On the Addition Date with respect to any designation by the Seller
of Eligible Accounts to be Supplemental Accounts pursuant to Section 2.02(a),
the Purchaser shall purchase the Seller's right, title and interest in, to and
under the Receivables in such Supplemental

                                       8

<PAGE>
Accounts (and such Receivables shall be deemed to be Receivables) and the
related Purchased Assets, subject to the satisfaction of the following
conditions on such Addition Date:

                  (i) all such Supplemental Accounts shall be Eligible Accounts;

                  (ii) the Seller shall have delivered to the Purchaser copies
         of UCC-1 financing statements covering such Supplemental Accounts, if
         necessary to perfect the Purchaser's interest in the Receivables
         arising therein;

                  (iii) to the extent required of the Purchaser by Section
         2.09(c) of the Transfer and Servicing Agreement, the Seller shall have
         transferred to the Servicer for deposit in the Collection Account all
         Collections with respect to such Supplemental Accounts since the
         Addition Cut-Off Date;

                  (iv) as of each of the Addition Cut-Off Date and the Addition
         Date, no Insolvency Event with respect to the Seller shall have
         occurred nor shall the transfer of the Receivables arising in the
         Supplemental Accounts to the Purchaser have been made in contemplation
         of the occurrence thereof;

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

                  (vi) the Seller shall have delivered to the Purchaser an
         Officer's Certificate, dated the Addition Date, confirming, to the
         extent applicable, the items set forth in clauses (i) through (v)
         above; and

                  (vii) the transfer of the Receivables arising in the
         Supplemental Accounts to the Purchaser will not result in an Adverse
         Effect and, in the case of such Supplemental Accounts, the Seller shall
         have delivered to the Purchaser an Officer's Certificate, dated the
         related Addition Date, stating that the Seller reasonably believes that
         the transfer of the Receivables arising in such Supplemental Accounts
         to the Purchaser will not have an Adverse Effect.

         (c) In addition to designating Additional Accounts pursuant to Section
2.02(a), the Seller may, subject to the satisfaction by the Purchaser of the
conditions relating to the designation by the Purchaser of Accounts to the Trust
set forth in Section 2.09(a)(iii) of the Transfer and Servicing Agreement,
automatically convey newly originated Eligible Accounts to the Purchaser upon
their establishment.

         Section 2.03. Delivery of Documents. In the case of the designation of
Supplemental Accounts, the Seller shall deliver to the Purchaser (i) the
computer file or microfiche list required to be delivered pursuant to Section
2.01(c) with respect to such Supplemental Accounts on the date such file or list
is required to be delivered pursuant to Section 2.01(c) (the "Document Delivery
Date") and (ii) a duly executed, written assignment (including an acceptance by
the Purchaser), substantially in the form of Exhibit A (the "Supplemental
Conveyance"), on the Document Delivery Date.



                                       9

<PAGE>
         Section 2.04. Representations and Warranties as to the Security
Interest of the Purchaser in the Receivables. The Seller makes the following
representations and warranties to the Purchaser. The representations and
warranties speak as of the execution and delivery of this Agreement and as of
the Closing Date. Such representations and warranties shall survive the sale,
transfer and assignment of the Receivables to the Transferor and the Trust, the
pledge thereof to the Indenture Trustee and the termination of this Agreement
and shall not be waived by any party hereto unless the Rating Agency Condition
is satisfied.

                  (a) This Agreement creates a valid and continuing security
         interest (as defined in the applicable UCC) in the Receivables in favor
         of the Purchaser, which security interest is prior to all other Liens
         other than the Lien of each of the Indenture and the Trust, and is
         enforceable as such as against creditors of and purchasers from the
         Seller.

                  (b) The Receivables constitute "accounts" within the meaning
         of the applicable UCC.

                  (c) The Seller owns and has good and marketable title to the
         Receivables free and clear of any Lien, claim or encumbrance of any
         Person.

                  (d) The Seller has caused or will have caused, within ten
         days, 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 Receivables granted to
         the Purchaser hereunder.

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

                                       10

<PAGE>
                                 ARTICLE THREE

                            CONSIDERATION AND PAYMENT

         Section 3.01. Purchase Price. The Purchase Price for Receivables
relating to (i) Initial Accounts as of the Initial Cut-Off Date and the related
Purchased Assets conveyed to the Purchaser under this Agreement shall be payable
on the Closing Date and (ii) Initial Accounts, Additional Accounts and the
related Purchased Assets to be conveyed after the Closing Date to the Purchaser
under this Agreement, shall be payable in cash on the Distribution Date
following the Monthly Period in which such Receivables and the related Purchased
Assets are conveyed by the Seller to the Purchaser.

         Section 3.02. Adjustments to Purchase Price. The Purchase Price shall
be adjusted on each Distribution Date by an amount equal to the Credit
Adjustment with respect to any one or more Receivables previously conveyed to
the Purchaser by the Seller which have since been reduced by the Seller or the
Servicer because of a rebate, refund, unauthorized charge or billing error to an
Obligor because such Receivable was created in respect of merchandise which was
refused or returned by an Obligor or due to the occurrence of any other event
referred to in Section 3.09 of the Transfer and Servicing Agreement. In the
event that the Credit Adjustment pursuant to this Section causes the Purchase
Price to be a negative number, the Seller agrees that, not later than 1:00 p.m.,
New York City time, on such Distribution Date, the Seller shall pay or cause to
be paid to the Purchaser an amount equal to the amount by which the Credit
Adjustment exceeds the Purchase Price. Notwithstanding the foregoing, if as a
result of the occurrence of any event giving rise to a Credit Adjustment,
Purchaser is required to deposit funds into the Special Funding Account pursuant
to Section 3.09 of the Transfer and Servicing Agreement, Seller shall pay
Purchaser an amount equal to such required deposit in immediately available
funds on or before the date Purchaser is required to make such deposit to the
Special Funding Account.

         Section 3.03. Capital Contribution. Simultaneously with the closing of
the Purchaser of the private placement of the Offered Notes, the Seller shall
make a capital contribution to the Purchaser of $55,101,763 in consideration of
a membership interest in the Purchaser.

                                       11

<PAGE>
                                  ARTICLE FOUR

                         REPRESENTATIONS AND WARRANTIES

         Section 4.01. Representations and Warranties of the Seller.

         (a) The Seller hereby represents and warrants to, and agrees with, the
Purchaser as of the date of this Agreement, as of the Closing Date and on each
Addition Date, that:

                  (i) Organization and Good Standing. The Seller is a federal
         savings bank validly existing under the laws of the United States of
         America, with power and authority to own its properties and conduct its
         business as such properties are currently owned and such business is
         presently conducted, and had at all relevant times, and has, power,
         authority and legal right to acquire, own and sell the Receivables. The
         Seller is a member of the Federal Deposit Insurance Corporation.

                  (ii) Due Qualification. The Seller is duly qualified to do
         business and has obtained all necessary licenses and approvals in each
         jurisdiction in which the failure to so qualify or to obtain such
         licenses and approvals would, in the reasonable judgment of the Seller,
         materially and adversely affect the performance by the Seller of its
         obligations under this Agreement and the Receivables Purchase
         Agreements, or the validity or enforceability of this Agreement, the
         Receivables Purchase Agreements or the Receivables.

                  (iii) Power and Authority. The Seller has the power and
         authority to execute, deliver and perform its obligations under this
         Agreement and to carry out its terms; and the execution, delivery and
         performance of this Agreement, each Receivables Purchase Agreement, any
         other document or instrument delivered pursuant hereto, including any
         Supplemental Conveyance, to which the Seller is a party (the
         "Conveyance Papers") and the sale of the Receivables has been duly
         authorized by it by all necessary corporate action.

                  (iv) No Violation. The execution, delivery and performance by
         the Seller of this Agreement, each Receivables Purchase Agreement, each
         Conveyance Paper and the sale of the Receivables, the consummation of
         the transactions contemplated hereby and by the Receivables Purchase
         Agreements and the fulfillment of the terms hereof and thereof will not
         conflict with, result in a breach of any of the terms and provisions
         of, or constitute (with or without notice or lapse of time or both) a
         default under, its charter or bylaws, or conflict with or breach any of
         the material terms or provisions of, or constitute (with or without
         notice or lapse of time or both) a default under, any indenture,
         agreement or other instrument to which it is a party or by which it
         shall be bound; nor result in the creation or imposition of any Lien
         upon any of its properties pursuant to the terms of any such indenture,
         agreement or other instrument (other than this Agreement); nor violate
         any law or, to its knowledge, any order, rule or regulation applicable
         to it of any court or of any federal or state regulatory body,
         administrative agency or other governmental instrumentality having
         jurisdiction over it or its properties, which breach,


                                       12

<PAGE>
         default, conflict, Lien or violation would have a material adverse
         effect on the Seller's earnings, business affairs or business prospects
         or the Receivables.

                  (v) No Proceedings. There are no proceedings or investigations
         pending, or to the best knowledge of the Seller, threatened against the
         Seller, before any court, regulatory body, administrative agency or
         other governmental instrumentality having jurisdiction over the Seller
         or its properties: (A) asserting the invalidity of this Agreement, the
         Receivables Purchase Agreements or the Conveyance Papers, (B) seeking
         to prevent the issuance of the Notes or the consummation of any of the
         transactions contemplated by this Agreement, the Receivables Purchase
         Agreements or the Conveyance Papers, (C) seeking any determination or
         ruling that might materially and adversely affect the performance by
         the Seller of its obligations under this Agreement, the Receivables
         Purchase Agreements or Conveyance Papers or (D) seeking to affect
         adversely the income tax attributes of the Trust under federal or
         applicable state income or franchise tax systems.

                  (vi) All Consents Required. All approvals, authorizations,
         consents, orders or other actions of any Person or any Governmental
         Authority required in connection with the execution and delivery by
         Seller of this Agreement or any of the Conveyance Papers and the
         performance of the transactions contemplated by this Agreement or any
         of the Conveyance Papers by Seller have been obtained.

                  (vii) Insolvency. Seller is not insolvent and no Insolvency
         Event with respect to Seller has occurred, and the transfer of the
         Receivables and Purchased Assets by Seller to Purchaser contemplated
         hereby has not been made in contemplation of such insolvency or
         Insolvency Event.

         (b) The representations and warranties set forth in this Section shall
survive the transfer and assignment of the Receivables to the Purchaser. Upon
discovery by the Seller or the Purchaser of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
written notice to the other party, the Owner Trustee and the Indenture Trustee
within three Business Days following such discovery.

         Section 4.02. Representations and Warranties as to the Agreement and
the Receivables.

         (a) Representations and Warranties. The Seller hereby represents and
warrants to the Purchaser as of the date of this Agreement and as of the Closing
Date with respect to the Initial Accounts (and the Receivables arising therein),
and, with respect to Additional Accounts (and the Receivables arising therein),
as of the related Addition Date that:

                  (i) this Agreement and, in the case of Supplemental Accounts,
         the related Supplemental Conveyance, each constitutes a legal, valid
         and binding obligation of the Seller enforceable against the Seller in
         accordance with its terms, except as such enforceability may be limited
         by applicable Debtor Relief Laws or general principles of equity;

                  (ii) as of the Initial Cut-Off Date, with respect to the
         Initial Accounts (and the Receivables arising therein) and as of the
         related Addition Cut-Off Date with respect



                                       13

<PAGE>
         to Additional Accounts (and the Receivables arising therein), Schedule
         1 to this Agreement, as supplemented to such date, is an accurate and
         complete listing in all material respects of all the Accounts relating
         to Receivables as of the Initial Cut-Off Date or such Addition Cut-Off
         Date, as the case may be, and the information contained therein with
         respect to the identity of such Accounts and the Receivables existing
         thereunder is true and correct in all material respects as of the
         Initial Cut-Off Date or such applicable Addition Cut-Off Date, as the
         case may be;

                  (iii) each Receivable conveyed to the Purchaser by the Seller
         has been conveyed to the Purchaser free and clear of any Lien of any
         Person claiming through or under the Seller or any of its Affiliates
         (other than Liens permitted under Section 5.01(b)) and in compliance
         with all Requirements of Law applicable to the Seller;

                  (iv) all authorizations, consents, orders or approvals of or
         registrations or declarations with any Governmental Authority required
         to be obtained, effected or given by the Seller in connection with the
         conveyance by the Seller of the Receivables to the Purchaser have been
         duly obtained, effected or given and are in full force and effect;

                  (v) this Agreement or, in the case of Supplemental Accounts,
         the related Supplemental Conveyance, upon execution and delivery by the
         Seller, constitutes an absolute sale, transfer and assignment to the
         Purchaser of all right, title and interest of the Seller in the
         Receivables and other Purchased Assets conveyed to the Purchaser by the
         Seller and the proceeds thereof and Recoveries identified as relating
         to the Receivables conveyed to the Purchaser by the Seller or, if this
         Agreement or, in the case of Supplemental Accounts, the related
         Supplemental Conveyance, does not constitute a sale of such property,
         it constitutes a grant of a first priority perfected "security
         interest" (as defined in the UCC) in such property to the Purchaser,
         which, in the case of Receivables in Initial Accounts and the proceeds
         thereof and Recoveries, is enforceable upon execution and delivery of
         this Agreement, or, with respect to then existing Receivables in
         Additional Accounts, as of the applicable Addition Date, and which will
         be enforceable with respect to such Receivables hereafter and
         thereafter created and the proceeds thereof upon such creation; and
         upon the filing of the financing statements and, in the case of
         Receivables hereafter created and the proceeds thereof, upon the
         creation thereof, the Purchaser shall have a first priority perfected
         security or ownership interest in such property and proceeds;

                  (vi) on the Initial Cut-Off Date, each Initial Account
         specified in Schedule 1 with respect to the Seller is an Eligible
         Account and, on the applicable Addition Cut-Off Date, each related
         Additional Account specified in Schedule 1 with respect to the Seller
         is an Eligible Account;

                  (vii) on the Initial Cut-Off Date, each Receivable in Initial
         Accounts conveyed to the Purchaser by the Seller is an Eligible
         Receivable and, on the applicable Addition Cut-Off Date, each
         Receivable conveyed in the related Additional Accounts conveyed to the
         Purchaser by the Seller is an Eligible Receivable;

<PAGE>
                  (viii) as of the date of the creation of any new Receivable
         transferred to the Purchaser by the Seller, such Receivable is an
         Eligible Receivable; and

                  (ix) the Seller has used random selection procedures and no
         selection procedures believed by the Seller to be materially adverse to
         the interests of the Noteholders have been used in selecting Accounts
         relating to Receivables.

         (b) Notice of Breach. The representations and warranties set forth in
this Section shall survive the transfer and assignment of the Receivables to the
Purchaser and the transfer and assignment by the Purchaser of the Receivables to
the Issuer. Upon discovery by either the Seller or the Purchaser of a breach of
any of the representations and warranties set forth in this Section, the party
discovering such breach shall give written notice to the other party, the Owner
Trustee and the Indenture Trustee within three Business Days following such
discovery; provided that the failure to give notice within three Business Days
does not preclude subsequent notice. The Seller hereby acknowledges that the
Purchaser intends to rely on the representations hereunder in connection with
representations made by the Purchaser to secured parties, assignees or
subsequent transferees including transfers made by the Purchaser to the Trust
pursuant to the Transfer and Servicing Agreement and the pledge by the Trust to
the Indenture Trustee pursuant to the Indenture and that the Owner Trustee and
the Indenture Trustee may enforce such representations directly against the
Seller.

         Section 4.03. Representations and Warranties of the Purchaser.

         (a) As of the Closing Date and each Addition Date, the Purchaser hereby
represents and warrants to, and agrees with, the Seller that:

                  (i) Organization and Good Standing. The Purchaser has been
         duly formed and is validly existing as a limited liability company in
         good standing under the laws of the State of Delaware, with power and
         authority to own its properties and to conduct its business as such
         properties are currently owned and such business is presently
         conducted, and had at all relevant times, and has, power, authority and
         legal right to acquire, own and purchase the Receivables.

                  (ii) Due Qualification. The Purchaser is duly qualified to do
         business as a foreign limited liability company in good standing and
         has obtained all necessary licenses and approvals in each jurisdiction
         in which the failure to so qualify or to obtain such licenses and
         approvals would, in the reasonable judgment of the Purchaser,
         materially and adversely affect the performance by the Purchaser of its
         obligations under, or the validity or enforceability of, this
         Agreement.

                  (iii) Power and Authority. The Purchaser has the power and
         authority to execute, deliver and perform its obligations under this
         Agreement and to carry out its terms; and the execution, delivery and
         performance of this Agreement and the Conveyance Papers has been duly
         authorized by the Purchaser by all necessary limited liability company
         action.

                  (iv) No Violation. The execution, delivery and performance by
         the Purchaser of this Agreement and the Conveyance Papers and of the
         purchase of the

                                       15

<PAGE>
         Receivables and the consummation of the transactions contemplated
         hereby and by the Conveyance Papers and the fulfillment of the terms
         hereof and thereof does not conflict with, result in any breach of any
         of the terms and provisions of, nor constitute (with or without notice
         or lapse of time or both) a default under, the limited liability
         company agreement of the Purchaser, nor conflict with or violate any of
         the material terms or provisions of, or constitute (with or without
         notice or lapse of time or both) a default under, any indenture,
         agreement or other instrument to which the Purchaser is a party or by
         which it shall be bound; nor result in the creation or imposition of
         any Lien upon any of its properties pursuant to the terms of any such
         indenture, agreement or other instrument (other than this Agreement);
         nor violate any law or any order, rule or regulation applicable to the
         Purchaser of any court or of any federal or state regulatory body,
         administrative agency or other governmental instrumentality having
         jurisdiction over the Purchaser or its properties, which breach,
         default, conflict, Lien or violation would have a material adverse
         effect on the earnings, business affairs or business prospects of the
         Purchaser or on the ability of the Purchaser to perform its obligations
         under this Agreement.

                  (v) No Proceedings. There are no proceedings or investigations
         pending, or to the best knowledge of the Purchaser, threatened against
         the Purchaser, before any Governmental Authority having jurisdiction
         over the Purchaser or its properties: (A) asserting the invalidity of
         this Agreement or any Conveyance Papers, (B) seeking to prevent the
         issuance of the Notes or the consummation of any of the transactions
         contemplated by this Agreement, (C) seeking any determination or ruling
         that might materially and adversely affect the performance by the
         Purchaser of its obligations under this Agreement or the Conveyance
         Papers or (D) seeking to affect adversely the income tax attributes of
         the Trust under federal or applicable state income or franchise tax
         systems.

                  (vi) All Consents Required. All approvals, authorizations,
         consents, orders or other actions of any Person or any Governmental
         Authority required in connection with the execution and delivery by
         Purchaser of this Agreement or any of the Conveyance Papers and the
         performance of the transactions contemplated by this Agreement or any
         of the Conveyance Papers by Purchaser have been obtained, effected or
         given and are in full force and effect.

         (b) The representations and warranties set forth in this Section shall
survive the Conveyance of the Receivables to the Purchaser. Upon discovery by
the Purchaser or the Seller of a breach of any of the foregoing representations
and warranties, the party discovering such breach shall give prompt written
notice to the other party, the Owner Trustee and the Indenture Trustee.

                                       16

<PAGE>
                                  ARTICLE FIVE

                                    COVENANTS

         Section 5.01. Covenants of the Seller. The Seller hereby covenants and
agrees with the Purchaser as follows:

                  (a) Receivables Not to be Evidenced by Promissory Notes.
         Except in connection with its enforcement or collection of any
         Receivable, the Seller will take no action to cause any Receivable
         conveyed by it to the Purchaser to be evidenced by any instrument (as
         defined in the UCC) and if any Receivable is so evidenced (whether or
         not in connection with the enforcement or collection of a Receivable),
         it shall be deemed to be an Ineligible Receivable and shall be
         reassigned to the Seller in accordance with Section 6.01(b).

                  (b) Security Interests. Except for the conveyances hereunder,
         the Seller will not sell, pledge, assign or transfer to any other
         Person, or grant, create, incur, assume or suffer to exist any Lien on,
         any Receivable conveyed by it to the Purchaser, whether now existing or
         hereafter created, or any interest therein, and the Seller shall defend
         the right, title and interest of the Purchaser in, to and under the
         Receivables, whether now existing or hereafter created, against all
         claims of third parties claiming through or under the Seller; provided,
         however, that nothing in this Section shall prevent or be deemed to
         prohibit the Seller from suffering to exist upon any of the Receivables
         transferred by it to the Purchaser any Liens for municipal or other
         local taxes if such taxes shall not at the time be due and payable or
         if the Seller shall currently be contesting the validity thereof in
         good faith by appropriate proceedings and shall have set aside on its
         books adequate reserves with respect thereto.

                  (c) Account Allocations. In the event that the Seller is
         unable for any reason to transfer Receivables to the Purchaser in
         accordance with the provisions of this Agreement (including by reason
         of the application of the provisions of Section 8.02 or any order of
         any Governmental Authority), then the Seller agrees (except as
         prohibited by any such order) to allocate and pay to the Purchaser,
         after the date of such inability, all amounts in the manner by which
         the Purchaser will allocate and pay such amounts to the Trust after
         such inability by the Purchaser to transfer Receivables to the Trust
         pursuant to Section 2.11 of the Transfer and Servicing Agreement.

                  (d) Delivery of Collections or Recoveries. In the event that
         the Seller receives Collections or Recoveries, the Seller agrees to pay
         to the Purchaser (or to the Servicer if the Purchaser so directs) all
         such Collections and Recoveries as soon as practicable after receipt
         thereof but in no event later than two Business Days after the Date of
         Processing thereof.

                  (e) Notice of Liens. The Seller shall notify the Purchaser
         promptly after becoming aware of any Lien on any Receivable (or on the
         underlying receivable) other than the conveyances hereunder, under any
         Receivables Purchase Agreements, under the Transfer and Servicing
         Agreement or under the Indenture.

                                       17

<PAGE>
                  (f) Continuous Perfection. The Seller shall not change its
         name, identity or structure in any manner that might cause any
         financing or continuation statement filed pursuant to this Agreement to
         be seriously misleading unless the Seller shall have delivered to the
         Purchaser at least 30 days' prior written notice thereof and, no later
         than 30 days after making such change, shall have taken all action
         necessary or advisable to amend such financing statement or
         continuation statement so that it is not misleading. The Seller shall
         not change the jurisdiction under whose laws it is organized, its chief
         execution office or change the location of its principal records
         concerning the Receivables unless it has delivered to the Purchaser at
         least 30 days' prior written notice of its intention to do so and has
         taken such action as is necessary or advisable to cause the interest of
         the Purchaser in the Receivables and other Purchased Assets to continue
         to be perfected with the priority required by this Agreement.

                  (g) Interchange. With respect to any Distribution Date, on or
         prior to the immediately preceding Determination Date, the Servicer
         shall notify the Seller of the amount of Interchange required to be
         included as Collections of Finance Charge Receivables with respect to
         such Monthly Period, which amount for any Series shall be specified in
         the related Indenture Supplement. Not later than 1:00 p.m., New York
         City time, on the related Transfer Date, the Seller shall deposit, or
         cause to be deposited, into the Collection Account, in immediately
         available funds, the amount of the Interchange to be so included as
         Collections of Finance Charge Receivables with respect to such Monthly
         Period.

         Section 5.02. Covenants of the Seller with Respect to Receivables
Purchase Agreements. The Seller, in its capacity as purchaser of Receivables
from the Account Owner pursuant to the Receivables Purchase Agreements between
the Seller and the Account Owner, hereby covenants that it will at all times
enforce the covenants and agreements of the Account Owner in such Receivables
Purchase Agreements, including covenants substantially to the effect set forth
below:

                  (a) Periodic Rate Finance Charges. Except (i) as otherwise
         required by any Requirements of Law or (ii) as is deemed by the Account
         Owner to be necessary in order for it to maintain its credit card
         business on a competitive basis based on a good faith assessment by it
         of the nature of the competition in the credit card business, it shall
         not at any time reduce the annual percentage rate of the Periodic Rate
         Finance Charges assessed on the Receivables transferred by it to the
         Purchaser or other fees charged on any of the Accounts owned by it if
         either (A) as a result of any such reduction, such Account Owner's
         reasonable expectation is that such reduction will cause a Pay Out
         Event or Event of Default to occur or (B) such reduction is not also
         applied to all comparable segments of the VISA(R) or other retail
         consumer revolving credit card accounts owned by such Account Owner
         which have characteristics the same as, or substantially similar to,
         such Accounts.

                  (b) Credit Card Agreements and Guidelines. Subject to
         compliance with all Requirements of Law and Section 5.02(a), the
         Account Owner may change the terms and provisions of the Credit Card
         Agreements or the Credit Card Guidelines with respect to any of the
         Accounts owned by it in any respect (including the calculation of the
         amount


                                       18

<PAGE>
         or the timing of charge-offs and the Periodic Rate Finance Charges and
         other fees to be assessed thereon) only if such change is made
         applicable to all comparable segments of the VISA(R) or other retail
         consumer revolving credit card accounts owned by such Account Owner
         which have characteristics the same as, or substantially similar to,
         such Accounts. Notwithstanding the foregoing, unless required by
         Requirements of Law or as permitted by Section 5.02(a), no Account
         Owner will take any action with respect to the Credit Card Agreements
         or the Credit Card Guidelines, which, at the time of such action, the
         Account Owner reasonably believes will have a material adverse effect
         on the Noteholders.

         The Seller further covenants that it will not enter into any amendments
to the Receivables Purchase Agreements or enter into a new Receivables Purchase
Agreement unless the Rating Agency Condition has been satisfied.

         The Purchaser covenants that it will provide the Seller with such
information as the Seller may reasonably request to enable the Seller to
determine compliance with the covenants contained in Section 5.02(b).

                                       19

<PAGE>
                                  ARTICLE SIX

                              REPURCHASE OBLIGATION

         Section 6.01. Reassignment of Ineligible Receivables.

         (a) In the event any representation or warranty under Section
4.02(a)(ii), (iii), (iv), (vi), (vii), (viii) or (ix) is not true and correct in
any material respect as of the date specified therein with respect to any
Receivable or the related Account and as a result of such breach the Purchaser
is required to accept reassignment of Ineligible Receivables previously sold by
the Seller to the Purchaser pursuant to Section 2.05(a) of the Transfer and
Servicing Agreement, the Seller shall accept reassignment of such Ineligible
Receivables on the terms and conditions set forth in Section 6.01(b).

         (b) The Seller shall accept reassignment of any Ineligible Receivables
previously sold by the Seller to the Purchaser from the Purchaser on the date on
which such reassignment obligation arises, and shall pay for such reassigned
Ineligible Receivables by paying to the Purchaser, not later than 3:00 p.m., New
York City time, on such date, an amount equal to the product of (i) 100% and
(ii) the sum of (A) the unpaid principal balance of such Ineligible Receivables
plus (B) accrued and unpaid finance charges at the annual percentage rate
applicable to such Receivables from the last date billed through the end of the
Monthly Period in which such reassignment obligation arises. Upon reassignment
of such Ineligible Receivables, the Purchaser shall automatically and without
further action be deemed to sell, transfer, assign, set-over and otherwise
convey to the Seller, without recourse, representation or warranty, all the
right, title and interest of the Purchaser in and to such Ineligible
Receivables, all Recoveries related thereto, all monies and amounts due or to
become due with respect thereto and all proceeds thereof; and such reassigned
Ineligible Receivables shall be treated by the Purchaser as collected in full as
of the date on which they were transferred. The Purchaser shall execute such
documents and instruments of transfer or assignment and take such other actions
as shall reasonably be requested by the Seller to effect the conveyance of such
Ineligible Receivables and other property pursuant to this subsection.

         Section 6.02. Reassignment. In the event any representation or warranty
set forth in Section 4.01(a) or (c) or Section 4.02(a)(i) or (v) is not true and
correct in any material respect and as a result of such breach the Purchaser is
required to accept a reassignment of the Receivables previously sold by the
Seller to the Purchaser pursuant to Section 2.06 of the Transfer and Servicing
Agreement, the Seller shall be obligated to accept a reassignment of such
Receivables on the terms set forth below.

         The Seller shall pay to the Purchaser by depositing in the Collection
Account in immediately available funds, not later than 1:00 p.m., New York City
time, two Business Days after which such reassignment obligation arises, in
payment for such reassignment, an amount equal to the amount specified in
Section 2.06 of the Transfer and Servicing Agreement. Upon reassignment of the
Receivables on such Transfer Date, the Purchaser shall automatically and without
further action be deemed to sell, transfer, assign, set-over and otherwise
convey to the Seller, without recourse, representation or warranty, all the
right, title and interest of the Purchaser in and to the Receivables, all
Recoveries related thereto and all monies and amounts


                                       20

<PAGE>
due or to become due with respect thereto and all proceeds thereof. The
Purchaser shall execute such documents and instruments of transfer or assignment
and take such other actions as shall reasonably be requested by the Seller to
effect the conveyance of such property pursuant to this Section.

