This short form prospectus is referred to as a base shelf prospectus and has been filed under legislation in each of the provinces and territories of Canada that permits certain information about these securities to be determined after this prospectus has become final and that permits the omission from this prospectus of that information. The legislation requires the delivery to purchasers of a pricing supplement containing the omitted information within a specified period of time after agreeing to purchase any of these securities.

No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. This short form base shelf prospectus, together with each document deemed to be incorporated by reference herein, constitutes a public offering of these securities only in those jurisdictions where they may be lawfully offered for sale and therein only by persons permitted to sell such securities. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States, except in certain transactions exempt from the registration requirements of such Act.

Information has been incorporated by reference in this short form base shelf prospectus from documents filed with the securities commissions or similar authorities in Canada. Copies of the documents incorporated by reference may be obtained on request without charge from Bank of Montreal, Corporate Secretary’s Department, 100 King Street West, 1 First Canadian Place, 21st Floor, Toronto, Ontario, M5X 1A1, telephone: (416) 867-6785 and are also available electronically at www.sedar.com.

SHORT FORM BASE SHELF PROSPECTUS

Initial Public Offering April 30, 2013

MASTER CREDIT CARD TRUST II

Up to $4,000,000,000 Credit Card Receivables-Backed Notes

Master Credit Card Trust II™ (the “Issuer” or the “Trust”) may, from time to time, during the 25 months that this short form base shelf prospectus, including any amendments hereto (the “Prospectus”) remains valid, offer and issue credit card receivables-backed notes (the “Notes”) in an aggregate principal amount not to exceed $4,000,000,000. The Notes will be issued in series (each a “Series”), each of which will evidence debt obligations of the Trust secured by, and with recourse limited to, credit card receivables and certain other assets acquired by the Trust from Bank of Montreal (the “Seller”). The head and registered office of the Trust is located at the office of Computershare Trust Company of Canada, the trustee of the Trust (in such capacity, the “Issuer Trustee”) located at 100 University Avenue, 9th Floor, Toronto, Ontario M5J 2Y1.

It will be a condition of the issuance of any Notes that they shall have received an Approved Rating as hereinafter defined from at least two Rating Agencies.

The offering of Notes hereunder will be made pursuant to the medium term note program of the Trust (the “MTN Program”) as contemplated by National Instrument 44-102 — Shelf Distributions of the Canadian securities administrators (the “National Instrument”). The National Instrument permits the omission from the Prospectus of certain terms of the Notes, which will be established at the time of the offering and the sale of the Notes and will be included in pricing supplements incorporated by reference herein, as more particularly described under the heading “Documents Incorporated by Reference”. Accordingly, the specific terms of Notes to be offered and sold hereunder pursuant to the MTN Program will be set out in pricing supplements delivered to purchasers in connection with the sale of such Notes. The Notes will be denominated in, and the principal of, and interest (if any) on, the Notes will be payable in Canadian dollars or United States dollars. The interest rate (if any) applicable to the Notes may be fixed or variable or calculated in some other manner as set out in the applicable pricing supplement. The specific designation, aggregate principal amount, currency of denomination and payment, interest payment dates, authorized denominations, maturity, offering price, or other specific terms of a particular issue of Notes will also be set forth in the applicable pricing supplement.

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RATES ON APPLICATION

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The Notes will be offered severally by one or more dealers as may be appointed from time to time by the Issuer (collectively, the “Dealers”), as agents of the Issuer or as principals, subject to confirmation by the Issuer pursuant to the agreement

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referred to under the heading “Plan of Distribution”. The rate of commission payable in connection with sales of the Notes by the Dealers will be as determined from time to time by mutual agreement. The Notes may be purchased from time to time by any of the Dealers, as principal, at such prices as may be agreed to between the Issuer and such Dealer, for resale to the public at prices to be negotiated with purchasers. Such resale prices may vary during the period of distribution and as between purchasers. Commissions may be paid in connection with such purchases and the Dealer’s compensation will be increased or decreased by the amount by which the aggregate price paid for the Notes by purchasers exceeds or is less than the aggregate price paid by such Dealer to the Issuer for the Notes. The Issuer may also offer the Notes directly to the public from time to time pursuant to any applicable statutory registration exemptions at such prices and upon such terms as may be agreed upon by the Issuer and the purchaser. The commission payable, if any, will be set forth in the applicable pricing supplement. The Issuer and, if applicable, the Dealers reserve the right to reject any offer to purchase Notes in whole or in part. The Issuer also reserves the right to withdraw, cancel or modify an offering of Notes under the Prospectus without notice. The offering of Notes is subject to approval of legal matters on behalf of the Trust and the Seller by Osler, Hoskin and Harcourt LLP and on behalf of the Dealers by Bennett Jones LLP.

BMO Nesbitt Burns Inc. is an indirect wholly-owned subsidiary of Bank of Montreal. As a result of the relationship between Bank of Montreal (and its affiliates) and the Trust, the Trust may be considered to be a “connected issuer” of BMO Nesbitt Burns Inc. under applicable securities legislation. See “Plan of Distribution”.

The Notes are being offered on a continuous basis by the Issuer through the Dealers. The Notes will not be listed on any securities exchange. There is no market through which the Notes may be sold and purchasers may not be able to resell Notes purchased under the Prospectus. This may affect the pricing of the securities in any secondary market, the transparency and availability of trading prices, the liquidity of the securities, and the extent of issuer regulation. Each Dealer expects, but is not obligated, to make a market in the Notes for which it is a Dealer. If such a market develops, there is no assurance that it will continue. See “Risk Factors” for a discussion of certain factors that should be considered by prospective purchasers of the Notes.

The Notes, if issued on the date hereof, would not be precluded as investments under certain statutes as set out under “Eligibility for Investment”.

THE NOTES WILL REPRESENT SECURED DEBT OBLIGATIONS OF THE TRUST ONLY, WITH RECOURSE LIMITED TO THE SECURED PROPERTY ALLOCATED TO THE NOTEHOLDERS AS DESCRIBED HEREIN, AND WILL NOT REPRESENT INTERESTS IN OR OBLIGATIONS OF, OR GUARANTEED OR INSURED BY, BANK OF MONTREAL, COMPUTERSHARE TRUST COMPANY OF CANADA (OTHER THAN IN ITS CAPACITY AS TRUSTEE OF THE TRUST), BNY TRUST COMPANY OF CANADA, THE DEALERS, THE BENEFICIARIES OF THE TRUST OR ANY AFFILIATE OF ANY OF THE FOREGOING. NONE OF THESE ENTITIES HAS REPRESENTED OR UNDERTAKEN THAT THE RECEIVABLES AND THE RELATED ASSETS WILL REALIZE THEIR FACE VALUE OR ANY PART THEREOF AND, ACCORDINGLY, NEITHER THE TRUST NOR ITS CREDITORS WILL HAVE ANY CLAIM AGAINST ANY OF THESE ENTITIES FOR ANY DEFICIENCY ARISING IN THE REALIZATION OF THE RECEIVABLES AND THE RELATED ASSETS. THE TRUST IS NOT A TRUST COMPANY AND DOES NOT CARRY ON OR INTEND TO CARRY ON THE BUSINESS OF A TRUST COMPANY. THE NOTES ARE NOT “DEPOSITS” WITHIN THE MEANING OF THE CANADA DEPOSIT INSURANCE CORPORATION ACT AND NEITHER THE NOTES NOR THE UNDERLYING ACCOUNTS OR RECEIVABLES ARE INSURED OR GUARANTEED BY THE CANADA DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

TABLE OF CONTENTS

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DOCUMENTS INCORPORATED BY REFERENCE .............................................................................................................. 5 ELIGIBILITY FOR INVESTMENT .......................................................................................................................................... 6 TRANSACTION STRUCTURE SUMMARY .......................................................................................................................... 6 TRANSACTION STRUCTURE .............................................................................................................................................. 10 THE TRUST ............................................................................................................................................................................ 10 THE SELLER ........................................................................................................................................................................... 10 THE TRUSTEES ...................................................................................................................................................................... 11

Issuer Trustee ............................................................................................................................................................. 11 Indenture Trustee ........................................................................................................................................................ 11

THE ADMINISTRATOR ......................................................................................................................................................... 11 TRUST ASSETS ...................................................................................................................................................................... 11 THE CREDIT CARD BUSINESS OF BANK OF MONTREAL ............................................................................................ 12

General ....................................................................................................................................................................... 12 Acquisition and Use of Credit Cards .......................................................................................................................... 13 Collection of Delinquent Accounts ............................................................................................................................ 13 Interchange ................................................................................................................................................................. 13

THE ACCOUNTS .................................................................................................................................................................... 14

General ....................................................................................................................................................................... 14 Billing and Payments .................................................................................................................................................. 14

MASTER TRUST PROVISIONS ............................................................................................................................................ 15

Acquisition of Additional Trust Assets ...................................................................................................................... 15 Redeemed Accounts ................................................................................................................................................... 17 Outstanding Series ...................................................................................................................................................... 17 New Issuances ............................................................................................................................................................ 18 Collection Account ..................................................................................................................................................... 19 Deposits in Collection Account .................................................................................................................................. 20 Excess Funding Account ............................................................................................................................................ 21 Allocations Among Series .......................................................................................................................................... 22

SERIES PROVISIONS ............................................................................................................................................................ 23

General ....................................................................................................................................................................... 23 Interest ........................................................................................................................................................................ 23 Principal ..................................................................................................................................................................... 25 Postponement of Accumulation Period ...................................................................................................................... 27 Allocations and Reallocations .................................................................................................................................... 27 Reallocations Among Securities of Different Series .................................................................................................. 28 Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections ...................................... 30 Subordination ............................................................................................................................................................. 34 Allocation of Investor Principal Collections .............................................................................................................. 36 Principal Funding Account ......................................................................................................................................... 37 Payments .................................................................................................................................................................... 37 Defaulted Receivables; Recoveries; Rebates and Fraudulent Charges ....................................................................... 38 Investor Charge-Offs; Other Reductions of the Allocated Amount ........................................................................... 38 Cash Collateral Account ............................................................................................................................................. 39 Amortization Events ................................................................................................................................................... 40 Events of Default ........................................................................................................................................................ 42 Sale of Receivables..................................................................................................................................................... 43 Servicing Compensation and Payment of Expenses ................................................................................................... 45 Record Date ................................................................................................................................................................ 45

TABLE OF CONTENTS (continued)

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Optional Termination; Final Payment of Principal ..................................................................................................... 45 Reports ....................................................................................................................................................................... 46 List of Noteholders ..................................................................................................................................................... 46

THE RECEIVABLES PURCHASE AGREEMENT AND THE NOTE ISSUANCE AGREEMENT GENERALLY ........... 47

The Seller Note ........................................................................................................................................................... 47 Conveyance of Receivables ........................................................................................................................................ 47 Representations and Warranties ................................................................................................................................. 48 Indemnification .......................................................................................................................................................... 49 Collection and Other Servicing Procedures ................................................................................................................ 50 Servicer Covenants ..................................................................................................................................................... 50 Certain Matters Regarding the Servicer ..................................................................................................................... 51 Servicer Default .......................................................................................................................................................... 51 Evidence as to Compliance......................................................................................................................................... 52 Amendments ............................................................................................................................................................... 53

MATERIAL CONTRACTS ..................................................................................................................................................... 53 RISK FACTORS ...................................................................................................................................................................... 54

Series Considerations ................................................................................................................................................. 54 Master Trust Considerations ....................................................................................................................................... 57

PLAN OF DISTRIBUTION ..................................................................................................................................................... 60 SELLER’S SECURITIES LAW INDEMNITY COVENANT ................................................................................................ 61 USE OF PROCEEDS ............................................................................................................................................................... 61 RATINGS ................................................................................................................................................................................. 61 BOOK-ENTRY REGISTRATION .......................................................................................................................................... 65

Book-Entry Registration ............................................................................................................................................. 65 Definitive Notes ......................................................................................................................................................... 65

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS ........................................................................... 65

Interest ........................................................................................................................................................................ 66 Disposition ................................................................................................................................................................. 66 Refundable Tax .......................................................................................................................................................... 67

AUDITORS, TRANSFER AGENT AND REGISTRAR ......................................................................................................... 67 PROMOTER ............................................................................................................................................................................ 67 INTEREST OF EXPERTS ....................................................................................................................................................... 67 LEGAL MATTERS .................................................................................................................................................................. 67 STATUTORY RIGHTS OF WITHDRAWAL AND RESCISSION ....................................................................................... 67 UNDERTAKING ..................................................................................................................................................................... 67 CERTIFICATE OF THE TRUST AND THE PROMOTER...................................................................................................... 1 CERTIFICATE OF THE DEALERS ......................................................................................................................................... 2

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DOCUMENTS INCORPORATED BY REFERENCE

Information has been incorporated by reference in the Prospectus from documents filed with securities commissions or similar authorities in Canada. Copies of the documents incorporated herein by reference may be obtained on request without charge from the Corporate Secretary’s Department, Bank of Montreal, 100 King Street West, 1 First Canadian Place, 21st Floor, Toronto, Ontario, M5X 1A1, telephone: (416) 867-6785. For the purposes of the Province of Québec, this simplified prospectus contains information to be completed by consulting the permanent information record. A copy of the permanent information record may be obtained from Bank of Montreal at the above-mentioned address and telephone number.

The following documents filed with the various securities commissions or similar securities regulatory authorities in each of the provinces and territories of Canada are incorporated by reference into the Prospectus:

(a) the Annual Information Form of the Trust dated April 30, 2013;

(b) the audited annual financial statements of the Trust for the year ended December 31, 2012, together with the auditors’ report thereon together with management’s discussion and analysis of financial condition and results of operations in respect thereof;

(c) the comparative audited annual financial statements of Master Credit Card Trust for the years ended December 31, 2012 and December 31, 2011, together with the auditors’ report thereon together with management’s discussion and analysis of financial condition and results of operations in respect thereof; and

(d) the Trust’s portfolio data as at February 28, 2013 pertaining to the Trust Assets.

Any annual information forms, material change reports (excluding confidential reports), any other disclosure document filed pursuant to an undertaking to a provincial or territorial securities regulatory authority, comparative annual and interim financial statements and related auditors’ reports and management discussion and analysis and annual filings filed by the Issuer with the securities regulatory authorities in each of the provinces and territories of Canada subsequent to the date of the Prospectus and prior to the termination of the offering shall be deemed to be incorporated by reference into the Prospectus. All shelf information omitted from the Prospectus will be contained in one or more pricing supplements that will be delivered to purchasers together with the Prospectus. A pricing supplement containing the specific terms in respect of an offering of Notes will be delivered to purchasers of such Notes together with the Prospectus and will be deemed to be incorporated by reference into the Prospectus for purposes of securities legislation as of the date of such pricing supplement, but only for purposes of the offering of such Notes (unless otherwise expressly provided therein). Upon a new annual information form and the related annual financial statements being filed by the Issuer with, and where required, accepted by, the applicable securities regulatory authorities during the currency of the Prospectus, the previous annual information form, the previous annual financial statements and all interim financial statements, material change reports and information circulars filed prior to the commencement of the Issuer’s financial year in which the new annual information form was filed shall be deemed no longer to be incorporated into the Prospectus for purposes of future offers and sales of Notes hereunder. The Administrator may post on www.sedar.com from time to time certain information pertaining to the Trust Assets. Any such posted information will be incorporated by reference into the Prospectus for purposes of securities legislation as at the date of such posting. Upon new data being posted by Bank of Montreal, as Administrator of the Trust, the previously posted data shall be deemed no longer incorporated into the Prospectus for purposes of future offers and sales of Notes hereunder.

Except as referenced above, no other document or information is incorporated by reference in, or forms part of, the Prospectus.

Any statement contained in this Prospectus or in a document incorporated or deemed to be incorporated by reference herein will be deemed to be modified or superseded for the purposes of the Prospectus to the extent that a statement contained herein, or in any other subsequently filed document which also is incorporated or is deemed to be incorporated by reference herein, modifies or supersedes such statement. The modifying or superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it modifies or supersedes. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation, an untrue statement of a material fact or an omission to state a material fact that is required to be stated or that is

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necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of the Prospectus.

ELIGIBILITY FOR INVESTMENT

In the opinion of Osler, Hoskin & Harcourt LLP and Bennett Jones LLP, Notes of a particular Series (or, if there is more than one class in the particular Series, Notes of a particular class), if acquired on the date hereof, and unless otherwise specified in a pricing supplement, will be qualified investments on such date under the Income Tax Act (Canada) and the regulations thereunder (the “Tax Act”) for trusts governed by registered retirement savings plans (“RRSPs”), registered retirement income funds (“RRIFs”), registered education savings plans, deferred profit sharing plans, registered disability savings plans or tax-free savings accounts (“TFSAs”) provided that, at that time, such Notes have an investment grade rating from a prescribed rating agency as contemplated under “Ratings” below and provided that, at that time, such Notes are issued as part of a single issue of debt of at least $25 million or, if such Notes are issued under a debt issuance program under which debt obligations are issued on a continuous basis, the Trust has issued and outstanding debt under the program of at least $25 million. The Notes will not be a prohibited investment under the Tax Act for an RRSP, RRIF or TFSA provided the annuitant of the RRSP or RRIF or the holder of the TFSA, as the case may be, deals at arm’s length with the Trust and does not have a “significant interest” (within the meaning of the Tax Act) in the Trust (or, if proposed amendments to the Tax Act contained in draft legislation released on December 21, 2012 are not enacted as proposed, in a corporation, partnership or trust that does not deal at arm’s length with the Trust).

TRANSACTION STRUCTURE SUMMARY

The following is a brief overview of the transaction structure and is qualified by the more detailed information contained elsewhere in the Prospectus. Certain terms are defined in this Transaction Structure Summary for ease of reference and are also defined elsewhere. In some cases the meanings of such terms have been simplified or abbreviated to preserve the summary intent of this part of the Prospectus. Prospective investors are cautioned that such intent may be inconsistent with a full understanding of the material terms of the transactions described. Reference to the more detailed descriptions is recommended.

Bank of Montreal

Bank of Montreal (the “Seller”), a chartered bank subject to the provisions of the Bank Act (Canada), was founded in 1817 and is Canada’s oldest chartered bank. The head office of Bank of Montreal is located at 129 Rue Saint-Jacques, Montréal, Québec H2Y 1L6, and the executive offices are located at 1 First Canadian Place, Toronto, Ontario M5X 1A1.

Bank of Montreal offers, domestically and internationally, a broad range of credit and non-credit products and services to individuals, industry, financial institutions and governments directly and through special-purpose domestic and foreign subsidiaries.

The Trust

The Trust has been established pursuant to the laws of the Province of Ontario by a Declaration of Trust made by the Issuer Trustee on September 28, 2012 (the “Declaration of Trust”). Pursuant to an Assignment and Assumption Agreement made as of September 28, 2012 (the “Assignment and Assumption Agreement”) between the Trust and Master Credit Card Trust (“MCCT”), the Trust acquired all of the right, title and interest of MCCT in, to and under (i) the Purchased Assets (as defined in the amended and restated receivables purchase agreement made as of September 25, 2006, as further amended pursuant to an Amending Agreement dated as of October 9, 2007 (the “Original Receivables Purchase Agreement”) between Bank of Montreal and MCCT, (ii) the Original Receivables Purchase Agreement, (iii) the Second Amended and Restated Certificate Issuance Agreement dated as of March 30, 2010 between MCCT, Bank of Montreal and the Indenture Trustee (the “Second Amended and Restated Certificate Issuance Agreement”), and (iv) each of the outstanding Series Supplements (as defined below), the consideration for which was the assumption by the Trust of all of the duties and obligations of MCCT pursuant to the Seller Note and the outstanding series of notes previously issued by MCCT, the Original Receivables Purchase Agreement, the Second Amended and Restated Certificate Issuance Agreement and the outstanding Series Supplements, in each case as outstanding on September 28, 2012 (such date, the “Assignment Date”). As a result, (i) the Trust is responsible for the payment obligations of each series of notes of MCCT that was outstanding on the Assignment Date (such series of notes collectively, the “Previously Issued Series”), along with the payment obligations to the Seller pursuant to the Seller Note, and (ii) the Trust has obtained the benefit of each representation, warranty, covenant or other agreement made by the Seller under the Receivables Purchase Agreement prior to the Assignment Date, including the

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applicable remedies relating thereto.. See “Master Trust Provisions - Outstanding Series”. The Original Receivables Purchase Agreement was further amended and restated pursuant to a Second Amended and Restated Receivables Purchase Agreement dated as of September 28, 2012 made between Bank of Montreal and the Trust (as assignee) (as so amended and restated, the “Receivables Purchase Agreement”). The Second Amended and Restated Certificate Issuance Agreement was further amended and restated pursuant to a Third Amended and Restated Note Issuance Agreement dated as of September 28, 2012 made between Bank of Montreal, the Indenture Trustee and the Trust (as assignee) (as so amended and restated, the “Note Issuance Agreement”).

The assumption by the Trust of the obligations of MCCT was necessary in order to allow for a continuation of the credit card receivable securitization program of the Seller. MCCT will be terminated on June 30, 2018 in accordance with the terms of the deed of settlement under which it was established and, as a result, MCCT could not continue to issue credit card receivables-backed notes with final maturity dates that extend past June 30, 2018. The historical continuous disclosure filings of MCCT for periods prior to the Assignment Date will continue to be available at www.sedar.com under MCCT’s issuer profile, and all necessary continuous disclosure information with respect to the Previously Issued Series for periods following the Assignment Date shall be included in the continuous disclosure filings of the Trust.