                                       21

<PAGE>
                                 ARTICLE SEVEN

                              CONDITIONS PRECEDENT

         Section 7.01. Conditions to the Purchaser's Obligations Regarding
Initial Receivables. The obligations of the Purchaser to purchase the
Receivables in the Initial Accounts on the Closing Date shall be subject to the
satisfaction of the following conditions:

                  (a) all representations and warranties of the Seller contained
         in this Agreement shall be true and correct on the Closing Date with
         the same effect as though such representations and warranties had been
         made on such date;

                  (b) all information concerning the Initial Accounts provided
         to the Purchaser shall be true and correct as of the Initial Cut-Off
         Date in all material respects;

                  (c) the Seller shall have (i) delivered to the Purchaser a
         computer file or microfiche list containing a true and complete list of
         all Initial Accounts identified by account number and by the
         Receivables balance as of the Initial Cut-Off Date and (ii)
         substantially performed all other obligations required to be performed
         by the provisions of this Agreement;

                  (d) the Seller shall have recorded and filed, at its expense,
         any financing statement with respect to the Receivables (other than
         Receivables in Additional Accounts) now existing and hereafter created
         for the transfer of accounts (as defined in the applicable UCC) meeting
         the requirements of applicable law in such manner and in such
         jurisdictions as would be necessary to perfect the sale of and security
         interest in the Receivables from the Seller to the Purchaser, and shall
         deliver a file-stamped copy of such financing statements or other
         evidence of such filings to the Purchaser;

                  (e) on or before the Closing Date, (i) the Purchaser and the
         Owner Trustee shall have entered into the Trust Agreement, (ii) the
         Purchaser, the Bank, the Indenture Trustee and the Trust shall have
         entered into the Transfer and Servicing Agreement, (iii) the Trust and
         the Indenture Trustee shall have entered into the Indenture and (iv)
         the closing under all such agreements shall take place simultaneously
         with the initial closing hereunder; and

                  (f) all corporate and legal proceedings and all instruments in
         connection with the transactions contemplated by this Agreement shall
         be satisfactory in form and substance to the Purchaser, and the
         Purchaser shall have received from the Seller copies of all documents
         (including records of corporate proceedings) relevant to the
         transactions herein contemplated as the Purchaser may reasonably have
         requested.

         Section 7.02. Conditions Precedent to the Seller's Obligations. The
obligations of the Seller to sell Receivables in the Initial Accounts on the
Closing Date shall be subject to the satisfaction of the following conditions:

                                       22

<PAGE>
                  (a) all representations and warranties of the Purchaser
         contained in this Agreement shall be true and correct with the same
         effect as though such representations and warranties had been made on
         such date;

                  (b) payment or provision for payment of the Purchase Price in
         accordance with the provision of Section 3.01 shall have been made; and

                  (c) all corporate and legal proceedings and all instruments in
         connection with the transactions contemplated by this Agreement shall
         be satisfactory in form and substance to the Seller, and the Seller
         shall have received from the Purchaser copies of all documents
         (including records of corporate proceedings) relevant to the
         transactions herein contemplated as the Seller may reasonably have
         requested.

                                       23

<PAGE>
                                 ARTICLE EIGHT

                          TERM AND PURCHASE TERMINATION

        Section 8.01. Term. This Agreement shall commence as of the date of
execution and delivery hereof and shall continue until at least the termination
of the Trust as provided in Article Eight of the Trust Agreement. Thereafter,
this Agreement may be terminated by the mutual agreement of the parties hereto.

        Section 8.02. Purchase Termination. If an Insolvency Event occurs with
respect to the Seller, then the Seller shall immediately cease to transfer
Principal Receivables to the Purchaser and shall promptly give notice to the
Purchaser, the Owner Trustee and the Indenture Trustee of such Insolvency Event.
Notwithstanding any cessation of the transfer to the Purchaser of additional
Principal Receivables, Principal Receivables transferred to the Purchaser prior
to the occurrence of such Insolvency Event and Collections in respect of such
Principal Receivables and Finance Charge Receivables whenever created, accrued
in respect of such Principal Receivables, shall continue to be property of the
Purchaser available for transfer by the Purchaser to the Trust pursuant to the
Transfer and Servicing Agreement.

                                       24

<PAGE>
                                  ARTICLE NINE

                            MISCELLANEOUS PROVISIONS

         Section 9.01. Amendment. This Agreement and any Conveyance Papers and
the rights and obligations of the parties hereunder and thereunder may not be
changed orally, but only by an instrument in writing signed by the Purchaser and
the Seller in accordance with this Section. This Agreement and any Conveyance
Papers may be amended from time to time by the Purchaser and the Seller (i) to
cure any ambiguity, (ii) to correct or supplement any provisions herein which
may be inconsistent with any other provisions herein or in any such other
Conveyance Papers, (iii) to add any other provisions with respect to matters or
questions arising under this Agreement or any Conveyance Papers which shall not
be inconsistent with the provisions of this Agreement or any Conveyance Papers,
(iv) to change or modify the Purchase Price and (v) to change, modify, delete or
add any other obligation of the Seller or the Purchaser; provided, however, that
no amendment pursuant to clause (ii), (iii), (iv) or (v) shall be effective
unless the Seller and the Purchaser have been notified in writing that the
Rating Agency Condition has been satisfied; provided further that the Seller
shall have delivered to the Purchaser an Officer's Certificate, dated the date
of such action, stating that the Seller reasonably believes that such action
will not have an Adverse Effect unless the Owner Trustee and the Indenture
Trustee shall consent thereto. Any reconveyance executed in accordance with the
provisions hereof shall not be considered to be an amendment to this Agreement.
A copy of any amendment to this Agreement shall be sent to the Rating Agency.

         Section 9.02. Governing Law. THIS AGREEMENT 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 5-1041 OF THE GENERAL OBLIGATIONS
LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

         Section 9.03. Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all demands, notices, instruction, directions and
communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered at, mailed by registered mail, return receipt
requested or sent by facsimile transmission to (i) in the case of the Seller,
7320 East Butherus Drive, Suite 100, Scottsdale, Arizona 85260-2438, Attention:
Legal Department (facsimile no. (303) 397-4767), (ii) in the case of the
Purchaser, 13531 East Caley Avenue, Englewood, Colorado 80111, Attention: Legal
Department (facsimile no. (303) 397-4767), (iii) in the case of the Owner
Trustee, Rodney Square North, 1100 North Market Street, Wilmington, Delaware
19890-0001, Attention: Corporate Trust Administration (facsimile no. (302)
651-1576), (iv) in the case of the Indenture Trustee, 1740 Broadway, Denver,
Colorado 80274-8693, Attention: Corporate Trust and Escrow Services (facsimile
no. (303) 863-5645); or (v) as to each party, at such other address or facsimile
number as shall be designated by such party in a written notice to each other
party.

         Section 9.04. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement or any Conveyance
Paper shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions or terms shall be


                                       25

<PAGE>
deemed severable from the remaining covenants, agreements, provisions or terms
of this Agreement or any Conveyance Paper and shall in no way affect the
validity or enforceability of the remaining covenants, agreements, provisions or
terms of this Agreement or of any Conveyance Paper.

         Section 9.05. Merger, Consolidation of, or Assignment of Obligations of
Seller.

         (a) The Seller shall not consolidate with or merge into any other
corporation or convey or transfer its properties and assets substantially as an
entirety to any Person unless:

                  (i) the Person formed by such consolidation or into which the
         Seller is merged or the Person which acquires by conveyance or transfer
         the properties and assets of Seller substantially as an entirety shall
         be, if the Seller is not the surviving entity, an entity organized and
         existing under the laws of the United States or any State and if the
         Seller is not the surviving entity, such entity expressly assumes, by
         an agreement supplemental hereto, executed and delivered to the
         Purchaser and the Indenture Trustee in form reasonably satisfactory to
         the Purchaser and the Indenture Trustee, the performance of every
         covenant and obligation of the Seller hereunder;

                  (ii) the Seller has delivered to the Purchaser and the
         Indenture Trustee (A) an Officer's Certificate stating that such
         consolidation, merger, conveyance or transfer and such supplemental
         agreement comply with this Section and that all conditions precedent
         herein provided for relating to such transaction have been complied
         with and (B) an Opinion of Counsel to the effect that such supplemental
         agreement is a valid and binding obligation of such surviving entity
         enforceable against such surviving entity in accordance with its terms,
         except as such enforceability may be limited by applicable bankruptcy,
         insolvency, reorganization, moratorium or other similar laws affecting
         creditors' rights generally from time to time in effect and except as
         such enforceability may be limited by general principles of equity
         (whether considered in a suit at law or in equity);

                  (iii) the Seller shall have delivered to the Purchaser and
         Indenture Trustee and each Rating Agency a Tax Opinion, dated the date
         of such consolidation, merger, conveyance or transfer; and

                  (iv) if the Seller is not the surviving entity, the surviving
         entity shall file new UCC-1 financing statements with respect to the
         interest of the purchaser in the Receivables.

         (b) This Section shall not be construed to prohibit or in any way limit
the Seller's ability to effectuate any consolidation or merger pursuant to which
the Seller would be the surviving entity.

         (c) The Seller shall notify each Rating Agency promptly after any
consolidation, merger, conveyance or transfer effected pursuant to this Section;

         (d) The obligations of the Seller hereunder shall not be assignable nor
shall any Person succeed to the obligations of the Seller hereunder except in
each case in accordance with


                                       26

<PAGE>
(i) the provisions of the foregoing paragraphs or (ii) conveyances, mergers,
consolidations, assumptions, sales or transfers to other entities (A) for which
the Seller delivers an Officer's Certificate to the Purchaser and the Indenture
Trustee indicating that the Seller reasonably believes that such action will not
adversely affect in any material respect the interests of the Purchaser or any
Noteholder, (B) which meet the requirements of clause (ii) of paragraph (a) and
(C) for which such purchaser, transferee, pledgee or entity shall expressly
assume, in an agreement supplemental hereto, executed and delivered to the
Purchaser and the Indenture Trustee in writing in form satisfactory to the
Seller and the Indenture Trustee, the performance of every covenant and
obligation of the Seller thereby conveyed.

         Section 9.06. Acknowledgement and Agreement of the Seller. By execution
below, the Seller expressly acknowledges and agrees that all of the Purchaser's
right, title, and interest in, to, and under this Agreement, including all of
the Purchaser's right, title, and interest in and to the Receivables purchased
pursuant to this Agreement, may be assigned by the Purchaser to the Trust, and a
security interest therein may be granted by the Trust to the Indenture Trustee
for the benefit of the beneficiaries of the Trust, including the Noteholders,
and the Seller consents to such assignment and grant. The Seller further agrees
that notwithstanding any claim, counterclaim, right of setoff or defense which
it may have against the Purchaser, due to a breach by the Purchaser of this
Agreement or for any other reason, and notwithstanding the bankruptcy of the
Purchaser or any other event whatsoever, the Seller's sole remedy shall be a
claim against the Purchaser for money damages, and then only to the extent of
funds available to the Purchaser, and in no event shall the Seller assert any
claim on or any interest in the Receivables or any proceeds thereof or take any
action which would reduce or delay receipt by the Trust of collections with
respect to the Receivables. Additionally, the Seller agrees that any amounts
payable by the Seller to the Purchaser hereunder which are to be paid by the
Purchaser to the Indenture Trustee shall be paid by the Seller, on behalf of the
Purchaser, directly to the Indenture Trustee.

         Section 9.07. Further Assurances. The Purchaser and the Seller agree to
do and perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the other party and
their respective permitted successors and assigns, the Owner Trustee or the
Indenture Trustee more fully to effect the purposes of this Agreement and the
Conveyance Papers, including the execution of any financing statements or
continuation statements relating to the Receivables for filing under the
provisions of the UCC of any applicable jurisdiction.

         Section 9.08. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Purchaser or the Seller, any
right, remedy, power or privilege under this Agreement, shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege under this Agreement preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The
rights, remedies, powers and privileges provided under this Agreement are
cumulative and not exhaustive of any rights, remedies, powers and privileges
provided by law.

         Section 9.09. Counterparts. This Agreement and all Conveyance Papers
may be executed in separate counterparts, each of which when so executed and
delivered shall be an original, but all of which together shall constitute one
and the same instrument.

                                       27

<PAGE>
         Section 9.10. Third-Party Beneficiaries. This Agreement and the
Conveyance Papers will inure to the benefit of and be binding upon the parties
hereto and their respective successors and permitted assigns. The Trust and the
Indenture Trustee shall be considered third-party beneficiaries of this
Agreement. Except as otherwise expressly provided in this Agreement, no other
Person will have any right or obligation hereunder.

         Section 9.11. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement and the Conveyance Papers set forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement and the
Conveyance Papers. This Agreement and the Conveyance Papers may not be modified,
amended, waived or supplemented except as provided herein.

         Section 9.12. 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 9.13. Schedules and Exhibits. The schedules and exhibits
attached hereto and referred to herein shall constitute a part of this Agreement
and are incorporated into this Agreement for all purposes.

         Section 9.14. Survival of Representations and Warranties. All
representations, warranties and agreements contained in this Agreement or
contained in any Supplemental Conveyance shall remain operative and in full
force and effect and shall survive conveyance of the Receivables by the
Purchaser to the Trust pursuant to the Transfer and Servicing Agreement and the
grant of a security interest therein by the Trust to the Indenture Trustee
pursuant to the Indenture.

         Section 9.15. Nonpetition Covenant. To the fullest extent permitted by
law, notwithstanding any prior termination of this Agreement, the Seller shall
not, prior to the date which is one year and one day after the termination of
this Agreement, acquiesce, petition or otherwise invoke or cause the Purchaser
or the Trust to invoke the process of any Governmental Authority for the purpose
of commencing or sustaining a case against the Purchaser or the Trust under any
Debtor Relief Law or appointing a receiver, conservator, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Purchaser or
the Trust or any substantial part of its property or ordering the winding-up or
liquidation of the affairs of the Purchaser or the Trust.

                                       28


<PAGE>
         IN WITNESS WHEREOF, the Purchaser and the Seller have caused this
Receivables Purchase Agreement to be duly executed by their respective officers
as of the day and year first above written.

                                      NORDSTROM fsb,
                                      as Seller

                                      By: /s/ Denny D. Dumler
                                          --------------------------------------
                                          Name: Denny D. Dumler
                                          Title: President

                                      NORDSTROM CREDIT CARD RECEIVABLES LLC,
                                                                     as Servicer

                                      By: /s/ Kevin T. Knight
                                          --------------------------------------
                                          Name: Kevin T. Knight
                                          Title: President

                                       29

<PAGE>
                                                                       EXHIBIT A

                        FORM OF SUPPLEMENTAL CONVEYANCE

      (As required by Section 2.03 of the Receivables Purchase Agreement)

         This Supplemental Conveyance No. ___ dated as of ____________, 200_, is
between Nordstrom fsb, as seller (the "Seller"), and Nordstrom Credit Card
Receivables LLC, as purchaser (the "Purchaser"), pursuant to the Receivables
Purchase Agreement referred to below.

         WHEREAS, the Seller and the Purchaser are parties to a receivables
purchase agreement, dated as of April 1, 2002 (as such agreement may have been
amended or supplemented from time to time, the "Receivables Purchase
Agreement");

         WHEREAS, pursuant to the Receivables Purchase Agreement, the Seller
wishes to designate Additional Accounts to be included as Accounts and the
Seller wishes to convey its right, title and interest in the Receivables of such
Additional Accounts, whether now existing or hereafter created, to the Purchaser
pursuant to the Receivables Purchase Agreement (as each such term is defined in
the Receivables Purchase Agreement); and

         WHEREAS, the Purchaser is willing to accept such designation and
conveyance subject to the terms and conditions hereof.

         NOW, THEREFORE, the Seller and the Purchaser hereby agree as follows:

         1. Defined Terms. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Receivables Purchase
Agreement.

         "Addition Date" means, with respect to the Additional Accounts
designated hereby __________ ___, ____.

         "Addition Cut-Off Date" means, with respect to the Additional Accounts
designated hereby, __________ ___, ____.

         2. Designation of Additional Accounts. The Seller delivers herewith a
computer file or microfiche list containing a true and complete schedule
identifying all such Additional Accounts (the "Additional Accounts") and
specifying for each such Additional Account, as of the Addition Cut-Off Date,
its account number, the aggregate amount outstanding in such Account and the
aggregate amount of Principal Receivables in such Account. Such computer file,
microfiche list or other documentation shall be as of the date of this
Supplemental Conveyance incorporated into and made part of this Supplemental
Conveyance and is marked as Schedule 1 to this Supplemental Conveyance.

         3. Conveyance of Receivables.

                  (a) The Seller does hereby sell, transfer, assign, set over
         and otherwise convey to the Purchaser, without recourse except as
         provided in the Receivables Purchase

                                      A-1

<PAGE>
         Agreement, all its right, title and interest in, to and under the
         Receivables arising in such Additional Accounts, existing at the close
         of business on the Addition Cut-Off Date and thereafter created until
         termination of the Receivables Purchase Agreement, all Interchange and
         Recoveries with respect to such Receivables, all monies due or to
         become due and all amounts received or receivable with respect thereto
         and all proceeds thereof.

                  (b) In connection with such sale and if necessary, the Seller
         agrees to record and file, at its own expense, one or more financing
         statements (and continuation statements with respect to such financing
         statements when applicable) with respect to the Receivables, existing
         on the Addition Cut-Off Date and thereafter created, meeting the
         requirements of applicable state law in such manner and in such
         jurisdictions as are necessary to perfect the sale and assignment of
         and the security interest in the Receivables to the Purchaser, and to
         deliver a file-stamped copy of such financing statement or other
         evidence of such filing to the Purchaser.

                  (c) In connection with such sale, the Seller further agrees,
         at its own expense, on or prior to the date of this Supplemental
         Conveyance, to indicate in the appropriate computer files or microfiche
         list that all Receivables created in connection with the Additional
         Accounts designated hereby have been conveyed to the Purchaser pursuant
         to this Supplemental Conveyance.

         4. Acceptance by the Purchaser. The Purchaser hereby acknowledges its
acceptance of all right, title and interest to the property, existing on the
Addition Cut-Off Date and thereafter created, conveyed to the Purchaser pursuant
to Section 3(a) and declares that it shall maintain such right, title and
interest. The Purchaser further acknowledges that, prior to or simultaneously
with the execution and delivery of this Supplemental Conveyance, the Seller
delivered to the Purchaser the computer file or microfiche list described in
Section 2.

         5. Representations and Warranties of the Seller. The Seller hereby
represents and warrants to the Purchaser as of the date of this Supplemental
Conveyance and as of the Addition Date that:

            (a) Legal, Valid and Binding Obligation. This Supplemental
         Conveyance constitutes a legal, valid and binding obligation of the
         Seller enforceable against the Seller in accordance with its terms,
         except as such enforceability may be limited by applicable Debtor
         Relief Laws or general principles of equity.

            (b) Eligibility of Accounts. On the Addition Cut-Off Date, each
         Additional Account designated hereby is an Eligible Account.

            (c) No Liens. Each Receivable in an Additional Account designated
         hereby has been conveyed to the Purchaser free and clear of any Lien
         and each underlying receivable is free and clear of all Liens.

            (d) Eligibility of Receivables. On the Addition Cut-Off Date, each
         Receivable existing in an Additional Account designated hereby is an
         Eligible Receivable




                                      A-2

<PAGE>
         and as of the date of creation of any Receivable in an Additional
         Account designated hereby, such Receivable is an Eligible Receivable.

            (e) Selection Procedures. Each Account has been randomly selected
         and no selection procedures believed by the Seller to be adverse to the
         interests of the Purchaser or the Noteholders were utilized in
         selecting the Additional Accounts.

            (f) Transfer of Receivables. This Supplemental Conveyance
         constitutes an absolute sale, transfer and assignment to the Purchaser
         of all right, title and interest of the Seller in the Receivables
         arising in the Additional Accounts designated hereby existing on the
         Addition Cut-Off Date or thereafter created, the Recoveries with
         respect thereto, all monies due or to become due and all amounts
         received with respect thereto and the "proceeds" (including "proceeds"
         as defined in Article 9 of the UCC) thereof.

            (g) No Conflict. The execution and delivery of this Supplemental
         Conveyance, the performance of the transactions contemplated by this
         Supplemental Conveyance and the fulfillment of the terms hereof, will
         not conflict with, result in any breach of any of the material terms
         and provisions of, or constitute (with or without notice or lapse of
         time or both) a material default under, any indenture, contract,
         agreement, mortgage, deed of trust or other instrument to which the
         Seller is a party or by which it or its properties are bound.

            (h) No Violation. The execution and delivery of this Supplemental
         Conveyance by the Seller, the performance of the transactions
         contemplated by this Supplemental Conveyance and the fulfillment of the
         terms hereof applicable to the Seller will not conflict with or violate
         any Requirements of Law applicable to the Seller.

            (i) No Proceedings. There are no proceedings or investigations,
         pending or, to the best knowledge of the Seller, threatened, against
         the Seller before any Governmental Authority (i) asserting the
         invalidity of this Supplemental Conveyance, (ii) seeking to prevent the
         consummation of any of the transactions contemplated by this
         Supplemental Conveyance, (iii) seeking any determination or ruling
         that, in the reasonable judgment of the Seller, would materially and
         adversely affect the performance by the Seller of its obligations under
         this Supplemental Conveyance or (iv) seeking any determination or
         ruling that would materially and adversely affect the validity or
         enforceability of this Supplemental Conveyance.

            (j) All Consents. All authorizations, consents, orders or approvals
         of any Governmental Authority required to be obtained by the Seller in
         connection with the execution and delivery of this Supplemental
         Conveyance by the Seller and the performance of the transactions
         contemplated by this Supplemental Conveyance by the Seller, have been
         obtained.

         6. Ratification of the Receivables Purchase Agreement. The Receivables
Purchase Agreement is hereby ratified, and all references to the "Receivables
Purchase Agreement", "this Agreement" and "herein" shall be deemed from and
after the Addition Date to be a reference to the Receivables Purchase Agreement
as supplemented by this Supplemental Conveyance.


                                      A-3

<PAGE>
Except as expressly amended hereby, all the representations, warranties, terms,
covenants and conditions of the Receivables Purchase Agreement shall remain
unamended and shall continue to be, and shall, remain, in full force and effect
in accordance with its terms and except as expressly provided herein shall not
constitute or be deemed to constitute a waiver of compliance with or consent to
non-compliance with any term or provision of the Receivables Purchase Agreement.

         7. Counterparts. This Supplemental Conveyance may be executed in
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument.

         8. Governing Law. This Supplemental Conveyance 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-4

<PAGE>
         IN WITNESS WHEREOF, the undersigned have caused this Supplemental
Conveyance to be duly executed and delivered by their respective duly authorized
officers on the day and the year first above written.

                                       NORDSTROM fsb,
                                          as Seller

                                       By:
                                            ------------------------------------
                                            Name:
                                            Title:



                                       NORDSTROM CREDIT CARD RECEIVABLES LLC,
                                          as Purchaser

                                       By:
                                            ------------------------------------
                                            Name:
                                            Title:


                                      A-5

<PAGE>
                                                                   Schedule 1 to
                                                                    Supplemental
                                                                      Conveyance

                               Additional Accounts


                                      A-6

<PAGE>
                                                                      Schedule 1


                                List of Accounts

       [Delivered to the Owner Trustee and Indenture Trustee at Closing]



                                      S-1


<PAGE>
                                                                   Exhibit 10.40



================================================================================




                    NORDSTROM CREDIT CARD MASTER NOTE TRUST,
                                   as Issuer,

                                       and

                                 NORDSTROM fsb,
                                as Administrator



                            -------------------------

                            ADMINISTRATION AGREEMENT
                            Dated as of April 1, 2002

                            -------------------------




================================================================================

<PAGE>
                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
Section 1.01 Capitalized Terms; Interpretive Provisions...................    2
Section 1.02 Duties of Administrator......................................    2
Section 1.03 Records......................................................    7
Section 1.04 Compensation.................................................    7
Section 1.05 Additional Information to be Furnished to Issuer.............    7
Section 1.06 Independence of Administrator................................    7
Section 1.07 No Joint Venture.............................................    7
Section 1.08 Other Activities of Administrator............................    7
Section 1.09 Term of Agreement; Resignation and Removal of Administrator..    8
Section 1.10 Action upon Termination, Resignation or Removal..............    9
Section 1.11 Notices......................................................    9
Section 1.12 Amendments...................................................   10
Section 1.13 Successors and Assigns.......................................   10
Section 1.14 GOVERNING LAW................................................   11
Section 1.15 Effect of Headings and Table of Contents.....................   11
Section 1.16 Counterparts.................................................   11
Section 1.17 Severability of Provisions...................................   11
Section 1.18 Not Applicable to Nordstrom fsb in Other Capacities..........   11
Section 1.19 Limitation of Liability of Owner Trustee.....................   11
Section 1.20 Third-Party Beneficiary......................................   11
Section 1.21 Nonpetition Covenant.........................................   11
Section 1.22 Successor Administrator......................................   12

                                    EXHIBITS

Exhibit A - Form of Power of Attorney.....................................  A-1

</TABLE>


                                        i

<PAGE>
                            ADMINISTRATION AGREEMENT

         This Administration Agreement, dated as of April 1, 2002 (the
"Agreement"), is between Nordstrom Credit Card Master Note Trust, as issuer (the
"Issuer"), and Nordstrom fsb (the "Bank"), as administrator (in such capacity,
the "Administrator").

         WHEREAS, the Issuer has entered into a master indenture, dated as of
April 1, 2002 (the "Master Indenture"), between the Issuer and Wells Fargo Bank
Minnesota, National Association, as trustee (the "Indenture Trustee"), as
supplemented by the series 2002-1 indenture supplement, dated as of April 1,
2002 (the "Series 2002-1 Indenture Supplement", and together with the Master
Indenture, the "Indenture"), between the Issuer and the Indenture Trustee to
provide for the issuance of asset backed notes (the "Notes") from time to time
pursuant to one or more indenture supplements;

         WHEREAS, the Issuer has entered into certain agreements in connection
with the issuance of the Notes, the issuance of the beneficial ownership
interest of the Issuer and transactions related thereto, including (i) the
Master Indenture; (ii) the Series 2002-1 Indenture Supplement; (iii) a transfer
and servicing agreement, dated as of April 1, 2002 (as amended, supplemented or
otherwise modified form time to time, the "Transfer and Servicing Agreement"),
among Nordstrom Credit Card Receivables LLC, as transferor (the "Transferor"),
the Bank, as servicer (in such capacity, the "Servicer"), the Indenture Trustee
and the Issuer and (iv) an amended and restated trust agreement, dated as of
April 1, 2002 (as amended, supplemented or otherwise modified form time to time,
the "Trust Agreement" and, together with the Master Indenture, the Series 2002-1
Indenture Supplement and the Transfer and Servicing Agreement, as each may be
amended, supplemented or otherwise modified form time to time, the "Related
Agreements"), between the Transferor, as transferor, and Wilmington Trust
Company, as trustee (the "Owner Trustee");

         WHEREAS, pursuant to the Related Agreements, the Issuer and the Owner
Trustee are required to perform certain duties in connection with (i) the Notes
and the collateral therefor pledged pursuant to the Indenture (the "Collateral")
and (ii) the beneficial ownership interest in the Issuer (the holder of such
interest being referred to herein as the "Owner");

         WHEREAS, the Issuer and the Owner Trustee desire to have the
Administrator perform certain of the duties of the Issuer and the Owner Trustee
referred to in the preceding clause and to provide such additional services
consistent with the terms of this Agreement and the Related Agreements as the
Issuer and the Owner Trustee may from time to time request; and

         WHEREAS, the Administrator has the capacity to provide the services
required hereby and is willing to perform such services for the Issuer and the
Owner Trustee on the terms set forth herein.

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

<PAGE>
         Section 1.01. Capitalized Terms; Interpretive Provisions.

         (a) Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto or incorporated by reference in the Trust
Agreement, the Transfer and Servicing Agreement or the Indenture, as the case
may be. Whenever used herein, unless the context otherwise requires, the
following words and phrases shall have the following meanings:

         "Agreement" has the meaning set forth in the Preamble.

         "Indenture" has the meaning set forth in the Preamble.

         "Master Indenture" has the meaning set forth in the Preamble.

         "Related Agreements" has the meaning set forth in the Preamble.

         "Series 2002-1 Indenture Supplement" has the meaning set forth in the
Preamble.

         "Transfer and Servicing Agreement" has the meaning set forth in the
Preamble.

         "Trust Agreement" has the meaning set forth in the Preamble.

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

         Section 1.02. Duties of Administrator.

         (a) Duties with Respect to the Related Agreements.

         The Administrator shall consult with the Owner Trustee regarding the
duties of the Issuer and the Owner Trustee under the Related Agreements. The
Administrator shall monitor the performance of the Issuer and shall advise the
Owner Trustee when action is necessary to comply with the Issuer's or the Owner
Trustee's duties under the Related Agreements. The Administrator shall prepare
for execution by the Issuer or the Owner Trustee or shall cause the preparation
by other appropriate persons of all such documents, reports, filings,
instruments, orders, certificates and opinions as shall be the duty of the
Issuer or the Owner Trustee to prepare, file or deliver pursuant to any Related
Agreement. In addition to the foregoing, the Administrator shall take all
appropriate action that is the duty of the Issuer or the Owner Trustee to take
pursuant to the Indenture including such of the foregoing as are required with
respect to the following matters under the Indenture (references are to Sections
of the Master Indenture):

                  (i) the preparation of or obtaining of the documents and
         instruments required for execution, authentication and delivery of the
         Notes (whether upon initial issuance, 

                                       2

<PAGE>
         transfer or exchange or otherwise), if any, and delivery of the same to
         the Indenture Trustee (if applicable) (Sections 2.03, 2.05, 2.06,
         2.12(c) or 2.15);

                  (ii) the duty to cause the Note Register to be kept, to
         appoint a successor Transfer Agent and Registrar, if necessary, and to
         give the Indenture Trustee notice of any appointment of a new Transfer
         Agent and Registrar and the location, or change in location, of the
         Note Register (Section 2.05);

                  (iii) the furnishing of the Indenture Trustee, the Servicer,
         any Noteholder or the Paying Agent with the names and addresses of
         Noteholders after receipt of a written request therefor from the
         Indenture Trustee, the Servicer, any Noteholder or the Paying Agent,
         respectively, or as otherwise specified in the Indenture (Sections
         2.09(a), 2.10 and 7.01);

                  (iv) the preparation of an Issuer Request regarding
         cancellation of any Notes. (Section 2.10);

                  (v) the preparation, obtaining or filing of the instruments,
         opinions and certificates and other documents required for the release
         of collateral (Section 2.11);

                  (vi) the duty to cause the Issuer to maintain an office or
         agency within the City of Minneapolis, State of Minnesota (and as
         otherwise set forth in an Indenture Supplement) and to give the
         Indenture Trustee and the Noteholders notice of the location, or change
         in location, of such office or agency (Section 3.02);

                  (vii) the duty to direct the Indenture Trustee to deposit with
         any Paying Agent the sums specified in the Indenture and the
         preparation of an Issuer Order directing the investment of such funds
         in Eligible Investments (Section 3.03);

                  (viii) the duty to cause newly appointed Paying Agents, if
         any, to deliver to the Indenture Trustee the instrument specified in
         the Indenture regarding funds held in trust (Section 3.03);

                  (ix) the direction to Paying Agents to pay to the Indenture
         Trustee all sums held in trust by such Paying Agents (Section 3.03);

                  (x) the duty to cause the Issuer to keep in full effect its
         existence, rights and franchises as a Delaware business trust and the
         obtaining and preservation of the Issuer's qualification to do business
         in each jurisdiction in which such qualification is or shall be
         necessary to protect the validity and enforceability of the Indenture,
         the Notes, the Collateral and each other related instrument and
         agreement (Section 3.04);

                  (xi) the preparation of all supplements, amendments, financing
         statements, continuation statements, if any, instruments of further
         assurance and other instruments necessary to protect, maintain and
         enforce the Collateral (Section 3.05);

                  (xii) the obtaining of the Opinion of Counsel on the Series
         Issuance Date and the annual delivery of Opinions of Counsel s to the
         Collateral (Section 3.06);


                                       3

<PAGE>
                  (xiii) the identification to the Indenture Trustee in an
         Officer's Certificate of a Person with whom the Issuer has contracted
         to assist it in performing its duties under the Indenture (Section
         3.07(b));

                  (xiv) the duty to cause the Issuer to punctually perform and
         observe all of the obligations and agreements contained in the
         Indenture and 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 required to be filed by the
         terms of the Indenture and the Transfer and Servicing Agreement in
         accordance with and in the applicable time periods (Section 3.07(c));

                  (xv) causing the delivery of notice by the Indenture Trustee
         to the Rating Agencies of the occurrence of any Servicer Default of
         which the Issuer has knowledge and the action, if any, being taken in
         connection with such default (Section 3.07(d));

                  (xvi) the delivery of any computer files or microfiche lists
         of Accounts that the Issuer has received from the Transferor pursuant
         to the Transfer and Servicing Agreement (Section 3.07(g));

                  (xvii) the delivery to the Indenture Trustee, within 120 days
         after the end of each fiscal year of the Issuer of an Officer's
         Certificate with respect to various matters relating to compliance with
         the Indenture (Section 3.09);

                  (xviii) the preparation and obtaining of documents,
         certificates, opinions and instruments required in connection with the
         consolidation or merger by the Issuer with or into any other Person or
         the sale of the Issuer's assets substantially as an entirety to any
         Person (Section 3.10);

                  (xix) the delivery of notice to the Indenture Trustee and each
         Rating Agency of (1) each Event of Default, (2) each default by the
         Servicer or the Transferor under the Transfer and Servicing Agreement,
         (3) each default by a Seller under a Receivables Purchase Agreement and
         (4) any action taken by the Indenture Trustee pursuant to Section 5.05
         of the Master Indenture (Section 3.19);

                  (xx) the monitoring of the Issuer's obligations as to the
         satisfaction and discharge of the Indenture and the preparation and
         delivery of an Officer's Certificate and the obtaining of the Opinion
         of Counsel and the Independent Certificate relating thereto (Section
         4.01);

                  (xxi) the compliance with any directive of the Indenture
         Trustee with respect to the sale of the Collateral if an Event of
         Default shall have occurred and be continuing and the Notes have been
         accelerated (Section 5.05);

                  (xxii) the preparation and delivery of an Officer's
         Certificate to be delivered to the Indenture Trustee and the
         deliverance of such Officer's Certificate to the Noteholders (Section
         6.03(b));


                                       4

<PAGE>
                  (xxiii) the removal of the Indenture Trustee, if necessary and
         in compliance with the Indenture, and the appointment of a successor
         (Section 6.08);

                  (xxiv) the preparation and delivery of various reports to be
         filed with the Indenture Trustee and the Commission, as applicable
         (Section 7.03);

                  (xxv) the preparation of an Issuer Order and Officer's
         Certificate and the obtaining of an Opinion of Counsel and Independent
         Certificates, if necessary, for the release of the Collateral (Sections
         8.09 and 8.10);

                  (xxvi) the preparation and delivery of Issuer Orders,
         agreements, certificates, instruments, consents and other documents and
         the obtaining of Opinions of Counsel with respect to the execution of
         supplemental indentures (Sections 3.07(f), 10.01, 10.02 and 10.03);

                  (xxvii) the execution of new Notes conforming to any
         supplemental indenture (Section 10.06);

                  (xxviii) in connection with a Defeasance, compliance with the
         provisions of Section 11.04 of the Master Indenture (Section 11.04);

                  (xxix) the preparation of all Officers' Certificates, Opinions
         of Counsel and, if necessary, Independent Certificates with respect to
         any requests by the Issuer to the Indenture Trustee to take any action
         under the Indenture (Section 12.01(a));

                  (xxx) the preparation and delivery of Officers' Certificates
         and the obtaining of Independent Certificates, if necessary, in
         connection with 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 property from the lien of the Indenture (Section
         12.01(b));

                  (xxxi) the preparation and delivery to Noteholders and the
         Indenture Trustee of any agreements with respect to alternate payment
         and notice provisions (Section 12.06); and

                  (xxxii) compliance with the provisions of the Transfer and
         Servicing Agreement, Indenture Supplement and Trust Agreement
         applicable to the Issuer.

         (b) Additional Duties.

                  (i) In addition to the duties of the Administrator set forth
         above, but subject to Sections 1.02(c)(ii) and 1.06, the Administrator
         shall perform all duties and obligations of the Issuer under the
         Related Agreements and shall perform such calculations and shall
         prepare for execution by the Issuer and shall cause the preparation by
         other appropriate persons of all such documents, reports, filings,
         instruments, certificates and opinions as it shall be the duty of the
         Issuer or the Owner Trustee to prepare, file or deliver pursuant to the
         Related Agreements and shall administer the Trust in the interest of
         the holders of the Notes and the Transferor Certificates and at the
         request of the Issuer shall take all appropriate action that is the
         duty of the Issuer or the Owner Trustee to take pursuant to 

                                       5

<PAGE>
         the Related Agreements. Subject to Sections 1.02(c)(ii) and 1.06, and
         in accordance with the directions of the Issuer, the Administrator
         shall administer, perform or supervise the performance of such other
         activities in connection with the Collateral (including the Related
         Agreements) as are not covered by any of the foregoing provisions and
         as are expressly requested by the Owner Trustee and are reasonably
         within the capability of the Administrator.

                  (ii) The Administrator shall perform any duties expressly
         required to be performed by the Administrator under the Trust
         Agreement.

                  (iii) In carrying out the foregoing duties or any of its other
         obligations under this Agreement, the Administrator may enter into
         transactions with or otherwise deal with any of its Affiliates;
         provided, however, that the terms of any such transactions or dealings
         shall be in accordance with any directions received from the Issuer and
         shall be, in the Administrator's opinion, no less favorable to the
         Issuer than would be available from unaffiliated parties.

                  (iv) It is the intention of the parties hereto that the
         Administrator shall, and the Administrator hereby agrees to, prepare,
         file and deliver on behalf of the Issuer all such documents, reports,
         filings, instruments, certificates and opinions as it shall be the duty
         of the Issuer to prepare, file or deliver pursuant to the Related
         Agreements. In furtherance thereof, the Owner Trustee shall, on behalf
         of the Issuer, execute and deliver to the Administrator and its agents,
         and to each successor Administrator appointed pursuant to the terms
         hereof, one or more powers of attorney substantially in the form of
         Exhibit A hereto, appointing the Administrator the attorney-in-fact of
         the Issuer for the purpose of executing on behalf of the Issuer all
         such documents, reports, filings, instruments, certificates and
         opinions.

         (c) Non-Ministerial Matters.

                  (i) With respect to matters that in the reasonable judgment of
         the Administrator are non-ministerial, the Administrator shall not take
         any action unless within a reasonable time before the taking of such
         action, the Administrator shall have notified the Transferor of the
         proposed action and the Transferor shall not have withheld consent or
         provided an alternative direction. For the purpose of the preceding
         sentence, "non-ministerial matters" shall include:

                           (A) the amendment of or any supplement to the
                  Indenture;

                           (B) the initiation of any claim or lawsuit by the
                  Issuer and the compromise of any action, claim or lawsuit
                  brought by or against the Issuer (other than in connection
                  with the collection or enforcement of the Collateral);

                           (C) the amendment, change or modification of the
                  Related Agreements;

                           (D) the appointment of each successor Transfer Agent
                  and Registrar, each successor Paying Agent and each successor
                  Indenture Trustee pursuant to 

                                       6

<PAGE>
                  the Indenture or the appointment of successor Administrators,
                  or the consent to the assignment by each of the Transfer Agent
                  and Registrar, Paying Agent or Indenture Trustee of its
                  obligations under the Indenture; and

                           (E) the removal of the Indenture Trustee.

                  (ii) Notwithstanding anything to the contrary in this
         Agreement, the Administrator shall not be obligated to, and shall not,
         (A) make any payments from its own funds to the Noteholders, the Owner
         or any other Person under the Related Agreements, (B) sell the
         Collateral pursuant to Section 5.05 of the Master Indenture other than
         pursuant to a written directive of the Indenture Trustee or (C) take
         any other action that the Issuer directs the Administrator not to take
         on its behalf.

         Section 1.03. Records. The Administrator shall maintain appropriate
books of account and records relating to services performed hereunder, which
books of account and records shall be accessible for inspection by the Issuer,
the Owner Trustee, the Indenture Trustee, the Servicer and the Transferor at any
time during normal business hours.

         Section 1.04. Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement, the Administrator shall be
entitled to $100 per month which shall be payable in accordance with Section
3.01(e) of the Transfer and Servicing Agreement. The Transferor shall be
responsible for payment of the Administrator's fees (to the extent not paid
pursuant to Section 3.01(e) of the Transfer and Servicing Agreement).

         Section 1.05. Additional Information to be Furnished to Issuer. The
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.

         Section 1.06. Independence of Administrator. For all purposes of this
Agreement, the Administrator shall be an independent contractor and shall not be
subject to the supervision of the Issuer or the Owner Trustee with respect to
the manner in which it accomplishes the performance of its obligations
hereunder. Unless expressly authorized by the Issuer, the Administrator shall
have no authority to act for or represent the Issuer or the Owner Trustee in any
way and shall not otherwise be deemed an agent of the Issuer or the Owner
Trustee.

         Section 1.07. No Joint Venture. Nothing contained in this Agreement
shall (i) constitute the Administrator and either of the Issuer or the Owner
Trustee as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, (ii) be construed to impose
any liability as such on any of them or (iii) be deemed to confer on any of them
any express, implied or apparent authority to incur any obligation or liability
on behalf of the others.

         Section 1.08. Other Activities of Administrator. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other Person or entity even though such Person or entity
may engage in business activities similar to those of the Issuer, the Owner
Trustee or the Indenture Trustee.


                                       7

<PAGE>
         Section 1.09. Term of Agreement; Resignation and Removal of
Administrator.

         (a) This Agreement shall continue in force until the termination of the
Issuer, upon which event this Agreement shall automatically terminate.

         (b) Subject to Sections 1.09(e) and (f), the Administrator may resign
its duties hereunder by providing the Issuer with at least 60 days' prior
written notice.

         (c) Subject to Sections 1.09(e) and (f), the Issuer may remove the
Administrator without cause by providing the Administrator with at least 60
days' prior written notice.

         (d) Subject to Sections 1.09(e) and (f), at the sole option of the
Issuer, the Administrator may be removed immediately upon written notice of
termination from the Issuer to the Administrator if any of the following events
shall occur:

                  (i) the Administrator shall default in the performance of any
         of its duties under this Agreement and, after notice of such default,
         shall not cure such default within 30 days (or, if such default cannot
         be cured in such time, shall not give within 30 days such assurance of
         cure as shall be reasonably satisfactory to the Issuer);

                  (ii) a court having jurisdiction in the premises shall enter a
         decree or order for relief, and such decree or order shall not have
         been vacated within 60 days, in respect of the Administrator in any
         involuntary case under any applicable bankruptcy, insolvency or other
         similar law now or hereafter in effect or appoint a receiver,
         conservator, liquidator, assignee, custodian, trustee, sequestrator or
         similar official for the Administrator or any substantial part of its
         property or order the winding-up or liquidation of its affairs; or

                  (iii) the Administrator shall commence a voluntary case under
         any applicable bankruptcy, insolvency or other similar law now or
         hereafter in effect, shall consent to the entry of an order for relief
         in an involuntary case under any such law, or shall consent to the
         appointment of a receiver, liquidator, assignee, trustee, custodian,
         sequestrator or similar official for the Administrator or any
         substantial part of its property, shall consent to the taking of
         possession by any such official of any substantial part of its
         property, shall make any general assignment for the benefit of
         creditors, shall admit in writing its inability to pay its debts
         generally as they become due or shall fail generally to pay its debts
         as they become due.

         The Administrator agrees that if any of the events specified in clause
(ii) or (iii) above shall occur, it shall give written notice thereof to the
Issuer and the Indenture Trustee within seven days after the happening of such
event.

         (e) No resignation or removal of the Administrator pursuant to this
Section shall be effective until (i) a successor Administrator shall have been
appointed by the Issuer and (ii) such successor Administrator shall have agreed
in writing to be bound by the terms of this Agreement in the same manner as the
Administrator is bound hereunder.

         (f) The appointment of any successor Administrator shall be effective
only after satisfaction of the Rating Agency Condition with respect to the
proposed appointment.


                                       8

<PAGE>
         Section 1.10. Action upon Termination, Resignation or Removal. Promptly
upon the effective date of termination of this Agreement pursuant to Section
1.09(a) or the resignation or removal of the Administrator pursuant to Sections
1.09(b), (c) or (d), respectively, the Administrator shall be entitled to be
paid all fees and reimbursable expenses accruing to it pursuant to Section 1.04
of this Agreement and Section 3.01(e) of the Transfer and Servicing Agreement to
the date of such termination, resignation or removal. The Administrator shall
forthwith upon such termination pursuant to Section 1.09(a) deliver to the
Transferor all property and documents of or relating to the Collateral then in
the custody of the Administrator. In the event of the resignation or removal of
the Administrator pursuant to Sections 1.09(b), (c) or (d), respectively, the
Administrator shall cooperate with the Issuer and take all reasonable steps
requested to assist the Issuer in making an orderly transfer of the duties of
the Administrator.

         Section 1.11. Notices. Any notice, report or other communication given
hereunder shall be in writing and addressed as follows:

         If to the Issuer or the Owner Trustee, to

                  Nordstrom Credit Card Master Note Trust
                  c/o Wilmington Trust Company
                  Rodney Square North
                  1100 North Market Street
                  Wilmington, Delaware  19890-0001
                  Attention:  Corporate Trust Administration
                  (facsimile no. (302) 636-4140)

         If to the Administrator, to

                  Nordstrom fsb
                  7320 East Butherus Drive, Suite 100
                  Scottsdale, Arizona  85260-2438
                  (facsimile no. (303) 397-4488)

         If to the Indenture Trustee, to

                  Wells Fargo Bank Minnesota, National Association
                  Wells Fargo Corporate Trust
                  Asset Backed Securities
                  625 Marquette Avenue, MAC N9311-161
                  Minneapolis, Minnesota  55480
                  (facsimile no. (612) 667-3464)

         If to the Transferor, to

                  Nordstrom Credit Card Receivables LLC
                  13531 East Caley Avenue
                  Englewood, Colorado  80111
                  (facsimile no. (303) 397-4488)


                                       9

<PAGE>
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if personally delivered at, mailed by registered mail, return receipt requested,
or sent by facsimile transmission, as provided above.

         Section 1.12. Amendments. This Agreement may be amended from time to
time, by a written amendment duly executed and delivered by the Issuer and the
Administrator, as acknowledged and accepted by the Transferor, with the written
consent of the Owner Trustee (as such and in its individual capacity), without
the consent of any of the Noteholders or the Owner, to cure any ambiguity, to
correct or supplement any provisions in this Agreement or for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or modifying in any manner the rights of the
Noteholders or Owner; provided, however, that (i) such amendment will not, as
evidenced by an Officer's Certificate of the Administrator addressed and
delivered to the Owner Trustee, materially and adversely affect the interests of
any Noteholder or the Owner and (ii) the Rating Agency Condition will have been
satisfied with respect to such amendment.

         This Agreement may also be amended from time to time, by a written
amendment duly executed and delivered by the Issuer, the Administrator and the
Transferor, with the written consent of the Owner Trustee (as such and in its
individual capacity), the Noteholders evidencing not less than a majority in the
Outstanding Amount and the Owner, for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
modifying in any manner the rights of Noteholders or the Owner; provided,
however, that, without the consent of the Holders of all of the Notes then
Outstanding, no such amendment shall (i) 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 (ii) reduce the aforesaid portion of the Outstanding Amount of
the Notes of all Series, the Holders of which are required to consent to any
such amendment.

         Prior to the execution of any such amendment or consent, the
Administrator shall furnish written notification of the substance of such
amendment or consent to each Rating Agency. Promptly after the execution of any
such amendment or consent, the Administrator shall furnish written notification
of the substance of such amendment or consent to the Indenture Trustee.

         It shall not be necessary for the consent of Noteholders pursuant to
this Section to approve the particular form of any proposed amendment or
consent, but it shall be sufficient if such consent shall approve the substance
thereof.

         Section 1.13. Successors and Assigns. This Agreement may not be
assigned by the Administrator unless such assignment is previously consented to
in writing by the Issuer, the Transferor and the Owner Trustee (as such and in
its individual capacity) and subject to the satisfaction of the Rating Agency
Condition in respect thereof. An assignment with such consent and satisfaction,
if accepted by the assignee, shall bind the assignee hereunder in the same
manner as the Administrator is bound hereunder. Notwithstanding the foregoing,
upon notice to the Rating Agencies, this Agreement may be assigned by the
Administrator without the consent of the Issuer, the Transferor, the Owner
Trustee or the Rating Agencies to a corporation or other organization that is a
successor (by merger, consolidation or purchase of assets) to the

                                       10

<PAGE>
Administrator, provided that such successor organization executes and delivers
to the Issuer, the Transferor and the Owner Trustee an agreement in which such
corporation or other organization agrees to be bound hereunder by the terms of
said assignment in the same manner as the Administrator is bound hereunder.
Subject to the foregoing, this Agreement shall bind any successors or assigns of
the parties hereto.

         Section 1.14. GOVERNING LAW. THIS AGREEMENT AND EACH NOTE SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY 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 1.15. Effect of Headings and Table of Contents. The headings
herein and Table of Contents are for convenience only and shall not affect the
construction hereof.

         Section 1.16. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.

         Section 1.17. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions and terms of this Agreement and shall in no way affect the validity
or enforceability of the other covenants, agreements, provisions and terms of
this Agreement.

         Section 1.18. Not Applicable to Nordstrom fsb in Other Capacities.
Nothing in this Agreement shall affect any obligation Nordstrom fsb may have in
any other capacity, other than as Administrator.

         Section 1.19. Limitation of Liability of Owner Trustee. Notwithstanding
anything contained herein to the contrary, this instrument has been signed by
Wilmington Trust Company not in its individual capacity but solely in its
capacity as Owner Trustee of the Issuer and in no event shall Wilmington Trust
Company in its individual capacity or any beneficial owner of the Issuer have
any liability for the representations, warranties, covenants, agreements or
other obligations of the Issuer hereunder, as to all of which recourse shall be
had solely to the assets of the Issuer. For all purposes of this Agreement, 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 1.20. Third-Party Beneficiary. The Owner Trustee is a
third-party beneficiary to this Agreement and is entitled to the rights and
benefits hereunder and may enforce the provisions hereof as if it were a party
hereto.

         Section 1.21. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, to the fullest extent permitted by law, the
Administrator shall not at any time with respect to the Issuer or the Transferor
acquiesce, petition or otherwise invoke or cause the Issuer or the Transferor to
invoke the process of any court or government authority for the purpose of


                                       11

<PAGE>
commencing or sustaining a case against the Issuer or the Transferor under any
federal or state bankruptcy, insolvency or similar law or appointing a receiver,
conservator, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Issuer or the Transferor or any substantial part of its
property or ordering the winding up or liquidation of the affairs of the Issuer
or the Transferor; provided, however, that this Section shall not operate to
preclude any remedy described in Article Five of the Master Indenture.

         Section 1.22. Successor Administrator. In the event of a servicing
transfer pursuant to Article Seven of the Transfer and Servicing Agreement, the
successor servicer under the Transfer and Servicing Agreement shall, upon the
date of such servicing transfer, become the successor Administrator hereunder.
"Administrator" shall mean initially Nordstrom fsb and thereafter its permitted
successor and assigns as provided in Section 1.13 or any successor Administrator
as provided in this Section.




                                       12

<PAGE>
         IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.

                                        NORDSTROM CREDIT CARD MASTER NOTE TRUST,
                                        as Issuer

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

                                        By:  /s/ James P. Lawler
                                             -----------------------------------
                                             Name: James P. Lawler
                                             Title: Vice-President

                                        NORDSTROM fsb,
                                        as Administrator

                                        By:  /s/ Denny D. Dumler
                                             -----------------------------------
                                             Name: Denny D. Dumler
                                             Title: President

Acknowledged and Accepted:

NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Transferor

By:  /s/ Kevin T. Knight
     -----------------------------------
     Name: Kevin T. Knight
     Title: President

<PAGE>
                                                                       EXHIBIT A

                                POWER OF ATTORNEY

         KNOW ALL MEN BY THESE PRESENTS, that Nordstrom Credit Card Master Note
Trust, a Delaware business trust (the "Trust"), does hereby make, constitute and
appoint Nordstrom fsb, as Administrator under the Administration Agreement (as
defined below), and its agents and attorneys, as Attorneys-in-Fact to execute on
behalf of the Trust all such documents, reports, filings, instruments,
certificates, notices and opinions as it shall be the duty of the Trust to
prepare, file or deliver pursuant to the Related Agreements, including, without
limitation, to appear for and represent the Trust in connection with the
preparation, filing and audit of federal, state and local tax returns pertaining
to the Trust, and with full power to perform any and all acts associated with
such returns and audits that the Trust could perform, including without
limitation, the right to distribute and receive confidential information, defend
and assert positions in response to audits, initiate and defend litigation, and
to execute waivers of restriction on assessments of deficiencies, consents to
the extension of any statutory or regulatory time limit, and settlements. For
the purpose of this Power of Attorney, the term "Administration Agreement" means
the administration agreement, dated as of April 1, 2002, between the Trust and
Nordstrom fsb, as administrator (the "Administrator"), as amended from time to
time.

         This power of attorney is coupled with an interest and shall survive
and not be affected by the subsequent bankruptcy or dissolution of the Trust.

         All powers of attorney for this purpose heretofore filed or executed by
the Trust are hereby revoked.

         Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed thereto in the Administration Agreement.

         EXECUTED this      day of       , 2002.
                       ----        ------

                                        NORDSTROM CREDIT CARD MASTER NOTE TRUST

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

                                        By:
                                             -----------------------------------
                                             Name:
                                             Title:



                                       A-1



<PAGE>
                                                                   Exhibit 10.41














                     NORDSTROM CREDIT CARD RECEIVABLES LLC,
                                 as Transferor,







                                       and







                            WILMINGTON TRUST COMPANY,
                                as Owner Trustee








                      AMENDED AND RESTATED TRUST AGREEMENT
                            Dated as of April 1, 2002

<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>

                                   ARTICLE ONE

                                   DEFINITIONS

Section 1.01.  Capitalized Terms.............................................................................    1
Section 1.02.  Other Definitional Provisions.................................................................    3


                                   ARTICLE TWO

                                  ORGANIZATION

Section 2.01.  Name..........................................................................................    4
Section 2.02.  Office........................................................................................    4
Section 2.03.  Purpose and Powers............................................................................    4
Section 2.04.  Appointment of Owner Trustee..................................................................    5
Section 2.05.  Initial Capital Contribution of Trust Assets..................................................    5
Section 2.06.  Declaration of Trust..........................................................................    5
Section 2.07.  Title to Trust Property.......................................................................    5
Section 2.08.  Situs of Trust................................................................................    5
Section 2.09.  Representations and Warranties of Transferor..................................................    6
Section 2.10.  Liability of Certificateholders...............................................................    7


                                  ARTICLE THREE

                                  CERTIFICATES

Section 3.01.  Initial Ownership.............................................................................    8
Section 3.02.  Form of Certificates..........................................................................    8
Section 3.03.  Authentication of Certificates................................................................    8
Section 3.04.  Restrictions on Transfer......................................................................    8
Section 3.05.  Mutilated, Destroyed, Lost or Stolen Certificate..............................................    9
Section 3.06.  Issuance of New Transferor Certificates.......................................................    9


                                  ARTICLE FOUR

                            ACTIONS BY OWNER TRUSTEE

Section 4.01.  Prior Notice to Owner and Transferor with Respect to Certain Matters..........................   11
Section 4.02.  Restrictions on Power.........................................................................   11
</TABLE>


                                       i

<PAGE>

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
                                  ARTICLE FIVE

                      AUTHORITY AND DUTIES OF OWNER TRUSTEE

Section 5.01.  General Authority.............................................................................   12
Section 5.02.  General Duties................................................................................   12
Section 5.03.  Action Upon Instruction.......................................................................   12
Section 5.04.  No Duties Except as Specified in this Agreement or in Instructions............................   13
Section 5.05.  No Action Except under Specified Documents or Instructions....................................   13
Section 5.06.  Restrictions..................................................................................   13


                                   ARTICLE SIX

                          CONCERNING THE OWNER TRUSTEE

Section 6.01.  Acceptance of Trusts and Duties...............................................................   15
Section 6.02.  Furnishing of Documents.......................................................................   16
Section 6.03.  Representations and Warranties................................................................   16
Section 6.04.  Reliance; Advice of Counsel...................................................................   17
Section 6.05.  Not Acting in Individual Capacity.............................................................   18
Section 6.06.  Owner Trustee Not Liable for Certificates, Notes or Receivables...............................   18
Section 6.07.  Owner Trustee May Own Notes...................................................................   18


                                  ARTICLE SEVEN

                          COMPENSATION OF OWNER TRUSTEE

Section 7.01.  Owner Trustee's Fees and Expenses.............................................................   19
Section 7.02.  Indemnification...............................................................................   19
Section 7.03.  Payments to the Owner Trustee.................................................................   19


                                  ARTICLE EIGHT

                         TERMINATION OF TRUST AGREEMENT

Section 8.01.  Termination of Trust Agreement................................................................   20
</TABLE>


                                       ii

<PAGE>

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
                                  ARTICLE NINE

                     SUCCESSOR AND ADDITIONAL OWNER TRUSTEES

Section 9.01.  Eligibility Requirements for Owner Trustee....................................................   21
Section 9.02.  Resignation or Removal of Owner Trustee.......................................................   21
Section 9.03.  Successor Owner Trustee.......................................................................   22
Section 9.04.  Merger or Consolidation of Owner Trustee......................................................   22
Section 9.05.  Appointment of Co-Trustee or Separate Trustee.................................................   22


                                   ARTICLE TEN

                                   TAX MATTERS

Section 10.01.  Tax and Accounting Characterization..........................................................   24
Section 10.02.  Signature on Returns; Tax Matters Partner....................................................   24
Section 10.03.  Tax Reporting................................................................................   24


                                 ARTICLE ELEVEN

                                  MISCELLANEOUS

Section 11.01.  Supplements and Amendments...................................................................   25
Section 11.02.  No Legal Title to Trust Assets in Transferor.................................................   26
Section 11.03.  Limitations on Rights of Others..............................................................   26
Section 11.04.  Notices......................................................................................   26
Section 11.05.  Severability.................................................................................   27
Section 11.06.  Counterparts.................................................................................   27
Section 11.07.  Successors and Assigns.......................................................................   27
Section 11.08.  Third-Party Beneficiaries....................................................................   27
Section 11.09.  Nonpetition Covenants........................................................................   27
Section 11.10.  No Recourse..................................................................................   27
Section 11.11.  Effect of Headings and Table of Contents.....................................................   27
Section 11.12.  GOVERNING LAW................................................................................   27
Section 11.13.  Acceptance of Terms of Agreement.............................................................   28
Section 11.14.  Merger and Integration.......................................................................   28
Section 11.15.  Certificates Nonassessable and Fully Paid....................................................   28





Exhibit A     -   Form of Ownership Interest Certificate....................................................   A-1
Exhibit B     -   Form of Transferor Certificate............................................................   B-1
Exhibit C     -   Form of Certificate of Trust..............................................................   C-1
</TABLE>


                                      iii

<PAGE>
                      AMENDED AND RESTATED TRUST AGREEMENT

         This Amended and Restated Trust Agreement, dated as of April 1, 2002,
is between Nordstrom Credit Card Receivables LLC, a Delaware limited liability
company, as Transferor, and Wilmington Trust Company, a Delaware banking
corporation, as Owner Trustee.