The Trust has issued and is expected to issue Series from time to time and may issue Additional Securities. The Trust has not and will not engage in any business activity other than acquiring and holding Trust Assets and proceeds therefrom, fulfilling its payment obligations under the Previously Issued Series, the Series 2012-2 Notes and the Seller Note, issuing Notes and any Additional Securities and making payments thereon and related activities. As a consequence, the Trust does not and is not expected to have any resources other than the Trust Assets.

The assets of the Trust (the “Trust Assets”) include a portfolio of receivables (the “Receivables”) arising under the Accounts from time to time, funds collected or to be collected from cardholders in respect of the Receivables (“Collections”), the right to receive Interchange fees attributed to cardholder charges for merchandise and services in the Accounts, monies on deposit in certain segregated bank accounts of the Trust, funds collected or to be collected from Participation Interests, if any, and any Series Enhancement issued with respect to a particular Series. The drawing on or payment of any Series Enhancement for the benefit of a Series or class of Notes will not be available to the Noteholders of any other Series or class. The term “Series Enhancement” means, with respect to any Series or class of Notes, any letter of credit, surety bond, cash collateral account, spread account, guaranteed rate agreement, maturity liquidity facility, interest rate swap agreement or other similar arrangement for the benefit of Noteholders of such Series or class.

The Receivables

The Receivables which (i) were assigned to MCCT pursuant to the Original Receivables Purchase Agreement and subsequently assigned to the Trust pursuant to the Assignment and Assumption Agreement, and (ii) the Seller has assigned or will assign to the Trust from time to time pursuant to the Receivables Purchase Agreement, have been or will be generated from transactions made by holders of certain credit card accounts. Bank of Montreal will service these accounts at its facilities located in Toronto and Montréal. The Receivables assigned to the Trust prior to the date hereof were generated under the MasterCard program and were originated by Bank of Montreal. Such accounts are owned by Bank of Montreal.

Servicing

The Servicer (initially, Bank of Montreal) (the “Servicer”) is responsible for servicing, managing and making collections of the Receivables. Subject to certain limitations, the Servicer will use for its own benefit and not segregate collections of Receivables received by it during any calendar month (each a “Due Period”) until not later than 12:00 noon (Toronto time) on the twenty-first day of the following month or, if such day is not a business day, the next succeeding business day (each an “Allocation Date”). On or about the third business day preceding each Allocation Date (each a “Determination Date”), the Servicer will determine the amounts allocable to the Noteholders’ Allocation, to the Noteholders’ Allocation for any other Series and to the Seller’s Allocation as described herein in respect of Collections of Receivables for the related Due Period. On each Allocation Date, the Servicer will deposit all such Collections into the Collection Account, net of any amounts permitted to be deducted by the Servicer as described under “Master Trust Provisions — Deposits in Collection Account”.

Revolving Period

The “Revolving Period” for each Series will commence on the applicable date of issuance (the “Series Issuance Date”) and will continue to, but not include, the earlier of (i) the day the Accumulation Period for such Series commences,

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and (ii) the day the Early Amortization Period for such Series commences. During the Revolving Period, Principal Collections and certain other amounts otherwise forming part of such Series’ Noteholders’ Allocation will generally be used by the Trust to purchase new Receivables from the Seller in accordance with the Receivables Purchase Agreement or otherwise used to maintain such Series’ Noteholders’ Allocation until the end of the Revolving Period. Under “Series Provisions” see “Principal”, “Allocations and Reallocations” and “Amortization Events” for a discussion of the events which might lead to the termination of the Revolving Period for a Series prior to its scheduled ending date.

The Servicer may, based on the principal payment rate on the Receivables and the amount of principal allocable or payable to Noteholders of all outstanding Series scheduled to be in revolving periods, postpone the commencement of the Accumulation Period and extend the length of the Revolving Period for a Series. See “Series Provisions - Postponement of Accumulation Period”.

Accumulation Period

Unless an Amortization Event has occurred with respect to a Series, the Notes of such Series will have an accumulation period (the “Accumulation Period”) which will commence at the close of business on the date specified in the related Series Supplement (and set out in the applicable pricing supplement) subject to certain conditions, or such other date as the Servicer may determine in accordance with the terms of the related Series Supplement, and will continue until the earliest of (a) the commencement of an Early Amortization Period for such Series or (b) payment of the Allocated Amount of the Notes of such Series in full. During such Accumulation Period, Principal Collections and certain other amounts forming part of such Series’ Noteholders’ Allocation will be deposited on each Allocation Date in the related Principal Funding Account and used to make principal payments on the Notes of such Series when due. The amount to be deposited in the Principal Funding Account on any Allocation Date may be limited to an amount equal to the Controlled Accumulation Amount plus any existing Deficit Controlled Accumulation Amount, in each case in respect of such Series, that was to be deposited into the related Principal Funding Account on the prior Allocation Dates (collectively, the “Controlled Payment Amount”). Under “Series Provisions” see “Principal”, “Principal Funding Account” and “Payments”.

Subject to the commencement of the Early Amortization Period for a Series: (a) funds on deposit in the related Principal Funding Account (in an amount not to exceed the outstanding principal amount of the Class A Notes of such Series) will be available to be paid to the holders of the Class A Notes of such Series (the “Class A Noteholders”) in respect of the principal amount of such Class A Notes on the expected final payment date for such Series as specified in the related Series Supplement (such date for a Series, the “Expected Final Payment Date”); (b) funds on deposit in the related Principal Funding Account in excess of the outstanding principal amount of such Class A Notes (in an amount not to exceed the outstanding principal amount of the Class B Notes of such Series) will be available to be paid to holders of the Class B Notes of such Series (the “Class B Noteholders”) in respect of the principal amount of such Class B Notes on their Expected Final Payment Date; (c) funds on deposit in the related Principal Funding Account in excess of the sum of the outstanding principal amount of such Class A Notes and the outstanding principal amount of such Class B Notes (in an amount not to exceed the outstanding principal amount of the Class C Notes of such Series) will be available to be paid to holders of the Class C Notes of such Series (the “Class C Noteholders”) in respect of the principal amount of such Class C Notes on their Expected Final Payment Date; and (d) funds on deposit in the related Principal Funding Account in excess of the sum of the outstanding principal amount of such Class A Notes, the outstanding principal amount of such Class B Notes and the outstanding principal amount of such Class C Notes (in an amount not to exceed the outstanding principal amount of the Class D Notes of such Series) will be available to be paid to holders of the Class D Notes of such Series (the “Class D Noteholders”) in respect of the principal amount of such Class D Notes on their Expected Final Payment Date. If the Notes of a Series have not been paid in full on their Expected Final Payment Date, the Early Amortization Period for such Series will commence. Although it is anticipated that during the Accumulation Period for a Series, funds will be deposited in the related Principal Funding Account in an amount equal to the applicable Controlled Payment Amount on each Allocation Date and that sufficient amounts will be available for payment to the Noteholders of such Series on their Expected Final Payment Date, no assurance can be given in that regard. See “Series Provisions - Allocation of Investor Principal Collections”.

If an Amortization Event occurs during the Accumulation Period for a Series, the Early Amortization Period for such Series will commence as described herein.

Amortization Period

The “Early Amortization Period” for a Series means the period commencing at the close of business on the day before the day on which an Amortization Event has occurred with respect to such Series and ending on the earlier of (a) the date on which all amounts to which the Notes of such Series are entitled have been paid in full and (b) the series termination

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date for such Series as specified in the related Series Supplement (and as set forth in the applicable pricing supplement) (the “Series Termination Date”). Amounts which form part of such Series’ Noteholders’ Allocation and, if the Amortization Event applies to other Series, to the Noteholders’ Allocation for such other Series that would otherwise be used by the Trust to purchase new Receivables, to maintain such Series’ Noteholders’ Allocation or be accumulated in the related Principal Funding Account, will instead be paid as principal payments to the applicable holders of Notes (“Noteholders” monthly on each Allocation Date beginning with the first Special Payment Date (which is the Allocation Date in the Due Period following the Due Period in which the Early Amortization Period for such Series commences). During an Early Amortization Period, payments of principal to Noteholders of such Series will not be subject to any Controlled Payment Amount. In addition, upon the commencement of the Early Amortization Period, any funds on deposit in a related Principal Funding Account or Interest Funding Account will be paid to the Noteholders of such Series on the first Special Payment Date. See “Series Provisions - Amortization Events”.

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TRANSACTION STRUCTURE

The following diagram depicts generally how this transaction is structured. The diagram is a simplified overview only and should be considered together with the information contained in the Prospectus and any pricing supplement.

THE TRUST

The Trust has been established pursuant to the laws of the Province of Ontario by a declaration of trust dated as of September 28, 2012 (the “Declaration of Trust”) made by Computershare Trust Company of Canada, as issuer trustee (the “Issuer Trustee”). The Trust has assumed all of the obligations of MCCT under the Previously Issued Series, has issued the Series 2012-2 Notes (as defined below), and is expected to issue additional Series from time to time and may issue Additional Securities (as defined below). The Trust has not and will not engage in any business activity other than acquiring and holding Trust Assets and proceeds therefrom, fulfilling its payment obligations under the Previously Issued Series, the Series 2012-2 Notes and the Seller Note, issuing the Notes and any Additional Securities and making payments thereon and related activities, including investing in Eligible Investments (as hereinafter defined). See “Risk Factors - Master Trust Considerations”. As a consequence, the Trust does not and is not expected to have any resources other than the Trust Assets.

THE SELLER

Bank of Montreal (the “Seller”), a chartered bank subject to the provisions of the Bank Act (Canada), was founded in 1817 and is Canada’s oldest chartered bank. The head office of Bank of Montreal is located at 129 Rue Saint-Jacques, Montréal, Québec H2Y 1L6, and the executive offices are located at 1 First Canadian Place, Toronto, Ontario M5X 1A1.

Bank of Montreal offers, domestically and internationally, a broad range of credit and non-credit products and services to individuals, industry, financial institutions and governments directly and through special-purpose domestic and foreign subsidiaries.

Class C Notes

Class A Notes

Class B Notes

Credit Card Receivables

Payment for Trust Assets (including payments in respect of the

Seller Note)

Credit Card Obligors

Bank of Montreal

Master Credit Card Trust II

Series Allocation of Receivables

Investors

Principal and Finance

Charges

Interest and Principal

Proceeds of Notes

Class DNotes

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THE TRUSTEES

Issuer Trustee

The Issuer Trustee is a trust company established under the laws of Canada and is licensed to carry on business as a trustee in each of the provinces and territories of Canada. The head and registered office of the Issuer Trustee is located at 100 University Avenue, 9th Floor, Toronto, Ontario M5J 2Y1.

The issuer trustee of the Trust shall at all times be a resident of Canada for purposes of the Tax Act, and unless the Rating Agency Condition is otherwise satisfied, shall (i) either (a) have risk-based capital of at least $50,000,000 or, in the case of an entity that is not subject to risk-based capital adequacy requirements, has a combined capital and surplus of at least $50,000,000 or (b) be a wholly owned subsidiary of a Canadian or United States entity which has risk-based capital of at least $50,000,000 or, in the case of an entity that is not subject to risk-based capital adequacy requirements, has a combined capital and surplus of at least $50,000,000, and (ii) have long-term unsecured debt obligations that are rated by two or more rating agencies in a generic rating category which denotes investment grade.

Indenture Trustee

BNY Trust Company of Canada is the Indenture Trustee (the “Indenture Trustee”) of the Trust under the third amended and restated note issuance agreement dated as of September 28, 2012 made between Bank of Montreal, the Trust and the Indenture Trustee (the “Note Issuance Agreement”). The Indenture Trustee is a trust company incorporated under the laws of Canada and is licensed to carry on business as a trustee in each of the provinces and territories of Canada or is exempt from such requirements. The head office of the Indenture Trustee is Suite 1101 – 4 King Street West, Toronto, Ontario M5H 1B8.

The Indenture Trustee of the Trust shall at all times (a) be a trust company resident in Canada and organized and doing business under the laws of Canada or any province thereof authorized under such laws to exercise corporate trust powers, (b) be subject to supervision or examination by federal or provincial authority and (c) be, or be a wholly-owned subsidiary (directly or indirectly) of, a Canadian chartered bank or a bank or bank holding company organized, in good standing and doing business under the laws of the United States of America, any State thereof or the District of Columbia which has a combined capital and surplus of at least $50,000,000 and whose long-term debt is rated investment grade by applicable rating agencies.

THE ADMINISTRATOR

Pursuant to an administration agreement dated as of September 28, 2012 between the Trust and Bank of Montreal (the “Administration Agreement”), Bank of Montreal carries out certain administrative activities for and on behalf of the Trust (in such capacity, the “Administrator”). The Trust has agreed to pay Bank of Montreal an annual fee in an amount equal to $500 per fiscal quarter payable in arrears (to be paid monthly in twelve equal instalments) (the “Monthly Administration Fee”) and its expenses in consideration for the performance by Bank of Montreal of the activities and the fulfilment by Bank of Montreal of its responsibilities under the Administration Agreement.

TRUST ASSETS

The assets of the Trust (the “Trust Assets”) include a portfolio of receivables (the “Receivables”) arising under the Accounts from time to time, funds collected or to be collected from cardholders in respect of the Receivables (“Collections”), the right to receive Interchange fees attributed to cardholder charges for merchandise and services in the Accounts, monies on deposit in certain segregated bank accounts of the Trust, funds collected or to be collected from Participation Interests, if any, and any Series Enhancement issued with respect to a particular Series. The drawing on or payment of any Series Enhancement for the benefit of a Series or class of Notes will not be available to the Noteholders of any other Series or class. The term “Series Enhancement” means, with respect to any Series or class of Notes, any letter of credit, surety bond, cash collateral account, spread account, guaranteed rate agreement, maturity liquidity facility, interest rate swap agreement or other similar arrangement for the benefit of Noteholders of such Series or class.

The “Receivables” are all amounts shown on the Servicer’s records as amounts payable by the person or persons obliged to make payments, including any guarantor thereof, on any Account from time to time. The Receivables consist of all amounts billed to cardholders including periodic finance charges, annual fees, cash advance transaction fees and services and certain other fees specified in the Receivables Purchase Agreement and the amount of all Principal Receivables Discounts

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(collectively, “Finance Charge Receivables”), and all amounts charged to cardholders for merchandise and services, amounts advanced to cardholders as cash advances and all other fees billed to cardholders or posted to the Accounts other than Finance Charge Receivables (collectively, “Principal Receivables”). In addition, Interchange attributed to cardholder charges for merchandise and services in the Accounts will be treated as Finance Charge Collections. See “The Credit Card Business of Bank of Montreal - Interchange”. From time to time, subject to certain conditions, certain of the amounts described above which are included in Principal Receivables may be treated as Finance Charge Receivables. Recoveries of charged-off Receivables will be treated as Finance Charge Collections. The amount of Receivables will fluctuate from day to day as new Receivables are generated and sold to the Trust and as existing Receivables are collected, charged-off as uncollectible or otherwise adjusted.

The Trust Assets will be allocated as described herein to secure the Trust’s obligations under the Notes, any Notes of other Series and certificates issued to the Seller.

THE CREDIT CARD BUSINESS OF BANK OF MONTREAL

General

The Receivables which (i) were assigned to MCCT pursuant to the Original Receivables Purchase Agreement and subsequently assigned to the Trust pursuant to the Assignment and Assumption Agreement, and (ii) the Seller has assigned or will assign to the Trust from time to time pursuant to the Receivables Purchase Agreement, have been or will be generated from transactions made by holders of certain credit card accounts. Bank of Montreal will service these Accounts at its facilities located in Toronto and Montréal. The Receivables assigned to the Trust prior to the date hereof were generated under the MasterCard® program and were originated by Bank of Montreal. Such Accounts are owned by Bank of Montreal.

Subject to certain conditions, the Seller may assign to the Trust receivables arising in credit card accounts of a type

not currently included in the Accounts. In addition, the Seller may purchase portfolios of credit card accounts from other credit card issuers and receivables in such accounts may be sold to the Trust. Such accounts may not be originated, used or collected in the same manner as the MasterCard accounts described below and may differ with respect to loss and delinquency or revenue experience and historical payment rates. Such accounts may also have different terms than the accounts described below, including lower periodic finance charges. Consequently, the sale to the Trust of the receivables arising in such accounts could have the effect of reducing the Portfolio Yield. See “Master Trust Provisions - Acquisition of Additional Trust Assets” and “The Receivables Purchase Agreement and Note Issuance Agreement Generally - Representations and Warranties”.

The following discussion describes certain terms and characteristics of the portfolio of Canadian dollar consumer MasterCard accounts owned by Bank of Montreal. The Accounts represent substantially all of the Canadian dollar consumer MasterCard accounts of Bank of Montreal, and the Receivables therein represent approximately 98% of the balance of the receivables in Bank of Montreal’s entire consumer MasterCard portfolio, in each case, as of the date of this Prospectus. In addition, Additional Accounts will consist of Eligible Accounts which are not currently in existence and which may not be of the same type as Accounts the Receivables in which have been sold to the Trust previously. See “Master Trust Provisions - Acquisition of Additional Trust Assets” and “The Receivables Purchase Agreement and Note Issuance Agreement Generally - Representations and Warranties”.

Bank of Montreal is a member of the MasterCard program operated by MasterCard International Incorporated. The MasterCard credit card is issued as part of the worldwide MasterCard system, and transactions creating receivables through the use of the credit card are processed through the MasterCard authorization and settlement system. Should that system materially curtail its activities, or should Bank of Montreal cease to be a member of MasterCard for any reason, an Amortization Event could occur, and delays in payments on the Receivables and possible reductions in the amounts thereof could also occur. The Receivables in the Accounts which have been assigned to the Trust arise in a variety of MasterCard accounts. Such Accounts have varying billing and payment structures, including varying periodic finance charges and fees.

The MasterCard credit cards of the types pursuant to which the Accounts were or will be established may be used to purchase merchandise and services and to obtain cash advances. A cash advance is made when a credit card account is used

® Bank of Montreal is a licensed user of the registered trademark owned by MasterCard International.

to obtain cash from a financial institution or automated banking machine, which may be located at a financial institution,

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supermarket or other business establishment, or when a cardholder draws a cheque on his or her credit card account. Amounts due with respect to both purchases and cash advances will be included in the Receivables.

The MasterCard credit card accounts owned by Bank of Montreal were principally generated through (a) applications mailed directly to prospective cardholders, (b) applications made available to prospective cardholders at the banking facilities of Bank of Montreal and at retail outlets, (c) telephone solicitations, and (d) the internet.

Acquisition and Use of Credit Cards

When Bank of Montreal receives applications for MasterCard accounts, it reviews each application for completeness and creditworthiness. In addition, Bank of Montreal generally obtains a credit report issued by an independent credit reporting agency with respect to the applicants. In the event there are discrepancies between the application and the credit report and in certain other circumstances, Bank of Montreal may verify certain of the information regarding the applicant. Bank of Montreal generally evaluates the ability of an applicant for a MasterCard credit card account to repay credit card balances by applying a credit scoring system using models developed which incorporate Bank of Montreal’s credit policy. Credit scoring is intended to provide a general indication, based on the information available, of the applicant’s willingness and ability to repay his or her obligations. Credit scoring evaluates a potential cardholder’s credit profile to arrive at an estimate of the associated credit risk. Models for credit scoring are developed by using statistics to evaluate certain selected criteria and their correlation with credit risk. From time to time, the credit scoring models used by Bank of Montreal are reviewed and, if necessary, updated to reflect current economic trends and their impact on credit risk. Once an application to open an account is approved, an initial credit limit is established for the account based on, among other things, the applicant’s credit score and ability to pay.

The Receivables Purchase Agreement permits Bank of Montreal to sell to the Trust receivables in credit card accounts which it has purchased from other institutions. Any such sales will be subject to the general requirement regarding the addition of assets to the Trust. See “Master Trust Provisions - Acquisition of Additional Trust Assets”.

Each cardholder is subject to an agreement governing the terms and conditions of the accounts. Pursuant to such agreements, Bank of Montreal reserves the right to change or terminate any terms, conditions, services or features of the accounts (including increasing or decreasing periodic finance charges, other charges or minimum payments). Credit limits may be adjusted periodically based upon an evaluation of the cardholder’s performance.

Collection of Delinquent Accounts

Generally, Bank of Montreal considers a MasterCard account delinquent if a minimum payment due thereunder is not received by Bank of Montreal by the due date indicated on the cardholder’s statement. Efforts to collect delinquent credit card receivables are made by the personnel of Bank of Montreal, supplemented by collection agencies and counsel retained by Bank of Montreal. Under current practice, Bank of Montreal includes a request for payment of overdue amounts on all billing statements issued after the account becomes delinquent. Bank of Montreal may also, at its discretion, enter into arrangements with delinquent cardholders who are liable on an account to extend or otherwise change payment schedules. The current policy of Bank of Montreal is to charge-off an account when that account becomes 180 days delinquent; provided that if Bank of Montreal receives notice that a cardholder that is liable for an account has filed for bankruptcy or has a bankruptcy petition filed against it, Bank of Montreal charges-off such account not later than 30 days after Bank of Montreal receives such notice. The credit evaluation, servicing and charge-off policies and collection practices of Bank of Montreal may change over time in accordance with the business judgment of Bank of Montreal, applicable law and guidelines established by applicable regulatory authorities.