                                   ARTICLE ONE

                                   DEFINITIONS

         Section 1.01.     Capitalized Terms. Whenever used in this Agreement,
the following words and phrases shall have the meanings set forth below:

         "Administration Agreement" means the administration agreement, dated as
of April 1, 2002, between the Issuer and the Bank, as amended or supplemented
from time to time.

         "Administrator" means the Bank, in its capacity as Administrator under
the Administration Agreement, or any successor in such capacity.

         "Agreement" means this Amended and Restated Trust Agreement, as amended
or supplemented from time to time.

         "Bank" means Nordstrom fsb and its successors.

         "Business Trust Statute" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Section 3801, et seq., as amended or supplemented from time to
time.

         "Certificate of Trust" means the Certificate of Trust in the form
attached hereto as Exhibit C which has been filed for the Trust pursuant to
Section 3810(a) of the Business Trust Statute.

         "Certificateholder" means a holder of a Certificate.

         "Certificates" means, unless otherwise indicated, the Transferor
Certificates, the Supplemental Certificates and the Ownership Interest
Certificate.

         "Closing Date" means May 1, 2002.

         "Corporate Trust Office" means, with respect to the Owner Trustee, the
principal corporate trust office of the Owner Trustee located at Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention:
Corporate Trust Administration (facsimile no. (302) 636-4140); or such other
address as the Owner Trustee may designate by notice to the Transferor, or the
principal corporate trust office of any successor Owner Trustee (the address of
which the successor Owner Trustee will notify the Owner and the Transferor).

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

<PAGE>
         "Expenses" means any and all liabilities, obligations, losses, damages,
taxes, claims, actions and suits, and any and all reasonable costs, expenses and
disbursements (including reasonable legal fees and expenses) of any kind and
nature whatsoever.

         "Indemnified Parties" means the Owner Trustee and its successors,
assigns, directors, officers, agents, employees and servants.

         "Indenture" means the Master Indenture, as supplemented by the related
Indenture Supplement, as the same may be amended, supplemented or otherwise
modified from time to time.

         "Indenture Supplement" means the indenture supplement pursuant to which
a Series is issued.

         "Indenture Trustee" means Wells Fargo Bank Minnesota, National
Association, not in its individual capacity but solely as Indenture Trustee
under the Master Indenture, and its successors.

         "Issuer" means the Trust.

         "Master Indenture" means the master indenture, dated as of April 1,
2002, between the Trust and the Indenture Trustee, as amended, supplemented or
otherwise modified from time to time.

         "Offered Notes" has the meaning set forth in the related Indenture.

         "Owner" means the Transferor in its capacity as beneficial owner of the
Trust hereunder, and its successors.

         "Owner Trustee" means Wilmington Trust Company, not in its individual
capacity but solely as Owner Trustee under this Agreement, and its successors.

         "Ownership Interest Certificate" means the certificate evidencing the
beneficial ownership interest of the Owner in the Trust, substantially in the
form attached hereto as Exhibit A.

         "Secretary of State" means the Secretary of State of the State of
Delaware or any successor thereto.

         "Supplemental Certificate" has the meaning specified in Section
3.06(b).

         "Transfer and Servicing Agreement" means the transfer and servicing
agreement, dated as of April 1, 2002, among the Issuer, the Transferor, the
Indenture Trustee and the Bank, as amended or supplemented from time to time.

         "Transferor" means Nordstrom Credit Card Receivables LLC, and its
successors.

         "Transferor Certificate Supplement" has the meaning specified in
Section 3.06(b).

                                       2

<PAGE>
         "Transferor Certificates" means the certificates executed by the Owner
Trustee on behalf of the Trust and authenticated by or on behalf of the Owner
Trustee, substantially in the form attached hereto as Exhibit B.

         "Trust" means Nordstrom Credit Card Master Note Trust.

         "Trust Assets" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Trust Termination Date" means the day on which the rights of all
Series of Notes to receive payment from the Trust have terminated.

         Section 1.02.     Other Definitional Provisions. Capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed thereto
in the Transfer and Servicing Agreement or in the Indenture, as the case may be.

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

         (b) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement 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
Agreement or in any such certificate or other document are inconsistent with the
meanings of such terms under GAAP, the definitions contained in this Agreement
or in any such certificate or other document shall control.

         (c) For all purposes of this Agreement, 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 Agreement include all Exhibits hereto, (iii) references
to words such as "herein", "hereof" and the like shall refer to this Agreement
as a whole and not to any particular part, Article or Section within this
Agreement, (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 Agreement, (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.

                                       3

<PAGE>
                                   ARTICLE TWO

                                  ORGANIZATION

         Section 2.01. Name. The Trust continued hereby shall be known as
"Nordstrom Credit Card Master Note Trust", in which name the Trust and the Owner
Trustee on behalf of the Trust shall each have power and authority and is hereby
authorized and empowered to and may conduct the business of the Trust and may
engage in the activities permitted in this Agreement, make and execute contracts
and other instruments on behalf of the Trust and sue and be sued, to the extent
provided herein. This Agreement amends and restates in its entirety the trust
agreement dated March 25, 2002, between the Transferor and the Owner Trustee.

         Section 2.02. Office. The office of the Trust shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in the
State of Delaware as the Owner Trustee may designate by written notice to the
Owner, the Indenture Trustee and the Transferor.

         Section 2.03. Purpose and Powers. The sole purpose of the Trust is to
engage in the activities set forth in this Section. The Trust shall have power
and authority and is hereby authorized and empowered, without the need for
further action on the part of the Trust, and the Owner Trustee shall have power
and authority, and is hereby authorized and empowered, in the name and on behalf
of the Trust, to do or cause to be done all acts and things necessary,
appropriate or convenient to cause the Trust to engage in the activities set
forth in this Section as follows:

                  (i) to execute, deliver and issue the Notes pursuant to the
         Indenture and the Certificates pursuant to this Agreement, and to sell
         the Notes upon the written order of the Transferor;

                  (ii) with the net proceeds of the sale of the Notes, to
         acquire the Trust Assets and to pay transactional expenses;

                  (iii) to pay interest on and principal of the Notes and the
         Certificates and any excess collections to the Transferor, as holder of
         the Transferor Certificate pursuant to the Series 2002-1 Indenture
         Supplement;

                  (iv) to assign, grant, pledge and mortgage the Collateral
         pursuant to the Indenture to the Indenture Trustee as security for the
         Notes and to hold, manage and distribute to the Transferor, the Owner
         or the Noteholders pursuant to the terms of this Agreement and the
         Transaction Documents any portion of the Collateral released from the
         lien of, and remitted to the Trust pursuant to, the Indenture;

                  (v) to enter into, execute, deliver and perform the
         Transaction Documents to which it is to be a party;

                  (vi) to engage in those activities, including entering into
         agreements, that are necessary, suitable or convenient to accomplish
         the foregoing or are incidental thereto or connected therewith; and

                                       4

<PAGE>
                  (vii) subject to compliance with the Transaction Documents, to
         engage in such other activities as may be required in connection with
         conservation of the Trust Assets and the making of payments to the
         Noteholders and the Certificateholders and distributions to the
         Transferor.

Notwithstanding the grant of power and authority to the Owner Trustee set forth
herein, the Transferor may, in its sole discretion, sign and file registration
statements on behalf of the Trust under the Securities Act, registering the
offer and sale of Notes or Certificates issued by the Trust and periodic reports
relating to such Notes or Certificates required to be filed under the Exchange
Act, and the rules and regulations of the Commission thereunder. Furthermore,
the Trust shall not have power, authority or authorization to, and shall not,
engage in any activity other than in connection with the foregoing or other than
as required or authorized by the terms of this Agreement or the other
Transaction Documents.

         Section 2.04. Appointment of Owner Trustee. The Transferor hereby
appoints the Owner Trustee as trustee of the Trust effective as of the date
hereof, to have all the rights, powers and duties set forth herein and, to the
extent not inconsistent herewith, in the Business Trust Statute, and the Owner
Trustee hereby accepts such appointment.

         Section 2.05. Initial Capital Contribution of Trust Assets. The
Transferor hereby sells, assigns, transfers, conveys and sets over to the Owner
Trustee, as of the date hereof, the sum of $10.00. The Owner Trustee hereby
acknowledges receipt in trust from the Transferor, as of such date, of the
foregoing contribution, which shall constitute the initial Trust Assets and
shall be held by the Owner Trustee. The Transferor shall pay the organizational
expenses of the Trust as they may arise or shall, upon the request of the Owner
Trustee, promptly reimburse the Owner Trustee for any such expenses paid by the
Owner Trustee.

         Section 2.06. Declaration of Trust. The Owner Trustee hereby declares
that it will hold the Trust Assets in trust upon and subject to the conditions
set forth herein for the use and benefit of the Certificateholders, who are
intended to be "beneficial owners" within the meaning of the Business Trust
Statute subject to the obligations of the Trust under the Transaction Documents.
It is the intention of the parties hereto that the Trust constitute a business
trust under the Business Trust Statute and that this Agreement constitute the
governing instrument of such business trust. The parties hereto agree that they
will take no action contrary to the foregoing intention. Effective as of the
date hereof, the Owner Trustee shall have all rights, powers and duties set
forth herein and, to the extent not inconsistent herewith, in the Business Trust
Statute with respect to accomplishing the purposes of the Trust.

         Section 2.07. Title to Trust Property. Legal title to the Trust Assets
shall be vested at all times in the Trust as a separate legal entity except
where applicable law in any jurisdiction requires title to any part of the Trust
Assets to be vested in a trustee or trustees, in which case title shall be
deemed to be vested in the Owner Trustee, a co-trustee and/or a separate
trustee, as the case may be.

         Section 2.08. Situs of Trust. The Trust will be located in Delaware and
administered in the State of Delaware and the location of the Administrator. All
bank accounts maintained by the Owner Trustee on behalf of the Trust shall be
located in Washington, Colorado, Delaware or


                                       5

<PAGE>
New York. The Trust shall not have any employees in any State other than
Delaware; provided, however, that nothing herein shall restrict or prohibit the
Owner Trustee from having employees within or without the State of Delaware.
Payments will be received by the Trust only in Washington, Colorado, Delaware or
New York, and payments will be made by the Trust only in such States. The only
office of the Trust will be at the Corporate Trust Office.

         Section 2.09. Representations and Warranties of Transferor. The
Transferor hereby represents and warrants to the Owner Trustee that:

                  (a) The Transferor is a limited liability company duly
         organized and validly existing in good standing under the laws of the
         State of Delaware, with power, authority and legal right to own its
         properties and to conduct its business as such properties are currently
         owned and such business is presently conducted, and had at all relevant
         times, and has, power, authority and legal right to acquire, own and
         sell the Receivables.

                  (b) The Transferor is duly qualified to do business as a
         limited liability company and is in good standing and has obtained all
         necessary licenses and approvals in each jurisdiction in which the
         failure to so qualify or to obtain such licenses and approvals would
         materially and adversely affect the performance by the Transferor of
         its obligations under, or the validity or enforceability of, this
         Agreement, any of the other Transaction Documents to which it is a
         party, the Receivables, the Notes or the Certificates.

                  (c) The Transferor has (i) the power and authority to execute
         and deliver this Agreement and to carry out its terms, (ii) the power
         and authority to transfer the Owner Trust Assets to and deposit the
         same with the Trust, (iii) duly authorized such transfer and deposit to
         the Trust by all necessary action and (iv) duly authorized the
         execution, delivery and performance of this Agreement by all necessary
         action.

                  (d) Each of this Agreement and the other Transaction Documents
         to which it is a party constitutes a legal, valid and binding
         obligation of the Transferor, enforceable in accordance with its terms,
         except as such enforceability may be subject to or limited by
         bankruptcy, liquidation, insolvency, reorganization, moratorium,
         liquidation, fraudulent conveyance or other similar laws affecting the
         enforcement of creditors' rights in general and by general principles
         of equity, regardless of whether such enforceability shall be
         considered in a proceeding in equity or in law.

                  (e) The execution, delivery and performance by the Transferor
         of this Agreement and the other Transaction Documents to which the
         Transferor is a party, the consummation of the transactions
         contemplated by this Agreement and the fulfillment of the terms hereof
         do not conflict with, result in any breach of any of the terms and
         provisions of, nor constitute (with or without notice or lapse of time)
         a default under, the limited liability company agreement of the
         Transferor, or conflict with or violate any of the material terms or
         provisions of, or constitute (with or without notice or lapse of time)
         a default under, any indenture, agreement or other instrument to which
         the Transferor is a party or by which it is bound; nor result in the
         creation or imposition of any Lien upon any of its properties pursuant
         to the terms of any such indenture, agreement or other 


                                       6

<PAGE>
         instrument (other than pursuant to the Transaction Documents); nor
         violate any law or, to the best of the Transferor's knowledge, any
         order, rule or regulation applicable to the Transferor of any court or
         of any federal or state regulatory body, administrative agency or other
         governmental instrumentality having jurisdiction over the Transferor or
         its properties; which breach, default, conflict, Lien or violation
         would have a material adverse effect on the earnings, business affairs
         or business prospects of the Transferor.

                  (f) There are no proceedings or investigations pending or, to
         the Transferor's knowledge, threatened, before any court, regulatory
         body, administrative agency or other governmental instrumentality
         having jurisdiction over the Transferor or its properties: (i)
         asserting the invalidity of this Agreement, any of the other
         Transaction Documents, the Notes or the Certificates, (ii) seeking to
         prevent the issuance of the Notes or the Certificates or the
         consummation of any of the transactions contemplated by this Agreement
         and any of the other Transaction Documents or (iii) seeking any
         determination or ruling that might materially and adversely affect the
         performance by the Transferor of its obligations under, or the validity
         or enforceability of, this Agreement, any of the other Transaction
         Documents, the Receivables, the Notes or the Certificates.

         Section 2.10. Liability of Certificateholders. The Certificateholders
shall be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.

                                       7

<PAGE>
                                  ARTICLE THREE

                                  CERTIFICATES

         Section 3.01. Initial Ownership. The Owner as the holder of the
Ownership Interest Certificate, and each Transferor, as the holder of a
Transferor Certificate, (i) shall be the only beneficial owners of the Trust and
(ii) shall be bound by the provisions of this Trust Agreement.

         Section 3.02. Form of Certificates.

         (a) The Ownership Interest Certificate shall be issued in registered
form in substantially the form attached hereto as Exhibit A and initially
registered as provided in Annex 1 to Exhibit A. A Transferor Certificate shall
be issued in registered form in substantially the form attached hereto as
Exhibit B and initially registered as provided in Annex 1 to Exhibit B.

         (b) The Certificates shall be executed by manual or facsimile signature
of the Owner Trustee. The Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall, when duly
authenticated pursuant to Section 3.03, be validly issued and fully paid
undivided beneficial interests in the assets of the Trust and entitled to the
benefits of this Agreement, notwithstanding that such individuals or any of them
shall have ceased to be so authorized prior to the authentication and delivery
of the Certificates or did not hold such offices at the date of authentication
and delivery of the Certificates.

         Section 3.03. Authentication of Certificates. On the Initial Closing
Date, the Owner Trustee shall execute, authenticate and deliver the Ownership
Interest Certificate and the Transferor Certificate upon the written order of
the Transferor, signed by its chairman of the board, its president, any vice
president, secretary, any assistant treasurer or any authorized signatory,
without further corporate action by the Transferor. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
unless there appears on such Certificate a certificate of authentication
substantially in the form set forth in Exhibits A and B, respectively, executed
by the Owner Trustee by the manual signature of a duly authorized signatory, and
such certificate upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated, validly issued and
delivered hereunder. Each Certificate shall be dated the date of its
authentication. Upon issuance, execution, authentication and delivery pursuant
to the terms hereof, the Certificateholders shall be entitled to the benefits of
this Agreement.

         Section 3.04. Restrictions on Transfer. Except to the extent set forth
in Section 2.07(c) of the Transfer and Servicing Agreement, to the fullest
extent permitted by applicable law, the Certificates (or any interest therein)
may not be sold, transferred, assigned, participated, pledged or otherwise
disposed of to any Person; provided, however, subject to Section 3.06, a
Certificate (or any interest therein) may be sold, transferred, assigned,
participated, pledged or otherwise disposed of if the transferor thereof has
provided the Owner Trustee and the Indenture Trustee with a Tax Opinion relating
to such sale, transfer, assignment, participation, pledge or other disposition.
The Transferor Certificates may not be purchased by or transferred to any

                                       8

<PAGE>
"employee benefit plan" within the meaning of Section 3(3) of ERISA ( whether or
not subject to ERISA, and including foreign or government plans) or any "plan"
described in Section 4975(e)(1) of the 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.

         Section 3.05. Mutilated, Destroyed, Lost or Stolen Certificate. If (i)
a mutilated Certificate shall be surrendered to the Owner Trustee, or if the
Owner Trustee shall receive evidence to its satisfaction of the destruction,
loss or theft of a Certificate and (ii) there shall be delivered to the Owner
Trustee (as such and in its individual capacity) such security or indemnity as
may be required by it to save it harmless, then the Owner Trustee on behalf of
the Trust shall execute and the Owner Trustee shall authenticate and deliver, in
exchange for or in lieu of the mutilated, destroyed, lost or stolen Certificate,
a new Certificate of like tenor and denomination. In connection with the
issuance of any new Certificate under this Section, the Owner Trustee may
require the payment of a sum sufficient to cover any tax or other governmental
charge or expense that may be imposed in connection therewith. Any duplicate
Certificate issued pursuant to this Section shall constitute conclusive evidence
of ownership in the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.

         Section 3.06. Issuance of New Transferor Certificates.

         (a) Taken together, the Transferor Certificates shall represent an
undivided beneficial interest in the Trust Assets, subject to the Lien of the
Indenture Trustee as provided in the Indenture, including the right to receive
Collections with respect to the Receivables and other amounts at the times and
in the amounts specified in the Master Indenture and any Indenture Supplement to
be paid to the Transferor on behalf of all holders of the Transferor
Certificates.

         (b) At any time the Transferor may surrender its Transferor Certificate
to the Owner Trustee in exchange for a newly issued Transferor Certificate and a
second certificate (a "Supplemental Certificate"), the form and terms of which
shall be defined in a supplement (a "Transferor Certificate Supplement") to this
Agreement (which Transferor Certificate Supplement shall be subject to Section
11.01 to the extent that it amends any of the terms of this Agreement) to be
delivered to or upon the order of the Transferor. The issuance of any such
Supplemental Certificate shall be subject to satisfaction of the following
conditions:

             (i) on or before the fifth day immediately preceding the Transferor
         Certificate surrender and exchange, the Transferor shall have given the
         Owner Trustee, the Servicer, the Indenture Trustee and each Rating
         Agency notice (unless such notice requirement is otherwise waived) of
         such Transferor Certificate surrender and exchange;

             (ii) the Transferor shall have delivered to the Owner Trustee and
         the Indenture Trustee any related Transferor Certificate Supplement in
         form satisfactory to the Owner Trustee and the Indenture Trustee,
         executed by each party hereto;

             (iii) the Rating Agency Condition shall have been satisfied with
         respect to such Transferor Certificate surrender and exchange;

             (iv) such surrender and exchange will not result in any Adverse
         Effect and the Transferor shall have delivered to the Owner Trustee and
         the Indenture Trustee an


                                       9

<PAGE>
         Officer's Certificate, dated the date of such surrender and exchange to
         the effect that the Transferor reasonably believes that such surrender
         and exchange will not, based on the facts known to such officer at the
         time of such certification, have an Adverse Effect and that all other
         conditions to the issuance of such Supplemental Certificate have been
         satisfied;

             (v) the Transferor shall have delivered to the Owner Trustee and
         Indenture Trustee (with a copy to each Rating Agency) a Tax Opinion,
         dated the date of such surrender and exchange with respect to such
         surrender and exchange; and

             (vi) the aggregate amount of Principal Receivables as of the date
         of such surrender and exchange shall be greater than the Required
         Minimum Principal Balance as of the date of such surrender and exchange
         after giving effect to such surrender and exchange.

         Any Supplemental Certificate held by any Person at any time after the
date of its initial issuance may be transferred or exchanged only upon the
delivery to the Owner Trustee and 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.

                                       10

<PAGE>
                                  ARTICLE FOUR

                            ACTIONS BY OWNER TRUSTEE

         Section 4.01. Prior Notice to Owner and Transferor with Respect to
Certain Matters. With respect to the following matters, unless otherwise
instructed by the Transferor, the Trust shall not take action unless at least 30
days before the taking of such action the Owner Trustee shall have notified the
Transferor in writing:

                  (a) the initiation of any claim or lawsuit by the Trust
         (except claims or lawsuits brought in connection with the collection of
         the Receivables) and the settlement of any action, claim or lawsuit
         brought by or against the Trust (except with respect to the
         aforementioned claims or lawsuits for collection of the Receivables
         brought by the Trust);

                  (b) the election by the Trust to file an amendment to the
         Certificate of Trust (unless such amendment is required to be filed
         under the Business Trust Statute);

                  (c) the amendment of the Master Indenture by a supplemental
         indenture or otherwise in circumstances where the consent of any
         Noteholder is required;

                  (d) the amendment of the Master Indenture by a supplemental
         indenture or any other Transaction Document to which the Trust is a
         party in circumstances where the consent of any Noteholder is not
         required and such amendment materially adversely affects the interest
         of the Certificateholders;

                  (e) the amendment, change or modification of the
         Administration Agreement, except to cure any ambiguity or to amend or
         supplement any provision in a manner or add any provision that would
         not materially adversely affect the interests of the
         Certificateholders; or

                  (f) the appointment pursuant to the Indenture of a replacement
         or successor Transfer Agent and Registrar, Administrator or Indenture
         Trustee, or the consent to the assignment by the Transfer Agent and
         Registrar, Administrator or Indenture Trustee of its obligations under
         the Indenture.

         Section 4.02. Restrictions on Power.

         (a) The Owner Trustee shall not be required to take or refrain from
taking any action if such action or inaction would be contrary to any obligation
of the Trust or the Owner Trustee under any of the Transaction Documents or
would be contrary to Section 2.03.

         (b) The Owner Trustee shall have no power to create, assume or incur
indebtedness or other liabilities in the name of the Trust other than as
contemplated in this Agreement, the Transfer and Servicing Agreement and the
Indenture.

                                       11

<PAGE>
                                  ARTICLE FIVE

                      AUTHORITY AND DUTIES OF OWNER TRUSTEE

         Section 5.01. General Authority. The Owner Trustee shall administer the
Trust in the interest of the Certificateholders, subject to the lien of the
Indenture in accordance with this Agreement. Each of the Trust and the Owner
Trustee in the name and on behalf of the Trust shall have power and authority,
and is hereby authorized and empowered, to execute and deliver the Transaction
Documents to which the Trust is to be a party and each certificate or other
document attached as an exhibit to or contemplated by the Transaction Documents
to which the Trust is to be a party, or any amendment thereto or other
agreement, in each case in such form as the Transferor shall approve as
evidenced conclusively by the Owner Trustee's execution thereof and the
Transferor's execution of the related documents. In addition to the foregoing,
the Owner Trustee in the name and on behalf of the Trust shall also have power
and authority and is hereby authorized and empowered, but shall not be
obligated, to take all actions required of the Trust pursuant to the Transaction
Documents. The Owner Trustee in the name and on behalf of the Trust shall also
have power and authority and is hereby authorized and empowered from time to
time to take such action as the Transferor or the Administrator directs in
writing with respect to the Transaction Documents.

         Section 5.02. General Duties. Subject to Section 2.03, it shall be the
duty of the Owner Trustee to discharge (or cause to be discharged) all of its
responsibilities pursuant to the terms of this Agreement and to administer the
Trust in the interest of the Transferor, subject to the Transaction Documents
and in accordance with the provisions of this Agreement. Notwithstanding the
foregoing, the Owner Trustee shall be deemed to have discharged (or caused to be
discharged) its duties and responsibilities hereunder and under the other
Transaction Documents to the extent the Administrator has agreed in the
Administration Agreement or another Transaction Document to perform any act or
to discharge any duty of the Owner Trustee or the Trust under any Transaction
Document, and the Owner Trustee shall not be liable for the default or failure
of the Administrator to carry out its obligations thereunder.

         Section 5.03. Action Upon Instruction.

         (a) The Owner Trustee shall not be required to take any action
hereunder or under any other Transaction Document if the Owner Trustee shall
have reasonably determined, or shall have been advised by counsel, that such
action is likely to result in liability on the part of the Owner Trustee or is
contrary to the terms of any Transaction Document or is otherwise contrary to
law.

         (b) Subject to Article Four, whenever the Owner Trustee is unable to
decide between alternative courses of action permitted or required by the terms
of any Transaction Document, the Owner Trustee shall promptly give notice (in
such form as shall be appropriate under the circumstances) to the Transferor
requesting instruction as to the course of action to be adopted, and to the
extent the Owner Trustee acts or refrains from acting in good faith in
accordance with any such instruction of the Transferor received, the Owner
Trustee shall not be liable on account of such action or inaction to any Person.
If the Owner Trustee shall not have received appropriate instruction within ten
days of such notice (or within such shorter period of time as


                                       12

<PAGE>
reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from
taking such action, not in violation of the Transaction Documents, as it shall
deem to be in the best interest of the Certificateholders, and shall have no
personal liability to any Person for such action or inaction.

         (c) Subject to Article Four, the event that the Owner Trustee is unsure
as to the application of any provision of any Transaction Document or any such
provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Owner Trustee or is silent or is
incomplete as to the course of action that the Owner Trustee is required to take
with respect to a particular set of facts, the Owner Trustee may give notice (in
such form as shall be appropriate under the circumstances) to the Transferor
requesting instruction and, to the extent that the Owner Trustee acts or
refrains from acting in good faith in accordance with any such instruction
received, the Owner Trustee shall not be liable, on account of such action or
inaction, to any Person. If the Owner Trustee shall not have received
appropriate instruction within ten days of such notice (or within such shorter
period of time as reasonably may be specified in such notice or may be necessary
under the circumstances) it may, but shall be under no duty to, take or refrain
from taking such action, not in violation of the Transaction Documents, as it
shall deem to be in the best interests of the Certificateholders, and shall have
no liability to any Person for such action or inaction.

         Section 5.04. No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall not have any duty or obligation to manage,
make any payment with respect to, register, record, sell, dispose of, or
otherwise deal with the Trust or the Trust Assets, or to otherwise take or
refrain from taking any action under, or in connection with, this Agreement or
any document contemplated hereby to which the Trust is a party, except as
expressly provided by the terms of this Agreement or in any document or written
instruction received by the Owner Trustee pursuant to Section 5.03; and no
implied duties or obligations shall be read into any Transaction Document
against the Owner Trustee. The Owner Trustee shall have no responsibility for
any filing or recording, including filing any financing or continuation
statement in any public office at any time or to otherwise perfect or maintain
the perfection of any security interest or lien granted to it or the Trust
hereunder or to prepare or file any Commission filing for the Trust or to record
any Transaction Document. The Owner Trustee in its individual capacity
nevertheless agrees that it will, at its own cost and expense, promptly take all
action as may be necessary to discharge any Liens (other than the Lien of the
Indenture) on any part of the Trust Assets that result from actions by, or
claims against, the Owner Trustee in its individual capacity that are not
related to the ownership or the administration of the Trust Assets or the
transactions contemplated by the Transaction Documents.

         Section 5.05. No Action Except under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose of
or otherwise deal with any part of the Trust Assets except in accordance with
(i) the powers granted to and the authority conferred upon the Owner Trustee
pursuant to this Agreement, (ii) the Transaction Documents or (iii) any document
or instruction delivered to the Owner Trustee pursuant to Section 5.03.

         Section 5.06. Restrictions. The Owner Trustee shall not take any action
(i) that would violate the purposes of the Trust set forth in Section 2.03 or
(ii) that, to the actual knowledge of


                                       13

<PAGE>
the Owner Trustee, would result in the Trust becoming taxable as a corporation
for federal income tax purposes. The Transferor shall not direct the Owner
Trustee to take action that would violate the provisions of this Section.