Interchange

MasterCard credit card-issuing financial institutions receive certain fees (“Interchange”) from MasterCard International Incorporated, which in turn collects fees from institutions that clear transactions for merchants in connection with cardholder charges for merchandise and services. Interchange represents partial compensation for taking credit risk, absorbing fraud losses and funding receivables for a limited period prior to initial billing. Bank of Montreal is required, pursuant to the terms of the Receivables Purchase Agreement, to transfer to the Trust the amount of Interchange attributed to consumer cardholder charges for merchandise and services in the Accounts which is payable to Bank of Montreal by Mastercard International Incorporated. Interchange is allocated to the Trust on the basis of the percentage equivalent of the ratio that the amount of consumer cardholder charges for merchandise and services in the Accounts bears to the total amount of cardholder charges for merchandise and services in Bank of Montreal’s consumer cardholder portfolio. MasterCard

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International Incorporated may from time to time change the amount of Interchange reimbursed to financial institutions issuing MasterCard credit cards.

THE ACCOUNTS

General

Pursuant to the Original Receivables Purchase Agreement, the Seller sold to MCCT, on a fully-serviced basis, (a) all Receivables which existed on June 30, 1997 (the “Trust Cut-Off Date”) and which arose in the Seller’s Canadian dollar consumer MasterCard credit card accounts (the “Initial Accounts”) and (b) all Receivables arising in Canadian dollar consumer MasterCard credit card accounts which were originated after the Trust Cut-Off Date and prior to the Assignment Date by the Seller in the ordinary course of its business (the “New Accounts”), and pursuant to the Assignment and Assumption Agreement such Receivables were acquired by the Trust from MCCT. Pursuant to the Receivables Purchase Agreement, the Seller has sold to the Trust, on a fully-serviced basis, all Receivables arising in the Initial Accounts and the New Accounts on or after the Assignment Date until the termination of the Receivables Purchase Agreement. In addition, pursuant to the Receivables Purchase Agreement, the Seller is entitled, and in some circumstances will be obligated, to designate Receivables arising in other Eligible Accounts (“Lump Sale Accounts” and, together with the Initial Accounts and the New Accounts, the “Accounts”) for sale to the Trust or, in lieu thereof or in addition thereto, to sell Participation Interests to the Trust. Additional Accounts will consist of New Accounts and Lump Sale Accounts.

The Accounts will include Receivables which have been charged-off as uncollectible in accordance with normal servicing policies. However, for purposes of calculation of the amount of Principal Receivables and Finance Charge Receivables owned by the Trust on any date, the balance of such charged-off Receivables is zero and the Trust will own only the right to receive recoveries with respect to such Receivables.

As of the date of the Receivables Purchase Agreement, each Series Issuance Date and on the date any new Receivables are generated, the Seller has and will represent and warrant to the Trust that the Receivables (and such new Receivables) meet the eligibility requirements set forth in the Receivables Purchase Agreement. See “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Representations and Warranties”. There can be no assurance that all of the Accounts will continue to meet applicable eligibility requirements in the future.

Pursuant to the Receivables Purchase Agreement, the Seller is entitled and, in certain circumstances, may be obligated, from time to time, to designate Lump Sale Accounts and to assign to the Trust all Receivables arising in such Lump Sale Accounts as of the applicable cut-off date together with all Receivables subsequently arising in such Accounts. The sale to the Trust of the Receivables arising in the Additional Accounts or Participation Interests will be subject to certain limitations and conditions. See “Master Trust Provisions - Acquisition of Additional Trust Assets”.

Additional Accounts may be subject to different origination criteria than those for the Initial Accounts and may not be accounts of the same type previously sold to the Trust. Therefore, there can be no assurance that the Receivables arising in such Additional Accounts will be of the same credit quality as the Initial Accounts or the Additional Accounts the Receivables in which have been sold previously to the Trust. Moreover, Additional Accounts may contain Receivables which consist of fees, charges and amounts which are different from the fees, charges and amounts described below. Such Additional Accounts may also be subject to different credit limits, balances and ages. Consequently, there can be no assurance that the Accounts will continue to have the characteristics described below as Additional Accounts are created or added. In addition, the inclusion in the Trust of Additional Accounts with lower periodic finance charges may have the effect of reducing the Portfolio Yield. See “Risk Factors”.

Billing and Payments

The Accounts have various billing and payment structures, including varying periodic finance charges and fees. The following is information on the current general billing and payment characteristics of the Accounts.

Monthly billing statements are made available by Bank of Montreal to cardholders at the end of the billing period. Each month a MasterCard cardholder who is liable on an account must make a minimum payment plus the full amount of any unpaid minimum payment required in respect of the preceding monthly statement.

A periodic finance charge is assessed on the Accounts at an annual rate specified at the time each Account is opened and from time to time thereafter in the monthly billing statements relating to such Accounts. Periodic finance charges are

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charged on balances for purchases and on service charges and fees starting from the date that they are charged to an account until the date that payment is received. Periodic finance charges are charged on cash advances from the date of advance until the date that payment is received. Periodic finance charges on balances for purchases and service charges and fees which appear on an account statement for the first time will be waived if (a) such balances are paid in full by the payment due date shown on such account statement, and (b) the balance shown on the cardholder’s previous account statement was paid in full by the payment due date shown on that account statement. The periodic finance charges for any month are calculated on a daily basis by multiplying each daily periodic finance charge-bearing closing balance by the equivalent daily rate of the applicable annual rate. Bank of Montreal may change the periodic finance charge on the various types of Accounts at any time by written notice to the cardholder who is liable on the Account.

Bank of Montreal may assess an annual card fee that varies depending on the card type chosen by the cardholder. Certain of the Accounts may be subject to certain additional fees, including a cash advance fee and a dishonoured cheque fee. See “Risk Factors - Master Trust Considerations - Consumer Protection Laws”.

Payments on the Accounts are currently processed and applied to the balance in an account in the following order: (a) first, to billed (i) periodic finance charges, (ii) service charges and fees, (iii) cash advances, (iv) interest bearing purchases and other charges, and (v) non-interest bearing purchases and other charges, and (b) second, to charged but unbilled (i) periodic finance charges, (ii) service charges and fees, (iii) cash advances, and (iv) non-interest bearing purchases and other charges. Bank of Montreal may change the manner in which payments are processed and applied at any time by written notice to the cardholder who is liable on the Account.

There can be no assurance that periodic finance charges, fees and other charges will remain at current levels in the future. See “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Collection and Other Servicing Procedures”.

MASTER TRUST PROVISIONS

Acquisition of Additional Trust Assets

If, on any Determination Date, the sum of (i) the total amount of Principal Receivables as of the close of business on the last business day of the immediately preceding Due Period and (ii) the principal amounts on deposit, or to be deposited on the next Allocation Date, in the Excess Funding Account is less than 108% of the sum of the initial principal amounts of all outstanding Notes of all Series as of the close of business on the last business day of any Due Period (the “Required Minimum Principal Balance”), the Seller is required by the Receivables Purchase Agreement, on or prior to the close of business on the tenth business day following such Determination Date, to make a Lump Sale of Receivables to the Trust such that, after giving effect to such sale, the total amount of Principal Receivables owned by the Trust when taken together with the principal amounts on deposit in the Excess Funding Account on such date is at least equal to the Required Minimum Principal Balance. The receivables that may be sold to the Trust in a “Lump Sale” will consist of (i) receivables arising in additional Eligible Accounts comprising part of the portfolio of Canadian dollar consumer credit card loans arising in the MasterCard accounts owned by Bank of Montreal (the “Portfolio”), and (ii) participation interests representing undivided interests in or securities backed by a pool of assets primarily consisting of receivables in credit card accounts and collections thereon (“Participation Interests”). The acquisition of Participation Interests by the Trust shall be effected by an amendment to the Receivables Purchase Agreement which would not require the consent of Noteholders. The Seller may, upon 30 days’ prior notice to the Trust, the applicable Rating Agencies and any provider of Series Enhancement, and with the prior consent of any such provider of Series Enhancement, reduce the Required Minimum Principal Balance, provided that such reduction will not result in a Ratings Effect or an Adverse Effect and provided further the Required Minimum Principal Balance shall never be less than 102% of the sum of (i) the aggregate initial principal amounts on such date for all outstanding Series that are not variable funding Series, and (ii) the aggregate outstanding principal amounts of all Series which are variable funding Series (after giving effect to all payments of principal made or to be made to the holders of such variable funding Series on such date). In addition, the Seller may from time to time, at its sole discretion, subject to the conditions specified in the second succeeding paragraph, voluntarily make a Lump Sale of Receivables to the Trust.

Pursuant to the Receivables Purchase Agreement, unless each of the applicable Rating Agencies otherwise consents, (a) during any three consecutive Due Periods (i) the number of New Accounts opened during such three-month period in respect of which Receivables are sold by the Seller to the Trust shall not exceed 15% of the number of Accounts as of the first day of such three-month period, and (ii) the aggregate amount of Principal Receivables arising in New Accounts opened during such three-month period which are sold by the Seller to the Trust shall not exceed 15% of the aggregate amount of Principal Receivables owned by the Trust as of the first day of such three-month period, and (b) during any calendar year

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(x) the number of New Accounts opened in such calendar year in respect of which Receivables are sold by the Seller to the Trust shall not exceed 20% of the number of Accounts as of the first day of the calendar year, and (y) the aggregate amount of Principal Receivables arising in New Accounts opened in such calendar year which are sold by the Seller to the Trust shall not exceed 20% of the aggregate amount of Principal Receivables owned by the Trust as of the first day of such calendar year. New Accounts and Lump Sale Accounts are collectively referred to herein as “Additional Accounts”.

The Seller has conveyed to the Trust the Receivables which arose or will be arising in Additional Accounts and Participation Interests subject to various conditions set out in the Receivables Purchase Agreement, including (a) in the case of Lump Sales and sales of Receivables at a Principal Receivables Discount, on or before the fifth business day immediately preceding such sale, the Seller shall have given the Trust, the Indenture Trustee, the Servicer (if not the Seller), the applicable Rating Agencies and any provider of Series Enhancement written notice that the Receivables arising in the Additional Accounts or Participation Interests will be sold to the Trust, (b) in the case of Lump Sales and sales of Receivables at a Principal Receivables Discount, the Trust shall have received confirmation from the applicable Rating Agencies that such addition will not result in a Ratings Effect, (c) in the case of Additional Accounts, the Additional Accounts shall be Eligible Accounts, (d) in the case of Lump Sales, the Seller shall deliver to the Trust and the Indenture Trustee copies of any filings or assignments covering the Lump Sale Accounts or Participation Interests necessary to perfect the Trust’s ownership of and the Indenture Trustee’s security interest in the Receivables arising therein, (e) certain events relating to the bankruptcy, insolvency or administration of the Seller (a “Seller Insolvency Event”) shall not have occurred nor shall the transfer of Receivables arising in the Additional Accounts or the Participation Interests to the Trust have been made in contemplation of the occurrence thereof, (f) the sale to the Trust of the Receivables arising in the Additional Accounts or the Participation Interests will not result in the occurrence of an Amortization Event and, in the case of Lump Sales, the Seller shall deliver to the Trust, the Indenture Trustee and each Series Enhancer a certificate of an authorized officer of the Seller stating that the Seller reasonably believes that the addition of the Receivables arising in the Lump Sale Accounts or the Participation Interests to the Trust will not have an Adverse Effect and that, in the case of Participation Interests, such sale is no less favourable in any material respect to the interests of the Trust or any Series Enhancer than would be the sale of Receivables in Lump Sale Accounts, and (g) in the case of Lump Sale Accounts, the Seller shall deliver to the Trust and the Indenture Trustee a computer file or microfiche list containing a true and complete list of the Lump Sale Accounts indicating for each such Account its account number, aggregate amount of Principal Receivables outstanding in such Account and the aggregate amount of Receivables outstanding in such Account.

“Principal Receivables Discount” means, with respect to any Account designated by the Seller to the Trust, the portion of the related Principal Receivables which represents a discount from the face value thereof. The amount of any Principal Receivables Discount is equal to a specified percentage (determined by the Seller in its sole discretion) of the amounts billed to the obligor or posted to the obligor’s Account in respect of purchases of goods and services and cash advances. Such percentage shall be zero with respect to all the Accounts, unless and until the Seller gives the Trust notice of any Accounts (or types of Accounts) to be subject to any such discount and the applicable discount percentage and provided that the applicable Rating Agencies have confirmed that the application of such discount and discount percentage will not result in a Ratings Effect.

Affiliates of the Seller currently own or may acquire portfolios of credit card accounts the receivables in which may, subject to applicable law, be participated to the Seller and sold to the Trust. Such a sale of receivables to the Trust will be subject to the conditions described above relating to Lump Sales.

Lump Sale Accounts may be subject to different eligibility criteria than the Initial Accounts. See “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Representations and Warranties”. Lump Sale Accounts may include accounts originated using criteria different from those which were applied to the Initial Accounts and New Accounts because such accounts were originated at a later date or were part of a portfolio of credit card accounts which were not part of the Portfolio or which were acquired from another credit card issuer. Moreover, Lump Sale Accounts may not be accounts of the same type previously sold to the Trust. Consequently, there can be no assurance that such Lump Sale Accounts will be of the same credit quality as the Initial Accounts or the Additional Accounts acquired by the Trust since the Trust Cut-Off Date.

Lump Sale Accounts of a type different from the Initial Accounts or New Accounts may contain Receivables which consist of fees, charges and amounts which are different from the fees, charges and amounts which have been designated as Finance Charge Receivables and Principal Receivables herein. Participation Interests also may be added to the Trust as Lump Sales. In either case, the Servicer will designate the portions of funds collected or to be collected in respect of such Receivables or Participation Interests to be treated for purposes of the Note Issuance Agreement as Principal Receivables and Finance Charge Receivables. Furthermore, in the event that Receivables are purchased from the Seller at a discount, a portion

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of the Principal Receivables so purchased, in an amount equal to the amount of such discount, may be treated for purposes of the Note Issuance Agreement and any Series Supplement as a collection of Finance Charge Receivables. See “Risk Factors - Master Trust Considerations - Acquisition of Additional Trust Assets”.

Redeemed Accounts

Pursuant to the Receivables Purchase Agreement, on not more than one day of any Due Period, the Seller shall have the right, upon satisfaction of certain conditions, to require a partial redemption of the Seller Note in exchange for the reassignment to it or its designee of all of the Trust’s interest in the Receivables then existing and thereafter created, all monies due or to become due and all amounts received with respect thereto and all proceeds thereof in or with respect to Accounts randomly selected by the Seller (the “Redeemed Accounts”). The conditions to the Seller’s right to redeem include (a) on or before the fifth business day immediately preceding the date upon which Receivables arising in such Accounts are to be reassigned, the Seller shall have given the Trust, the Indenture Trustee, the Servicer (if not the Seller), the applicable Rating Agencies and any provider of Series Enhancement written notice of such redemption specifying the cut-off date and closing date for reassignment of the Redeemed Accounts (the “Redemption Date”), (b) on or prior to the Redemption Date, the Seller shall have delivered to the Trust and the Indenture Trustee a computer file or microfiche list containing a true and complete list of the Redeemed Accounts specifying for each such Account, as of the redemption notice date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables outstanding in such Account, (c) the Seller shall have represented and warranted as of each Redemption Date that the list of Redeemed Accounts delivered pursuant to clause (b) above, as of the Redemption Date, is true and complete in all material respects, (d) the Trust and the Indenture Trustee shall have received confirmation from the applicable Rating Agencies that such redemption will not result in a Ratings Effect, and (e) the Seller shall have delivered to the Trust and any provider of Series Enhancement a certificate of an authorized officer, dated the Redemption Date, to the effect that the Seller reasonably believes that such redemption will not at the time of its occurrence or at a future date cause an Adverse Effect.

Upon satisfaction of the above conditions, the Trust shall execute and deliver to the Seller a written reassignment and shall be deemed to sell, transfer, assign, set over and otherwise convey to the Seller or its designee on the Redemption Date, without recourse, representation or warranty, all the right, title and interest of the Trust in and to the Receivables arising in the Redeemed Accounts as of the cut-off date, all monies due and to become due and all amounts received with respect thereto and all proceeds thereof and the unpaid principal amount of the Seller Note will be reduced by an amount equal to the aggregate face amount of the Principal Receivables in the Redeemed Accounts. The security interest held by the Indenture Trustee in respect of the Receivables arising in the Redeemed Accounts will be released upon the sale by the Trust to the Seller of such Receivables.

Outstanding Series

The Previously Issued Series which were issued by MCCT and with respect to which the Trust has assumed the payment obligations pursuant to the Assignment and Assumption Agreement are as follows: (i) the $525,000,000 5.237% Credit Card Receivables-Backed Class A Notes, Series 2008-1, $12,370,000 6.237% Credit Card Receivables-Backed Class B Notes, Series 2008-1, $12,370,000 7.237% Credit Card Receivables-Backed Class C Notes, Series 2008-1 and $5,815,556 3.307% Credit Card Receivables-Backed Class D Notes, Series 2008-1 (collectively, the “Series 2008-1 Notes”), (ii) the $500,000,000 Credit Card Receivables-Backed Class A Floating Rate Notes, Series 2008-4, $20,275,000 Credit Card Receivables-Backed Class B Floating Rate Notes, Series 2008-4, $20,275,000 Credit Card Receivables-Backed Class C Floating Rate Notes, Series 2008-4 and $5,898,087 Credit Card Receivables-Backed Class D Floating Rate Notes, Series 2008-4 (collectively, the “Series 2008-4 Notes”); (iii) the $800,000,000 3.502% Credit Card Receivables-Backed Class A Notes, Series 2011-1 and $46,560,847 5.052% Credit Card Receivables-Backed Class B Notes, Series 2011-1 (collectively, the “Series 2011-1 Notes”), (iv) the $400,000,000 Credit Card Receivables-Backed Class A Floating Rate Notes, Series 2011-2 and $37,158,470 Credit Card Receivables-Backed Class B Floating Rate Notes, Series 2011-2 (collectively, the “Series 2011-2 Notes”), and (v) the $1,000,000,000 2.626% Credit Card Receivables-Backed Class A Notes, Series 2012-1 and $58,202,000 3.876% Credit Card Receivables-Backed Class B Notes, Series 2012-1 (collectively, the “Series 2012-1 Notes”).

On October 31, 2012, the Trust issued US$750,000,000 0.78% Credit Card Receivables-Backed Class A Notes, Series 2012-2, US$15,873,000 1.48% Credit Card Receivables-Backed Class B Notes, Series 2012-2 and US$27,778,000 1.97% Credit Card Receivables-Backed Class C Notes, Series 2012-2 (collectively, the “Series 2012-2 Notes”).

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New Issuances

The Note Issuance Agreement provides that, pursuant to any one or more Series Supplements, the Trust may issue from time to time new Series and Additional Securities subject to the conditions described below (each such issuance a “New Issuance”) at the direction of the Seller, for the purposes of redeeming any other outstanding Series which permits such refinancing with the proceeds of an issuance of new Series, in the event of the exercise by the Seller of a right to redeem a portion of the Seller Note for cash and in certain other circumstances specified in the Note Issuance Agreement. Each New Issuance of a new Series applied to redeem a portion of the Seller Note will have the effect of decreasing the Seller’s Allocation to the extent of the principal amount of such new Series so applied. Under the Note Issuance Agreement, the parties thereto may designate, with respect to any newly-issued Series, (a) its name or designation, (b) its initial principal amount (or method for calculating such amount), (c) its interest rate (or formula for the determination thereof), (d) the payment date or dates and the date or dates from which interest shall accrue, (e) the method for allocating collections to the secured property securing the Trust’s obligations in favour of such Noteholders, (f) any bank accounts to be used by such Series and the terms governing the operation of any such bank accounts, (g) the percentage used to calculate monthly servicing fees and other administrative fees, (h) the issuer and terms of any form of Series Enhancement with respect thereto, (i) the terms on which the Notes of such Series may be exchanged for Notes of another Series, repurchased or remarketed to other investors, (j) the Series termination date, (k) the number of classes of Notes of such Series, and if more than one class, the rights and priorities of each such class, (l) the priority of any Series with respect to any other Series, (m) whether such Series will be part of a Group, and (n) any other relevant terms (all such terms, the “Principal Terms” of such Series). None of the Seller, the Servicer, the Indenture Trustee or the Trust is required or intends to obtain the consent of any Noteholder of any outstanding Series to issue any additional Series.

The Notes of each Series will be included in a group (each a “Group”) of series of indebtedness of the Trust. The Series 2008-1 Notes, Series 2011-1 Notes, Series 2012-1 Notes and Series 2012-2 Notes are included in Group One. The Series 2008-4 Notes and Series 2011-2 Notes are included in Group Two.

The Series of Notes to be issued hereunder may be included in Group One, Group Two or another Group. To the extent that collections of Principal Receivables allocated to a Series included in a Group are not needed to make distributions in respect of such Series or to be deposited into the related Principal Funding Account, such collections will be allocated to cover distributions due to or for the benefit of other Series within such Group. Any such reallocation will not result in a reduction in the Allocated Amount with respect to such Series. In addition, collections of Principal Receivables and certain other amounts otherwise allocable to other Series in a Group, to the extent such collections are not needed to make distributions, payments to or deposits for the benefit of other Series in such Group, may be applied in respect of distributions to be made for the benefit of such Series. See “Series Provisions - Allocations and Reallocations”. See also “Risk Factors - Master Trust Considerations - Issuance of Additional Series”.

The Series Supplement for a newly-issued Series will specify whether such Series will be included in Group One, Group Two or any other Group. The Series Supplement for a Series included in a Group may provide for the reallocation of collections on Receivables and other amounts or obligations among all Series in such Group in the manner and to the extent described in the Series Supplement relating to each Series in the Group. Consequently, the issuance of a new Series in a Group may have the effect of reducing or increasing the amount of Finance Charge Collections which are reallocated to the Noteholders’ Allocation for Notes of existing Series in the Group. For example, in Group One, which provides for the reallocation of Finance Charge Collections allocable to a Series among all Series in such Group, an additional Series which is issued with a larger claim with respect to monthly interest than that of previously-issued Series in Group One (due to a higher interest rate) will receive a proportionately larger reallocation of Finance Charge Collections to the Noteholders’ Allocation for such Series. Such issuance will reduce the amount of Group One Investor Finance Charge Collections which are reallocated to the existing Series in Group One. Conversely, the issuance of an additional Series with a smaller claim with respect to monthly interest (due to a lower interest rate) will have the effect of increasing the amount of Group One Investor Finance Charge Collections allocable to such other Series.

A series may also be issued to provide credit enhancement for other Series. The certificates of such Series would provide for the reallocation of Principal Collections otherwise allocable to the Noteholders’ Allocation for such Series to avoid charge-offs against the Noteholders’ Allocation for the Notes of the Series to which such new Series is subordinated. With respect to any Series, except to the extent expressly provided in the Series Supplement for that Series (and set forth in the applicable pricing supplement), no other Series will have a claim to collections on the Receivables allocated to the Noteholders’ Allocation for such Series.

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The Note Issuance Agreement provides that the Seller may designate Principal Terms such that each Series has a period during which accumulation of the principal amount thereof in a principal funding account or amortization of the principal amount thereof is intended to occur which may have a different length and begin on a different date than such periods for any other Series. Further, one or more Series may be in their accumulation or amortization periods while other Series are not. Principal Collections otherwise allocable to a Series which is not amortizing or accumulating principal may be reallocated to a Series which is amortizing or accumulating principal.

Each Series may have the benefits of Series Enhancement issued by enhancement providers different from the providers of Series Enhancement with respect to any other Series. Under the Note Issuance Agreement, the Trust shall pledge to the Indenture Trustee any such Series Enhancement and the Indenture Trustee shall hold its security interest therein only for the benefit of the Series to which such Series Enhancement relates. With respect to each such Series Enhancement, the Seller may deliver a different form of Series Enhancement agreement.

A Series may be an “Adjustable Series”, which is a Series with respect to which all or a portion of the Allocated Amount of such Series may in certain circumstances be adjusted from time to time in order to ensure that the Required Minimum Principal Balance is being maintained when the Seller has not added Additional Accounts or deposited funds into the Excess Funding Account in order to maintain such balance.

In addition to Notes of other Series, the Note Issuance Agreement provides that the Trust may issue trust units and certificates evidencing ownership interests in a portion of the Trust Assets (collectively, “Additional Securities”). To the extent any such Additional Securities are issued in connection with the purchase by the Trust on the open market of Notes of any Series and in certain other circumstances described in the Note Issuance Agreement, the holders of such Additional Securities may be allocated Finance Charge Collections and Principal Collections and may be entitled to take advantage of any Series Enhancement, in each case, to the extent that the holders of such Notes were allocated Finance Charge Collections and Principal Collections or were entitled to payments from such Series Enhancement.

Under the Note Issuance Agreement and pursuant to a Series Supplement, a New Issuance may occur only upon the satisfaction of certain conditions provided in the Note Issuance Agreement. The obligation of the Trust to make a New Issuance and to execute and deliver the related Series Supplement is subject to the satisfaction of certain conditions, including (a) on or before the fifth Business Day immediately preceding the date upon which the New Issuance is to occur, the Seller shall have given the Trust, the Indenture Trustee, the Servicer, the applicable Rating Agencies and any provider of Series Enhancement written notice of the exercise of its right to require a New Issuance and the date upon which such New Issuance is to occur, (b) the Seller shall have delivered to the Trust and the Indenture Trustee the related Series Supplement, in form satisfactory to the Trust, executed by each party to the Note Issuance Agreement other than the Trust and the Indenture Trustee, (c) the Seller shall have delivered to the Trust and the Indenture Trustee any related Series Enhancement agreement executed by each of the parties to such agreement other than the Trust and the Indenture Trustee, (d) the Trust shall have received confirmation from the applicable Rating Agencies that such New Issuance will not result in a Ratings Effect, (e) the Seller shall have delivered to the Trust, the Indenture Trustee and any provider of Series Enhancement a certificate of an authorized officer, dated the date upon which such New Issuance is to occur, to the effect that the Seller reasonably believes that such New Issuance will not at the time of its occurrence or at a future date cause an Adverse Effect, (f) the Seller shall have executed and delivered to the Trust a securities law indemnity covenant, and (g) any other conditions specified in any Series Supplement. Upon satisfaction of the above conditions, the Trust shall execute the Series Supplement and issue the Notes of such new Series.

Subject to the preceding paragraph, there is no limit to the number of New Issuances that the Trust may be required to make under the Note Issuance Agreement. There can be no assurance that the terms of any Series will not have an impact on the timing and amount of payments received by Noteholders of other Series.

Collection Account

The Servicer, for the benefit of the Trust and the Indenture Trustee, has established and maintains, in the name of the Trust, an Eligible Deposit Account bearing a designation clearly indicating that the funds deposited therein are subject to a security interest in favour of the Indenture Trustee held for the benefit of the Noteholders (the “Collection Account”). “Eligible Deposit Account” means a segregated trust account with an Eligible Institution. An “Eligible Institution” means a bank or trust company chartered or licensed under the laws of Canada or of any province thereof which at all times either (a) has (i) a long-term unsecured debt rating of AA (low) or better by DBRS and a short-term unsecured debt rating of R-1 (middle) or better by DBRS, and (ii) a long-term unsecured debt rating of A2 or better by Moody’s and a short-term unsecured debt rating of P-1 by Moody’s or, if such entity does not have a short-term unsecured debt rating from Moody’s, a

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long-term unsecured debt rating of Aa3 or better by Moody’s, (b) has its obligations with respect to the relevant matter guaranteed by an institution with the ratings referred to in (a)(i), (a)(ii) and in either (a)(iii)(A) or (iii)(B), or (c) otherwise satisfies the Rating Agency Condition. If so qualified, the Indenture Trustee or the Servicer may be considered an Eligible Institution for the purposes of this definition. “Rating Agency Condition” means, with respect to any action, that each Rating Agency shall have notified the Seller, the Servicer, the Trust and the Indenture Trustee in writing that such action will not result in a reduction or withdrawal of the rating of any outstanding Series or class or Additional Securities with respect to which it is a Rating Agency.

The Collection Account is currently established at Bank of Montreal. If at any time the Collection Account ceases to be an Eligible Deposit Account, the Collection Account shall be moved so that it will again qualify as an Eligible Deposit Account. Funds in the Collection Account generally will be invested in book-based securities, negotiable instruments, investments or securities (“Eligible Investments”) which evidence (a) direct obligations of, and obligations fully guaranteed as to timely payment by, the Government of Canada or any agency or instrumentality thereof the obligations of which are backed by the full faith and credit of the Government of Canada; (b) short term or long term unsecured debt obligations issued or fully guaranteed by a province or municipality of Canada provided that such debt obligations receive a rating of “P-1” or better or “Aa3” or better from Moody’s and “R-1(middle)” or better or “AA(low)” or better from DBRS; (c) demand deposits, time deposits or certificates of deposit of any chartered bank or trust company or credit union or cooperative credit society incorporated under the laws of Canada or any province thereof and subject to supervision and examination by federal banking or depository institution authorities; provided, however, that at the time of the investment or contractual commitment to invest therein, the commercial paper or other short-term unsecured debt obligations (other than such obligations the rating of which is based on the credit of a Person other than such depository institution or trust company) thereof shall have a credit rating of “P-1” or better from Moody’s and “R-1(middle)” or better from DBRS; (d) call loans to and notes or bankers’ acceptances issued or accepted by any bank, trust company, credit union or co-operative society described in (c) above; (e) commercial paper having, at the time of the investment or contractual commitment to invest therein, a rating of “P-1” or better from Moody’s and “R-1 (middle)” or better (in the case of commercial paper of a corporation) or “R-1(high)(sf)” or better (if the case of asset-backed commercial paper backed by global style liquidity) from DBRS; (f) investments in money market funds having a rating of “Aaa” by Moody’s and “AAA” by DBRS, when purchased; (g) demand deposits, term deposits and certificates of deposit which when purchased are issued by an entity, the commercial paper of which has a rating of “P-1” or better from Moody’s and “R-1(middle)” or better from DBRS; and (h) any other investment with respect to the investment in which the Rating Agency Condition shall have been satisfied at the time of the investment therein or contractual commitment to invest therein; provided, however, that notwithstanding anything to the contrary above, with respect to any Eligible Investment: (i) if its term to maturity is no more than 30 days following the date of investment therein, such Eligible Investment shall be rated at least “A2” or “P-1” by Moody’s; (ii) if its term to maturity is more than 30 days but less than 90 days following the date of investment therein, such Eligible Investment shall be rated at least “A1” or “P-1” by Moody’s; (iii) if its term to maturity is more than 90 days but less than 180 days following the date of investment therein, such Eligible Investment shall be rated at least “Aa3” by Moody’s; and (iv) if its term to maturity is 180 days or more following the date of investment therein, such Eligible Investment shall be rated “Aaa” by Moody’s. If so qualified, securities of the Seller and the Trustee may be considered Eligible Investments for the purposes of the definition of Eligible Investments.

Any earnings (net of losses and investment expenses) on funds in the Collection Account will be paid or allocated as specified in the Series Supplements. The Servicer has the revocable power to withdraw funds from the Collection Account, on behalf of the Trust, and to instruct the Trust to make withdrawals and payments from the Collection Account for the purpose of carrying out its duties under the Note Issuance Agreement and in any Series Supplement.

Deposits in Collection Account

The Servicer (initially, Bank of Montreal) is responsible for servicing, managing and making collections of the Receivables. Subject to the limitations set out in the following paragraph, the Servicer will use for its own benefit and not segregate collections of Receivables received by it during any calendar month (each a “Due Period”) until not later than 12:00 noon (Toronto time) on the twenty-first day of the following month or, if such day is not a business day, the next succeeding business day (each an “Allocation Date”). On or about the third business day preceding each Allocation Date (each a “Determination Date”), the Servicer will determine the amounts allocable to the Noteholders’ Allocation for each Series and to the Seller’s Allocation as described herein in respect of Collections of Receivables for the related Due Period.

For as long as (a) Bank of Montreal remains the Servicer, and (b) either (i) Bank of Montreal has a certificate of deposit or short-term credit rating of P-1 by Moody’s, at least A-1 by S&P and at least R-1 (low) by DBRS, or (ii) the obligations of Bank of Montreal to deposit Collections received by it into the Collection Account are fully guaranteed by an

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entity with such ratings (such conditions, the “Commingling Conditions”), Bank of Montreal may use for its own benefit all Collections received with respect to the Receivables in each Due Period until the related Allocation Date, at which time Bank of Montreal will deposit all such Collections, to the extent described below, into the Collection Account, and will make the deposits and payments to the accounts and parties described herein on the date of such deposit. See “Series Provisions - Payments”. However, if Bank of Montreal is no longer the Servicer or Bank of Montreal (or a guarantor of its obligations) fails to maintain the required rating, the Servicer will make such deposits, as described below, not later than two business days after the date on which the related Receivables are processed. Whether the Servicer is required to make deposits of Collections pursuant to the first or the second sentence of this paragraph, but subject to satisfaction of the Partial Commingling Conditions (as defined below) at any time during which the Commingling Conditions are not being met, (x) the Servicer will be required to deposit Collections into the Collection Account only up to the aggregate amount of Collections required to be deposited into an account established for any Series or, without duplication, paid on the related Allocation Date to Noteholders of any Series or to the issuer of any Series Enhancement pursuant to the terms of any Series Supplement or Series Enhancement agreement and (y) if at any time prior to an Allocation Date the amount of Collections deposited in the Collection Account exceeds the amount required to be deposited pursuant to clause (x) above, the Servicer will be permitted to withdraw such excess from the Collection Account and, if the Servicer is not the Seller, remit it to the Seller.

On the day any such deposit is made into the Collection Account, the Servicer will withdraw from the Collection Account and pay to the Seller, on behalf of the Trust, (a) the Seller’s portion of Series Allocable Principal Collections, provided that the aggregate of the total amount of Principal Receivables on such day (determined after giving effect to any Principal Receivables transferred to the Trust on such day) and the principal amounts on deposit in the Excess Funding Account on such day are equal to or greater than the Required Minimum Principal Balance, (b) the Seller’s portion of Series Allocable Finance Charge Collections (net of the Servicing Fee for the related Due Period, which will be paid to the Servicer in the event that the Seller is no longer the Servicer), and (c) any similar amounts payable to the Seller with respect to other Series.

“Partial Commingling Condition” means a requirement that, for any Due Period during which the Commingling Conditions are not being met:

(a) an asset test be conducted by the Servicer on each Business Day to ensure that the aggregate of the total amount of Principal Receivables and the principal amount on deposit in the Excess Funding Account is equal to or greater than the Required Minimum Principal Balance, in each case as of the close of business on the immediately preceding Business Day;

(b) monitoring for the occurrence of any Amortization Event be completed by the Servicer on each Business Day; and

(c) on or before the fifth Business Day following each calendar month, unless there has been a breach of the daily asset test described in clause (a) or an Amortization Event has occurred during such calendar month, the Servicer shall have delivered to the Rating Agencies and the Trust an Officer’s Certificate confirming that (A) the daily asset test referred to in clause (a) above has been completed by the Servicer with respect to each Business Day of such calendar month and that no breach of the daily asset test occurred on any Business Day during such calendar month, and (B) no Amortization Event has occurred on or prior to the last Business Day of such calendar month.

Excess Funding Account

The Servicer, for the benefit of the Trust and the Indenture Trustee, has established and maintains, in the name of the Trust, an Eligible Deposit Account bearing a designation clearly indicating that the funds deposited therein are subject to a security interest in favour of the Indenture Trustee held for the benefit of the Noteholders (the “Excess Funding Account”). On any Allocation Date on which the aggregate of the total amount of Principal Receivables and the principal amount on deposit in the Excess Funding Account is less than the Required Minimum Principal Balance (determined after giving effect to any Principal Receivables transferred to the Trust on such date), the Servicer will not distribute to the Seller any Principal Collections that would otherwise be distributed to the Seller, but will instead deposit such funds in the Excess Funding Account.

Funds on deposit in the Excess Funding Account may be withdrawn and paid to the Seller on any business day up to the amount by which the aggregate of the total amount of Principal Receivables and the principal amount on deposit in the

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Excess Funding Account exceeds the Required Minimum Principal Balance (determined after giving effect to any Principal Receivables transferred to the Trust on such date); provided, however, with respect to any business day on which one or more Series are in an Accumulation Period, an Early Amortization Period or any other type of amortization period as defined in the Series Supplement for such Series, any amounts on deposit in the Excess Funding Account will first be made available on the next Allocation Date to the extent needed to cover principal payments due to or for the benefit of such Series.

Funds on deposit in the Excess Funding Account shall at the direction of the Servicer be invested by the Trust in Eligible Investments. Any earnings (net of losses and investment expenses) on funds in the Excess Funding Account during any Due Period will be treated as Collections of Finance Charge Receivables for such Due Period.

Allocations Among Series

Pursuant to the Note Issuance Agreement, during each Due Period the Servicer will determine for each outstanding Series (including the Previously Issued Series) its Series Allocable Finance Charge Collections, Series Allocable Principal Collections, Series Allocable Defaulted Receivables and Series Allocable Miscellaneous Payments.

“Finance Charge Collections” shall mean, for any Due Period, the lesser of the aggregate amount of Finance Charge Receivables billed to the obligors or posted to the Accounts at the beginning of such Due Period and Collections actually received in such Due Period. All recoveries with respect to Receivables previously charged-off as uncollectible will be treated as Finance Charge Collections. Finance Charge Collections with respect to any Due Period shall include a portion, determined pursuant to the Receivables Purchase Agreement, of the Interchange paid or payable to the Seller with respect to such Due Period.

“Principal Collections” shall mean all Collections other than Finance Charge Collections.

“Series Allocable Finance Charge Collections”, “Series Allocable Principal Collections” and “Series Allocable Defaulted Amount” mean, with respect to any Series and for any Due Period, the product of (a) the Series Allocation Percentage for such Series, and (b) the amount of Finance Charge Collections, Principal Collections and Defaulted Amounts deposited in the Collection Account with respect to such Due Period, respectively.

“Defaulted Amounts” means, with respect to any Due Period, an amount (which shall not be less than zero) equal to (a) the amount of Principal Receivables which became Defaulted Receivables in such Due Period, minus (b) the amount of any Defaulted Receivables of which the Seller or the Servicer became obligated to accept reassignment or assignment in accordance with the terms of the Receivables Purchase Agreement or the Note Issuance Agreement during such Due Period but refused to purchase pursuant to the provisions of the Receivables Purchase Agreement; provided, however, that, if a Seller Insolvency Event occurs, the amount of such Defaulted Receivables which are subject to reassignment to the Seller in accordance with the terms of the Receivables Purchase Agreement or the Note Issuance Agreement will not be added to the amount to be subtracted under clause (b) and, if certain events of bankruptcy, insolvency or receivership occur with respect to the Servicer, the amount of such Defaulted Receivables which are subject to assignment to the Servicer in accordance with the terms of the Note Issuance Agreement will not be added to the amount to be subtracted under clause (b).

“Series Allocation Percentage” means, with respect to any Series and for any Due Period, the percentage equivalent of a fraction, the numerator of which is the Series Adjusted Allocated Amount for such Series as of the last day of the immediately preceding Due Period and the denominator of which is the Trust Adjusted Allocated Amount as of such last day.

“Series Allocable Miscellaneous Payments” means, with respect to any Series and for any Due Period, the product of (a) the Series Allocation Percentage for such Series, and (b) the sum of (i) Adjustment Payments and Transfer Deposit Amounts deposited in the Collection Account with respect to such Due Period and (ii) any Unallocated Principal Collections available to be treated as such as described herein under “Series Provisions — Reallocations Among Securities of Different Series — Investor Principal Collections for All Series”.

“Series Adjusted Allocated Amount” means, with respect to any Series and as of any date, the initial principal amount of the Notes of such Series less the excess, if any, of the cumulative amount of investor charge-offs for such Series as of the last day of the immediately preceding Due Period over the aggregate reimbursement of such investor charge-offs.

“Trust Adjusted Allocated Amount” means, with respect to any Due Period, the sum of the Series Adjusted Allocated Amounts for all outstanding Series.

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SERIES PROVISIONS

General

The Notes are issuable from time to time at the discretion of the Trust during the period that the Prospectus remains valid on terms determined at the date of issue in an aggregate principal amount not to exceed $4,000,000,000. The Notes are offered pursuant to a MTN Program, as contemplated by the National Instrument. The National Instrument permits the omission from the Prospectus of certain variable terms of the Notes, which will be established at the time of the offering and sale of the Notes and will be included in pricing supplements, which are incorporated by reference into the Prospectus solely for the purpose of the Notes issued thereunder. A pricing supplement containing the specific terms of any particular offering of Notes will be delivered to purchasers of such Notes together with the Prospectus. The specific variable terms of any offering of Notes including, where applicable and without limitation, the aggregate principal amount of Notes being offered, the issue price, the issue, delivery and maturity dates, the redemption or repayment provisions, if any, the interest rate or interest rate basis and the interest payment date(s), will be established by the Trust and set forth in the applicable pricing supplement that will accompany the Prospectus. The Trust reserves the right to set forth in a pricing supplement specific variable terms of an offering of Notes that are not within the options and parameters set forth in the Prospectus. Reference is made to the applicable pricing supplement for a description of the specific terms of any offering of Notes. Notes will be offered in such amounts, at such times, at such rates of discount or interest and on such other terms and conditions as the Trust may, from time to time, determine based on financing requirements, prevailing market conditions and other factors. The Expected Final Payment Date for the Notes of a Series will be as specified in the applicable Series Supplement and as set out in the applicable pricing supplement. Holders of the Notes will receive payments of principal and interest until the applicable Series Termination Date.

Each Series of Notes will be issued pursuant to the Note Issuance Agreement, and a series supplement thereto relating to the Notes of such Series (each, a “Series Supplement”), among the Seller as holder of the Seller Note and as Servicer of the Accounts, the Trust and the Indenture Trustee. The Notes will evidence indebtedness of the Trust secured by a portion of the Trust Assets, such portion being the Noteholders’ Allocation. Unless otherwise specified in the applicable pricing supplement, each Series of Notes will be comprised of four classes, being the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes. The remainder of this section entitled “Series Provisions” relates to each Series of Notes that is comprised of such four classes. The relevant provisions of any Series not so comprised will be set forth in the applicable pricing supplement.

The class A Notes of each Series (the “Class A Notes”) will have the right to receive from such Series’ Noteholders’ Allocation funds up to (but not in excess of) the amounts required to make payments of interest on such Class A Notes and the payment of the Class A Allocated Amount for such Notes on their Expected Final Payment Date, or earlier or later under certain circumstances.