                                       14

<PAGE>
                                   ARTICLE SIX

                          CONCERNING THE OWNER TRUSTEE

         Section 6.01.     Acceptance of Trusts and Duties. The Owner Trustee
accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts, but only upon the terms of this Agreement. The
Owner Trustee also agrees to disburse all monies actually received by it
constituting part of the Trust Assets upon the terms of this Agreement. The
Owner Trustee shall not be answerable or accountable under any Transaction
Document under any circumstances, except (i) for its own willful misconduct, bad
faith or gross negligence in the performance of its duties or the omission to
perform any such duties or (ii) in the case of the inaccuracy of any
representation or warranty contained in Section 6.03 expressly made by the Owner
Trustee in its individual capacity. In particular, but not by way of limitation
(and subject to the exceptions set forth in the preceding sentence):

                  (a) the Owner Trustee shall not be liable for any error of
         judgment made in good faith by the Owner Trustee;

                  (b) the Owner Trustee shall not be liable with respect to any
         action taken or omitted to be taken by it in accordance with the
         instructions of the Administrator or the Transferor;

                  (c) no provision of this Agreement or any other Transaction
         Document shall require the Owner Trustee to expend or risk its own
         funds or otherwise incur any financial liability in the exercise or
         performance of any of its duties, rights or powers hereunder or under
         any other Transaction Document, if the Owner Trustee shall have
         reasonable grounds for believing that repayment of such funds or
         adequate indemnity against such risk or liability is not reasonably
         assured or provided to it;

                  (d) under no circumstances shall the Owner Trustee be liable
         for indebtedness evidenced by or arising under any of the Transaction
         Documents, including the principal of and interest on the Notes;

                  (e) the Owner Trustee shall not be responsible for or in
         respect of the validity or sufficiency of this Agreement, the due
         execution hereof by the Transferor or the form, character, genuineness,
         sufficiency, value or validity of any of the Trust Assets, the
         Transaction Documents, the Notes or the Certificates other than the
         genuineness of the Owner Trustee's signature on the Certificates and on
         the certificate of authentication on the Certificates, and the Owner
         Trustee shall in no event assume or incur any personal liability, duty
         or obligation to any Noteholder or to the Owner or any other Person,
         other than as expressly provided for herein or expressly agreed to in
         the other Transaction Documents;

                  (f) the Owner Trustee shall not be liable for the default or
         misconduct of the Transferor, the Servicer, the Administrator or the
         Indenture Trustee or any other Person under any of the Transaction
         Documents or otherwise, and the Owner Trustee shall have no obligation
         or personal liability to perform the obligations of the Trust under the


                                       15

<PAGE>
         Transaction Documents, including those that are required to be
         performed by the Administrator under the Administration Agreement, the
         Indenture Trustee under the Indenture or the Servicer under the
         Transfer and Servicing Agreement;

                  (g) the Owner Trustee shall be under no obligation to exercise
         any of the rights or powers vested in it by this Agreement, or to
         institute, conduct or defend any litigation under this Agreement or
         otherwise or in relation to this Agreement or any other Transaction
         Document, at the request, order or direction of the Transferor, unless
         the Transferor has offered to the Owner Trustee security or indemnity
         satisfactory to it against the costs, expenses and liabilities that may
         be incurred by the Owner Trustee therein or thereby; the right of the
         Owner Trustee to perform any discretionary act enumerated in this
         Agreement or any other Transaction Document shall not be construed as a
         duty, and the Owner Trustee shall not be answerable or liable to any
         Person for any such act other than liability to the Trust and the
         beneficial owners of the Trust for its own gross negligence or willful
         misconduct in the performance of any such act or the omission to
         perform any such act; and

                  (h) notwithstanding anything contained herein to the contrary,
         the Owner Trustee shall not be required to take any action in any
         jurisdiction other than in the State of Delaware if the taking of such
         action will (i) require the registration with, licensing by or the
         taking of any other similar action in respect of, any state or other
         governmental authority or agency of any jurisdiction other than the
         State of Delaware by or with respect to the Owner Trustee, (ii) result
         in any fee, tax or other governmental charge under the laws of any
         jurisdiction or any political subdivision thereof in existence on the
         date hereof other than the State of Delaware becoming payable by the
         Owner Trustee or (iii) subject the Owner Trustee to personal
         jurisdiction in any jurisdiction other than the State of Delaware for
         causes of action arising from acts unrelated to the consummation of the
         transactions by the Owner Trustee contemplated hereby; the Owner
         Trustee shall be entitled to obtain advice of counsel (which advice
         shall be an expense of the Transferor) to determine whether any action
         required to be taken pursuant to the Agreement results in the
         consequences described in clauses (i), (ii) and (iii) of this
         subsection; and in the event that said counsel advises the Owner
         Trustee that such action will result in such consequences, the
         Transferor shall appoint an additional trustee pursuant to Section 9.05
         to proceed with such action.

         Section 6.02. Furnishing of Documents. The Owner Trustee shall furnish
to the Transferor and the Indenture Trustee, promptly upon written request
therefor, duplicates or copies of all reports, notices, requests, demands,
certificates, financial statements and any other instruments furnished to the
Owner Trustee under the Transaction Documents.

         Section 6.03. Representations and Warranties. The Owner Trustee hereby
represents and warrants to the Transferor that:

                  (a) it is a Delaware banking corporation duly organized and
         validly existing in good standing under the laws of the State of
         Delaware and has all requisite corporate power and authority to
         execute, deliver and perform its obligations under this Agreement;

                                       16

<PAGE>
                  (b) it has taken all corporate action necessary to authorize
         the execution and delivery by it of this Agreement, and this Agreement
         will be executed and delivered by one of its officers who is duly
         authorized to execute and deliver this Agreement on its behalf;

                  (c) neither the execution nor the delivery by it of this
         Agreement, nor the consummation by it of the transactions contemplated
         hereby nor compliance by it with any of the terms or provisions hereof
         will contravene any federal or Delaware law, governmental rule or
         regulation governing the banking or trust powers of the Owner Trustee
         or any judgment or order binding on it, or constitute any default under
         its charter documents or by-laws or any indenture, mortgage, contract,
         agreement or instrument to which it is a party or by which any of its
         properties may be bound or result in the imposition of any Lien, charge
         or encumbrance on the Trust Assets resulting from actions by or claims
         against the Owner Trustee individually that are related to this
         Agreement or the other Transaction Documents; and

                  (d) each of this Agreement and each other Transaction Document
         to which it is a party has been duly executed and delivered by it and
         constitutes the legal, valid and binding agreement of it, enforceable
         against the Owner Trustee in accordance with its terms, except as
         enforceability may be limited by bankruptcy, liquidation, insolvency,
         reorganization or other similar laws affecting the enforcement of
         creditors' rights in general and by general principles of equity,
         regardless of whether such enforceability is considered in a proceeding
         in equity or at law.

         Section 6.04. Reliance; Advice of Counsel.

         (a) The Owner Trustee shall incur no liability to anyone in acting upon
any signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond, or other document or paper believed by it to
be genuine and believed by it to be signed by the proper party or parties. The
Owner Trustee may accept a certified copy of a resolution of the board of
directors or other governing body of any Person as conclusive evidence that such
resolution has been duly adopted by such body and that the same is in full force
and effect. As to any fact or matter the method of the determination of which is
not specifically prescribed herein, the Owner Trustee may for all purposes
hereof rely on a certificate, signed by the president or any vice president or
by the treasurer or other authorized officer of an appropriate Person, as to
such fact or matter, and such certificate shall constitute full protection to
the Owner Trustee for any action taken or omitted to be taken by it in good
faith in reliance thereon.

         (b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the other
Transaction Documents, the Owner Trustee (i) may act directly or through its
agents or attorneys pursuant to agreements entered into with any of them, and
the Owner Trustee shall not be liable for the conduct or misconduct of such
agents or attorneys if such agents or attorneys shall have been selected by the
Owner Trustee with reasonable care, and (ii) may consult with counsel,
accountants and other skilled Persons to be selected with reasonable care and
employed by it. The Owner Trustee shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the written opinion
or written advice of any such counsel, accountants or other such Persons.

                                       17

<PAGE>
         Section 6.05. Not Acting in Individual Capacity. Except as expressly
provided in this Article, in accepting the trusts hereby created, Wilmington
Trust Company acts solely as Owner Trustee hereunder and not in its individual
capacity, and all Persons having any claim against the Owner Trustee by reason
of the transactions contemplated by any Transaction Document shall look only to
the Trust Assets for payment or satisfaction thereof.

         Section 6.06.     Owner Trustee Not Liable for Certificates, Notes or
Receivables. The statements contained herein and in the Certificates, Notes and
other Transaction Documents (other than the genuineness of the signature and
authentication (as applicable) of the Owner Trustee on the Certificates and its
representations and warranties in Section 6.03) shall be taken as the statements
of the Transferor, and the Owner Trustee assumes no responsibility for the
correctness thereof. The Owner Trustee makes no representations as to the
validity or sufficiency of this Agreement, any other Transaction Document or the
Certificates (other than the genuineness of the signature and authentication (as
applicable) of the Owner Trustee on the Certificates and its representations and
warranties in Section 6.03), the Notes or related documents. The Owner Trustee
shall at no time have any responsibility or liability for or with respect to the
legality, validity and enforceability of the Receivables or the perfection and
priority of any security interest in the Receivables or the maintenance of any
such perfection and priority, or for or with respect to the sufficiency of the
Trust Assets or its ability to generate the payments to be distributed to the
Noteholders under the Indenture, including the existence, condition and
ownership of the Receivables, the existence and contents of the Receivables on
any computer or other record thereof, the validity of the assignment of the
Receivables to the Trust or of any intervening assignment, the completeness of
the Receivables; the performance or enforcement of the Receivables, the
compliance by the Transferor with any warranty or representation made under any
Transaction Document or in any related document or the accuracy of any such
warranty or representation or any action of the Administrator, the Servicer or
the Indenture Trustee taken in the name of the Owner Trustee.

         Section 6.07.     Owner Trustee May Own Notes. The Owner Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may deal with the Transferor, the Administrator, the Servicer and the Indenture
Trustee in banking transactions with the same rights as it would have if it were
not Owner Trustee.

                                       18

<PAGE>
                                  ARTICLE SEVEN

                          COMPENSATION OF OWNER TRUSTEE

         Section 7.01. Owner Trustee's Fees and Expenses. The Owner Trustee
shall receive as compensation for its services hereunder such fees as have been
separately agreed upon before the date hereof among the Transferor, the Servicer
and the Owner Trustee, and the Owner Trustee shall be entitled to be reimbursed
by the Transferor (and if not by the Transferor, by the Servicer) for its other
reasonable expenses hereunder, including the reasonable compensation, expenses
and disbursements of such agents, representatives, experts and counsel as the
Owner Trustee may employ in connection with the exercise and performance of its
rights and its duties hereunder and under the Transaction Documents; provided,
however, that the Owner Trustee shall have no recourse to the assets pledged
under the Indenture with respect to any payments under this Section and the
Owner Trustee's right to enforce such obligation shall be subject to the
provisions of 11.09.

         Section 7.02. Indemnification. To the fullest extent permitted by law,
the Transferor (and if not the Transferor, the Servicer) shall indemnify, defend
and hold harmless the Indemnified Parties from and against Expenses which may at
any time be imposed on, incurred by, or asserted against the Owner Trustee or
any Indemnified Party in any way relating to or arising out of the Transaction
Documents, the Trust Assets, the acceptance and administration of the Trust
Assets or any action or inaction of the Owner Trustee; provided that the
Transferor shall not be liable for or required to indemnify any Indemnified
Party from and against Expenses arising or resulting from any of the matters
described in the third sentence of Section 6.01, Expenses for which
indemnification is actually received under other Transaction Documents or income
taxes or any fees received by the Owner Trustee; provided further that the
Transferor shall not be liable for or required to indemnify an Indemnified Party
from and against expenses arising or resulting from (i) the Indemnified Party's
own willful misconduct, bad faith or gross negligence, (ii) income taxes or
(iii) the inaccuracy of any representation or warranty contained in Section
6.03. No Indemnified Party shall have any recourse to the assets pledged under
the Indenture with respect to any Expenses payable by the Transferor pursuant to
this Section. An Indemnified Party's right to enforce such obligation shall be
subject to the provisions of Section 11.09. The indemnities contained in this
Section shall survive the resignation and termination of the Owner Trustee or
the termination of this Agreement. In any event of claim, action or proceeding
for which indemnity will be sought pursuant to this Section, the Indemnified
Party's choice of legal counsel shall be subject to approval of the Transferor,
which approval shall not be unreasonably withheld.

         Section 7.03. Payments to the Owner Trustee. Any amounts paid to an
Indemnified Party pursuant to this Article shall not be construed to be a part
of the Trust Assets.

                                       19

<PAGE>
                                  ARTICLE EIGHT

                         TERMINATION OF TRUST AGREEMENT

         Section 8.01. Termination of Trust Agreement.

         (a) The Trust shall dissolve upon the earlier of (i) at the option of
the Transferor (written notice of which shall be provided to the Owner Trustee),
the Trust Termination Date and (ii) dissolution of the Trust in accordance with
applicable law. After satisfaction of liabilities of the Trust as provided by
applicable law, any money or other property held as part of the Trust Assets
following such distribution shall be distributed to the Transferor. The
bankruptcy, liquidation, dissolution, termination, death or incapacity of the
Transferor shall not (A) operate to terminate this Agreement or annul, dissolve
or terminate the Trust, (B) entitle the Transferor's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court
for a partition or winding up of all or any part of the Trust or Trust Assets or
(C) otherwise affect the rights, obligations and liabilities of the parties
hereto.

         (b) Except as provided in Section 8.01(a), the Transferor shall not be
entitled to revoke, dissolve or terminate the Trust. The Owner shall not be
entitled to revoke, dissolve or terminate the Trust.

         (c) Upon completion of the winding up of the Trust in accordance with
the Business Trust Statute, the Owner Trustee shall cause the Certificate of
Trust to be canceled by filing a certificate of cancellation with the Secretary
of State in accordance with the provisions of Section 3810 of the Business Trust
Statute and thereupon the Trust and this Agreement (other than Articles Six and
Seven and Section 11.09) shall terminate.

                                       20

<PAGE>
                                  ARTICLE NINE

                     SUCCESSOR AND ADDITIONAL OWNER TRUSTEES

         Section 9.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times (i) be a Person satisfying the provisions of Section
3807(a) of the Business Trust Statute; (ii) be authorized to exercise trust
powers; (iii) have, or have a corporate parent that has, a combined capital and
surplus of at least $50,000,000; (iv) be subject to supervision or examination
by federal or state authorities; and (v) have (or have a parent which has) a
rating of at least Baa3 by Moody's, at least BBB- by Standard & Poor's and, if
rated by Fitch, at least BBB- by Fitch, or otherwise be acceptable to each
Rating Agency. If such Person shall publish reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purpose of this Section, the combined capital
and surplus of such Person shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Owner Trustee shall cease to be eligible in accordance with
the provisions of this Section, the Owner Trustee shall resign immediately in
the manner and with the effect specified in Section 9.02.

         Section 9.02. Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Transferor; provided, however, that such
resignation and discharge shall only be effective upon the appointment of a
successor Owner Trustee. Upon receiving such notice of resignation, the
Transferor shall promptly appoint a successor Owner Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
resigning Owner Trustee and one copy to the successor Owner Trustee. If no
successor Owner Trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Owner Trustee at the expense of the Transferor may petition any court
of competent jurisdiction for the appointment of a successor Owner Trustee.

         If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 9.01 and shall fail to resign after
written request therefor by the Transferor, or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a
receiver of the Owner Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Transferor may, but shall not be required to, remove the
Owner Trustee. If the Transferor shall remove the Owner Trustee under the
authority of the immediately preceding sentence, the Transferor shall promptly
(i) appoint a successor Owner Trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the outgoing Owner Trustee so
removed and one copy to the successor Owner Trustee and (ii) pay all amounts
owed to the outgoing Owner Trustee.

         Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 9.03 and, in the case of removal, payment of all
fees and expenses owed to the outgoing Owner Trustee. The Transferor shall
provide notice of such resignation or removal of the Owner Trustee to each
Rating Agency.

                                       21

<PAGE>
         Section 9.03. Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 9.02 shall execute, acknowledge and deliver to the
Transferor and to its predecessor Owner Trustee an instrument accepting such
appointment under this Agreement, and thereupon the resignation or removal of
the predecessor Owner Trustee shall become effective and such successor Owner
Trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor under
this Agreement, with like effect as if originally named as Owner Trustee. The
predecessor Owner Trustee shall upon payment of its fees and expenses deliver to
the successor Owner Trustee all documents and statements and monies held by it
under this Agreement; and the Transferor and the predecessor Owner Trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for fully and certainly vesting and confirming in the successor
Owner Trustee all such rights, powers, duties and obligations.

         No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee shall
be eligible pursuant to Section 9.01.

         Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, the Transferor shall mail notice of such acceptance of appointment
including the name of such successor Owner Trustee to the Transferor, the
Indenture Trustee, the Noteholders and each Rating Agency. If the Transferor
shall fail to mail such notice within ten days after acceptance of appointment
by the successor Owner Trustee, the successor Owner Trustee shall cause such
notice to be mailed at the expense of the Transferor.

         Upon acceptance of appointment by a successor Owner Trustee pursuant to
this Section, such successor Owner Trustee shall file an amendment to the
Certificate of Trust with the Secretary of State identifying the name and
principal place of business of such successor Owner Trustee in the State of
Delaware.

         Section 9.04. Merger or Consolidation of Owner Trustee. Notwithstanding
anything herein to the contrary, any Person into which the Owner Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Owner
Trustee shall be a party, or any Person succeeding to all or substantially all
of the corporate trust business of the Owner Trustee, shall be the successor of
the Owner Trustee hereunder (provided that such Person shall meet the
eligibility requirements set forth in Section 9.01), without the execution or
filing of any instrument or any further act on the part of any of the parties
hereto; provided further that (i) the Owner Trustee shall mail notice of such
merger or consolidation to each Rating Agency and (ii) the Owner Trustee shall
file any necessary amendments to the Certificate of Trust with the Secretary of
State.

         Section 9.05. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Assets may at the time be located, the Transferor and the Owner
Trustee acting jointly shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by each of the Transferor
and the Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Assets,
and to vest in such Person, in such


                                       22

<PAGE>
capacity, such title to the Trust, or any part thereof, and, subject to the
other provisions of this Section, such powers, duties, obligations, rights and
trusts as the Transferor and the Owner Trustee may consider necessary or
desirable. If the Transferor shall not have joined in such appointment within 15
days after the receipt by it of a request so to do, the Owner Trustee alone
shall have the power to make such appointment. No co-trustee or separate trustee
under this Agreement shall be required to meet the terms of eligibility as a
successor trustee pursuant to Section 9.01, and no notice of the appointment of
any co-trustee or separate trustee shall be required pursuant to Section 9.03.

         Each 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 Owner Trustee shall be conferred upon and exercised or
         performed by the Owner 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 Owner 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 Owner 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 Trust 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 Owner Trustee;

                  (ii) no trustee under this Agreement shall be personally
         liable by reason of any act or omission of any other trustee under this
         Agreement; and

                  (iii) the Transferor and the Owner Trustee acting jointly may
         at any time accept the resignation of or remove any separate trustee or
         co-trustee.

         Any notice, request or other writing given to the Owner 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 Agreement 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 Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Owner Trustee. Each such instrument shall be filed with the Owner
Trustee and a copy thereof given to the Transferor.

         Any separate trustee or co-trustee may at any time appoint the Owner
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
Agreement 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
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.

                                       23

<PAGE>
                                   ARTICLE TEN

                                   TAX MATTERS

         Section 10.01. Tax and Accounting Characterization. It is the intent of
the parties hereto that the Trust not constitute a separate entity for federal
income tax or state income or franchise tax (where such franchise taxes are
based solely upon or measured by net income) purposes. It is the intent of the
Transferor, the Noteholders and the Certificateholders that the Class A Notes be
treated as indebtedness of the Transferor secured by the Trust Assets and the
payments on the Receivables for federal income tax and state income and
franchise tax purposes. If there are multiple Certificateholders at any point in
time for federal, state and local income and franchise tax purposes, it is the
intention of the parties that the Trust qualify as a partnership during the
period there are multiple Certificateholders, with the assets of the partnership
being the Owner Trust Assets and the partners of the partnership being the
Certificateholders and the Notes being debt of the partnership. The parties
agree that the Trust shall not file or cause to be filed annual returns, reports
or other forms and will treat the Trust in a manner consistent with the
characterization that the Trust is not a separate entity for tax purposes unless
there are multiple Certificateholders at the same time or, unless there are
future changes in the federal or state income or franchise tax (where such
franchise taxes are based solely upon or measured by net income) laws, whereby
existing trusts with a single Certificateholder are treated as a separate entity
for purposes of the aforementioned taxes.

         Section 10.02. Signature on Returns; Tax Matters Partner.

         (a) In the event that the Trust shall be required to file federal or
other income tax returns as a partnership, such returns shall be signed by an
authorized signatory for the Transferor or such other Person as shall be
required by law to sign such returns of the Trust.

         (b) By acceptance of its beneficial interest in a Certificate, each
Certificateholder agrees that in the event that the Trust is classified as a
partnership for federal income tax purposes, the Transferor shall be the "tax
matters partner" of the Trust pursuant to the Code so long as the Transferor
holds any Certificate.

         Section 10.03. Tax Reporting. Unless otherwise required by appropriate
tax authorities, the Trust shall not file or cause to be filed annual or other
income or franchise tax returns and shall not be required to obtain a taxpayer
identification number.

                                       24

<PAGE>
                                 ARTICLE ELEVEN

                                  MISCELLANEOUS

         Section 11.01. Supplements and Amendments.

         (a) This Agreement may be amended from time to time by a written
amendment duly executed and delivered by the Transferor and the Owner Trustee,
with the written consent of the Indenture Trustee, but without the consent of
any of the Noteholders, and upon satisfaction of the Rating Agency Condition, to
cure any ambiguity, to correct or supplement any provisions in this Agreement or
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or modifying in any manner
the rights of the Noteholders; provided, however, that any such amendment will
not (i) in the good faith judgment of the parties thereto, materially adversely
affect the interest of any Noteholder and (ii) as evidenced by an Opinion of
Counsel addressed and delivered to the Owner Trustee and the Indenture Trustee,
cause the Trust to be classified as an association (or a publicly traded
partnership) taxable as a corporation for federal income tax purposes; provided,
further, that Section 2.03 may be amended only with the consent of the Holders
of Notes evidencing not less than a majority of the Outstanding Amount of the
Notes. Additionally, notwithstanding the preceding sentence, this Agreement will
be amended by the Transferor and the Owner Trustee without the consent of the
Indenture Trustee or any of the Noteholders to add, modify or eliminate such
provisions as may be necessary or advisable in order to enable all or a portion
of the Trust (i) to qualify as, and to permit an election to be made to cause
the Trust to be treated as, a "financial asset securitization investment trust"
as described in the provisions of Section 860L of the Code, and (ii) to avoid
the imposition of state or local income or franchise taxes imposed on the
Trust's property or its income; provided, however, that (i) 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 Section, (ii) the Rating Agency Condition shall have been satisfied with
respect to such amendment and (iii) such amendment does not affect the rights,
benefits, protections, privileges, immunities, duties or obligations of the
Owner Trustee hereunder. The amendments which the Transferor may make without
the consent of Noteholders pursuant to the preceding sentence may include,
without limitation, the addition of a sale of Receivables.

         (b) This Agreement may also be amended from time to time by a written
amendment duly executed and delivered by the Transferor and the Owner Trustee,
with the consent of the Indenture Trustee and the Holders of Notes evidencing
not less than a majority of the Outstanding Amount and upon satisfaction of the
Rating Agency Condition for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Noteholders; provided, however, that
without the consent of all Noteholders, no such amendment shall (i) increase or
reduce in any manner the amount of, or accelerate or delay the timing of
distributions that are required to be made for the benefit of the Noteholders or
(ii) reduce the aforesaid percentage of the Outstanding Amount of the Notes of
all Series, the Holders of which are required to consent to any such amendment;
provided further, that such amendment will not, as evidenced by an Opinion of
Counsel addressed and delivered to the Owner Trustee and the Indenture Trustee,
cause the Trust

                                       25

<PAGE>
to be classified as an association (or a publicly traded partnership) taxable as
a corporation for federal income tax purposes.

         (c) Promptly after the execution of any such amendment or consent, the
Transferor shall furnish written notification of the substance of such amendment
or consent to the Indenture Trustee and each Rating Agency. It shall not be
necessary for the consent of the Noteholders pursuant to this Section to approve
the particular form of any proposed amendment or consent, but it shall be
sufficient if such consent shall approve the substance thereof.

         (d) Promptly after the execution of any amendment to the Certificate of
Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.

         (e) The Owner Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Officer's Certificate of the Transferor to the
effect that the conditions to amendment have been satisfied. The Owner Trustee
may, but shall not be obligated to, enter into, and unless it has consented
thereto in writing shall not be bound by, any amendment which affects the Owner
Trustee's own rights, duties, benefits, protections, privileges or immunities
(as such or in its individual capacity) under this Agreement or otherwise.

         Section 11.02. No Legal Title to Trust Assets in Transferor. The
Transferor shall not have legal title to any part of the Trust Assets. No
transfer, by operation of law or otherwise, of any right, title, and interest of
the Transferor to and in its undivided beneficial interest in the Trust Assets
shall operate to terminate this Agreement or annul, dissolve or terminate the
Trust or entitle any transferee to an accounting or to the transfer to it of
legal title to any part of the Trust Assets.

         Section 11.03. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Owner Trustee, the other Indemnified
Parties, the Transferor, the holder of any Certificate and, to the extent
expressly provided herein, the Indenture Trustee and the Noteholders, and
nothing in this Agreement, whether express or implied, shall be construed to
give to any other Person any legal or equitable right, remedy or claim in the
Trust Assets or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.

         Section 11.04. Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all demands, notices, instructions, directions
and communications under this Agreement shall be in writing and shall be deemed
to have been duly given if personally delivered at, mailed by registered mail,
return receipt requested or sent by facsimile transmission (except that notice
to the Owner Trustee, the Transferor or Indenture Trustee shall be deemed given
only upon actual receipt by the Owner Trustee, the Transferor or Indenture
Trustee), if to (i) the Owner Trustee, addressed to the Corporate Trust Office;
(ii) the Indenture Trustee, addressed to Wells Fargo Bank Minnesota, National
Association, 625 Marquette Avenue, MAC N9311-161, Minneapolis, Minnesota 55479,
Attention: Corporate Trust Asset-Backed Securities (facsimile no. (612)
667-3464); or (iii) the Transferor, addressed to Nordstrom Credit Card
Receivables LLC, 13531 East Caley Avenue, Englewood, Colorado 80111, Attention:
Legal Department (facsimile no. (303) 397-4488); or as to each party, at such
other address or facsimile number as shall be designated by such party in a
written notice to each other party.

                                       26

<PAGE>
         Section 11.05. Severability. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid or unenforceable, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the
validity or enforceability of the other covenants, agreements, provisions or
terms of this Agreement or of the Certificates or the rights of the
Certificateholders thereof.

         Section 11.06. Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all of which together shall constitute one
and the same instrument.

         Section 11.07. Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Transferor, the Owner Trustee and each Certificateholder and their respective
successors and permitted assigns, all to the extent as herein provided. Any
request notice, direction, consent, waiver or other instrument or action by a
Certificateholder shall bind the successors and assigns of the Transferor or
such Certificateholder.

         Section 11.08. Third-Party Beneficiaries. This Agreement will inure to
the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Except as otherwise expressly provided in this
Agreement, no other Person will have any right or obligation hereunder.

         Section 11.09. Nonpetition Covenants. Notwithstanding any prior
termination of the Trust or this Agreement, the Owner Trustee, individually or
in its capacity as Owner Trustee, and the Transferor shall not, prior to the
date which is one year and one day after the termination of the Trust or this
Agreement, acquiesce, petition or otherwise invoke or cause the Trust to invoke
the process of any court or Governmental Authority for the purpose of commencing
or sustaining a case against the Trust under any Federal or state bankruptcy,
insolvency or similar law or appointing a receiver, conservator, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Trust or any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Trust; provided, however, that this Section
shall not operate to preclude any remedy described in Article Five of the Master
Indenture.

         Section 11.10. No Recourse. Each Person holding or owning a
Certificate, by accepting the Certificates, acknowledges that the Certificates
do not represent interest in or obligations of the Servicer, the Owner Trustee,
the Indenture Trustee or any Affiliate thereof (other than the Trust), and no
recourse may be had against such parties or their assets, or against the assets
pledged under the Indenture, except as expressly agreed by such party in the
Transaction Documents.

         Section 11.11. Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.

         Section 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF

                                       27

<PAGE>
DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.

         Section 11.13. Acceptance of Terms of Agreement. The receipt and
acceptance of the Ownership Interest Certificate by the Owner and the Transferor
Certificate by the Transferor, without any signature or further manifestation of
assent, shall constitute the unconditional acceptance by the Owner and the
Transferor, respectively, of all the terms and provisions of this Agreement, and
shall constitute the agreement of the Trust that the terms and provisions of
this Agreement shall be binding, operative and effective as among the Trust, the
Owner and the Transferor.

         Section 11.14. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings,
written and oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived or supplemented except as provided herein.

         Section 11.15. Certificates Nonassessable and Fully Paid.
Certificateholders shall not be personally liable for obligations of the Issuer.
The interests represented by the Certificates shall be nonassessable for any
losses or expenses of the Issuer or for any reason whatsoever, and, upon the
authentication thereof by the Owner Trustee pursuant to Section 3.03, 3.04, 3.05
or 3.06, the Certificates are and shall be deemed fully paid.

                                       28

<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers hereunto duly authorized, as of the
day and year first above written.

                                         WILMINGTON TRUST COMPANY,
                                            as Owner Trustee

                                         By:  /s/ James P. Lawler
                                              ----------------------------------
                                                Name: James P. Lawler
                                                Title: Vice-President

                                         NORDSTROM CREDIT CARD RECEIVABLES LLC,
                                            as Transferor

                                         By:  /s/ Kevin T. Knight
                                              ----------------------------------
                                                Name: Kevin T. Knight
                                                Title: President

                                       29

<PAGE>
                                                                       EXHIBIT A

                     FORM OF OWNERSHIP INTEREST CERTIFICATE

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THIS CERTIFICATE (OR ANY
INTEREST HEREIN) MAY NOT BE TRANSFERRED TO ANY PERSON EXCEPT IN ACCORDANCE WITH
THE TRUST AGREEMENT.

                     NORDSTROM CREDIT CARD MASTER NOTE TRUST
                                OWNER CERTIFICATE

R-1

(This Certificate does not represent an interest in or obligation of Nordstrom
Credit Card Receivables LLC or any of its affiliates, except to the extent
described below.)

         This certifies that Nordstrom Credit Card Receivables LLC is the
registered Owner of the Nordstrom Credit Card Master Note Trust (the "Trust").
The Trust was created pursuant to (i) the filing of the Certificate of Trust
with the Secretary of State of the State of Delaware and (ii) the Trust
Agreement, dated as of March 25, 2002, as amended and restated as of April 1,
2002 (the "Trust Agreement"), between Nordstrom Credit Card Receivables LLC (the
"Transferor") and Wilmington Trust Company, as trustee (the "Owner Trustee").
Capitalized terms used herein that are not otherwise defined shall have the
meanings ascribed thereto in the Trust Agreement.

         This Certificate is the duly authorized Certificate evidencing a
beneficial ownership interest in the Trust (the "Certificate"). This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Trust Agreement, including the rights of the holder of the Transferor
Certificate to which Trust Agreement the holder by virtue of the acceptance
hereof assents and by which the holder is bound.

         Notwithstanding any prior termination of the Trust Agreement, the
holder, by its acceptance of this Certificate, covenants and agrees that it
shall not at any time with respect to the Trust, acquiesce, petition or
otherwise invoke or cause the Trust to invoke the process of any court or
governmental authority for the purpose of commencing or sustaining a case
against the Trust under any federal or state bankruptcy, insolvency or similar
law or appointing a receiver, conservator, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Trust or any
substantial part of its property, or ordering the winding up or liquidation of
the affairs of the Trust.

         Unless the certificate of authentication hereon shall have been
executed by the Owner Trustee, by manual signature, this Certificate shall not
entitle the holder hereof to any benefit under the Trust Agreement, the Transfer
and Servicing Agreement or the Indenture or be valid for any purpose.

                                       A-1

<PAGE>
         THIS CERTIFICATE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF
LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

         IN WITNESS WHEREOF, the Trust has caused this Certificate to be duly
executed.

                                        NORDSTROM CREDIT CARD MASTER NOTE TRUST

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

Dated:  ____________ __, 2002           By:  _________________________________
                                             Name:
                                             Title:


                          CERTIFICATE OF AUTHENTICATION

         This is the Certificate referred to in the within-mentioned Trust
Agreement.

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



                                         By:  _________________________________
                                                   Authorized Signatory


                                      A-2

<PAGE>
                                                                         Annex 1
                                                                    to Exhibit A

Registered Owner and address:

Nordstrom Credit Card Receivables LLC
13531 East Caley Avenue
Englewood, Colorado  80111

Tax Identification Number:  __________

                                      A-3

<PAGE>
                                                                       EXHIBIT B

                         FORM OF TRANSFEROR CERTIFICATE

         THIS TRANSFEROR CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. NEITHER THIS TRANSFEROR CERTIFICATE NOR ANY
PORTION HEREOF MAY BE OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION
PROVISIONS OF SUCH ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH
REGISTRATION PROVISIONS.

         THIS TRANSFEROR CERTIFICATE IS NOT PERMITTED TO BE TRANSFERRED,
ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED EXCEPT IN COMPLIANCE WITH
THE TERMS OF THE TRUST AGREEMENT REFERRED TO HEREIN.

No. R-2                                                                 One Unit

                     NORDSTROM CREDIT CARD MASTER NOTE TRUST
                             TRANSFEROR CERTIFICATE

Evidencing an interest in a trust, the corpus of which consists primarily of
receivables generated from time to time in the ordinary course of business in a
portfolio of revolving credit card accounts transferred by Nordstrom Credit Card
Receivables LLC (the "Transferor").

               (Not an interest in or obligation of the Transferor
                            or any affiliate thereof)

         This certifies that Nordstrom Credit Card Receivables LLC is the
registered owner of an undivided beneficial interest in the assets of the
Nordstrom Credit Card Master Note Trust (the "Trust"), subject to the lien of
the Notes as provided in the Master Indenture, dated April 1, 2002 (the "Master
Indenture"), between Wells Fargo Bank Minnesota, National Association, as
trustee (the "Indenture Trustee"), as supplemented by the Series 2002-1
Indenture Supplement, dated as of April 1, 2002 (the "Series 2002-1 Indenture
Supplement," and together with the Master Indenture, the "Indenture"), between
the Indenture Trustee and the Trust, as the same may be amended, modified or
otherwise supplemented from time to time, and the Trust, established pursuant to
the Amended and Restated Trust Agreement, dated as of April 1, 2002, as amended
and supplemented (the "Trust Agreement"), between the Transferor and Wilmington
Trust Company, as trustee (the "Owner Trustee"). The corpus of the Trust
consists of (a) a portfolio of certain receivables (the "Receivables") existing
in the revolving credit card accounts identified under the Transfer and
Servicing Agreement, dated as of April 1, 2002, as amended from time to time
(the "Transfer and Servicing Agreement"), among the Transferor, Nordstrom fsb,
as servicer (the "Servicer"), the Indenture Trustee and the Trust, as issuer,
from time to time (the "Accounts"), (b) certain funds collected or to be
collected from accountholders in respect of the Receivables, (c) all funds which
are from time to time on deposit in the Collection Account, Special Funding
Account and in the Series Accounts, (d) the benefits of any Series Enhancements
issued and to be issued by Series Enhancers with respect to one or more Series
of

                                      B-1

<PAGE>
Notes and (e) all other assets and interests constituting the Trust,
including Interchange and Recoveries allocated to the Trust pursuant to the
Transfer and Servicing Agreement. Although a summary of certain provisions of
the Transfer and Servicing Agreement, the Trust Agreement and the Indenture
(collectively, the "Agreements") is set forth below, this Certificate does not
purport to summarize the Agreements and reference is made to the Agreements for
information with respect to the interests, rights, benefits, obligations,
proceeds and duties evidenced hereby and the rights, duties and obligations of
the Owner Trustee. Capitalized terms used herein that are not otherwise defined
shall have the meanings ascribed thereto in the Agreements.

         This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreements, to which Agreements, as amended and
supplemented from time to time, the Transferor by virtue of the acceptance
hereof assents and is bound.

         The Receivables consist of Principal Receivables which arise generally
from the purchase of merchandise and services and amounts advanced to
cardholders as cash advances and Finance Charge Receivables which arise
generally from Periodic Rate Finance Charges, Late Fees and other fees and
charges with respect to the Accounts.

         This Certificate (this "Certificate") is the Transferor Certificate,
which represents the undivided beneficial interest in certain assets of the
Trust, subject to the lien of the Notes, including the right to receive a
portion of the Collections and other amounts at the times and in the amounts
specified in the Indenture. In addition to the Transferor Certificate, (a) Notes
will be issued to investors pursuant to the Indenture and (b) Supplemental
Certificates may be issued pursuant to the Trust Agreement.

         Unless otherwise specified in an Indenture Supplement with respect to a
particular Series, the Transferor has entered into the Transfer and Servicing
Agreement, and this Certificate is issued, with the intention that, for federal,
state and local income and franchise tax purposes, (a) the Notes of each Series
which are characterized as indebtedness at the time of their issuance will
qualify as indebtedness of the Transferor secured by the Receivables and (b) the
Trust shall not be treated as an association (or a publicly traded partnership)
taxable as a corporation. The Transferor by the acceptance of this Certificate,
agrees to treat the Notes for federal, state and local income and franchise tax
purposes as indebtedness of the Transferor.

         Subject to certain conditions and exceptions specified in the
Agreements, the obligations created by the Agreements and the Trust created
thereby shall terminate upon the earlier of (a) at the option of the Transferor,
the day on which the rights of all Series of Notes to receive payments from the
Trust have terminated (the "Trust Termination Date") or (b) dissolution of the
Trust in accordance with applicable law.



                                      B-2

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

         IN WITNESS WHEREOF, the Trust has caused this Certificate to be duly
executed.

                                       NORDSTROM CREDIT CARD MASTER NOTE TRUST

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

                                       By:  ____________________________________
                                              Name:
                                              Title:


Dated:   _________ __, 2002


                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

      This is the Transferor Certificate described in the Trust Agreement.

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



                                         By: ___________________________________
                                                      Authorized Signatory


                                      B-3

<PAGE>
                                                                      Annex 1 to
                                                                       Exhibit B

Registered Owner and address:

Nordstrom Credit Card Receivables LLC
13531 East Caley Avenue
Englewood, Colorado  80111

Tax Identification Number:  __________



                                      B-I-1

<PAGE>
                                                                       EXHIBIT C

                          FORM OF CERTIFICATE OF TRUST

                     NORDSTROM CREDIT CARD MASTER NOTE TRUST

         This Certificate of Trust of Nordstrom Credit Card Master Note Trust
(the "Trust") is being duly executed and filed by the undersigned, as trustee,
to form a business trust under the Delaware Business Trust Act (12 Del.
C. Section 3801 et seq.) (the "Act").

         1. Name. The name of the business trust created hereby is Nordstrom
Credit Card Master Note Trust.

         2. Delaware Trustee. The name and business address of the trustee of
the Trust having its principal place of business in the State of Delaware are
Wilmington Trust Company, Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration.

         3. Effective Date. This Certificate of Trust shall be effective upon
its filing with the Secretary of State of the State of Delaware.

         IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.

                                         WILMINGTON TRUST COMPANY,
                                         as trustee

                                         By: ___________________________________
                                             Name:
                                             Title:


                                      C-1


<PAGE>
                                                                   Exhibit 10.42




                    NORDSTROM CREDIT CARD MASTER NOTE TRUST,
                                   as Issuer,

                                       and

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
                              as Indenture Trustee

                                MASTER INDENTURE
                            Dated as of April 1, 2002

<PAGE>
                 RECONCILIATION AND TIE BETWEEN TRUST INDENTURE

                     ACT OF 1939 AND INDENTURE PROVISIONS*



<TABLE>
<CAPTION>
Trust Indenture
  Act Section                                                               Indenture Section
---------------                                                             -----------------
<S>                                                                         <C>
   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
</TABLE>


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

<PAGE>
                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                                                 Page
                                                                                                                 ----

                                   ARTICLE ONE

                                   DEFINITIONS

<S>                                                                                                              <C>
Section 1.01.  Definitions..................................................................................      2
Section 1.02.  Other Definitional Provisions................................................................     16


                                   ARTICLE TWO

                                    THE NOTES

Section 2.01.  Form Generally...............................................................................     18
Section 2.02.  Denominations................................................................................     18
Section 2.03.  Execution, Authentication and Delivery.......................................................     18
Section 2.04.  Authenticating Agent.........................................................................     19
Section 2.05.  Registration
 of and Limitations on Transfer and Exchange of Notes............................     20
Section 2.06.  Mutilated, Destroyed, Lost or Stolen Notes...................................................     21
Section 2.07.  Persons Deemed Owners........................................................................     22
Section 2.08.  Appointment of Paying Agent..................................................................     22
Section 2.09.  Access to List of Noteholders' Names and Addresses...........................................     23
Section 2.10.  Cancellation.................................................................................     23
Section 2.11.  Release of Collateral........................................................................     24
Section 2.12.  New Issuances................................................................................     24
Section 2.13.  Book-Entry Notes.............................................................................     25
Section 2.14.  Notices to Clearing Agency or Foreign Clearing Agency........................................     26
Section 2.15.  Definitive Notes.............................................................................     27
Section 2.16.  Global Notes.................................................................................     27
Section 2.17.  Meetings of Noteholders......................................................................     27
Section 2.18.  Uncertificated Classes.......................................................................     28


                                  ARTICLE THREE

                               COVENANTS OF ISSUER

Section 3.01.  Payment of Principal and Interest............................................................     29
Section 3.02.  Maintenance of Office or Agency..............................................................     29
Section 3.03.  Money for Note Payments to be Held in Trust..................................................     29
Section 3.04.  Existence....................................................................................     30
Section 3.05.  Protection of Trust..........................................................................     30
Section 3.06.  Opinions as to Collateral....................................................................     31
Section 3.07.  Performance of Obligations; Servicing of Receivables.........................................     32
</TABLE>


                                       i

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                 Page
                                                                                                                 ----

<S>                                                                                                              <C>
Section 3.08.  Negative Covenants...........................................................................     33
Section 3.09.  Statements as to Compliance..................................................................     34
Section 3.10.  Issuer May Consolidate, Etc., Only on Certain Terms..........................................     34
Section 3.11.  Successor Substituted........................................................................     36
Section 3.12.  No Other Business............................................................................     36
Section 3.13.  No Borrowing.................................................................................     36
Section 3.14.  Servicer's Obligations.......................................................................     36
Section 3.15.  Guarantees, Loans, Advances and Other Liabilities............................................     36
Section 3.16.  Capital Expenditures.........................................................................     37
Section 3.17.  Removal of Administrator.....................................................................     37
Section 3.18.  Restricted Payments..........................................................................     37
Section 3.19.  Notice of Events of Default..................................................................     37
Section 3.20.  Further Instruments and Acts.................................................................     37
Section 3.21.  Representations and Warranties as to the Security Interest of the Indenture Trustee in the
                    Receivables.............................................................................     37


                                  ARTICLE FOUR

                           SATISFACTION AND DISCHARGE

Section 4.01.  Satisfaction and Discharge of this Indenture.................................................     39
Section 4.02.  Application of Trust Money...................................................................     40


                                  ARTICLE FIVE

                      PAY OUT EVENTS, DEFAULTS AND REMEDIES

Section 5.01.  Pay Out Events...............................................................................     41
Section 5.02.  Events of Default............................................................................     41
Section 5.03.  Acceleration of Maturity; Rescission and Annulment...........................................     42
Section 5.04.  Collection of Indebtedness and Suits for Enforcement by Indenture Trustee....................     43
Section 5.05.  Remedies; Priorities.........................................................................     45
Section 5.06.  Optional Preservation of the Collateral......................................................     47
Section 5.07.  Limitation on Suits..........................................................................     47
Section 5.08.  Unconditional Rights of Noteholders to Receive Principal and Interest........................     48
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.................................................................     49
Section 5.12.  Rights of Noteholders to Direct Indenture Trustee............................................     49
Section 5.13.  Waiver of Past Defaults......................................................................     49
Section 5.14.  Undertaking for Costs........................................................................     50
</TABLE>


                                       ii

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                 Page
                                                                                                                 ----
<S>                                                                                                              <C>
Section 5.15.  Waiver of Stay or Extension Laws.............................................................     50
Section 5.16.  Sale of Receivables..........................................................................     50
Section 5.17.  Action on Notes..............................................................................     51


                                   ARTICLE SIX

                              THE INDENTURE TRUSTEE

Section 6.01.  Duties of the Indenture Trustee..............................................................     52
Section 6.02.  Notice of Pay Out Event or Event of Default..................................................     54
Section 6.03.  Rights of Indenture Trustee..................................................................     54
Section 6.04.  Not Responsible for Recitals or Issuance of Notes............................................     55
Section 6.05.  May Hold Notes...............................................................................     55
Section 6.06.  Money Held in Trust..........................................................................     55
Section 6.07.  Compensation, Reimbursement and Indemnification..............................................     55
Section 6.08.  Replacement of Indenture Trustee.............................................................     56
Section 6.09.  Successor Indenture Trustee by Merger........................................................     57
Section 6.10.  Appointment of Co-Indenture Trustee or Separate Indenture Trustee............................     57
Section 6.11.  Eligibility; Disqualification................................................................     59
Section 6.12.  Preferential Collection of Claims Against....................................................     59
Section 6.13.  Tax Returns..................................................................................     59
Section 6.14.  Representations and Covenants of the Indenture Trustee.......................................     59
Section 6.15.  Custody of the Collateral....................................................................     60


                                  ARTICLE SEVEN

          NOTEHOLDERS' LIST AND REPORTS BY INDENTURE TRUSTEE AND ISSUER

Section 7.01.  Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders.......................     61
Section 7.02.  Preservation of Information; Communications to Noteholders...................................     61
Section 7.03.  Reports by Issuer............................................................................     61
Section 7.04.  Reports by Indenture Trustee.................................................................     62


                                  ARTICLE EIGHT

                    ALLOCATION AND APPLICATION OF COLLECTIONS

Section 8.01.  Collection of Money..........................................................................     63
Section 8.02.  Rights of Noteholders........................................................................     63
Section 8.03.  Establishment of Collection Account and Special Funding Account..............................     63
Section 8.04.  Collections and Allocations..................................................................     65
</TABLE>


                                      iii

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                 Page
                                                                                                                 ----
<S>                                                                                                              <C>
Section 8.05.  Shared Principal Collections.................................................................     66
Section 8.06.  Additional Withdrawals from the Collection Account...........................................     67
Section 8.07.  Allocation of Collateral to Series or Groups.................................................     67
Section 8.08.  Excess Finance Charge Collections............................................................     67
Section 8.09.  Release of Collateral; Eligible Loan Documents...............................................     68
Section 8.10.  Opinion of Counsel...........................................................................     68


                                  ARTICLE NINE

                    DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS

Section 9.01.  Distributions and Reports to Noteholders.....................................................     70


                                   ARTICLE TEN

                             SUPPLEMENTAL INDENTURES

Section 10.01.  Supplemental Indentures Without Consent of Noteholders......................................     70
Section 10.02.  Supplemental Indentures with Consent of Noteholders.........................................     71
Section 10.03.  Execution of Supplemental Indentures........................................................     73
Section 10.04.  Effect of Supplemental Indenture............................................................     73
Section 10.05.  Conformity With Trust Indenture Act.........................................................     73
Section 10.06.  Reference in Notes to Supplemental Indentures...............................................     73


                                 ARTICLE ELEVEN

                                   TERMINATION

Section 11.01.  Termination of Trust........................................................................     74
Section 11.02.  Final Distribution..........................................................................     74
Section 11.03.  Termination Distributions...................................................................     75
Section 11.04.  Defeasance..................................................................................     75


                                 ARTICLE TWELVE

                                  MISCELLANEOUS

Section 12.01.  Compliance Certificates and Opinions, etc...................................................     77
Section 12.02.  Form of Documents Delivered to Indenture Trustee............................................     78
Section 12.03.  Acts of Noteholders.........................................................................     79
Section 12.04.  Notices, Etc. to Indenture Trustee and Issuer...............................................     80
</TABLE>


                                       iv

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                 Page
                                                                                                                 ----
<S>                                                                                                              <C>
Section 12.05.  Notices to Noteholders; Waiver..............................................................     80
Section 12.06.  Alternate Payment and Notice Provisions.....................................................     81
Section 12.07.  Conflict with Trust Indenture Act...........................................................     81
Section 12.08.  Effect of Headings and Table of Contents....................................................     81
Section 12.09.  Successors and Assigns......................................................................     81
Section 12.10.  Severability................................................................................     81
Section 12.11.  Benefits of Indenture.......................................................................     81
Section 12.12.  Legal Holidays..............................................................................     81
Section 12.13.  GOVERNING LAW...............................................................................     81
Section 12.14.  Counterparts................................................................................     82
Section 12.15.  Trust Obligations...........................................................................     82
Section 12.16.  No Petition.................................................................................     82
</TABLE>


                                       v

<PAGE>
                                MASTER INDENTURE

         This MASTER INDENTURE, dated as of April 1, 2002, is between Nordstrom
Credit Card Master Note Trust, a business trust organized under the laws of the
State of Delaware (herein, together with its permitted successors and assigns,
the "Issuer"), and Wells Fargo Bank Minnesota, National Association, a national
banking association, as indenture trustee (herein, together with its successors
in the trusts hereunder, the "Indenture Trustee").

                              PRELIMINARY STATEMENT

         The Issuer has duly authorized the execution and delivery of this
Master Indenture to provide for the issue of its asset backed notes (the
"Notes") as provided in this Master Indenture. All covenants and agreements made
by the Issuer herein are for the benefit and security of the Noteholders. The
Issuer is entering into this Master Indenture, and the Indenture Trustee is
accepting the trusts created hereby, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged.

         Simultaneously with the delivery of this Master Indenture, the Issuer
is entering into the Transfer and Servicing Agreement with Nordstrom Credit Card
Receivables LLC, a Delaware limited liability company, as Transferor (the
"Transferor"), Nordstrom fsb, a federal banking association, as Servicer (the
"Servicer"), and Wells Fargo Bank Minnesota, National Association, as Indenture
Trustee (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.

         Under the Transfer and Servicing Agreement, Receivables arising in
Accounts from time to time will be conveyed thereunder to the Issuer.

                                GRANTING CLAUSES

         The Issuer hereby Grants to the Indenture Trustee, for the benefit of
the Holders of the Notes and any Series Enhancers, 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, (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

<PAGE>
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 property conveyed to the Issuer under
any Participation Interest Supplement and the right to receive Recoveries
attributed to cardholder charges for merchandise and services in the Accounts,
(vi) the rights of the Seller under the Receivables Purchase Agreements, (vii)
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, (viii) all proceeds of any derivative contracts between the Trust and
a counterparty, as described in an Indenture Supplement, (ix) all Insurance
Proceeds relating to the Receivables, (x) any rights of the Transferor under the
Receivables Purchase Agreements, (xi) all other property of the Issuer, (xii)
all present and future claims, demands, causes and choses in action in respect
of any or all of the foregoing and (xiii) any and all proceeds of the foregoing;
in each case, including any rights of the Owner trustee and the Trust 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").

                                LIMITED RECOURSE

         The obligation of the Issuer to make payments of principal of, interest
on and other amounts with respect to, the Notes is limited by recourse only to
the Collateral.

                                  ARTICLE ONE

                                   DEFINITIONS

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

         "Account Owner" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Accounts" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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.

                                       2

<PAGE>
         "Act" has the meaning set forth in Section 12.03(a).

         "Addition Cut-Off Date" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Additional Accounts" has the meaning set forth in the Transfer and
Servicing Agreement.

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

         "Administration Agreement" means the Administration Agreement, dated as
of April 1, 2002, between the Issuer and the Administrator, as the same may be
amended, supplemented or otherwise modified from time to time.

         "Administrator" means Nordstrom fsb, or its successors and permitted
assigns, or any successor Administrator under the Administration Agreement.

         "Adverse Effect" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Affiliate" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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%.

         "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 the
         list of Authorized Officers (containing the specimen signatures of such
         officers) delivered by the Administrator to the Indenture Trustee on
         the Closing Date (as such list may be modified or supplemented from
         time to time thereafter);

                                       3

<PAGE>
                  (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 the list of Authorized Officers,
         containing the specimen signature of each such Person, delivered by the
         Transferor to the Indenture Trustee on the Closing Date (as such list
         may be modified or supplemented from time to time thereafter);

                  (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 the list of Authorized Officers, containing
         the specimen signature of each such Person, delivered by the Servicer
         to the Indenture Trustee on the Closing Date (as such list may be
         modified or supplemented from time to time thereafter); 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 the list of Authorized Officers, containing the specimen
         signature of each such Person, delivered by the Seller to the Indenture
         Trustee on the Closing Date (as such list may be modified or
         supplemented from time to time thereafter).

         "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.

         "Business Day" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Certificate of Trust" has the meaning set forth in the Trust
Agreement.

         "Certificates" has the meaning set forth in the Trust Agreement.

         "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.

         "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.

                                       4

<PAGE>
         "Clearstream" means Clearstream Banking, societe 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 Clause of this
Master Indenture.

         "Collection Account" has the meaning set forth in Section 8.03.

         "Collections" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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.

         "Defaulted Receivables" has the meaning set forth in the Transfer and
Servicing Agreement.

         "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.

         "Discount Percentage" has the meaning set forth in the Transfer and
Servicing Agreement.

                                       5

<PAGE>
         "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.

         "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 thereof (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. If so qualified, the Indenture Trustee may
be considered an Eligible Institution for the purposes of this definition.

         "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 thereof (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 be 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;

                                       6

<PAGE>
                  (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);

                  (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; or

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

         "Eligible Servicer" has the meaning set forth in the Transfer and
Servicing Agreement.

         "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 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.

         "FDIC" has the meaning specified in the Transfer and Servicing
Agreement.

         "Fitch" has the meaning set forth in the Transfer and Servicing
Agreement

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

                                       7

<PAGE>
         "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.

         "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 Master Indenture. 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.

         "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 Minnesota, National
Association, in its capacity as trustee under this Master Indenture, its
successors in interest and any successor indenture trustee under this Master
Indenture.

         "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

                                       8

<PAGE>
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.

         "Initial Accounts" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Initial Cut-Off Date" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Insolvency Event" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Insurance Proceeds" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Interchange" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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, and its successors.

         "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.

         "Lien" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Master Indenture" means this master indenture, dated as of April 1,
2002, between the Issuer and the Indenture Trustee, as the same may be amended,
supplemented 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 an 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.

         "Moody's" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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.

                                       9

<PAGE>
         "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.

         "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).

         "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 the date of determination, all Notes
theretofore authenticated and delivered under this Master Indenture 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 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
         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
         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 Outstanding
Amount of the Notes have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Notes owned by the Issuer, any other
obligor upon the Notes, the Transferor, the Servicer or any Affiliate of any
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

                                       10

<PAGE>
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.

         "Outstanding Amount" means the aggregate principal amount of all Notes
Outstanding at the date of determination and, with respect to the Notes of a
particular Series, the aggregate principal amount of all Notes of such Series
which are Outstanding at the date of determination.

         "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.

         "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.

         "Participation Interest Supplements" has the meaning set forth in the
Transfer and Servicing Agreement.

         "Pay Out Event" means, with respect to any Series, a Trust Pay Out
Event or a 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) 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.

         "Person" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Principal Receivables" has the meaning set forth in the Transfer and
Servicing Agreement.

         "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.

                                       11

<PAGE>
         "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 Date; (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.

         "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 thereof (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,
each rating agency, as specified in the applicable Indenture Supplement,
selected by the Transferor to rate the Notes of such 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 their
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

                                       12

<PAGE>
rated by any Rating Agency, the written consent of the Noteholders of such
Series or Class as specified in the Indenture Supplement for such Series.

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

         "Receivables" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Receivables Purchase Agreement" means (i) the receivables purchase
agreement, dated as of April 1, 2002, between Nordstrom fsb, as seller, and
Nordstrom Credit Card 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 or otherwise modified from time to time.

         "Recoveries" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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 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.

         "Removed Accounts" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Required Minimum Principal Balance" has the meaning set forth in the
Transfer and Servicing Agreement.

         "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 9.0%; 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

                                       13

<PAGE>
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 fsb, in its capacity as seller under the
Receivables Purchase Agreement, or any other seller under a Receivables Purchase
Agreement, and their respective successors.

         "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 any 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.

         "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.

         "Servicer" has the meaning set forth in the Transfer and Servicing
Agreement.

         "Servicer Default" has the meaning set forth in the Transfer and
Servicing Agreement.

                                       14

<PAGE>
         "Servicing Fee" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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.

         "Standard & Poor's" has the meaning set forth in the Transfer and
Servicing Agreement.

         "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 (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.

         "Termination Notice" has the meaning set forth in the Transfer and
Servicing Agreement.

         "Transaction Documents" means, with respect to any Series of Notes, the
Certificate of Trust, the Trust 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.

         "Transfer and Servicing Agreement" means the Transfer and Servicing
Agreement, dated as of April 1, 2002, among the Transferor, the Servicer, the
Indenture Trustee and the Issuer, as the same may be amended, supplemented or
otherwise modified from time to time.

         "Transfer Date" means the Business Day immediately preceding each
Distribution Date.

         "Transfer Restriction Event" has the meaning set forth in the Transfer
and Servicing Agreement.

                                       15

<PAGE>
         "Transferor" has the meaning set forth in the Transfer and Servicing
Agreement.

         "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.

         "Trust Agreement" means the Trust Agreement relating to the Trust,
dated as of April 1, 2002, between Nordstrom Credit Card Receivables LLC, as
transferor, and the Owner Trustee, as the same may be amended, supplemented or
otherwise modified from time to time.

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

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

         "Trustees" means the Indenture Trustee and the Owner Trustee.