The class B Notes of each Series (the “Class B Notes”) will have the right to receive from such Series’ Noteholders’ Allocation funds up to (but not in excess of) the amounts required to make payments of interest on such Class B Notes and the payment of the Class B Allocated Amount for such Notes on their Expected Final Payment Date, or earlier or later under certain circumstances.

The class C Notes of each Series (the “Class C Notes”) will have the right to receive from such Series’ Noteholders’ Allocation funds up to (but not in excess of) the amounts required to make payments of interest on such Class C Notes and the payment of the Class C Allocated Amount for such Notes on their Expected Final Payment Date, or earlier or later under certain circumstances.

The class D Notes of each Series (the “Class D Notes”) will have the right to receive from such Series’ Noteholders’ Allocation funds up to (but not in excess of) the amounts required to make payments of interest on such Class D Notes and the payment of the Class D Allocated Amount for such Notes on their Expected Final Payment Date, or earlier or later under certain circumstances.

Interest

Each Class of Notes will bear interest at the rate per annum specified in the related Series Supplement (and set out in the applicable pricing supplement) and will, in each case, be payable in arrears on each Interest Payment Date before as well as after any default and judgment with interest on overdue interest at the same rate. The interest payable on each Note on each Interest Payment Date shall be calculated in the manner specified in the related Series Supplement (and set out in the

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applicable pricing supplement). Any interest due but not paid on any Interest Payment Date will be due on the next succeeding Interest Payment Date together with additional interest on such amount at the applicable rate of interest for the particular class of Notes. An “Interest Payment Date” for a Series shall have the meaning set forth in the applicable Series Supplement (and shall be set forth in the applicable pricing supplement).

Interest will accrue on the unpaid principal amount of the Class A Notes at a per annum rate equal to the “Class A Interest Rate” specified in the related Series Supplement (and set out in the applicable pricing supplement) and, except as otherwise provided herein, will be paid to the Class A Noteholders on each applicable Interest Payment Date. On each Allocation Date, Class A Monthly Interest for the current period and Class A Monthly Interest previously due but not deposited into the Interest Funding Account on a prior Allocation Date will be deposited in an Eligible Deposit Account in the name of the Trust (the “Interest Funding Account”), which will initially be maintained with Bank of Montreal. In addition to and notwithstanding any provision in the Note Issuance Agreement or in the related Series Supplement (unless otherwise stated in the related Series Supplement and set out in the applicable pricing supplement), amounts deposited in the Interest Funding Account from time to time may be invested in demand deposits of Bank of Montreal provided that (i) at the time of the Trust’s investment therein, the short-term debt rating of Bank of Montreal is P-1 from Moody’s and R-1 (middle) or better from DBRS, (ii) at no time shall the value of such investments exceed 20% of the outstanding principal balance of the Notes, and (iii) should the short-term debt rating of Bank of Montreal be withdrawn or reduced below the ratings specified in clause (i) above, such amounts will be withdrawn and reinvested in Eligible Investments within two business days of such event.

Interest will accrue on the unpaid principal amount of the Class B Notes at a per annum rate equal to the Class B Interest Rate and, except as otherwise provided herein, be paid to the Class B Noteholders on each applicable Interest Payment Date. On each Allocation Date, Class B Monthly Interest for the current period and Class B Monthly Interest previously due but not deposited into the Interest Funding Account on a prior Allocation Date will be deposited in the Interest Funding Account.

Interest will accrue on the unpaid principal amount of the Class C Notes at a per annum rate equal to the Class C Interest Rate and, except as otherwise provided herein, be paid to the Class C Noteholders on each applicable Interest Payment Date. On each Allocation Date, Class C Monthly Interest for the current period and Class C Monthly Interest previously due but not deposited into the Interest Funding Account on a prior Allocation Date will be deposited in the Interest Funding Account.

Interest will accrue on the unpaid principal amount of the Class D Notes at a per annum rate equal to the Class D Interest Rate specified in the related Series Supplement (and set out in the applicable pricing supplement) and, except as otherwise provided herein, be paid to the Class D Noteholders on each applicable Interest Payment Date. On each Allocation Date, Class D Monthly Interest for the current period and Class D Monthly Interest previously due but not deposited into the Interest Funding Account on a prior Allocation Date will be deposited in the Interest Funding Account.

Pursuant to the Note Issuance Agreement, the Trust will pledge its interest in the Interest Funding Account to the Indenture Trustee to be held as part of the Noteholders’ Allocation. Any earnings (net of losses and investment expenses) on funds in the Interest Funding Account for each Series will be treated as Reallocated Investor Finance Charge Collections. During an Early Amortization Period with respect to a Series, Class A Monthly Interest will be paid on the Class A Notes, Class B Monthly Interest will be paid on the Class B Notes, Class C Monthly Interest will be paid on the Class C Notes and Class D Monthly Interest will be paid on the Class D Notes, in each case, on each applicable Special Payment Date, and any amounts on deposit in the Interest Funding Account on account of the Class A Notes, Class B Notes, Class C Notes and Class D Notes will be paid on the Notes of such Series to the respective Noteholders on the first applicable Special Payment Date. Interest due with respect to Notes for any applicable Interest Payment Date will accrue from and including the preceding applicable Interest Payment Date, or in the case of the first Interest Payment Date, from and including the applicable Series Issuance Date, to but excluding such Interest Payment Date, and will, unless otherwise stated in the applicable Series Supplement (and set forth in the related pricing supplement), be calculated on the basis of a 365-day year. Interest with respect to the Class A Notes, Class B Notes, the Class C Notes and the Class D Notes due but not paid on any applicable Interest Payment Date or Special Payment Date will be due on the next succeeding Allocation Date with additional interest on such amount at the Class A Interest Rate, the Class B Interest Rate, the Class C Interest Rate or the Class D Interest Rate, as applicable.

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Principal

The Servicer, for the benefit of the Trust and the Indenture Trustee, will establish and maintain, in the name of the Trust, an Eligible Deposit Account (the “Principal Funding Account”) with respect to each Series of Notes, which will initially be maintained with Bank of Montreal.

No principal payments will be made to the Class A Noteholders of a Series until their Expected Final Payment Date or, upon the occurrence of an Amortization Event for such Series, the first Special Payment Date. Payments of principal in respect of the Class B Notes of a Series will not commence until after the final principal payment with respect to the Class A Notes of such Series has been made, payments of principal in respect of the Class C Notes of a Series will not commence until after the final principal payment in respect of the Class B Notes of such Series has been made, and payments of principal in respect of the Class D Notes of a Series will not commence until after the final principal payment in respect of the Class C Notes of such Series has been made. On each Allocation Date with respect to the Revolving Period for a Series, Principal Collections which form part of such Series’ Noteholders’ Allocation (other than Subordinated Principal Collections that are used to fund the Class A Required Amount, the Class B Required Amount and the Class C Required Amount for such Series), subject to certain limitations, will either be (a) used to discharge the Trust’s obligation with respect to principal on one or more Series which are in accumulation or amortization periods or (b) paid to the Seller in consideration of the purchase of new Receivables in the Accounts, used to maintain the Noteholders’ Allocation or held as Unallocated Principal Collections.

Unless an Amortization Event shall have occurred with respect to a Series, until the Class A Allocated Amount for such Series is paid in full, on each Allocation Date with respect to the Accumulation Period for such Series, Principal Collections which form part of the Noteholders’ Allocation plus certain other amounts comprising Monthly Principal for such Series will no longer be paid for the benefit of another Series or to the Seller as described above but instead an amount thereof up to the Controlled Payment Amount for such Series for each such Allocation Date will be deposited in the Principal Funding Account for such Series. See “- Principal Funding Account” below. Any such amounts in excess of the applicable Controlled Payment Amount will be allocated as described below under “- Reallocations Among Securities of Different Series - Investor Principal Collections for All Series”. The funds deposited in the Principal Funding Account for a Series will be used to pay the Allocated Amount for such Series on its Expected Final Payment Date. If on such date the related Principal Funding Account Balance is less than the Allocated Amount for such Series, the Early Amortization Period for such Series will commence and on each Special Payment Date thereafter the Class A Noteholders of such Series will receive payments of Class A Monthly Principal and Class A Monthly Interest until the Class A Allocated Amount has been paid in full or the applicable Series Termination Date has occurred. Even if the Principal Funding Account Balance on the Series Termination Date for such Series is insufficient to pay the Class A Allocated Amount in full, such balance will be paid to the Class A Noteholders at such time.

It is expected that the final principal payment with respect to the Class A Notes of a Series will be made on their Expected Final Payment Date, but the principal of such Class A Notes may be paid earlier or, depending on the actual payment rate on the Receivables and the amount of available Excess Principal Collections, if any, during the Accumulation Period for such Series, later, as described under “Risk Factors — Series Considerations — Payments”. If the Class A Allocated Amount for a Series is paid in full on its Expected Final Payment Date, it is expected that the final principal payment with respect to the Class B Notes of such Series will be made on their Expected Final Payment Date, but the principal of such Class B Notes may be paid earlier or, depending on the actual payment rate on the Receivables and the amount of available Excess Principal Collections, if any, during the Accumulation Period for such Series, later, as described under “Risk Factors — Series Considerations — Payments”. If the Class B Allocated Amount for a Series is paid in full on its Expected Final Payment Date, it is expected that the final principal payment with respect to the Class C Notes of such Series will be made on their Expected Final Payment Date, but the principal of such Class C Notes may be paid earlier or, depending on the actual payment rate on the Receivables and the amount of available Excess Principal Collections, if any, during the Accumulation Period for such Series, later, as described under “Risk Factors — Series Considerations — Payments”. If the Class C Allocated Amount for a Series is paid in full on its Expected Final Payment Date, it is expected that the final principal payment with respect to the Class D Notes of such Series will be made on their Expected Final Payment Date, but the principal of such Class D Notes may be paid earlier or, depending on the actual payment rate on the Receivables and the amount of available Excess Principal Collections, if any, during the Accumulation Period for such Series, later, as described under “Risk Factors — Series Considerations — Payments”.

If an Early Amortization Period occurs with respect to a Series, principal payments to the Class B Noteholders of such Series will be made, to the extent of remaining Collections allocated and available therefor, on the Special Payment Date on which the final principal payment is made to the Class A Noteholders of such Series, principal payments to the

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Class C Noteholders of such Series will be made, to the extent of remaining Collections allocated and available therefor, on the Special Payment Date on which the final principal payment is made to the Class B Noteholders of such Series, and principal payments to the Class D Noteholders of such Series will be made, to the extent of remaining Collections allocated and available therefor, on the Special Payment Date on which the final principal payment is made to the Class C Noteholders of such Series. If the Receivables are sold or repurchased as described in the third following paragraph below, principal payments on such Series of Notes will be made on the Allocation Date following such sale or repurchase, subject (i) in the case of the Class B Notes of such Series, to the prior payment in full of the Class A Allocated Amount for such Series, (ii) in the case of the Class C Notes of such Series, to the prior payment in full of the Class B Allocated Amount for such Series, and (iii) in the case of the Class D Notes of such Series, to the prior payment in full of the Class C Allocated Amount for such Series.

On the Expected Final Payment Date for a Series, provided that the Class A Allocated Amount for such Series is paid in full on such Expected Final Payment Date and the Early Amortization Period for such Series has not commenced, Available Investor Principal Collections for such Series will be used to pay the Class B Allocated Amount for such Series as described below under “— Allocation of Investor Principal Collections”. If on such Expected Final Payment Date the Available Investor Principal Collections for such Series are less than the Class B Allocated Amount for such Series, an Early Amortization Period will commence with respect to such Series and on each Allocation Date thereafter the Class B Noteholders of such Series will receive distributions of Class B Monthly Principal and Class B Monthly Interest until the Class B Allocated Amount for such Series has been paid in full or the Series Termination Date for such Series has occurred. Even if the Available Investor Principal Collections on such Expected Final Payment Date are insufficient to pay the Class B Allocated Amount in full, all such funds will be paid to the Class B Noteholders at such time after giving effect to any payments thereof to the Class A Noteholders of such Series.

On the Expected Final Payment Date for a Series, provided that the Class B Allocated Amount for such Series is paid in full on such Expected Final Payment Date and the Early Amortization Period has not commenced with respect to such Series, Available Investor Principal Collections for such Series will be used to pay the Class C Allocated Amount for such Series as described below under “— Allocation of Investor Principal Collections”. If on such Expected Final Payment Date such Available Investor Principal Collections for such Series are less than the Class C Allocated Amount for such Series, an Early Amortization Period will commence with respect to such Series and on each Allocation Date thereafter the Class C Noteholders will receive distributions of Class C Monthly Principal and Class C Monthly Interest until such Class C Allocated Amount has been paid in full or the Series Termination Date for such Series has occurred. Even if the Available Investor Principal Collections on such Expected Final Payment Date are insufficient to pay the Class C Allocated Amount in full, all such funds will be paid to the Class C Noteholders at such time after giving effect to any payments thereof to the Class A Noteholders and the Class B Noteholders of such Series.

On the Expected Final Payment Date for a Series, provided that the Class C Allocated Amount for such Series is paid in full on such Expected Final Payment Date and the Early Amortization Period has not commenced with respect to such Series, Available Investor Principal Collections for such Series will be used to pay the Class D Allocated Amount for such Series as described below under “— Allocation of Investor Principal Collections”. If on such Expected Final Payment Date such Available Investor Principal Collections for such Series are less than the Class D Allocated Amount for such Series, an Early Amortization Period will commence with respect to such Series and on each Allocation Date thereafter the Class D Noteholders will receive distributions of Class D Monthly Principal and Class D Monthly Interest until such Class D Allocated Amount has been paid in full or the Series Termination Date for such Series has occurred. Even if the Available Investor Principal Collections on such Expected Final Payment Date are insufficient to pay the Class C Allocated Amount in full, all such funds will be paid to the Class D Noteholders at such time after giving effect to any payments thereof to the Class A Noteholders, the Class B Noteholders and the Class C Noteholders of such Series.

In the event of (i) a sale of the Receivables and an early termination of the Trust due to a Seller Insolvency Event, (ii) an optional repurchase by the Seller of the Receivables allocated to the Noteholders’ Allocation for Noteholders of all Series in connection with a Servicer Default (see “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Servicer Default”), (iii) a sale of a portion of the Receivables in connection with the Series Termination Date (see “- Optional Termination; Final Payment of Principal” below), or (iv) a reassignment of the Receivables to the Seller for Noteholders and the Noteholders’ Allocation in connection with a breach by the Seller of certain representations and warranties (each as described under “- Amortization Events”, “- Optional Termination; Final Payment of Principal” below or under “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Representations and Warranties” and “- Servicer Default”), payments of principal will be made to the Noteholders of each Series upon surrender of their Notes. The portion of the proceeds of any such sale or repurchase will be used first to pay interest amounts due with respect to such Series and second to pay principal amounts due with respect to such Series. Following any such sale or repurchase,

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on the related Payment Date any Available Cash Collateral Amount for such Series (after giving effect to all other withdrawals from the related Cash Collateral Account on such date) will be paid first to the Class A Noteholders of such Series to the extent that after giving effect to the payment to such Class A Noteholders from the proceeds from such sale or repurchase allocated to pay principal to such Class A Noteholders, the unpaid principal amount of the Class A Notes exceeds the Class A Allocated Amount for such Series, second to the Class B Noteholders of such Series to the extent that, after giving effect to the payment to such Class B Noteholders from the proceeds from such sale or repurchase allocated to pay principal to such Class B Noteholders (after the Class A Notes of such Series have been fully paid), the unpaid principal amount of such Class B Notes exceeds the Class B Allocated Amount for such Series, third to Class C Noteholders of such Series to the extent that, after giving effect to the payment to such Class C Noteholders from the proceeds from such sale or repurchase allocated to pay principal to such Class C Noteholders (after the Class A Notes and the Class B Notes of such Series have been fully paid), the unpaid principal amount of such Class C Notes exceeds the Class C Allocated Amount for such Series, and fourth to Class D Noteholders of such Series to the extent that, after giving effect to the payment to such Class D Noteholders from the proceeds from such sale or repurchase allocated to pay principal to such Class D Noteholders (after the Class A Notes, the Class B Notes and the Class C Notes of such Series have been fully paid), the unpaid principal amount of such Class D Notes exceeds the Class D Allocated Amount for such Series.

Postponement of Accumulation Period

Upon written notice to the Trust, the Issuer Trustee, the Indenture Trustee and the applicable Rating Agencies, the Servicer may elect to postpone the commencement of the Accumulation Period for a Series of Notes and extend the length of the Revolving Period for such Series, subject to certain conditions including those set forth below. The Servicer may make such election only if the “Accumulation Period Length” (determined as described below) is less than six months. On the Determination Date immediately preceding the Allocation Date specified in the related Series Supplement (and set out in the applicable pricing supplement) and on each Determination Date thereafter until the date the Accumulation Period for such Series begins, the Servicer will determine the Accumulation Period Length for such Series based generally on the lowest monthly principal payment rate on the Receivables for the prior 12 months and the amount of principal allocable or payable to the Noteholders of all outstanding Series which are scheduled to be in their revolving periods. If the Accumulation Period Length is less than six months, the Servicer may, at its option, postpone the commencement of the Accumulation Period such that the number of months included in the Accumulation Period will be equal to or exceed the Accumulation Period Length. The length of the Accumulation Period for any Series will not be less than one month.

Allocations and Reallocations

Allocation Between Noteholders and the Seller

The Servicer will allocate to the Noteholders’ Allocation for each Series for each Due Period a portion of the Trust Assets, including all collections of Receivables and all Defaulted Receivables, based on the Series Allocation Percentage for such Series as described under “Master Trust Provisions — Allocations Among Series”. The Servicer will then allocate amounts initially allocated to a particular Series between such Series’ Noteholders’ Allocation and the Seller’s Allocation for such Due Period as follows:

(a) Series Allocable Finance Charge Collections will at all times be allocated to the Noteholders’ Allocation based on the Floating Allocation Percentage (the amounts so allocated are referred to herein as “Investor Finance Charge Collections”);

(b) Series Allocable Defaulted Receivables will at all times be allocated to the Noteholders’ Allocation based on the Floating Allocation Percentage;

(c) during the Revolving Period, Series Allocable Principal Collections will be allocated to the Noteholders’ Allocation based on the Floating Allocation Percentage;

(d) during the Accumulation Period and any Early Amortization Period, Series Allocable Principal Collections will be allocated to the Noteholders’ Allocation based on the Principal Allocation Percentage; and

(e) Series Allocable Miscellaneous Payments will at all times be allocated to the Noteholders’ Allocation (the amounts allocated under clauses (c), (d) and (e) for any Due Period, together with any amounts which are to be allocated as Investor Principal Collections as described under “Reallocated Investor Finance

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Charge Collections and Excess Finance Charge Collections — Investor Finance Charge Collections” below, are referred to herein as “Investor Principal Collections”).

Amounts not allocated to such Series’ Noteholders’ Allocation as described above will be allocated to the Seller’s Allocation or paid to the Seller as described herein.

“Floating Allocation Percentage” for each Series and each Due Period is the percentage equivalent (which shall not be in excess of 100%) of the ratio which the Allocated Amount as of the last day of the immediately preceding Due Period bears to the product of (a) the Series Allocation Percentage in respect of which the Floating Allocation Percentage is being determined and (b) the aggregate of the total amount of Principal Receivables on the last day of the immediately preceding Due Period and the principal amount on deposit in the Excess Funding Account on such last day; provided, however, that, with respect to any Due Period in which a Lump Sale of Receivables or removal of Receivables in Accounts occurs, the amount referred to in clause (b) for such Due Period shall be the aggregate of the weighted average amount of Principal Receivables in the Trust for such Due Period and the principal amount on deposit in the Excess Funding Account on the last day of such Due Period. During the initial Due Period with respect to any Series of Notes, the Floating Allocation Percentage will equal the percentage equivalent of the ratio which the amount of the initial Allocated Amount for such Series bears to the product of (x) the Series Allocation Percentage and (y) the total amount of Principal Receivables on the applicable Series Cut-Off Date.

“Allocated Amount” for a Series and any date means an amount equal to (a) the aggregate initial principal amount of the Notes of such Series, minus (b) the aggregate of the amount of principal payments made to Noteholders of such Series prior to such date (other than any principal payments made to such Noteholders from amounts drawn from the related Cash Collateral Account for such purpose), minus (c) the Principal Funding Account Balance for such Series as of such date, minus (d) the aggregate amount of Investor Charge-Offs for such Series for all prior Allocation Dates minus (e) the aggregate amount of Subordinated Principal Collections allocated and applied to fund the Class A Required Amounts, if any, the Class B Required Amounts, if any, and the Class C Required Amounts, if any, on all prior Allocation Dates for such Series, plus (f) the sum of (i) the aggregate amount of any Series Allocable Miscellaneous Payments allocated and available on all prior Allocation Dates to reimburse Investor Charge-Offs for such Series, and (ii) the amount of Reallocated Investor Finance Charge Collections allocated and available on all prior Allocation Dates for the purpose of reimbursing amounts deducted pursuant to the foregoing clauses (d) and (e); provided, however, that in no event shall the Allocated Amount for a Series be less than zero.