         "UCC" shall have the meaning set forth in the Transfer and Servicing
Agreement.

         "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.

                                       16

<PAGE>
         (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 Agreement, 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 Agreement include all Exhibits hereto, (iii) references
to words such as "herein", "hereof" and the like shall refer to this Agreement
as a whole and not to any particular part, Article or Section within this
Agreement, (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 Agreement, (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.

                                       17

<PAGE>
                                  ARTICLE TWO
                                    THE NOTES

         Section 2.01. Form Generally. Any Series or Class of Notes, together
with the Indenture Trustee's certificate of authentication related thereto, may
be issued in bearer form with attached interest coupons and a special coupon or
in fully registered form and shall be in substantially the form of an exhibit to
the related 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 Definitive 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.

         Each Note will be dated the Closing Date and each Definitive Note will
be dated as of the date of its 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. Each Note shall be dated its date of authentication.

         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

                                       18

<PAGE>
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 agency 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:

                                       19

<PAGE>
         This is one of the Notes described in the within-mentioned Agreement.




                                           as Authenticating Agent
                                           for the Indenture Trustee

                                           By:
                                                --------------------------------
                                                   Authorized Signatory


         Section 2.05. Registration of and Limitations on Transfer and Exchange
of Notes. The Issuer shall cause to be kept 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.

                                       20

<PAGE>
         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 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.

         Section 2.06. Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
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 Indenture Trustee such security or indemnity as may be required
by it to hold the Issuer, the Noteholders, the Transfer Agent, the Registrar and
the Indenture Trustee harmless, then, in the absence of notice to the Issuer,
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 deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Note, a replacement Note

                                       21

<PAGE>
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 or the Indenture Trustee in connection
therewith.

         Upon the issuance of any replacement Note under this Section, the
Issuer 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. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Transferor, the Issuer or the Indenture Trustee shall treat the
Person in whose name any Note is registered as the owner of such Note for the
purpose of receiving distributions pursuant to the terms of the applicable
Indenture Supplement and for all other purposes whatsoever, whether or not such
Note is overdue, and neither the Issuer, the Transferor, the Indenture Trustee
nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be
affected by any notice to the contrary.

         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 Paying Agent.

                                       22

<PAGE>
         If and so long as any Notes are listed on the Luxembourg Stock Exchange
and such exchange shall so require, the Indenture Trustee will appoint a
co-paying agent in Luxembourg or another European city. The Indenture Trustee
will enter into any appropriate agency agreement with any co-paying agent not a
party to this Master Indenture, which will implement the provisions of this
Master Indenture that relate to such agent. The Indenture Trustee initially
appoints Kredietbank S.A. Luxembourgeoise, at its office located at 43 Boulevard
Royal, L-2955 Luxembourg, as Paying Agent for each Series of Notes listed on the
Luxembourg Stock Exchange.

         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 Outstanding Amount of
the 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

                                       23

<PAGE>
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.

         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 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 April 1, 2002) 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 any
         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;

                                       24

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

                  (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 an Indenture Supplement dated as of April 1,
2002), 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 Global Notes representing the Book-Entry Notes.

         The Global 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

                                       25

<PAGE>
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.

         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 Outstanding Amount of
         the 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.

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<PAGE>
         Section 2.15. Definitive Notes. If so specified in the related
Indenture Supplement, Notes may be issued as Definitive Notes. If (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, Beneficial Owners having an aggregate of a
majority of the Outstanding Amount of the Notes (or such other percentage as
specified in the related Indenture Supplement) of such 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).

         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

                                       27

<PAGE>
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 Indenture Supplement, any such
uncertificated Notes shall be issued in "registered form" within the meaning of
Code Section 163(f)(1).

                                       28

<PAGE>
                                 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 the city of Minneapolis, Minnesota 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 and 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 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.

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<PAGE>
         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 business 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.

         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

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<PAGE>
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 new 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 2003, 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

                                       31

<PAGE>
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 May
30 in the following calendar year.

         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. Except as otherwise expressly
provided herein or therein, the Issuer shall not waive, amend, modify,
supplement or terminate any Transaction Document or any provision thereof
without the consent of the Holders of at least 66 2/3% of the Outstanding Amount
of the Notes of each adversely affected Series.

         (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,

                                       32

<PAGE>
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 Section 3.01(b) and
Section 5.07 of the Transfer and Servicing Agreement. 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 Outstanding Amount of the 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 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:

                                       33

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

                  (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 2002), 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, 2003, the period from the Closing
         Date to January 31, 2003) 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

                                       34

<PAGE>
         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;

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

                                       35

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

                  (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.

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<PAGE>
         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).

         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 or the Trust Agreement 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 Trust 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.

                                       37

<PAGE>
                  (b) The Receivables constitute "accounts" within the meaning
         of the applicable UCC.

                  (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,
         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.

                                       38

<PAGE>
                                  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, 3.07, 3.08, 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 by the Indenture Trustee) 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;

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

                  (iii) the Issuer has delivered to the Indenture Trustee an
         Officer's Certificate, an Opinion of Counsel and (if required by the
         TIA or the Indenture Trustee) an Independent Certificate from a firm of
         certified public accountants, each meeting the applicable requirements
         of Section 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.

                                       40

<PAGE>
                                  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 Nordstrom,
         Inc., 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 Trust Pay Out
         Event;

                  (b) a Transfer Restriction Event shall occur; or

                  (c) the Trust shall become subject to registration 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 Early
Accumulation Period, as specified in the related Indenture Supplement, 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

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<PAGE>
         Outstanding Amount of the 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;

                  (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) 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
Outstanding Amount 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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<PAGE>
         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 Outstanding 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.

                                       43

<PAGE>
         (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;

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

                                       44

<PAGE>
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
         Outstanding Amount of such Notes, cause the Issuer to sell Principal
         Receivables in an amount equal to the

                                       45

<PAGE>
         Invested Amount with respect to the accelerated Series and the related
         Finance Charge Receivables (or interests therein) in accordance with
         Section 5.16;

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 Outstanding Amount of the 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 Outstanding Amount 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 Class A Notes of such Series for
         amounts due and unpaid on such Class A Notes for interest and
         principal, ratably, without preference or priority of any kind,
         according to the amounts due and payable on such Class A Notes for
         interest and principal;

                  (iii) to Holders of the Class B Notes of such Series for
         amounts due and unpaid on such Class B Notes for interest and
         principal, ratably, without preference or priority of any kind,
         according to the amounts due and payable on such Class B Notes for
         interest and principal;

                  (iv) to the Holders of the Class C Notes of such Series for
         amounts due and unpaid on such Class C Notes for interest and
         principal, ratably, without preference or priority of any kind,
         according to the amounts due and payable on such Class C Notes for
         interest and principal;

                  (v) to the Holders of all other Classes of Notes, if any, of
         such Series for amounts due and unpaid on such Notes for interest and
         principal, according to the

                                       46

<PAGE>
         amounts due and payable on each such Class of Notes for interest and
         principal, sequentially in the priority for payment under the related
         Indenture Supplement; 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, Special Funding Account or 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.

         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:

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<PAGE>
                  (a) the Holders of not less than 25% of the Outstanding Amount
         of any affected Series of Notes 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 Outstanding Amount of the 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 Outstanding
Amount of such Notes, 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.

         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

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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 Outstanding Amount of the 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 Outstanding Amount of the 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

                  (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

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<PAGE>
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.

         (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

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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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<PAGE>
                                   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 Outstanding Amount
of the 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 Outstanding Amount of the 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 Outstanding Amount of the 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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<PAGE>

                  (i) Section (b) or (d) shall not be construed to limit the
         effect of Section 601(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 Outstanding Amount of the Notes of each outstanding
         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, without
limitation, 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


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<PAGE>
only to such event of which the Indenture Trustee is deemed to have notice as
described in this subsection.

         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; and the Issuer shall
         provide a copy of such Officer's Certificate to the Noteholders at or
         prior to the time the Indenture Trustee receives such Officer's
         Certificate;

                  (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

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<PAGE>
         books, records and premises of the Issuer and the Servicer, personally
         or by agent or attorney;

                  (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,
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
Issuer shall direct the Servicer to indemnify and the Servicer shall

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<PAGE>
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 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 Outstanding Amount of the 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 Outstanding Amount of the Notes.


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<PAGE>
         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.

         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 Outstanding
Amount of the 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

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<PAGE>
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.

         (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.


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<PAGE>
         Section 6.11. Eligibility; Disqualification. The Indenture Trustee
shall at all times satisfy the requirements of TIA Section 310(a). The Indenture
Trustee shall have a combined capital and surplus of at least $50,000,000 as set
forth in its most recent published annual report of condition and its long-term
unsecured debt shall be rated at least Baa3 by Moody's, at least BBB- by
Standard & Poor's and, if rated by Fitch, at least BBB-by Fitch. The Indenture
Trustee shall comply with TIA Section 310(b), including the optional provision
permitted by the second sentence of TIA Section 310(b)(9); provided, however,
that there shall be excluded from the operation of TIA Section 310(b)(1) any
indenture or indentures under which other securities of the Issuer are
outstanding if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met.

         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 other Transaction Documents to which it is a party; and

                  (c) each of this Master Indenture and other Transaction
         Documents 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.


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         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 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.


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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


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                  (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.

         (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 required by TIA Section
313(a), within 60 days after each March 31 beginning with March 31, 2003, 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). The Indenture Trustee also shall comply with TIA Section 313(b).


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<PAGE>
                                  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 Outstanding Amount of the 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 a Default or 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 Supplement. 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

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be the "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 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 an investment manager or advisor). 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

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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."

         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 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 an investment manager or advisor).
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.

         (a) 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, if one
or more of the following conditions is satisfied: (i) Nordstrom fsb remains the
Servicer; 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 by
Standard & Poor's, not less than Prime-1 by Moody's and, if rated by Fitch, not
less than F-1 by Fitch, and Nordstrom fsb remains a wholly owned subsidiary
(directly or indirectly) of Nordstrom, Inc. and in the event that there is any
material change in the financing relationship between Nordstrom fsb and


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Nordstrom, Inc., (A) Nordstrom fsb shall have notified each Rating Agency and
(B) the Rating Agency Condition shall be satisfied with respect to such material
change, or (ii) any other arrangements are made such that the Rating Agency
Condition is satisfied with respect thereto, and for two Business Days following
any reduction of any such rating or change in ownership, 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. 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.

         (b) 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

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as of such Distribution Date (determined after giving effect to the Principal
Receivables or Participation Interests transferred to the 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 or Participation Interests conveyed to the Trust pursuant to Section
2.09 of the Transfer and Servicing Agreement or any Participation Interest
Supplement, 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.

         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,

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<PAGE>
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

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<PAGE>
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 applicable Indenture Supplement. The identity of the Noteholders with
respect to distributions and reports shall be determined according to the
immediately preceding Record Date.

                                   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 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; provided that such action shall not adversely affect the
         interests of the Holders of the Notes;

                  (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;


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                  (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; or

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

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
(i) to qualify as, and to permit an election to be made to cause the Trust to be
treated as, a "financial asset securitization investment trust" as described in
the provisions of Section 860L of the Code, and (ii) 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, without
limitation, 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 Outstanding Amount of the 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

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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);

                  (c) reduce the percentage of the Outstanding Amount of the
         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 outstanding 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.


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         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.

         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 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, 6.01 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

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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.

         Section 11.03. Termination Distributions. Upon the termination of the
Trust 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 Trust 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):

                               (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

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                  amount equal to, or (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.


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                                 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.

                  (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

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         (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
         Outstanding Amount of the 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 Outstanding Amount of the
         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 person 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 Outstanding Amount of the 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 Outstanding Amount of the 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.

         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

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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.

         (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

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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 Indenture 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 at
         Wilmington Trust Company, Rodney Square North, 1100 North Market
         Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust
         Administration, or at any other address previously furnished in writing
         to the Indenture 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, Englewood,
         Colorado 80111.

         Section 12.05. Notices to Noteholders; Waiver. Where the 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.


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         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. 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.

         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) are a 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. THE MASTER INDENTURE AND EACH NOTE SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAWS PROVISIONS (OTHER THAN SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE

                                       81

<PAGE>
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

         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, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law.


                                       82

<PAGE>
         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,
                                        as Issuer

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

                                        By:  /s/ James P. Lawler
                                             -------------------
                                             Name: James P. Lawler
                                             Title: Vice-President


                                        WELLS FARGO BANK MINNESOTA,
                                        NATIONAL ASSOCIATION,
                                        as Indenture Trustee

                                        By:  /s/ Jennifer C. Davis
                                             ---------------------
                                             Name: Jennifer C. Davis
                                             Title: Assistant Vice-President


Acknowledged and Accepted:

NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Transferor

By:  /s/ Kevin T. Knight
     -------------------
      Name: Kevin T. Knight
      Title: President

NORDSTROM fsb,
as Servicer

By:  /s/ Denny D. Dumler
     -------------------
      Name: Denny D. Dumler
      Title: President


<PAGE>
                                                                   Exhibit 10.43



================================================================================



                    NORDSTROM CREDIT CARD MASTER NOTE TRUST,
                                     Issuer

                                       and

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
                                Indenture Trustee

                       ----------------------------------

                       SERIES 2002-1 INDENTURE SUPPLEMENT

                            Dated as of April 1, 2002

                       ----------------------------------



================================================================================

<PAGE>
                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
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                                                                                                               ----
<S>            <C>                                                                                             <C>
                                                    ARTICLE ONE

                                                    DEFINITIONS

Section 1.01.  Definitions...................................................................................     1
Section 1.02.  Other Definitional Provisions.................................................................    13

                                                    ARTICLE TWO

                                        CREATION OF THE SERIES 2002-1 NOTES

Section 2.01.  Designation...................................................................................    15
Section 2.02.  Forms of Series 2002-1 Notes..................................................................    15
Section 2.03.  Registration; Registration of Transfer and Exchange...........................................    16

                                                   ARTICLE THREE

                                                   SERVICING FEE

Section 3.01.  Servicing Fee.................................................................................    24


                                                    ARTICLE FOUR

                 RIGHTS OF SERIES 2002-1 NOTEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS

Section 4.01.  Collections and Allocations...................................................................    25
Section 4.02.  Determination of Monthly Interest, Monthly Principal and Interest Rate........................    27
Section 4.03.  Application of Available Finance Charge Collections and Available Principal Collections.......    27
Section 4.04.  Investor Charge-Offs..........................................................................    30
Section 4.05.  Reallocated Principal Collections.............................................................    30
Section 4.06.  Excess Finance Charge Collections.............................................................    30
Section 4.07.  Shared Principal Collections..................................................................    30
Section 4.08.  Principal Funding Account.....................................................................    31
Section 4.09.  Reserve Account...............................................................................    31
Section 4.10.  Eligible
 Investment...........................................................................    33
</TABLE>


                                                         i

<PAGE>

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>            <C>                                                                                             <C>
                                                    ARTICLE FIVE

                DELIVERY OF SERIES 2002-1 NOTES; DISTRIBUTIONS; REPORTS TO SERIES 2002-1 NOTEHOLDERS

Section 5.01.  Delivery and Payment for the Series 2002-1 Notes..............................................    34
Section 5.02.  Distributions.................................................................................    34
Section 5.03.  Reports and Statements to Series 2002-1 Noteholders...........................................    34

                                                    ARTICLE SIX

                                            SERIES 2002-1 PAY OUT EVENTS

Section 6.01.  Series 2002-1 Pay Out Events..................................................................    36

                                                   ARTICLE SEVEN

                     REDEMPTION OF SERIES 2002-1 NOTES; FINAL DISTRIBUTIONS; SERIES TERMINATION

Section 7.01.  Optional Redemption of Series 2002-1 Notes; Final Distributions...............................    38
Section 7.02.  Series Termination............................................................................    39


                                                   ARTICLE EIGHT

                                              MISCELLANEOUS PROVISIONS

Section 8.01.  Ratification of Master Indenture; Amendments..................................................    40
Section 8.02.  Counterparts..................................................................................    40
Section 8.03.  GOVERNING LAW.................................................................................    40
Section 8.04.  Limitation of Liability.......................................................................    40
</TABLE>

                                                        ii

<PAGE>

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                 <C>                                                                                        <C>
                                                      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 Transfer Certificate - Rule 144A Global Note.......................................  E-1
EXHIBIT F           Form of Transfer Certificate - Regulation S Global Note....................................  F-1
EXHIBIT G           Form of Transfer Certificate - Class B Notes and Class C Notes.............................  G-1
EXHIBIT H           Form of Website Certificate................................................................  H-1
</TABLE>


                                                        iii

<PAGE>
                       SERIES 2002-1 INDENTURE SUPPLEMENT

         This Series 2002-1 Indenture Supplement, dated as of April 1, 2002, is
between Nordstrom Credit Card Master Note Trust, a business trust organized and
existing under the laws of the State of Delaware (herein, the "Issuer" or the
"Trust"), and Wells Fargo Bank Minnesota, National Association, a national
banking association, not in its individual capacity, but solely as indenture
trustee (herein, together with its successors in the trusts thereunder as
provided in the Master Indenture referred to below, the "Indenture Trustee")
under the Master Indenture, dated as of April 1, 2002, between the Issuer and
the Indenture Trustee.

                                   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 2002-1) 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 assigned such term 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 2002-1, (iii) the Reserve Account Draw Amount
and (iv) Principal Funding Investment Proceeds, if any.

<PAGE>
         "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
2002-1 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) and (vi) for such Distribution Date.

         "Base Rate" means, with respect to any Monthly Period, the sum of (i)
the Servicing Fee Rates, (ii) the weighted average of the Class A Note Interest
Rate, the Class B Note Interest Rate and the Class C Note Interest Rate and
(iii) 2.0%.

         "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 the actual number of days in such Interest Period, 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, whose numerator is the actual number of days in such Interest Period,
and whose denominator is 360; and (iii) the balance of the Principal Funding
Account on the first day of that Interest Period, up to the Class A Note
Principal Balance as of the related Record Date.

         "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 the actual number of days in such
Interest Period 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

                                       2

<PAGE>
last day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class A Note Initial Principal Balance).

         "Class A Note Initial Principal Balance" means $176,900,000.

         "Class A Note Interest Rate" means One-Month LIBOR plus 0.27% 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 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) 19.50% 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) 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 the actual number of days in such Interest Period 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.

         "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 the actual number of days for such Interest
Period, 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.


                                       3

<PAGE>
         "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,
the actual number of days in such Interest Period, 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 $23,100,000.

         "Class B Note Interest Rate" means One-Month LIBOR plus 0.70% 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 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) 9.0% 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) and (ii) zero.

         "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 the actual number of days in such Interest Period, 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 (which shall be zero in the case of the first 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 on the Determination Date preceding
each 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

                                       4

<PAGE>
such Distribution Date and which shall be an amount equal to the product of (i)
a fraction, the numerator of which is the actual number of days in such Interest
Period, 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 preceding Monthly Period (or, with respect to the initial Distribution
Date, the Class C Note Initial Principal Balance).

         "Class C Note Initial Principal Balance" means $19,800,000.

         "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, 2002.

         "Controlled Accumulation Amount" means, for any Distribution Date with
respect to the Controlled Accumulation Period, $25,000,000; 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 such 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
July 31, 2006 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.

         "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 for such Distribution Date and any existing
Accumulation Shortfall with respect to such Distribution Date.

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


                                       5

<PAGE>
         "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 17, 2002 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 2002-1 Final
Maturity Date, October 13, 2010.

         "Early Amortization Period" means the period commencing on the Business
Day on which a Pay Out Event with respect to Series 2002-1 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 2002-1 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 16, 2007
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 Reset Date, 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 and (ii) the denominator 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 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 2002-1, 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 2002-1.


                                       6

<PAGE>
         "Floating Investor Percentage" means, with respect to any Reset Date,
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 the greater of (a) the total amount of Principal
Receivables in the Trust as of the close of business on such Reset Date (or,
with respect to allocations of Uncovered Dilution Amounts, zero) and (b) the sum
of the numerators used to calculate the investor percentages for allocations
with respect to Finance Charge Receivables, Defaulted Amounts, Uncovered
Dilution 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 2002-1 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 the Series
2002-1 Indenture Supplement, as the same may be amended, supplemented or
otherwise modified from time to time.

         "Indenture Supplement" has the meaning specified in the Master
Indenture.

         "Initial Invested Amount" means $219,800,000.

         "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 2002-1 Notes minus the sum
of (i) amount of principal previously paid to the Series 2002-1 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.

         "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 3.01(b).

         "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

                                       7

<PAGE>
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
2002-1 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.

         "LIBOR Determination Date" means two London Business Day prior to the
Closing Date with respect to the first Distribution Date and, as to each
subsequent Distribution Date, two London Business Days prior to the immediately
preceding Distribution Date.

         "London Business Day" means any day other than a Saturday, Sunday or a
day on which banking institutions in London, England, are authorized or
obligated by law or government decree to be closed.

         "Master Indenture" means the master indenture, dated as of April 1,
2002, between the Issuer and the Indenture Trustee, as acknowledged and agreed
by the Servicer and the Transferor, as the same may be amended, modified or
supplemented from time to time (including with respect to any Series or Class,
the related Indenture Supplement).

         "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 April, the Monthly Period will be the period from
and including April 1, 2002 to and including April 30, 2002.

         "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 Principal Balance over the amount on deposit in the Principal
Funding Account without taking into account deposits therefrom 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.

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


                                       8

<PAGE>
         "Monthly Servicing Fee" means, with respect to any Distribution Date,
an amount equal to one-twelfth of the product of (i) the Servicing Fee Rate and
(ii) (a) the Adjusted Invested Amount as of the last day of the related Monthly
Period, minus (b) the product of the amount, if any, on deposit in the Special
Funding Account as of the last day of such Monthly Period and the Floating
Investor Percentage with respect to such Monthly Period; provided, however, that
with respect to the first Distribution Date, the Monthly Servicing Fee shall be
equal to $366,333.33.

         "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 and Class B 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 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.

         "One-Month LIBOR" means, with respect to any Interest Period, the
London interbank offered rate for deposits in U.S. dollars having a maturity of
one month commencing on the related LIBOR Determination Date which appears on
Telerate Page 3750, or such other source as is customarily used to quote LIBOR,
as of 11:00 a.m., London time, on such LIBOR Determination Date. If the rates
used to determine LIBOR do not appear on the Telerate Page 3750, or such other
source as is customarily used to quote LIBOR, the rates for that day will be
determined on the basis of the rates at which deposits in U.S. dollars, having a
maturity of one month and in a principal amount of not less than U.S. $1,000,000
are offered at approximately 11:00 a.m., London time, on such LIBOR
Determination Date to prime banks in the London interbank market by the
reference banks. The Indenture Trustee will request the principal London office
of each of such reference banks to provide a quotation of its rate. If at least
two such quotations are provided, the rate for that day will be the arithmetic
mean to the nearest 1/100,000 of 1% (0.0000001), with five one-millionths of a
percentage point rounded upward, of all such quotations. If fewer than two such
quotations are provided, the rate for that day will be the arithmetic mean to
the nearest 1/100,000 of 1% (0.0000001), with five one-millionths of a
percentage point rounded upward, of the offered per annum rates that one or more
leading banks in New York City, selected by the Indenture Trustee, are quoting
as of approximately 11:00 a.m., New York City time, on such LIBOR Determination
Date to leading European banks for United States dollar deposits for that
maturity; provided that if the banks selected as aforesaid are not quoting as
mentioned in this sentence, LIBOR in effect for the applicable Interest Period
will be LIBOR in effect for the previous interest period. The "Telerate Page
3750" is the display page named that on the Dow Jones Telerate Services (or any
other page that replaces that page on that service for the purpose of displaying
comparable name of rates). The reference banks are the four major banks in the
London interbank market selected by the Indenture Trustee.


                                       9

<PAGE>
         "Portfolio Adjusted Yield" shall mean, with respect to any Monthly
Period, the Portfolio Yield with respect to such Monthly Period minus the Base
Rate with respect to such Monthly Period.

         "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, (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 2002-1 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 2002 shall equal 10.68%.

         "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.

         "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 period from and
including the immediately preceding Distribution Date to but excluding such
Distribution Date.

         "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 2002-1
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 2002-1 Noteholders on one or more prior Distribution Dates.


                                       10

<PAGE>
         "Regulation D" means Regulation D under the Securities Act.

         "Regulation S" means Regulation S under the Securities Act.

         "Regulation S Global Note" has the meaning set forth in Section
2.02(b).

         "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 designates 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 2002-1 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" shall mean the Distribution Date with
respect to the Monthly Period which commences no later than three 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 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 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.


                                       11

<PAGE>
         "Rule 144A" means Rule 144A under the Securities Act.

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

         "Series 2002-1" means the Series of Notes the terms of which are
specified in this Series 2002-1 Indenture Supplement.

         "Series 2002-1 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 October 13, 2010 Distribution Date.

         "Series 2002-1 Indenture Supplement" means this series 2002-1 indenture
supplement, dated as of April 1, 2002, between the Trust and the Indenture
Trustee, as the same may be amended, supplemented or otherwise modified from
time to time.

         "Series 2002-1 Note" means a Class A Note, a Class B Note or a Class C
Note.

         "Series 2002-1 Noteholder" means a Class A Noteholder, a Class B
Noteholder or a Class C Noteholder.

         "Series 2002-1 Pay Out Event" has the meaning set forth in Section
6.01.

         "Series 2002-1 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).

         "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.

         "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 to the Successor Servicer. The
aggregate amount of Transition Expenses shall not exceed $100,000.


                                       12

<PAGE>
         "Trust Agreement" means the amended and restated trust agreement, dated
as of April 1, 2002, between the Owner Trustee and the Transferor, as the same
may be amended, supplemented or otherwise modified from time to time.

         "Uncovered Dilution Amount" means, with respect to any Monthly Period,
the excess of the Dilution Amount for such Monthly Period over the sum of (i)
any amount deposited into the Special Funding Account by the Transferor pursuant
to Section 3.09 of the Transfer and Servicing Agreement to cover the Dilution
Amount, (ii) the amount, if any, of Principal Receivables transferred to the
Trust by the Transferor to cover the Dilution Amount and (iii) the amount by
which the Transferor Interest was reduced to cover the Dilution Amount.

         "U.S. Person" means (i) a citizen or resident of the United States who
is a natural person, (ii) a corporation or a partnership (including any entity
treated as a corporation or partnership for U.S. federal income tax purposes)
created or organized in or under the laws of the United States, any state
thereof or the District of Columbia (unless, in the case of a partnership,
Treasury regulations are adopted that provide otherwise), (iii) an estate the
income of which is subject to the U.S. federal income taxation regardless of its
source or (iv) a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons (as such term is defined in the Code and Treasury regulations)
have authority to control all substantial decisions of the trust.
Notwithstanding the foregoing, to the extent provided in Treasury regulations,
certain trusts in existence prior to August 20, 1996 and treated as United
States persons prior to such date that elect to be treated as United States
persons shall also be considered "U.S. Persons."

         Section 1.02.  Other Definitional Provisions.

         (a) Each capitalized term defined herein shall relate to the Series
2002-1 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
2002-1 Indenture Supplement shall govern.

         (b) As used in this Series 2002-1 Indenture Supplement and in any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms not defined in this Series 2002-1 Indenture Supplement or in
any such certificate or other document, and accounting terms partly defined in
this Series 2002-1 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 2002-1 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 Indenture or in any such certificate or other document shall
control.

         (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.


                                       13

<PAGE>
         (d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Series 2002-1 Indenture Supplement shall refer to this
Series 2002-1 Indenture Supplement as a whole and not to any particular
provision of this Series 2002-1 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 2002-1
Indenture Supplement unless otherwise specified; and the term "including" means
"including without limitation."


                                       14

<PAGE>
                                   ARTICLE TWO

                       CREATION OF THE SERIES 2002-1 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 2002-1 Indenture
Supplement to be known as "Nordstrom Credit Card Master Note Trust, Series
2002-1" or the "Series 2002-1 Notes." The Series 2002-1 Notes shall be issued in
three Classes, the first of which shall be known as the "Series 2002-1 Floating
Rate Asset Backed Notes, Class A", the second of which shall be known as the
"Series 2002-1 Floating Rate Asset Backed Notes, Class B", and the third of
which shall be known as the "Series 2002-1 0% Asset Backed Notes, Class C". The
Series 2002-1 Notes shall be due and payable on the Series 2002-1 Final Maturity
Date.

         (b) Series 2002-1 shall be included in Group One and shall be a
Principal Sharing Series with respect to Group One only. Series 2002-1 shall be
an Excess Allocation Series with respect to Group One only. Series 2002-1 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 2002-1 Indenture
Supplement shall be controlling.

         Section 2.02.  Forms of Series 2002-1 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)      Global Notes.

                      (i) The Offered Notes offered and sold to U.S. Persons 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 and Exhibit A-2 hereto, added to the form of the
         Class A Notes ("Class-A Rule 144A Global Notes") and the Class B Notes
         ("Class-B Rule 144A Global Notes", and together with the Class A Rule
         144A Global Notes, the "Rule 144A Global Notes"), each of which 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 aggregate principal amount of the 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.