“Principal Allocation Percentage” means, for each Series and for each Due Period, the percentage equivalent (which shall not be in excess of 100%) of the ratio which the Adjusted Allocated Amount for such Series on the last day of the Revolving Period for such Series bears to the product of (a) the Series Allocation Percentage for such Series and (b) the aggregate of the total amount of Principal Receivables on the last day of the immediately preceding Due Period and the principal amount on deposit in the Excess Funding Account on such date; provided, however, that if a Lump Sale of Receivables or redemption of Receivables arising in Redeemed Accounts occurs during such Due Period, the amount referred to in clause (b) for such Due Period shall be the aggregate of the weighted average amount of Principal Receivables in the Trust and the principal amount on deposit in the Excess Funding Account for such Due Period.

Reallocations Among Securities of Different Series

Group One Investor Finance Charge Collections

The Series offered hereby may be included in Group One, Group Two or another Group. The following description of the allocation of Finance Charge Collections, Principal Collections and other amounts relates to such allocations with respect to Group One. The allocations of such amounts with respect to another Group would be the same as the following, where references to Group One are replaced with references to such Group.

The Servicer will calculate, for each Due Period, Group One Investor Finance Charge Collections and on the following Allocation Date shall allocate such amount among the Noteholders’ Allocation for each Series in Group One for the following purposes and in the following priority:

(a) Group One Investor Monthly Servicing and Administration Fees;

(b) Group One Investor Monthly Interest;

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(c) Group One Investor Default Amounts;

(d) Group One Investor Monthly Enhancement Fees;

(e) Group One Investor Additional Amounts; and

(f) the balance pro rata among each Series in Group One based on the current allocated amount of each such Series.

If the amount of Group One Investor Finance Charge Collections is not sufficient to cover each in full, the amount in each of clauses (a), (b), (c), (d) and (e), the amount available will be allocated among the Series in Group One pro rata based on the claim that each Series has under the applicable clause. This means, for example, that if, after satisfying the claims of each Series in Group One for servicing and administration fees, the remaining amount of Group One Investor Finance Charge Collections is not sufficient to cover Group One Investor Monthly Interest, each Series in Group One will share such amount pro rata and any Series with a claim with respect to monthly interest, overdue monthly interest and interest on such overdue monthly interest, if applicable, which is larger than the claim for such amounts for the Notes of any another Series (due to a higher interest rate) will receive a proportionately larger allocation.

The sum of (a) the amount of Group One Investor Finance Charge Collections allocated to the Noteholders’ Allocation for each Series, and (b) the Investment Proceeds for such Series for the relevant Due Period is referred to herein as “Reallocated Investor Finance Charge Collections”.

“Group One Investor Additional Amounts” means, for a Series and any Allocation Date, the sum of (a) with respect to the Notes of a Series, an amount equal to the sum of the Investor Charge-Offs and Subordinated Principal Collections applied to fund the Class A Required Amount, the Class B Required Amount and the Class C Required Amount for such Series which, in each case, have not been reimbursed, and (b) with respect to any other Series in Group One, (i) an amount equal to the amount by which the allocated amount of any class of Notes has been reduced as a result of investor charge-offs, subordination of principal collections and funding the investor default amount for any other class of Notes of such Series and (ii), if the related Series Supplement so provides, the amount of interest at the applicable interest rate that has accrued on the amount described in the preceding clause (i).

“Group One Investor Default Amount” means, for any Series and any Allocation Date, the sum of (a) the Investor Default Amount for such Series and such Allocation Date and (b) the aggregated amount of the investor default amounts for all other Series included in Group One for such Allocation Date.

“Group One Investor Finance Charge Collections” means, for any Series and any Allocation Date, the sum of (a) the aggregate amount of Investor Finance Charge Collections for such Series and such Allocation Date and (b) the aggregate amount of investor finance charge collections for such Allocation Date for all other Series in Group One.

“Group One Investor Monthly Interest” means, for any Series and any Allocation Date, (a) the sum of (i) Class A Monthly Interest for such Series and such Allocation Date, plus the amount of any Class A Monthly Interest for such Series previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus any additional interest with respect to interest amounts that were due but not paid to the Class A Noteholders of such Series on a prior Payment Date, plus (ii) Class B Monthly Interest for such Series and such Allocation Date, plus the amount of any Class B Monthly Interest for such Series previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus any additional interest with respect to interest amounts that were due but not paid to the Class B Noteholders of such Series on a prior Payment Date, plus (iii) Class C Monthly Interest for such Series and such Allocation Date, plus the amount of any Class C Monthly Interest for such Series previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus any additional interest with respect to interest amounts that were due but not paid to the Class C Noteholders of such Series on a prior Payment Date, plus (iv) Class D Monthly Interest for such Series and such Allocation Date, plus the amount of any Class D Monthly Interest for such Series previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus any additional interest with respect to interest amounts that were due but not paid to the Class D Noteholders of such Series on a prior Payment Date, and (b) the aggregate amount of monthly interest, including overdue monthly interest and interest on such overdue monthly interest, if applicable, for all other Series in Group One for such Allocation Date.

“Group One Investor Monthly Servicing and Administration Fees” means, for any Series and any Allocation Date, the sum of (a) the Monthly Servicing Fee, the Monthly Administrative Fees, the Monthly Trust Fee and the Monthly

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Indenture Trustee Fee, in each case for such Series, and (b) the portion of the servicing fee, administrative agent fees, trust fee and indenture trustee fee allocable to the Notes of each other Series in Group One.

“Monthly Servicing Fee” means, for each Series, 1/12th of the Series Servicing Fee.

“Monthly Trust Fee” means, for each Series, 1/12th of the annual retainer amount, together with the Issuer Trustee’s

expenses, as specified in a letter agreement between the Issuer Trustee and Bank of Montreal.

“Monthly Indenture Trustee Fee” means, for each Series, 1/12th of the annual retainer amount, together with the

Indenture Trustee’s expenses, as specified in a letter agreement between the Indenture Trustee and Bank of Montreal.

Investor Principal Collections for All Series

Investor Principal Collections for any Due Period during the Revolving Period for a Series will first be allocated to cover Subordinated Principal Collections for such Series to the extent necessary to fund the Class A Required Amount, the Class B Required Amount and the Class C Required Amount, if any, for such Series and such Due Period and, with respect to the Accumulation Period for such Series, an amount equal to the sum of the Class A Monthly Interest, the Class B Monthly Interest, the Class C Monthly Interest and the Class D Monthly Interest, in each case for such Series, will be deposited into the related Principal Funding Account or, with respect to any Early Amortization Period for such Series, paid to the Noteholders of such Series. See “- Subordination” and “- Allocation of Investor Principal Collections” below. The Servicer will determine the amount of Investor Principal Collections for each Series and any Due Period (plus certain other amounts described below under “- Allocation of Investor Principal Collections”) remaining after such required payments and deposits and the amount of any similar excess for any other Series (“Excess Principal Collections”). The Servicer will use the Excess Principal Collections for each Series to cover any principal payments to Noteholders and deposits to Principal Funding Accounts for any Series which are scheduled and which have not been covered out of the investor principal collections and certain other amounts for such Series (“Principal Shortfalls”). If Principal Shortfalls exceed Excess Principal Collections for any Due Period, Excess Principal Collections will be allocated pro rata among the applicable Series based on the relative amounts of Principal Shortfalls. To the extent that Excess Principal Collections exceed Principal Shortfalls, the balance will be allocated to the Seller, unless the aggregate of the total amount of Principal Receivables and the principal amount on deposit in the Excess Funding Account (after giving effect to any new Principal Receivables sold to the Trust) is equal to or less than the Required Minimum Principal Balance (such amount referred to as “Unallocated Principal Collections”), which shall be retained in the Excess Funding Account and will be released to the Seller (as partial payment of the then unpaid purchase price for the Receivables) to the extent the total amount of Principal Receivables together with the principal amounts then on deposit in the Excess Funding Account exceed the Required Minimum Principal Balance or until an amortization event occurs or an accumulation period (or amortization period, if applicable) commences for any Series (after which such amount will be treated as a Series Allocable Miscellaneous Payment).

Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections

Investor Finance Charge Collections

On each Allocation Date, the Servicer will allocate the Reallocated Investor Finance Charge Collections for each Series with respect to the Due Period immediately preceding such Allocation Date in the following priority:

(a) an amount equal to the sum of the applicable Monthly Trust Fee and the Monthly Indenture Trustee Fee, if any, for such Allocation Date shall be paid to the Issuer Trustee and the Indenture Trustee, respectively, pro rata;

(b) an amount equal to the applicable Monthly Servicing Fee and the Monthly Administration Fee, if any, for such Allocation Date shall be paid to the Servicer;

(c) an amount equal to Class A Monthly Interest for such Allocation Date, plus the amount of any Class A Monthly Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus the amount of any Class A Additional Interest for such Allocation Date and any Class A Additional Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date shall be deposited by the Servicer into the related Interest Funding Account;

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(d) an amount equal to Class B Monthly Interest for such Allocation Date, plus the amount of any Class B Monthly Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus the amount of any Class B Additional Interest for such Allocation Date and any Class B Additional Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date shall be deposited by the Servicer into the related Interest Funding Account;

(e) an amount equal to Class C Monthly Interest for such Allocation Date, plus the amount of any Class C Monthly Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus the amount of any Class C Additional Interest for such Allocation Date and any Class C Additional Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date shall be deposited by the Servicer into the related Interest Funding Account;

(f) an amount equal to Class D Monthly Interest for such Allocation Date, plus the amount of any Class D Monthly Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date, plus the amount of any Class D Additional Interest for such Allocation Date and any Class D Additional Interest previously due but not deposited into the related Interest Funding Account on a prior Allocation Date shall be deposited by the Servicer into the related Interest Funding Account;

(g) an amount equal to the Investor Default Amount for such Series and such Allocation Date shall be treated as a portion of Investor Principal Collections for such Series and such Allocation Date;

(h) an amount equal to the aggregate amount of Investor Charge-Offs for such Series which have not been previously reimbursed (after giving effect on such Allocation Date to the allocation of any Series Allocable Miscellaneous Payments for such Series for that purpose) shall be treated as a portion of Investor Principal Collections with respect to such Series and such Allocation Date;

(i) an amount equal to the aggregate amount of Subordinated Principal Collections that were applied to fund the aggregate of the Class A Required Amounts, if any, the Class B Required Amounts, if any, and the Class C Required Amounts, if any, for all prior Allocation Dates with respect to such Series and which have not been previously reimbursed (after giving effect on such Allocation Date to the allocation of any Series Allocable Miscellaneous Payments for such Series (after giving effect to paragraph (g) above) for that purpose) shall be treated as a portion of Investor Principal Collections with respect to such Series and such Allocation Date;

(j) an amount equal to the excess, if any, of the Required Cash Collateral Amount for such Series over the amount then on deposit in the related Cash Collateral Account shall be deposited in such Cash Collateral Account; and

(k) on any Allocation Date occurring during the Accumulation Period and prior to an Early Amortization Period only, there shall be deposited:

(i) first, in the related Interest Funding Account an amount equal to the excess, if any, of (i) the amount of Class A Monthly Interest required to be made to the Class A Noteholders on the Expected Final Payment Date over (ii) the amount of Class A Monthly Interest on deposit in the related Interest Funding Account plus the amount of Reallocated Investor Finance Charge Collections deposited in the related Interest Funding Account on such Allocation Date pursuant to item (c) above;

(ii) second, in the related Interest Funding Account an amount equal to the excess, if any, of (i) the amount of Class B Monthly Interest required to be made to the Class B Noteholders on the Expected Final Payment Date over (ii) the amount of Class B Monthly Interest on deposit in the related Interest Funding Account plus the amount of Reallocated Investor Finance Charge Collections deposited in the related Interest Funding Account on such Allocation Date pursuant to item (d) above;

(iii) third, in the related Interest Funding Account an amount equal to the excess, if any, of (i) the amount of Class C Monthly Interest required to be made to the Class C Noteholders on the Expected Final Payment Date over (ii) the amount of Class C Monthly Interest on deposit in

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the related Interest Funding Account plus the amount of Reallocated Investor Finance Charge Collections deposited in the related Interest Funding Account on such Allocation Date pursuant to item (e) above;

(iv) fourth, in the related Interest Funding Account an amount equal to the excess, if any, of (i) the amount of Class D Monthly Interest required to be made to the Class D Noteholders on the Expected Final Payment Date over (ii) the amount of Class D Monthly Interest on deposit in the related Interest Funding Account plus the amount of Reallocated Investor Finance Charge Collections deposited in the related Interest Funding Account on such Allocation Date pursuant to item (f) above; and

(v) the balance, if any, less $100 shall be paid to the Seller.

“Investor Default Amount” means, for a Series and any Allocation Date the product of (i) the Floating Allocation Percentage for such Series and such Due Period, and (ii) the Series Allocable Defaulted Amount for such Series and such Due Period.

“Class A Monthly Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the rate of interest applicable to the Class A Notes of such Series (which rate shall be as set forth in the related Series Supplement and the applicable pricing supplement, the “Class A Interest Rate”) and (ii) the outstanding principal balance of the Class A Notes as of the close of business on the preceding Allocation Date (after subtracting therefrom the aggregate of all payments of Class A Monthly Principal on such preceding Allocation Date) or, with respect to the first Allocation Date, the initial principal amount of the Class A Notes of such Series. During the Accumulation Period for such Series, certain additional amounts may be deposited into the related Interest Funding Account on account of Class A Monthly Interest for such Series; provided, however, that when such amounts are added to all amounts on deposit in such Interest Funding Account on a particular Allocation Date on account of interest on the Class A Notes of such Series, the total may equal but not exceed the amount of interest payments required to be made to the Class A Noteholders of such Series on their Expected Final Payment Date.

“Class B Monthly Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the rate of interest applicable to the Class B Notes of such Series (which rate shall be as set forth in the related Series Supplement and the applicable pricing supplement, the “Class B Interest Rate”) and (ii) the outstanding principal balance of the Class B Notes as of the close of business on the preceding Allocation Date (after subtracting therefrom the aggregate of all payments of Class B Monthly Principal on such preceding Allocation Date) or, with respect to the first Allocation Date, the initial principal amount of the Class B Notes of such Series. During the Accumulation Period for such Series, certain additional amounts may be deposited into the related Interest Funding Account on account of Class B Monthly Interest for such Series; provided, however, that when such amounts are added to all amounts on deposit in such Interest Funding Account on a particular Allocation Date on account of interest on the Class B Notes of such Series, the total may equal but not exceed the amount of interest payments required to be made to the Class B Noteholders of such Series on their Expected Final Payment Date.

“Class C Monthly Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the rate of interest applicable to the Class C Notes of such Series (which rate shall be as set forth in the related Series Supplement and the applicable pricing supplement, the “Class C Interest Rate”) and (ii) the outstanding principal balance of the Class C Notes as of the close of business on the preceding Allocation Date (after subtracting therefrom the aggregate of all payments of Class C Monthly Principal on such preceding Allocation Date) or, with respect to the first Allocation Date, the initial principal amount of the Class C Notes of such Series. During the Accumulation Period for such Series, certain additional amounts may be deposited into the related Interest Funding Account on account of Class C Monthly Interest for such Series; provided, however, that when such amounts are added to all amounts on deposit in such Interest Funding Account on a particular Allocation Date on account of interest on the Class C Notes of such Series, the total may equal but not exceed the amount of interest payments required to be made to the Class C Noteholders on their Expected Final Payment Date.

“Class D Monthly Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the rate of interest applicable to the Class D Notes of such Series (which rate shall be as set forth in the related Series Supplement and the applicable pricing supplement, the “Class D Interest Rate”) and (ii) the outstanding principal balance of the Class D Notes as of the close of business on the preceding Allocation Date (after subtracting therefrom the aggregate of all payments of Class D Monthly Principal on such preceding Allocation Date) or, with respect to the first

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Allocation Date, the initial principal amount of the Class D Notes of such Series. During the Accumulation Period for such Series, certain additional amounts may be deposited into the related Interest Funding Account on account of Class D Monthly Interest for such Series; provided, however, that when such amounts are added to all amounts on deposit in such Interest Funding Account on a particular Allocation Date on account of interest on the Class D Notes of such Series, the total may equal but not exceed the amount of interest payments required to be made to the Class D Noteholders on their Expected Final Payment Date.

“Class A Additional Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the Class A Interest Rate, and (ii) the Class A Interest Shortfall (or the portion thereof which has not been paid to Class A Noteholders).

“Class B Additional Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the Class B Interest Rate, and (ii) the Class B Interest Shortfall (or the portion thereof which has not been paid to Class B Noteholders).

“Class C Additional Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the Class C Interest Rate, and (ii) the Class C Interest Shortfall (or the portion thereof which has not been paid to Class C Noteholders).

“Class D Additional Interest” means, for a Series and any Allocation Date, an amount equal to one-twelfth of the product of (i) the Class D Interest Rate, and (ii) the Class D Interest Shortfall (or the portion thereof which has not been paid to Class D Noteholders).

“Class A Interest Shortfall” means, for a Series and any Allocation Date, an amount equal to the excess, if any, of (x) the aggregate Class A Monthly Interest for the Interest Period applicable to such Payment Date, over (y) the amounts of Class A Monthly Interest which will be on deposit in the related Interest Funding Account on such Payment Date.

“Class B Interest Shortfall” means, for a Series and any Allocation Date, an amount equal to the excess, if any, of (x) the aggregate Class B Monthly Interest for the Interest Period applicable to such Payment Date, over (y) the amounts of Class B Monthly Interest which will be on deposit in the related Interest Funding Account on such Payment Date.

“Class C Interest Shortfall” means, for a Series and any Allocation Date, an amount equal to the excess, if any, of (x) the aggregate Class C Monthly Interest for the Interest Period applicable to such Payment Date, over (y) the amounts of Class C Monthly Interest which will be on deposit in the related Interest Funding Account on such Payment Date.

“Class D Interest Shortfall” means, for a Series and any Allocation Date, an amount equal to the excess, if any, of (x) the aggregate Class D Monthly Interest for the Interest Period applicable to such Payment Date, over (y) the amounts of Class D Monthly Interest which will be on deposit in the related Interest Funding Account on such Payment Date.

“Class A Allocated Amount” means, for a Series and any Allocation Date, the lesser of (a) the sum of (i) the aggregate initial principal amount of the Class A Notes of such Series on the applicable Series Issuance Date, minus (ii) the aggregate amount of principal payments made to Class A Noteholders of such Series prior to such date, minus (iii) the Principal Funding Account Balance for such Series as of such date and (b) the Allocated Amount of such Series; provided, however, that in no event shall the Class A Allocated Amount be less than zero.

“Class B Allocated Amount” means, for a Series and any Allocation Date, the lesser of (a) the sum of (i) the aggregate initial principal amount of the Class B Notes of such Series on the applicable Series Issuance Date, minus (ii) the aggregate amount of principal payments made to Class B Noteholders of such Series prior to such date, minus (iii) the excess, if any, of (x) the Principal Funding Account Balance for such Series as of such date over (y) the outstanding principal amount of the Class A Notes of such Series as of such date and (b) the excess, if any, of the Allocated Amount for such Series over the Class A Allocated Amount for such Series; provided, however, that in no event shall the Class B Allocated Amount be less than zero.

“Class C Allocated Amount” means, for a Series and any Allocation Date, the lesser of (a) the sum of (i) the aggregate initial principal amount of the Class C Notes of such Series on the applicable Series Issuance Date, minus (ii) the aggregate amount of principal payments made to Class C Noteholders of such Series prior to such date, minus (iii) the excess, if any, of (x) the Principal Funding Account Balance for such Series as of such date over (y) the outstanding principal amount of the Class A Notes and the Class B Notes of such Series as of such date and (b) the excess, if any, of the Allocated Amount

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for such Series over the sum of the Class A Allocated Amount and the Class B Allocated Amount for such Series; provided, however, that in no event shall the Class C Allocated Amount be less than zero.

“Class D Allocated Amount” means, for a Series and any Allocation Date, the lesser of (a) the sum of (i) the aggregate initial principal amount of the Class D Notes of such Series on the applicable Series Issuance Date, minus (ii) the aggregate amount of principal payments made to Class D Noteholders of such Series prior to such date, minus (iii) the excess, if any, of (x) the Principal Funding Account Balance for such Series as of such date over (y) the outstanding principal amount of the Class A Notes, the Class B Notes and the Class C Notes of such Series as of such date and (b) the excess, if any, of the Allocated Amount for such Series over the sum of the Class A Allocated Amount, the Class B Allocated Amount and the Class C Allocated Amount for such Series; provided, however, that in no event shall the Class D Allocated Amount be less than zero.

“Class C Subordinated Principal Collections Allocation Percentage” means, for a Series and any Allocation Date, the percentage equivalent of a fraction, the numerator of which is the Class C Allocated Amount for such Series as of the last day of the second preceding Due Period and the denominator of which is the Allocated Amount for such Series as of such last day.

“Class D Subordinated Principal Collections Allocation Percentage” means, for a Series and any Allocation Date, the percentage equivalent of a fraction, the numerator of which is the Class D Allocated Amount for such Series as of the last day of the second preceding Due Period and the denominator of which is the Allocated Amount for such Series as of such last day.

“Interest Period” means, for any Payment Date, the period from and including the preceding Payment Date and excluding such Payment Date; provided, however, that the first Interest Period with respect to a Series of Notes will commence on the applicable Series Issuance Date.

“Payment Date” means each Interest Payment Date and each Special Payment Date.

“Special Payment Date” means, for a Series, each Allocation Date with respect to any Early Amortization Period for such Series.

“Reallocated Investor Finance Charge Collections” means, for a Series and any Allocation Date, the sum of the Investor Finance Charge Collections for such Allocation Date and the Investment Proceeds for the relevant Due Period, in each case for such Series.

Subordination

The Class B Notes of each Series will be subordinated to the extent described herein to fund payments with respect to the Class A Notes of such Series. The Class B Allocated Amount for a Series represents the Class B Noteholders’ allocable portion of such Series’ Noteholders’ Allocation in the Trust Assets and represents the subordinated amount which, in addition to the Class C Allocated Amount and the Available Cash Collateral Amount, is available to fund payments with respect to the Class A Notes, in each case with respect to such Series. See “- Cash Collateral Account” below.

The Class C Notes of each Series will be subordinated to the extent described herein to fund payments with respect to the Class A Notes and the Class B Notes of such Series. The Class C Allocated Amount for a Series represents the Class C Noteholders’ allocable portion of the Noteholders’ Allocation in the Trust Assets and represents the subordinated amount which, in addition to the Available Cash Collateral Amount, is available to fund payments with respect to the Class A Notes and the Class B Notes, in each case for such Series. See “- Cash Collateral Account” below.

The Class D Notes of each Series will be subordinated to the extent described herein to fund payments with respect to the Class A Notes, the Class B Notes and the Class C Notes of such Series. The Class D Allocated Amount for a Series represents the Class D Noteholders’ allocable portion of the Noteholders’ Allocation in the Trust Assets and represents the subordinated amount which, in addition to the Available Cash Collateral Amount, is available to fund payments with respect to the Class A Notes, the Class B Notes and the Class C Notes, in each case for such Series. See “- Cash Collateral Account” below.

On each Determination Date, the Servicer will determine for each Series (i) the amount by which the sum of the amounts described in clauses (a), (b) and (c) under the heading “— Reallocated Investor Finance Charge Collections and

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Excess Finance Charge Collections” above exceed the amount of the Reallocated Investor Finance Charge Collections allocated for payment of such amounts with respect to each Series (such excess, the “Class A Required Amount”), (ii) the amount by which the sum of the amount described in clause (d) under such heading exceeds the amount of the Reallocated Investor Finance Charge Collections allocated for payment of such amount for each Series (such excess, the “Class B Required Amount”), (iii) the amount by which the sum of the amount described in clause (e) under such heading exceeds the amount of the Reallocated Investor Finance Charge Collections allocated for payment of such amount for each Series (such excess, the “Class C Required Amount”), and (iv) the amount by which the sum of the amount described in clause (f) under such heading exceeds the amount of the Reallocated Investor Finance Charge Collections allocated for payment of such amount for each Series (such excess, the “Class D Required Amount” and, together with the Class A Required Amount, the Class B Required Amount and the Class C Required Amount for such Series, the “Required Draw Amount”). If Reallocated Investor Finance Charge Collections with respect to such Allocation Date for a Series are less than the applicable Required Draw Amount, a withdrawal will be made from the related Cash Collateral Account in an amount up to the lesser of (a) the Available Cash Collateral Amount on such Allocation Date and (b) such shortfall. If the Available Cash Collateral Amount for a Series on such Allocation Date is not sufficient to fund such shortfall, the Servicer will apply Subordinated Principal Collections for such Series with respect to such Allocation Date to make the following distributions in the following order:

(a) an amount equal to the lesser of (i) such Subordinated Principal Collections and (ii) the excess, if any, of (x) the applicable Class A Required Amount, if any, with respect to such Allocation Date over (y) the Available Cash Collateral Amount for such Series with respect to such Allocation Date, shall be paid by the Servicer to fund any deficiency in items (a), (b) and (c) under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above (after giving effect to any withdrawal from the related Cash Collateral Account for the purpose of funding the Class A Required Amount for such Series on such Allocation Date) in that order of priority;

(b) an amount equal to the lesser of (i) such Subordinated Principal Collections (after giving effect to clause (a) above), and (ii) the excess, if any, of (x) the applicable Class B Required Amount, if any, with respect to such Allocation Date over (y) the Available Cash Collateral Amount for such Series with respect to such Allocation Date (after giving effect to any withdrawal from the related Cash Collateral Account for the purpose of funding the Class B Required Amount for such Series on such Allocation Date), shall be paid by the Servicer to fund any deficiency pursuant to item (d) under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above (after giving effect to any withdrawal from the related Cash Collateral Account for the purpose of funding the Class B Required Amount for such Series for such Allocation Date); provided, however, that the amount of Subordinated Principal Collections for any Allocation Date that may be applied to fund any deficiency as described under this clause (b) shall be limited to an amount equal to the product of such Subordinated Principal Collections and the sum of the Class C Subordinated Principal Collections Allocation Percentage and the Class D Subordinated Principal Collections Allocation Percentage for such Series for such Allocation Date;

(c) an amount equal to the lesser of (i) such Subordinated Principal Collections (after giving effect to clauses (a) and (b) above), and (ii) the excess, if any, of (x) the applicable Class C Required Amount, if any, with respect to such Allocation Date over (y) the Available Cash Collateral Amount for such Series with respect to such Allocation Date (after giving effect to any withdrawal from the related Cash Collateral Account for the purpose of funding the Class C Required Amount for such Series on such Allocation Date), shall be paid by the Servicer to fund any deficiency pursuant to item (d) under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above (after giving effect to any withdrawal from the related Cash Collateral Account for the purpose of funding the Class C Required Amount for such Series for such Allocation Date); provided, however, that the amount of Subordinated Principal Collections for any Allocation Date that may be applied to fund any deficiency as described under this clause (b) shall be limited to an amount equal to the product of such Subordinated Principal Collections and the Class D Subordinated Principal Collections Allocation Percentage for such Series for such Allocation Date; and

(d) the balance, if any, shall be treated as a portion of Investor Principal Collections with respect to such Series and such Allocation Date.

“Subordinated Principal Collections” means, for a Series and any Allocation Date, the product of (a) the Floating Allocation Percentage, with respect to the Revolving Period, or the Principal Allocation Percentage, with respect to the

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Accumulation Period or the Early Amortization Period, of Allocable Principal Collections deposited in the Collection Account for the related Due Period (or any partial Due Period which occurs as the first Due Period during the Early Amortization Period), in each case for such Series, and (b) the Subordinated Principal Collections Allocation Percentage for such Series and such Allocation Date.

“Subordinated Principal Collections Allocation Percentage” means, for a Series and any Allocation Date, the percentage equivalent of a fraction, the numerator of which is the sum of the Class B Allocated Amount, the Class C Allocated Amount and the Class D Allocated Amount as of the last day of the second preceding Due Period, and the denominator of which is the Allocated Amount as of such last day, in each case for such Series.

Allocation of Investor Principal Collections

On each Allocation Date, the Servicer will allocate the sum of Investor Principal Collections for each Series (other than Subordinated Principal Collections used to fund the Class A Required Amount, the Class B Required Amount and the Class C Required Amount for such Series), Excess Principal Collections, if any, from other Series allocated to the Notes of such Series and any reallocated amounts described in the preceding paragraphs which are to be allocated as Investor Principal Collections, in each case, for the preceding Due Period (collectively, the “Available Investor Principal Collections” for such Allocation Date), and will allocate such amounts as follows:

(a) for each Allocation Date with respect to the Revolving Period for such Series, all Available Investor Principal Collections will be treated as Excess Principal Collections (see “- Reallocations Among Securities of Different Series - Investor Principal Collections for All Series” above) and deposited to the Collection Account; and

(b) for each Allocation Date with respect to the Accumulation Period or any Early Amortization Period for such Series, all Available Investor Principal Collections for such Series will be allocated and applied in the following priority:

(i) an amount equal to Monthly Principal for such Series and such Allocation Date up to the Allocation Amount for such Series will be deposited in the related Principal Funding Account; and

(ii) for each Allocation Date with respect to the Accumulation Period prior to (or, if the Allocated Amount for such Series is paid in full on its Expected Final Payment Date, on or prior to) the Allocation Date on which the Allocated Amount for such Series is paid in full, unless an Amortization Event has occurred with respect to such Series, after giving effect to the payments referred to in clause (b)(i) above, an amount equal to the balance, if any, of such Available Investor Principal Collections then on deposit in the Collection Account and the Excess Funding Account shall be treated as Excess Principal Collections.

“Monthly Principal”, with respect to a Series and any Allocation Date relating to the Accumulation Period or any Early Amortization Period for such Series, will equal the Available Investor Principal Collections for such Series and such Allocation Date; provided, however, that for each Allocation Date with respect to the Accumulation Period for such Series, Monthly Principal may not exceed the lesser of the Controlled Payment Amount for such Allocation Date and the Allocated Amount, in each case for such Series.

“Controlled Payment Amount”, for a Series and any Allocation Date with respect to the Accumulation Period for such Series, means an amount equal to the sum of the Controlled Accumulation Amount and any then existing Deficit Controlled Accumulation Amount, in each case for such Series.

“Controlled Accumulation Amount” means, for a Series, the amount specified as such in the applicable Series Supplement.

“Deficit Controlled Accumulation Amount” means, on the first Allocation Date with respect to the Accumulation Period for a Series, the excess, if any, of the Controlled Accumulation Amount over the amount paid as Monthly Principal for such Allocation Date, in each case for such Series, and, on each subsequent Allocation Date with respect to such Accumulation Period, the excess, if any, of the Controlled Accumulation Amount plus any then existing Deficit Controlled Accumulation Amount over the amount paid from the Collection Account as Monthly Principal paid on such Allocation Date, in each case for such Series.

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Principal Funding Account

The Servicer will establish and maintain in the name of the Trust, on behalf of the Trust, an Eligible Deposit Account for each Series of Notes (the “Principal Funding Account”) and the Trust shall pledge its interest in the Principal Funding Account to the Indenture Trustee, in each case, for the benefit of the Noteholders of such Series. Unless otherwise specified in the applicable Series Supplement (and set out in the applicable pricing supplement), initially, the Principal Funding Account for each Series will be established with Bank of Montreal. Monthly Principal for each Series will be deposited in the related Principal Funding Account as described above under “— Principal”.

Provided that an Amortization Event has not occurred with respect to a Series, amounts on deposit in the related Principal Funding Account (the “Principal Funding Account Balance”) on any Allocation Date (after giving effect to payments to be made on such Allocation Date) will be invested from the date of their deposit to the Expected Final Payment Date for such Series by the Trust at the direction of the Servicer in Eligible Investments. On each Allocation Date with respect to the Accumulation Period and on the first Special Payment Date, if any, thereafter, for such Series, the interest and other investment income (net of investment expenses) earned (and actually received by the Trust on or before the Allocation Date following such Due Period) on monies deposited into the related Cash Collateral Account, the related Interest Funding Account and the related Principal Funding Account for such Due Period (the “Investment Proceeds”) will be withdrawn from the related Principal Funding Account and treated as Reallocated Investor Finance Charge Collections for such Series.

Payments

Payments to Noteholders of each Series will be made from the related Interest Funding Account and from the related Principal Funding Account (the “Funding Accounts”). The Servicer, on behalf of the Trust, shall apply the funds on deposit in such accounts to make the following payments with respect to each Series:

(a) from the related Interest Funding Account on each Payment Date, in the following priority:

(i) first, the aggregate of the amounts on deposit in such Interest Funding Account in respect of Class A Monthly Interest and Class A Additional Interest for the Interest Period then ended shall be paid to the Paying Agent for payment to the Class A Noteholders of such Series;

(ii) second, the aggregate of the amounts on deposit in such Interest Funding Account in respect of Class B Monthly Interest and Class B Additional Interest for the Interest Period then ended shall be paid to the Paying Agent for payment to the Class B Noteholders of such Series;

(iii) third, the aggregate of the amounts on deposit in such Interest Funding Account in respect of Class C Monthly Interest and Class C Additional Interest for the Interest Period then ended shall be paid to the Paying Agent for payment to the Class C Noteholders of such Series; and

(iv) fourth, the aggregate of the amounts on deposit in such Interest Funding Account in respect of Class D Monthly Interest and Class D Additional Interest for the Interest Period then ended shall be paid to the Paying Agent for payment to the Class D Noteholders of such Series

(b) from the related Principal Funding Account on each Special Payment Date and on the Expected Final Payment Date for such Series in the following priority:

(i) first, the lesser of (x) all amounts on deposit in such Principal Funding Account, (y) the outstanding principal amount of the Class A Notes, and (z) the Class A Allocated Amount, in each case, for any such date, shall be paid to the Paying Agent for payment to the Class A Noteholders of such Series;

(ii) second, provided the principal amount of the Class A Notes has been paid in full, the lesser of (x) all amounts on deposit in such Principal Funding Account (after giving effect to all payments made therefrom under clause (b)(i) above), (y) the outstanding principal amount of the Class B Notes, and (z) the Class B Allocated Amount, in each case, for any such date, shall be paid to the Paying Agent for payment to the Class B Noteholders of such Series;

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(iii) third, provided the principal amount of the Class A Notes and the Class B Notes has been paid in full, the lesser of (x) all amounts on deposit in such Principal Funding Account (after giving effect to all payments made therefrom under clauses (b)(i) and (ii) above), (y) the outstanding principal amount of the Class C Notes and (z) the Class C Allocated Amount, in each case, for any such date, shall be paid to the Paying Agent for payment to the Class C Noteholders of such Series; and

(iv) fourth, provided the principal amount of the Class A Notes, the Class B Notes and the Class C Notes has been paid in full, the lesser of (x) all amounts on deposit in such Principal Funding Account (after giving effect to all payments made therefrom under clauses (b)(i), (ii) and (iii) above), (y) the outstanding principal amount of the Class D Notes and (z) the Class D Allocated Amount, in each case, for any such date, shall be paid to the Paying Agent for payment to the Class D Noteholders of such Series.

The paying agent (the “Paying Agent”) shall initially be the Indenture Trustee. The Paying Agent shall have the revocable power to withdraw funds from such accounts for the purpose of making payments to Noteholders of each Series.

Defaulted Receivables; Recoveries; Rebates and Fraudulent Charges

“Defaulted Receivables” for any Due Period are Principal Receivables which are charged-off as uncollectible in such Due Period. The amount of Defaulted Receivables for any Due Period will be an amount (not less than zero) equal to (a) the amount of the Receivables that became Defaulted Receivables in such Due Period less (b) the amount of any Defaulted Receivables of which the Seller or the Servicer becomes obligated to accept reassignment or assignment during such Due Period unless certain events of bankruptcy, insolvency or receivership have occurred with respect to the Seller or the Servicer, in which event the amount of such Defaulted Receivables will not be added to the sum so subtracted. Receivables in any Account will be charged-off as uncollectible in accordance with the Servicer’s customary and usual policies and procedures for servicing its own comparable credit card accounts, but in any event a Receivable in any Account will be charged-off when (i) that account becomes 180 days delinquent unless a payment is made that satisfies the criteria for curing delinquencies in the applicable credit card guidelines, and (ii) if the Seller receives notice that a cardholder has filed for bankruptcy or has a bankruptcy petition filed against it, the Servicer shall charge-off such account not later than 30 days after the Servicer receives such notice.

If the Servicer adjusts downward the amount of any Receivable because of a rebate, refund, unauthorized charge, billing error or certain other non-cash items to a cardholder, or because such Receivable was created in respect of merchandise which was refused or returned by a cardholder, or if the Servicer charges-off as uncollectible certain small balances, the Seller’s Allocation of Principal Receivables will be reduced by the amount of such adjustment or charge-off. In addition, the Seller’s Allocation of Principal Receivables will be reduced by the amount of any Receivable which was discovered as having been created through a fraudulent or counterfeit charge or which was subject to certain liens specified in the Receivables Purchase Agreement. After any such reduction in the amount of the Seller’s Allocation of Principal Receivables occurs, the amount of such Receivables described above will be deducted from Principal Receivables used in the calculation of the principal allocation percentage and the floating allocation percentage applicable to any Series. To the extent that the reduction in the amount of the Seller’s Allocation of Principal Receivables would reduce such interest below zero, the Seller is required by the Receivables Purchase Agreement to deposit on the Allocation Date following such Due Period into the Collection Account in immediately available funds an amount equal to the amount by which the Seller’s Allocation of Principal Receivables would be reduced below zero (an “Adjustment Payment”).

Investor Charge-Offs; Other Reductions of the Allocated Amount

If on any Allocation Date, the sum of (i) Reallocated Investor Finance Charge Collections for a Series and such Allocation Date and (ii) the Available Cash Collateral Amount for a Series and such Allocation Date (after giving effect to any Required Draw Amount for such Series to be withdrawn from the related Cash Collateral Account on such Allocation Date) are not sufficient to cover the Investor Default Amount for such Series and Allocation Date as set forth in clause (f) under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above (after making the prior payments described in clauses (a) to (e), inclusive, under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above), the Allocated Amount for such Series shall be reduced by the amount of the deficiency (an “Investor Charge-Off”). Investor Charge-Offs for such Series shall thereafter be reimbursed and the Allocated Amount for such Series increased (but not by an amount in excess of the aggregate Investor Charge-Offs) on any Allocation Date by the sum of (i) Series Allocable Miscellaneous Payments with respect to such Allocation Date and such Series, and (ii) the amount of Reallocated Investor Finance Charge Collections allocated and

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available for such Series for that purpose as described in clause (h) under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above.

If on any Allocation Date any Subordinated Principal Collections for a Series and such Allocation Date are allocated to fund any Class A Required Amount, Class B Required Amount or Class C Required Amount for such Series, the Allocated Amount for such Series shall be reduced by the amount of such Subordinated Principal Collections. Subordinated Principal Collections allocated or applied to fund any Class A Required Amount, Class B Required Amount or Class C Required Amount for such Series shall thereafter be reimbursed and the Allocated Amount for such Series increased on any Allocation Date by the sum of (i) Series Allocable Miscellaneous Payments with respect to such Series and such Allocation Date (but only to the extent such amount is not required to reimburse Investor Charge-Offs for such Series on such Allocation Date) and (ii) the amount of Reallocated Investor Finance Charge Collections allocated and available for such Series and that purpose as described in clause (i) under the heading “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” above.

Cash Collateral Account

Unless otherwise specified in the applicable Series Supplement (and set out in the applicable pricing supplement), the credit enhancement with respect to each Series will include funds on deposit in a cash collateral account (the “Cash Collateral Account”) in the name of the Trust. The Trust will hold the funds on deposit in the Cash Collateral Account for the benefit of the Noteholders of such Series. The Trust will pledge its interest in the funds on deposit in the Cash Collateral Account to the Indenture Trustee for the benefit of the Noteholders of such Series. Funds on deposit in a Cash Collateral Account will be invested in certain Eligible Investments. It is expected that such funds will be invested in debt obligations of Bank of Montreal or its affiliates as long as such obligations qualify as Eligible Investments.

There will be no funds on deposit in the related Cash Collateral Account on a Series Issuance Date. Thereafter, Surplus Finance Charge Collections for a Series will be deposited into the related Cash Collateral Account on each Allocation Date until the amount on deposit therein equals the Required Cash Collateral Amount for such Series and such Allocation Date.

“Required Cash Collateral Amount” means, in respect of a Series, the amount specified as such in the related Series Supplement.

“Surplus Finance Charge Collections” means, with respect to a Series and any Due Period, Reallocated Investor Finance Charge Collections for such Series remaining after payment of the amounts referred to in clause (a) to (h), inclusive, under the heading “Series Provisions — Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” for such Due Period and such Series.

If on any Allocation Date the Available Cash Collateral Amount for a Series (after giving effect to all deposits to and withdrawals from the related Cash Collateral Account on such Allocation Date) is greater than the Required Cash Collateral Amount for the Allocation Date and such Series, the amount of the excess will be withdrawn from the related Cash Collateral Account and paid to the Seller.

On each Allocation Date, the “Available Cash Collateral Amount” for a Series will be equal to the lesser of (i) the amount on deposit in the related Cash Collateral Account on such Allocation Date (before giving effect to any deposit to be made to the related Cash Collateral Account on such Allocation Date), and (ii) the Required Cash Collateral Amount for such Series.

For each Series, on each Allocation Date one or more withdrawals will be made from the related Cash Collateral Account in an aggregate amount up to the Available Cash Collateral Amount for such Series on such Allocation Date, to fund the following amounts in the following priority, in each case with respect to such Series:

(a) first, the Class A Required Amount, if any;

(b) second, the Class B Required Amount, if any;

(c) third, the Class C Required Amount, if any;

(d) fourth, the Class D Required Amount, if any;

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(e) fifth, the excess, if any, of the Investor Default Amount for such Allocation Date over the amount of Reallocated Investor Finance Charge Collections allocated and available to fund such Investor Default Amount will be allocated in the same manner as Available Investor Principal Collections for such Allocation Date; and

(e) sixth, the remainder, if any, will be deposited in the related Principal Funding Account.

On each Allocation Date preceding each Special Payment Date (commencing with the Allocation Date preceding the first Special Payment Date) and on the Allocation Date preceding the Expected Final Payment Date for each Series, a withdrawal will be made from the related Cash Collateral Account to pay principal with respect to the Notes of such Series to the extent that the unpaid principal amount of such Notes exceeds the Allocated Amount of such Series on such Allocation Date, in an amount equal to the lesser of (a) the Available Cash Collateral Amount for such Series on such Allocation Date (after giving effect to all other withdrawals under the related Cash Collateral Account on such Allocation Date as described above) and (b) such excess.