                      (ii) The Offered Notes sold in offshore transactions in
         reliance on Regulation S 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 hereto, added to the form of the Class A Notes ("Class A


                                       15

<PAGE>
         Regulation S Global Notes") and to the form of Class B Notes ("Class B
         Regulation S Global Notes", and together with the Class A Regulation S
         Global Notes, the "Regulation S Global Notes" and, together with the
         Rule 144A Global Notes, the "Global Notes"), which shall be deposited
         on behalf of the subscribers for the Class A Notes and the Class B
         Notes represented thereby with the Indenture Trustee as custodian for
         DTC and registered in the name of a nominee of DTC for the respective
         accounts of the Euroclear Operator and Clearstream or their respective
         depositories, duly executed by the Issuer and authenticated by the
         Indenture Trustee as hereinafter provided. The aggregate principal
         amount of the Regulation S 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.

         (c) Class C Notes. The Class C Notes shall be issued in the form of one
or more certificated notes in definitive, fully registered form without interest
coupons with the applicable legends set forth in Exhibit A-3, added to the form
of such Class C Notes. The Class C Notes shall be registered in the name of the
Holder or a nominee thereof, duly executed by the Issuer and authenticated by
the Indenture Trustee as hereinafter provided; provided that the Issuer may
amend this Series 2002-1 Indenture Supplement (without the consent of any
Noteholder) to permit the issuance of Class C Notes in the form of one or more
permanent global notes if the Issuer delivers to the Indenture Trustee an
Opinion of Counsel acceptable to the Indenture Trustee to the effect that the
issuance of such global note or notes would not cause the Issuer to lose its
exemption from registration, or cause it to be required to be registered, as an
investment company under the Investment Company Act or to lose the exemption for
any Class C Note from the registration provisions of the Securities Act.

         Section 2.03.  Registration; Registration of Transfer and Exchange.

         (a) No Series 2002-1 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.

         (b) No Offered Note may be offered, sold, resold or delivered, within
the United States or to, or for the benefit of, U.S. Persons 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. The Offered Notes may be
offered, sold, resold or delivered, as the case may be, in offshore transactions
to non-U.S. Persons in reliance on Regulation S. None of the Issuer, the
Indenture Trustee or any other Person may register the Offered Notes under the
Securities Act or any state securities laws.

         (c) No Class C Note may be offered, sold, resold or delivered, within
the United States or to, or for the benefit of, U.S. Persons except in
accordance with Section 2.03(f) below 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. The Class C Notes may be
offered, sold, resold or delivered, as the case may be, in offshore transactions
to non-U.S.

                                       16

<PAGE>
Persons in reliance on Regulation S. None of the Issuer, the Indenture Trustee
or any other Person may register the Class C Notes under the Securities Act or
any state securities laws.

         (d) Upon final payment due on a Series 2002-1 Note, the Holder thereof
shall present and surrender such Series 2002-1 Note at the Corporate Trust
Office or at the office of the Paying Agent (outside the United States if then
required by applicable law in the case of a note in definitive form issued in
exchange for a beneficial interest in a Regulation S Global Note pursuant to
Section 2.03(k)).

         (e) Transfers of Global Notes. 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) Regulation S Global Note to Rule 144A Global Note. If
         a holder of a beneficial interest in a Regulation S Global Note wishes
         to transfer all or a part of its interest in such Regulation S Global
         Note to a Person who wishes to take delivery thereof in the form of a
         Rule 144A Global Note, such holder may, subject to the terms hereof and
         the rules and procedures of Euroclear, Clearstream or DTC, as the case
         may be, exchange or cause the exchange of such interest for an
         equivalent beneficial interest in a Rule 144A Global Note of the same
         Class. Upon receipt by the Indenture Trustee, as Transfer Agent and
         Registrar, of (A) instructions from Euroclear, Clearstream or DTC, as
         the case may be, directing the Indenture Trustee, as Transfer Agent and
         Registrar, to cause such Rule 144A Global Note to be increased by an
         amount equal to such beneficial interest in such Regulation S Global
         Note but not less than the minimum denomination applicable to the
         related Class of Series 2002-1 Notes and (B) a certificate
         substantially in the form of Exhibit E hereto given by the prospective
         transferee of such beneficial interest and stating, among other things,
         that such transferee acquiring such interest in a Rule 144A Global Note
         is a QIB, is obtaining such beneficial interest in a transaction
         pursuant to Rule 144A and in accordance with any applicable securities
         laws of any State or any other applicable jurisdiction, then Euroclear,
         Clearstream or the Indenture Trustee, as Transfer Agent and Registrar,
         as the case may be, shall instruct DTC to reduce such Regulation S
         Global Note of the applicable Class of Series 2002-1 Notes by the
         aggregate principal amount of the interest in such Regulation S Global
         Note of the applicable Class of Series 2002-1 Notes to be transferred
         and increase the Rule 144A Global Note specified in such instructions
         by a principal amount equal to such reduction in such principal amount
         of the Regulation S Global Note of the applicable Class of Series
         2002-1 Notes.

                      (iii) Rule 144A Global Note to Regulation S Global Note.
         If a holder of a beneficial interest in a Rule 144A Global Note wishes
         to transfer all or a part of its interest in such Rule 144A Global Note
         to a Person who wishes to take delivery thereof in the form of a
         Regulation S Global Note, such holder may, subject to the terms hereof
         and the rules and procedures of Euroclear, Clearstream or DTC, as the
         case may be,

                                       17

<PAGE>
         exchange or cause the exchange of such interest for an equivalent
         beneficial interest in a Regulation S Global Note of the same Class.
         Upon receipt by the Indenture Trustee, as Transfer Agent and Registrar,
         of (A) instructions from Euroclear, Clearstream or DTC, as the case may
         be, directing the Indenture Trustee, as Transfer Agent and Registrar,
         to cause such Regulation S Global Note to be increased by an amount
         equal to the beneficial interest in such Rule 144A Global Note but not
         less than the minimum denomination applicable to the related Class of
         Series 2002-1 Notes to be exchanged and (B) a certificate substantially
         in the form of Exhibit F hereto given by the prospective transferee of
         such beneficial interest and stating, among other things, that such
         transferee acquiring such interest in a Regulation S Global Note is a
         not a U.S. Person and that such transfer is being made pursuant to Rule
         903 or 904 under Regulation S, then Euroclear, Clearstream or the
         Indenture Trustee, as Transfer Agent and Registrar, as the case may be,
         shall instruct DTC to reduce such Rule 144A Global Note of the
         applicable Class of Series 2002-1 Notes by the aggregate principal
         amount of the interest in such Rule 144A Global Note to be transferred
         and increase the Regulation S Global Note of the applicable Class of
         Series 2002-1 Notes specified in such instructions by a principal
         amount equal to such reduction in the principal amount of the Rule 144A
         Global Note of the applicable Class of Series 2002-1 Notes.

                      (iv) Other Exchanges. In the event that, pursuant to
         Section 2.03(k), 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 are
         to a non-U.S. Person, or otherwise comply with Rule 144A and Regulation
         S) and as may be from time to time adopted by the Issuer and the
         Indenture Trustee.

         (f) Transfer and Exchange of Class C Notes. Transfer of Class C Notes,
in whole or in part, shall only be made in accordance with this Section 2.03(f).

                      (i) Transfer of Class C Notes. 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. If an Opinion of Counsel has been so
         provided, Class C Notes may be transferred subject to the conditions
         set forth in this Section. Upon receipt by the Indenture Trustee, as
         Transfer Agent and Registrar, of (A) such holder's Class C Notes
         properly endorsed for assignment to the transferee, (B) the Opinion of
         Counsel discussed above in this clause and (C) a certificate in the
         form of Exhibit G hereof given by the prospective transferee of such
         beneficial interest stating (1) that the transfer of such interest has
         been made in accordance with the applicable restrictions in this Series
         2002-1 Indenture Supplement, including that the transferee either (x)
         is a QIB or (y) is not a U.S. Person and such transfer is being made
         pursuant to Rule 903 or 904 under Regulation S and (2) the transferee
         is not an employee benefit plan (as defined in Section 3(3) of ERISA),
         or any plan described in Section 4975(e)(1) of the Code or an entity
         whose underlying assets include "plan assets" by reason of an employee
         benefit plan's or plan's investment in the entity, or any other


                                       18

<PAGE>
         "benefit plan investor" (as defined in 29 C.F.R.
         Section 2510.3-101(f)(2) (each such person described in (2)(x), a
         "Benefit Plan Investor").

                      (ii) Exchange of Class C Note. If a holder of a beneficial
         interest in one or more Class C Notes wishes at any time to exchange
         such Class C Note for one or more Class C Notes of different principal
         amounts of the same Class (but not less than the minimum authorized
         denomination applicable thereto) that will be beneficially owned by
         such holder, such holder may exchange or cause the exchange of such
         interest for an equivalent beneficial interest in the Class C Note of
         the same Class as provided below. Upon receipt by the Indenture
         Trustee, as Transfer Agent and Registrar, of (A) such holder's Class C
         Note properly endorsed for such exchange and (B) written instructions
         from the Holder (or such beneficial holder, as identified by the
         Holder) of such Class C Notes designating the number and principal
         amounts of the Class C Note to be exchanged (the aggregate of such
         principal amounts being equal to the aggregate principal amount of the
         Class C Note surrendered for exchange) and certifying that such
         exchange does not represent a change in beneficial ownership, then the
         Indenture Trustee, as Transfer Agent and Registrar, shall cancel such
         Class C Notes, record the exchange in the Note Register and
         authenticate and deliver one or more Class C Notes, registered in the
         same names as the Class C Note surrendered by such holder or such
         different names as are specified in the endorsement described in clause
         (A) above, in principal amounts designated by such Holder (the
         aggregate of such amounts being equal to the beneficial interest in the
         Class C Note surrendered by such Holder).

         (g) Each transferee of an Offered Note shall be deemed to represent and
agree as follows:

                      (i) The transferee (a) (1) is a QIB, (2) is acquiring the
         Offered Notes for its own account or for the account of a QIB and (3)
         is aware that the sale of such Offered Notes to it is being made in
         reliance on Rule 144A or (b) is not a U.S. Person and is purchasing
         such Offered Notes in an offshore transaction pursuant to Regulation S.

                      (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 or Blue Sky law, 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.

                      (iii) The transferee agrees that if in the future it
         should offer, sell or otherwise transfer such Offered Note, it will do
         so only (a) 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

                                       19

<PAGE>
         Rule 144A, or (b) in an offshore transaction meeting the requirements
         of Rule 903 or 904 of Regulation S.

                      (iv) The transferee, if it is a foreign transferee outside
         the United States, acknowledges that the Class A Notes or Class B
         Notes, as applicable, will initially be represented by a Class A
         Regulation S Global Note or a Class B Regulation S Global Note, as
         applicable, and that transfers thereof are restricted as described
         herein. If it is a QIB, it acknowledges that the Class A Notes or Class
         B Notes, as applicable, offered in reliance on Rule 144A will be
         represented by a Class A Rule 144A Global Note or a Class B Rule 144A
         Global Note, as applicable.

                      (v) 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 OR BLUE SKY 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)(A) PURSUANT TO RULE 144A UNDER THE
         SECURITIES ACT ("RULE 144A") TO AN INSTITUTIONAL INVESTOR 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 OR (B) IN A TRANSACTION EFFECTED IN
         COMPLIANCE WITH REGULATION S 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
         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

                                       20

<PAGE>
         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 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."

                      (vi) 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.

                      (vii) (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).

                      (viii) It understands that the Regulation S Global Notes
         will bear a legend to the following effect unless otherwise agreed to
         by the Transferor and the Indenture Trustee:


                                       21

<PAGE>
         "THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S.
         SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), OR WITH ANY SECURITIES
         REGULATORY AUTHORITY OF ANY JURISDICTION AND, ACCORDINGLY, MAY NOT BE
         REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED
         STATES EXCEPT PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
         144A") TO AN INSTITUTIONAL INVESTOR 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 ."

                      (ix) 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 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 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.

         (h) In addition to the representations set forth in Section 2.03(g),
each beneficial owner of Regulation S Global Notes shall be deemed to have
further represented and agreed as follows:

                      (i) The owner is aware that the sale of such Offered Notes
         to it is being made in reliance on the exemption from registration
         provided by Regulation S and understands that the Offered Notes offered
         in reliance on Regulation S will bear the appropriate legend set forth
         in Exhibit A-1 or Exhibit A-2, as applicable, and be represented by one
         or more Regulation S Global Notes. The Offered Notes so represented may
         not at any time be held by or on behalf of U.S. Persons. Each of the
         owner and the related Holder is not, and shall not be, a U.S. Person.
         Before any interest in a Regulation S Global Note may be offered,
         resold, pledged or otherwise transferred to a person who takes delivery
         in the form of a Rule 144A Global Note, the transferee shall be
         required to provide the Indenture Trustee with a written certification
         substantially in the form of Exhibit E as to compliance with the
         transfer restrictions. The owner must inform a prospective transferee
         of the transfer restrictions.

         (i) Each transferee of a Class C Note shall be required to make the
representations set forth in clauses (i), (ii), (iii), (iv), (viii) and (ix) of
Section 2.03(g) with respect to the Class C Notes and to further represent and
agree as follows:

                      (i) before any interest in a Class C Note may be offered,
         resold, pledged or otherwise transferred, the transferee shall be
         required to provide the Indenture Trustee with a written certification
         substantially in the form of Exhibit G hereto as to compliance with the
         transfer restrictions and the owner must inform a prospective
         transferee of the transfer restrictions; and


                                       22

<PAGE>
                      (ii) each prospective Holder of a Class C Note shall
         represent to the Issuer, the Transferor, the Servicer and the Indenture
         Trustee that the transferee is not a Benefit Plan Investor.

         (j) Any purported transfer of a Series 2002-1 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.

         (k) 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 2002-1 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 2002-1 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 2002-1 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 2002-1 Note by such Holder.


                                       23

<PAGE>
                                  ARTICLE THREE

                                  SERVICING FEE

         Section 3.01.  Servicing Fee.

         (a) Servicing Compensation. The share of the Servicing Fee allocable to
the Series 2002-1 Noteholders with respect to any Distribution Date shall be
equal to the Monthly Servicing Fee. 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 2002-1 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 2002-1 Indenture Supplement, the Master Indenture and
the Transfer and Servicing Agreement.


                                       24

<PAGE>
                                  ARTICLE FOUR

                       RIGHTS OF SERIES 2002-1 NOTEHOLDERS
                  AND ALLOCATION AND APPLICATION OF COLLECTIONS

         Section 4.01.  Collections and Allocations.

         (a) Allocations. Collections of Finance Charge Receivables and
Principal Receivables and Defaulted Receivables allocated to Series 2002-1
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 after the
application of 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 to
         the extent such amount is deposited in the Collection Account; 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.

         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 2002-1 Notes pursuant to Section
7.01 of this Series 2002-1 Indenture Supplement.

         (c) Allocations to the Series 2002-1 Noteholders. The Servicer shall,
prior to the close of business on any Deposit Date, allocate to the Series
2002-1 Noteholders the following amounts as set forth below:

                  (i) Allocations of Finance Charge Collections. The Servicer
         shall allocate to the Series 2002-1 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 on such Deposit Date.

                  (ii) Allocations of Principal Collections. The Servicer shall
         allocate to the Series 2002-1 Noteholders the following amounts as set
         forth below:

                           (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


                                       25

<PAGE>
                  Collection Account on such Deposit Date shall be allocated to
                  the Series 2002-1 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 only 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 2002-1 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 2002-1 Noteholders of
                  Principal Receivables during the 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 only 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 2002-1 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 2002-1 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.


                                       26

<PAGE>
         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 2002-1
Noteholders on the related Distribution Date, including, but not limited to, 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 Transferor may in its sole discretion increase the Class C Note
Interest Rate; provided, however, any increase resulting in a Class C Note
Interest Rate in excess of 9.0% will require Rating Agency approval and
satisfaction of the Rating Agency Condition

         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 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 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;

                                       27

<PAGE>
                      (iv) an amount equal to 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 2002-1 and acceleration of the maturity of the Series
         2002-1 Notes, the balance, if any, up to the outstanding principal
         amount of the Series 2002-1 Notes will be treated as Available
         Principal Collections for that Distribution Date for distribution to
         the Series 2002-1 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 as described in 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;
         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


                                       28

<PAGE>
         Funding Account shall be treated as Shared Principal Collections and
         applied in accordance with Section 8.05 of the Master Indenture.

                  (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, if any, 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, if any, 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, 2006; 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

                                       29

<PAGE>
         July 2006 Distribution Date, and each Determination Date thereafter
         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. 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, on any
Distribution Date, the sum of the Investor Default Amount and the Investor
Uncovered Dilution Amount for such Distribution Date 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, the Invested Amount
(after giving effect to any reductions for any Reallocated Principal Collections
on such Distribution Date) will be reduced by the amount of such excess, but not
by more than the lesser of (i) the sum of the Investor Default Amount and the
Investor Uncovered Dilution Amount and (ii) the Invested Amount (after giving
effect to any reductions for any Reallocated Principal Collections on such
Distribution Date) for such Distribution Date (such reduction, an "Investor
Charge-Off").

         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, 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 2002-1 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 2002-1 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
2002-1 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 2002-1 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
2002-1 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.


                                       30

<PAGE>
         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, on
behalf of the Trust, for the benefit of the Series 2002-1 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 2002-1 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 2002-1 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
2002-1 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 the Principal Funding Account
to the Collection Account the Principal Funding Investment Proceeds on deposit
in the Principal Funding Account 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 2002-1 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, on behalf 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"),

                                       31

<PAGE>
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Offered 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 Offered 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
2002-1 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
2002-1 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 for any Distribution Date the Reserve Account
Draw Amount is greater than zero, the Reserve Account Draw Amount shall be
withdrawn from the Reserve Account on such Distribution Date 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.


                                       32

<PAGE>
         (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 Offered
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 2002-1 Indenture Supplement.

         Section 4.10. Eligible Investment.

         (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.


                                       33

<PAGE>
                                  ARTICLE FIVE


                        DELIVERY OF SERIES 2002-1 NOTES;
               DISTRIBUTIONS; REPORTS TO SERIES 2002-1 NOTEHOLDERS

         Section 5.01. Delivery and Payment for the Series 2002-1 Notes. The
Issuer shall execute and issue, and the Indenture Trustee shall authenticate,
the Series 2002-1 Notes in accordance with Section 2.03 of the Master Indenture.
The Indenture Trustee shall deliver the Series 2002-1 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 2002-1 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 2002-1 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 2002-1 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
2002-1 Indenture Supplement.

         (e) Except as provided in Section 11.02 of the Indenture with respect
to a final distribution, distributions to Series 2002-1 Noteholders hereunder
shall be made by (i) check mailed to each Series 2002-1 Noteholder (at such
Noteholder's address as it appears in the Note Register), except that with
respect to any Series 2002-1 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 2002-1 Note or the
making of any notation thereon.

         Section 5.03. Reports and Statements to Series 2002-1 Noteholders.

         (a) On each Distribution Date, the Paying Agent, on behalf of the
Indenture Trustee, shall forward to each Series 2002-1 Noteholder a statement
substantially in the form of Exhibit C prepared by the Servicer.


                                       34

<PAGE>
         (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 each statement or certificate provided pursuant to
Section 5.03(a) or (b) may be obtained by any Series 2002-1 Noteholder by a
request in writing to the Servicer.

         (d) On or before January 31 of each calendar year, beginning with
calendar year 2003, 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 2002-1 Noteholder, a statement prepared by
the Servicer containing the information which is required to be contained in the
statement to Series 2002-1 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 2002-1 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 2002-1 Noteholders under paragraph (a) of this Section
and the statement required to be forwarded to the Series 2002-1 Noteholders
under paragraph (d) of this Section 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 upon receipt by the
Paying Agent and the Indenture Trustee from such Person of a certification in
the form of Exhibit H, provided however, at the Indenture Trustee or its agent
shall provide such password to the parties to this Agreement without requiring
such certification. 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.ABSNet.net" or at such other address as shall be specified by the Indenture
Trustee from time to time in writing to the Series 2002-1 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 Agreement.



                                       35

<PAGE>
                                  ARTICLE SIX

                          SERIES 2002-1 PAY OUT EVENTS

         Section 6.01. Series 2002-1 Pay Out Events. If any one of the following
events shall occur with respect to the Series 2002-1 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 2002-1 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 2002-1
         Indenture Supplement, which failure has a material adverse effect on
         the Series 2002-1 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 2002-1 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
         2002-1 Notes and as a result of which the interests of the Series
         2002-1 Noteholders are materially and adversely affected for such
         period; provided, however, that a Series 2002-1 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 or Participation Interests 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 Yields for any three
         consecutive Monthly Periods is reduced to a rate which is less than the
         average of the Base Rates for such period;


                                       36

<PAGE>
                  (f) the Offered Notes Principal Balance shall not be paid in
         full on the Expected Final Principal Payment Date;

                  (g) an Insolvency Event occurs with respect to Nordstrom,
         Inc., the Transferor (including any additional Transferor), the Bank,
         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 Bank is unable for any reason to transfer Receivables
         to the Trust in accordance with the Receivables Purchase Agreement;

                  (i) the Trust becomes subject to regulation as an "investment
         company" within the meaning of the Investment Company Act of 1940; or

                  (j) without limiting the foregoing, the occurrence of an Event
         of Default with respect to Series 2002-1 and acceleration of the
         maturity of the Series 2002-1 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 2002-1 Notes evidencing at least 25%
of the aggregate unpaid principal amount of Series 2002-1 Notes by notice then
given in writing to the Transferor and the Servicer (and to the Indenture
Trustee if given by the Series 2002-1 Noteholders) may declare that a "Series
Pay Out Event" with respect to Series 2002-1 (a "Series 2002-1 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 2002-1
Pay Out Event shall occur without any notice or other action on the part of the
Indenture Trustee or the Series 2002-1 Noteholders immediately upon the
occurrence of such event.



                                       37

<PAGE>
                                 ARTICLE SEVEN

   REDEMPTION OF SERIES 2002-1 NOTES; FINAL DISTRIBUTIONS; SERIES TERMINATION

         Section 7.01. Optional Redemption of Series 2002-1 Notes; Final
Distributions.

         (a) On any day occurring on or after the date on which the outstanding
principal balance of the Series 2002-1 Notes is reduced to 10% or less of the
initial Note Principal Balance, the Servicer shall have the option to redeem the
Series 2002-1 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
optional redemption. Not later than 12:00 noon, New York City time, on such day
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 2002-1
shall be reduced to zero and the Series 2002-1 Noteholders shall have no further
security interest in the Receivables. The Reassignment Amount shall be
distributed as set forth in Section 7.01(d).

                  (c) (i) The amount to be paid by the Transferor with respect
         to Series 2002-1 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 2002-1 in connection with a repurchase 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

         (d) With respect to the Reassignment Amount deposited into the
Collection Account pursuant to Section 7.01, 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: (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 

                                       38

<PAGE>
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.

         (e) Notwithstanding anything to the contrary in this Series 2002-1
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 2002-1 Noteholders shall be deemed distributed
in full to the Series 2002-1 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 7.02. Series Termination. On the Series 2002-1 Final Maturity
Date, the right of the Series 2002-1 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.



                                       39

<PAGE>
                                 ARTICLE EIGHT

                            MISCELLANEOUS PROVISIONS

         Section 8.01. Ratification of Master Indenture; Amendments. As
supplemented by this Series 2002-1 Indenture Supplement, the Master Indenture is
in all respects ratified and confirmed and the Master Indenture as so
supplemented by this Series 2002-1 Indenture Supplement shall be read, taken and
construed as one and the same instrument. This Series 2002-1 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
2002-1 Indenture Supplement, the Series 2002-1 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
2002-1 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 2002-1 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 2002-1 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 Agreement 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 Agreement 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.




                                       40

<PAGE>
         IN WITNESS WHEREOF, the undersigned have caused this Series 2002-1
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,
                                        as Issuer

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

                                        By:  /s/ James P. Lawler
                                             -----------------------------------
                                             Name: James P. Lawler
                                             Title: Vice-President


                                        WELLS FARGO BANK MINNESOTA, 
                                        NATIONAL ASSOCIATION,
                                        as Indenture Trustee

                                        By:  /s/ Jennifer C. Davis
                                             -----------------------------------
                                             Name: Jennifer C. Davis
                                             Title: Assistant Vice-President

Acknowledged and Accepted:

NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Transferor

By:  /s/ Kevin T. Knight
     -----------------------------------
     Name: Kevin T. Knight
     Title: President

NORDSTROM fsb,
as Servicer

By:  /s/ Denny D. Dumler
     -----------------------------------
     Name: Denny D. Dumler
     Title: President

<PAGE>
                                                                     EXHIBIT A-1


                       FORM OF SERIES 2002-1 FLOATING RATE
                           ASSET BACKED NOTE, CLASS A

                           [REGULATION S GLOBAL NOTE]

                             [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 OR
BLUE SKY 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)(A) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO AN INSTITUTIONAL INVESTOR
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 OR (B) IN A TRANSACTION EFFECTED IN COMPLIANCE WITH REGULATION S 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



                                     A-1-1

<PAGE>
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
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 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.

No. [Reg. S/R-1] [144A/R-1]                                   Up to $176,900,000

[CUSIP NO. ___________]
[CUSIP NO. ___________]

Class A Note Rate:  One-Month LIBOR plus 0.27%

                     NORDSTROM CREDIT CARD MASTER NOTE TRUST

             SERIES 2002-1 FLOATING RATE ASSET BACKED NOTE, CLASS A

         Nordstrom Credit Card Master Note Trust (herein referred to as the
"Issuer" or the "Trust"), a Delaware statutory business trust governed by a
Trust Agreement, dated April 1, 2002 (the "Trust Agreement"), between Nordstrom
Credit Card Receivables 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 ONE HUNDRED SEVENTY-SIX MILLION NINE
HUNDRED THOUSAND DOLLARS, or such greater or lesser amount as determined in

                                     A-1-2

<PAGE>
accordance with the Indenture, on the Series 2002-1 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 October 13, 2010 Distribution Date), except
as otherwise provided below or in the Indenture. The Issuer will pay interest on
the unpaid principal amount of this Note at One-Month LIBOR plus 0.27% 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, the Closing Date) to but excluding the current Distribution Date. Interest
will be computed on the basis of the actual number of 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.

         "LIBOR Determination Date" means two London Business Day prior to the
Closing Date with respect to the first Distribution Date and, as to each
subsequent Distribution Date, two London Business Days prior to the immediately
preceding Distribution Date.

         "London Business Day" means any day other than a Saturday, Sunday or a
day on which banking institutions in London, England, are authorized or
obligated by law or government decree to be closed.

         "One-Month LIBOR" means, with respect to any Interest Period, the
London interbank offered rate for deposits in U.S. dollars having a maturity of
one month commencing on the related LIBOR Determination Date which appears on
Telerate Page 3750, or such other source as is customarily used to quote LIBOR,
as of 11:00 a.m., London time, on such LIBOR Determination Date. If the rates
used to determine LIBOR do not appear on the Telerate Page 3750, or such other
source as is customarily used to quote LIBOR, the rates for that day will be
determined on the basis of the rates at which deposits in U.S. dollars, having a
maturity of one month and in a principal amount of not less than U.S. $1,000,000
are offered at approximately 11:00 a.m., London time, on such LIBOR
Determination Date to prime banks in the London interbank market by the
reference banks. The Indenture Trustee will request the principal London office
of each of such reference banks to provide a quotation of its rate. If at least
two such quotations are provided, the rate for that day will be the arithmetic
mean to the nearest 1/100,000 of 1% (0.0000001), with five one-millionths of a
percentage point rounded upward, of all such quotations. If fewer than two such
quotations are provided, the rate for that day will be the arithmetic mean to
the nearest 1/100,000 of 1% (0.0000001), with five one-millionths of a
percentage point rounded upward, of the offered per annum rates that one or more
leading banks in New York City, selected by the Indenture Trustee, are quoting
as of approximately 11:00 a.m., New York City time, on such LIBOR Determination
Date to leading European banks for United States dollar deposits for that
maturity; provided that if the banks selected as aforesaid are not quoting as
mentioned in this sentence, LIBOR in effect for the applicable Interest Period
will be LIBOR in effect for the previous interest period. The "Telerate Page
3750" is the display page named that on the Dow Jones Telerate Services (or any
other page that replaces that page on that service for the purpose of displaying
comparable name of rates). The reference banks are the four major banks in the
London interbank market selected by the Indenture Trustee.


                                     A-1-3

<PAGE>
         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 2002-1
Indenture Supplement referred to on the reverse hereof, or be valid for any
purpose.




                                     A-1-4

<PAGE>
         IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be duly
executed.

                                        NORDSTROM CREDIT CARD MASTER NOTE TRUST,
                                          as Issuer

                                        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 MINNESOTA, 
                                        NATIONAL ASSOCIATION,
                                          as Indenture Trustee

                                        By:
                                             -----------------------------------
                                             Authorized Signatory




                                     A-1-5

<PAGE>
                     NORDSTROM CREDIT CARD MASTER NOTE TRUST
             SERIES 2002-1 FLOATING RATE 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
Issuer, designated as Nordstrom Credit Card Master Note Trust, Series 2002-1
(the "Series 2002-1 Notes"), issued under a Master Indenture, dated as of April
1, 2002 (the "Master Indenture") between the Issuer and Wells Fargo Bank
Minnesota, National Association, as indenture trustee (the "Indenture Trustee"),
as supplemented by