In the event of (i) a sale of the Receivables and an early termination of the Trust due to a Seller Insolvency Event, (ii) an optional repurchase by the Seller of the Receivables allocated to the Noteholders’ Allocation for Noteholders of a Series and Noteholders’ Allocation for all other Series in connection with a Servicer Default (see “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Servicer Default” above), (iii) a sale of a portion of the Receivables in connection with the Series Termination Date for a Series (see “- Optional Termination; Final Payment of Principal” below), or (iv) a reassignment of the Receivables to the Seller for Noteholders and the Noteholders’ Allocation in connection with a breach by the Seller of certain representations and warranties (each as described under “- Amortization Events”, “- Optional Termination; Final Payment of Principal” below or “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Representations and Warranties” and “- Servicer Default”), any Available Cash Collateral Amount for a Series on the related Allocation Date (after giving effect to all other draws under the credit enhancement on such Allocation Date as described above) will be withdrawn from the related Cash Collateral Account and the proceeds thereof will be paid, first to Class A Noteholders of such Series to the extent that, after giving effect to the distribution to such Class A Noteholders of the proceeds from such sale or repurchase allocated to such Class A Noteholders, the unpaid principal amount of the Class A Notes exceeds the Class A Allocated Amount for such Series, second to Class B Noteholders of such Series to the extent that, after giving effect to the distribution to such Class B Noteholders of the proceeds from such sale or repurchase allocated to such Class B Noteholders (after the Class A Notes of such Series have been fully paid), the unpaid principal amount of the Class B Notes exceeds the Class B Allocated Amount, third to Class C Noteholders of such Series to the extent that, after giving effect to the distribution to such Class C Noteholders of the proceeds from such sale or repurchase allocated to such Class C Noteholders (after the Class B Notes of such Series have been fully paid), the unpaid principal amount of the Class C Notes exceeds the Class C Allocated Amount for such Series, and fourth to Class D Noteholders of such Series to the extent that, after giving effect to the distribution to such Class D Noteholders of the proceeds from such sale or repurchase allocated to such Class D Noteholders (after the Class C Notes of such Series have been fully paid), the unpaid principal amount of the Class D Notes exceeds the Class D Allocated Amount for such Series.

On each Allocation Date, the Servicer will apply Surplus Finance Charge Collections for each Series (to the extent described under “Series Provisions — Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections”) to increase the Available Cash Collateral Amount for such Series (to the extent such amount is less than the Required Cash Collateral Amount for such Series).

Amortization Events

As described above, the Revolving Period for each Series will continue until the commencement of the Accumulation Period for such Series, which will continue until the Allocated Amount thereof has been paid in full, unless an Amortization Event occurs prior to any of such dates. Unless otherwise specified in the applicable Series Supplement, an “Amortization Event” for a Series refers to any of the following events:

(a) failure on the part of the Seller (i) to make any payment or deposit required under the Receivables Purchase Agreement, the Note Issuance Agreement or any Series Supplement within five business days after the date such payment or deposit is required to be made, or (ii) to observe or perform any other covenants or agreements of the Seller set forth in the Receivables Purchase Agreement, the Note Issuance Agreement or any Series Supplement, which failure has a material adverse effect on the Noteholders of any Series (without regard to the availability of any Series Enhancement) and which continues unremedied for a period of 60 days after written notice has been given to the Seller;

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(b) any representation or warranty made by the Seller in the Receivables Purchase Agreement, the Note Issuance Agreement or any Series Supplement or any information required to be given by the Seller to the Trust or the Indenture Trustee to identify the Accounts (i) proves to have been incorrect in any material respect when made or when delivered and continues to be incorrect in any material respect for a period of 60 days after written notice has been given to the Seller, and (ii) such incorrectness has a material adverse effect on the Noteholders of any Series (without regard to the availability of any Series Enhancement); provided, however, that with respect to the breach of certain representations and warranties, an Amortization Event shall not be deemed to occur thereunder if the Seller has repurchased the related Receivables or all such Receivables, if applicable, or has satisfied certain other obligations during such period in accordance with the provisions of the Receivables Purchase Agreement and the Note Issuance Agreement;

(c) the occurrence of certain events of bankruptcy, insolvency, receivership or administration relating to the Seller;

(d) a failure by the Seller to complete a Lump Sale to the Trust within five business days after the day on which it is required to do so pursuant to the Receivables Purchase Agreement;

(e) the amount of Surplus Finance Charge Collections for a Series averaged over any three consecutive Due Periods is less than (i) the Required Surplus Finance Charge Amount for such Series, or (ii) in specified circumstances, the Additional Required Surplus Finance Charge Amount for such Series, in each case, averaged over the last of such three consecutive Due Periods;

(f) the occurrence of any Servicer Default;

(g) on the last day of any Due Period during the Accumulation Period for such Series, the product of (i) the total amount of Principal Receivables as of such last day, (ii) the Series Allocation Percentage with respect to the Notes of such Series for such Due Period, and (iii) the excess of 100% over the Floating Allocation Percentage for such Series for such Due Period, fails to equal at least 100% of the Principal Funding Account Balance for such Series as of such last day;

(h) any reduction of the Portfolio Yield for any Due Period during the Accumulation Period to a rate below the weighted average interest rates for all outstanding Series in the applicable Group;

(i) the failure to pay in full the Allocated Amount of such Series on its Expected Final Payment Date;

(j) the Seller is unable for any reason to transfer Receivables to the Trust in accordance with the Receivables Purchase Agreement;

(k) if, on any Determination Date during the Revolving Period for such Series, the Allocated Amount for such Series does not exceed 96.5% of the aggregate initial principal amount of the Notes of such Series;

(l) if the Payment Rate averaged over any three consecutive Due Periods is less than or equal to 10%;

(m) the Trust becomes subject to a change in any applicable law or regulation and as a result the interests of the Noteholders of any Series or of the holder of the Seller Note are materially adversely affected;

(n) any failure by the Servicer to deliver the Officer’s Certificate described in clause (c) of the definition of Partial Commingling Condition with respect to any Due Period during which the Commingling Conditions are not being met on or before the date occurring two Business Days after the date such delivery is required to be made;

(o) at any time during which the Commingling Conditions are not being met, (A) the Servicer continues to commingle excess Collections as permitted by the terms of the Note Issuance Agreement, and (B) the daily asset test described in clause (a) of the definition of Partial Commingling Condition indicates that the aggregate of the total amount of Principal Receivables and the principal amount on deposit in the Excess Funding Account was less than the Required Minimum Principal Balance, in each case on the immediately

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preceding Business Day, and such deficiency continued for ten days after the Business Day as of which such deficiency was identified by the Servicer; of

(p) an Event of Default shall occur in respect of such Series.

“Payment Rate” for any Due Period means a fraction of which the numerator is the aggregate Collections for such Due Period and the denominator is the Receivables on the last day of the prior Due Period or, (i) in the case of a Lump Sale of Receivables pursuant to the Receivables Purchase Agreement, or (ii) a redemption of Receivables pursuant to the Receivables Purchase Agreement, the weighted average of the amount of Receivables owned by the Trust for such Due Period.

In the case of any event described in (a), (b) or (f) above, an Amortization Event with respect to any Series will be deemed to have occurred only if, after the applicable grace period described in such clauses, either the Indenture Trustee or Noteholders holding Notes evidencing more than 50% of the aggregate unpaid principal amount of the Notes of any Series to which such event relates by written notice to the Trust (and to the Seller and Servicer) may declare that an Amortization Event has occurred as of the date of such notice. In the case of any event described in clause (c), (d), (e), (g), (h), (i), (j), (k), (l), (m), (n), (o) or (p), an Amortization Event with respect to the Notes of the related Series will be deemed to have occurred without any notice or other action on the part of the Indenture Trustee or the Noteholders immediately upon the occurrence of such event. In the case of any event described in clause (c), (d), (j), (n) or (o), an Amortization Event with respect to all Series will be deemed to have occurred without any notice or other action on the part of the Indenture Trustee or the Noteholders of any Series immediately upon the occurrence of such event. Within two Business Days after the occurrence of an Amortization Event or a breach of the daily asset test described in clause (a) of the definition of Partial Commingling Condition, the Servicer shall give notice thereof to the Seller (if the Seller is not the Servicer), the Trust, the Indenture Trustee and each Rating Agency, and the Trust shall give notice thereof to any Series Enhancer. The Early Amortization Period for a Series will commence at the close of business on the day before the day on which the related Amortization Event occurs. Monthly payments of principal to the Noteholders of such Series will begin on the first Special Payment Date (which will be the first Allocation Date following the Due Period in which the Early Amortization Period commenced). Any amounts on deposit in the related Principal Funding Account at such time will first be paid to the Class A Noteholders, second to the Class B Noteholders, and third to the Class C Noteholders of such Series as described herein; provided, however, that principal payments with respect to the Class B Notes will not be made until the final principal payment has been made with respect to the Class A Notes, principal payments with respect to the Class C Notes will not be made until the final principal payment has been made on the Class B Notes, and principal payments with respect to the Class D Notes will not be made until the final principal payment has been made on the Class C Notes.

The Seller will covenant pursuant to each Series Supplement that, upon the occurrence of an Amortization Event with respect to the related Series, except to the extent prohibited or as otherwise required by applicable law, it will not reduce the periodic rate finance charges applicable to any Account to a rate that would result in the Net Portfolio Yield being less than 1.00% per annum as of the last day of any Due Period.

Events of Default

In addition to any events set forth in the related Series Supplement (and set forth in the applicable pricing supplement), each of the following events is an event of default for a Series of Notes (each, an “Event of Default”):

(a) a failure by the Trust to pay interest on any Note of such Series or any Class of the Series when due and payable and such default shall continue for a period of five business days following the date on which such interest became due and payable;

(b) failure by the Trust to pay the outstanding principal amount of any Note on its applicable Termination Date;

(c) a default in the performance, or breach, of the Trust’s covenants or warranties in the Note Issuance Agreement that has a material and adverse effect on the Noteholders of such Series and the continuance of such default or breach, for a period of 60 days after either the Indenture Trustee or the holders of 25% of the aggregate outstanding principal amount of the Notes of such Series, or the affected Class thereof, have provided written notice requesting remedy of that default or breach; or

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(d) if a receiver or administrator of the Trust were to be appointed or if certain other events relating to the bankruptcy, insolvency or administration the Trust occur.

The Trust’s failure to pay the full outstanding principal amount of a Series on its Expected Final Payment Date will not constitute an Event of Default. An event of default with respect to one Series or Class will not necessarily be an event of default with respect to any other Series or Class.

If an Event of Default described in clause (a), (b) or (c) (if the event of default under clause (c) is with respect to less than all Series and Classes of Notes then outstanding) occurs and is continuing with respect to such Series, then, unless the principal of such Series or any Class thereof shall have already become due and payable, either the Indenture Trustee or the majority holders of such Series, or the majority holders of any Class of such Series (each such Series or Class acting as a separate Class), by notice in writing to the Trust (and to the Indenture Trustee if given by holders), may declare the outstanding principal amount of all such Series or of the affected Class then outstanding and all interest accrued or principal accreted and unpaid (if any) thereon to be due and payable immediately.

If an Event of Default described in clause (c) above occurs and is continuing, then and in each and every such case, unless the principal of all the Notes of all Series and Classes has already become due and payable, either the Indenture Trustee or the majority holders of all the Notes then outstanding (treated as one Class), by notice in writing to the Trust (and to the Indenture Trustee if given by holders), may declare the outstanding principal amount of all the notes then outstanding and all interest accrued or principal accreted and unpaid (if any) thereon to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable.

If an Event of Default described in clause (d) occurs, such event of default will be an event of default for all outstanding Notes of all Series and Classes and if it is continuing beyond the relevant cure period, if any, then the Notes of all Series and Classes shall automatically become immediately due and payable by the Trust, without notice or demand to any person, and the Trust shall automatically and immediately be obligated to pay off the Notes of all outstanding Series and Classes.

At any time after such a declaration of acceleration has been made with respect to the Notes of any Series or Class and before a judgment has been obtained by the Indenture Trustee, the majority holders of such Series or Class, by written notice to the Trust and the Indenture Trustee, may rescind and annul such declaration and its consequences if:

(a) the Trust shall have paid or deposited with the Indenture Trustee a sum sufficient to pay (A) all overdue instalments of interest on the notes of such Series or Class, (B) the principal of any notes of such Series or Class which have become due otherwise than by such declaration of acceleration, and interest thereon at the rate or rates prescribed therefor by the terms of the notes of such Series or Class, to the extent that payment of such interest is lawful, (C) interest upon overdue instalments of interest at the rate or rates prescribed therefor by the terms of the notes of such Series or Class to the extent that payment of such interest is lawful, and (D) all sums paid by the Indenture Trustee hereunder and the reasonable compensation, expenses and disbursements of the Indenture Trustee, its agents and counsel and all other amounts due to the Indenture Trustee under the Note Issuance Agreement; and

(b) all other events of default with respect to such Series or Class of notes, other than the non-payment of the principal of the notes of such Series or Class which has become due solely by such acceleration, have been cured or waived as provided in the Note Issuance Agreement.

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

Sale of Receivables

Sale upon Seller Insolvency Event

In addition to the consequences of an Amortization Event discussed above, if a Seller Insolvency Event occurs, the Seller must promptly give notice to the Trust and the Indenture Trustee of such Seller Insolvency Event and, on the day of such Seller Insolvency Event, cease to transfer Principal Receivables to the Trust. After the occurrence of a Seller Insolvency Event, either the Trust or the Indenture Trustee may, in certain circumstances, sell, dispose of or otherwise liquidate the Receivables in a commercially reasonable manner and on commercially reasonable terms; provided, however, that if the net proceeds to be obtained from a sale of the Receivables will not yield for payment to Noteholders of each Series an amount at least equal to the initial principal amount of the Notes of each Series (minus amounts previously paid to such Noteholders on

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account of principal and all amounts on deposit in any applicable principal funding account) plus all accrued and unpaid interest and other amounts due thereon, then the Trust will not sell or dispose of the Receivables. The proceeds from any such sale, disposition or liquidation of the Receivables will be deposited in the Collection Account and allocated as described in the Note Issuance Agreement and each Series Supplement. If the portion of such proceeds allocated to the Class A Allocated Amount for a Series and the proceeds of any collections on the Receivables in the Collection Account allocated to the Class A Allocated Amount for such Series are not sufficient to pay the Class A Allocated Amount for such Series in full, the amount of principal returned to the Class A Noteholders of such Series will be reduced and such Class A Noteholders will incur a loss and no principal will be available to the Class B Noteholders or Class C Noteholders of such Series, who will also incur a loss. Following any such sale of the Receivables, however, any Available Cash Collateral Amount for a Series on the related Allocation Date (after giving effect to certain other withdrawals from the related Cash Collateral Account on such Allocation Date as described under “— Cash Collateral Account” above) will be withdrawn from the related Cash Collateral Account and paid first to Class A Noteholders of such Series to the extent that, after giving effect to the distribution to such Class A Noteholders of the proceeds of the sale allocated to such Class A Noteholders, the unpaid principal amount of the Class A Notes exceeds the Class A Allocated Amount for such Series, second, to Class B Noteholders of such Series to the extent that, after giving effect to the distribution to Class B Noteholders of the proceeds of the sale allocated to the Class B Noteholders of such Series, the unpaid principal amount of the Class B Notes exceeds the Class B Allocated Amount for such Series, third, to Class C Noteholders of such Series to the extent that, after giving effect to the distribution to Class C Noteholders of the proceeds of the sale allocated to the Class C Noteholders of such Series, the unpaid principal amount of the Class C Notes exceeds the Class C Allocated Amount of such Series, and fourth, to Class D Noteholders of such Series to the extent that, after giving effect to the distribution to Class D Noteholders of the proceeds of the sale allocated to the Class D Noteholders of such Series, the unpaid principal amount of the Class D Notes exceeds the Class D Allocated Amount of such Series.

Sale upon Event of Default and Acceleration

Receivables may be sold upon an acceleration of the Series after an Event of Default applicable to such Series and will be sold on or after the applicable Series Termination Date if they are not paid in full by that date

If an Event of Default occurs with respect to a Series and the Series is not accelerated, each Noteholder of such Series may notify the Indenture Trustee that it desires to cause the Trust to sell principal Receivables and the related non-principal Receivables, or interests in the principal Receivables and the related non-principal Receivables, in the amount described below. The sale can only occur if at least one of the following conditions is met:

(a) the holders of at least 90% of the outstanding principal amount of such Series have notified the Indenture Trustee in writing that they desire to cause the Trust to sell Principal Receivables for their Series; or

(b) the holders of a majority of the outstanding principal amount of such Series have notified the Indenture Trustee in writing that they desire to cause the Trust to sell Principal Receivables for their Series and the net proceeds of the sale of Receivables, as described below, plus amounts on deposit in the related Principal Funding Account would be sufficient to pay all amounts due on such Series.

If any of the conditions in either of (a) or (b) above is met, the Indenture Trustee will sell or will cause the Trust to sell Principal Receivables on behalf of all holders of such Series, whether or not they have actually requested that the Trust sell Principal Receivables in the amount described below.

If principal on such Series has not been paid in full on the related Series Termination Date, after giving effect to any adjustments, deposits and payments to be made on that date, the Trust will automatically become obligated to sell, and the Indenture Trustee will sell or will cause the Trust to sell, Principal Receivables on or after such date. The Trust will apply proceeds from the sale to the payment of the amounts due on such Series, and any excess shall be paid to the Seller.

In the case of any sale as described in this section, the amount of Principal Receivables sold will be in an amount not exceeding the Allocated Amount for the related Series and the holders of such Series shall be entitled to receive the lesser of the proceeds of that sale and the outstanding principal amount of and any unpaid interest on such Series. The proceeds from any such sale of the Receivables will be deposited in the Collection Account and allocated as described in the Note Issuance Agreement and each Series Supplement. The Allocated Amount for such Series will be automatically reduced to zero upon the sale. After the sale, the Trust will not allocate any further principal collections or interest collections to such Series.

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The amount of proceeds from the sale of Receivables for such Series may be less than the outstanding principal amount of such Series plus accrued and unpaid interest on such Series. This deficiency can arise if the Allocated Amount for such Series was reduced below the outstanding principal amount of such Series before the sale of Receivables and the sale price for the Receivables was less than the outstanding principal amount of such Series plus accrued and unpaid interest on such Series. These types of deficiencies will not be reimbursed.

The holders of such Series will maintain their rights in their Series until the holders deliver their Notes to the Trust as required in connection with the application of the sale proceeds to payment of the amounts due on such Series.

Servicing Compensation and Payment of Expenses

So long as Bank of Montreal is the Servicer, it shall accept as full compensation for the sale of the Receivables and its servicing activities and reimbursement of its expenses, the consideration payable to it as Seller under the Receivables Purchase Agreement.

A monthly servicing fee (the “Servicing Fee”) will be paid to any successor Servicer as compensation for its servicing activities and reimbursement of its expenses in an amount equal to the sum of the servicing fees with respect to all Series and the servicing fee in respect of the Seller’s Allocation. The series servicing fee with respect to the Notes of each Series (the “Series Servicing Fee”) shall accrue from the date a successor Servicer is appointed and shall be payable to the successor Servicer, in arrears, on each Allocation Date in respect of any Due Period (or portion thereof) occurring after the successor Servicer is appointed and prior to the earlier of the first Allocation Date following the Series Termination Date for such Series and the first Allocation Date on which the Allocated Amount for such Series is zero, in an amount equal to one-twelfth of the product of (a) a rate not exceeding 2% per annum (the “Series Servicing Fee Rate”), (b) the amount of Principal Receivables as of the last day of the Due Period second preceding such Allocation Date (or, if a Lump Sale of receivables or a redemption of receivables arising in Accounts occurs in the Due Period for which the Servicing Fee is to be paid, the weighted average amount of Principal Receivables owned by the Trust for such Due Period) and (c) the Series Allocation Percentage of such Series. The share of the Series Servicing Fee allocable to the Noteholders of a Series with respect to any Allocation Date (the “Monthly Servicing Fee”) shall be equal to one-twelfth of the product of (a) the Servicing Fee Rate and (b) the Allocated Amount of such Series as of the last day of the Due Period second preceding such Allocation Date. The remaining portion of the Series Servicing Fee (the “Seller Servicing Fee”) will be allocable to the Seller’s Allocated Amount and will be paid by the Seller to the Servicer from the Seller’s Allocation. The Monthly Servicing Fee will be paid on each Allocation Date with respect to each Due Period from the Collection Account (unless such amount has been netted against deposits to the Collection Account) as described under the headings “— Reallocated Investor Finance Charge Collections and Excess Finance Charge Collections” and “— Subordination” above.

So long as it is the Servicer, Bank of Montreal will pay, and a successor Servicer will pay from its servicing compensation, certain expenses incurred in connection with servicing the Accounts and the Receivables including, without limitation, expenses related to enforcement of the Receivables, and certain other fees and expenses which are referred to in the Note Issuance Agreement and any Series Supplement.

Record Date

Payments on the Notes will be made as described herein to the Noteholders in whose names the Notes were registered (expected to be CDS Clearing and Depository Services Inc. (“CDS”) or its nominee) at the close of business on the last day of the calendar month preceding the date of such payment (each a “Record Date”). However, the final payment on the Notes will be made only upon presentation and surrender of the Notes. Distributions will be made to CDS in immediately available funds. See “Book-Entry Registration”.

Optional Termination; Final Payment of Principal

On the Allocation Date occurring on or after the date that the Allocated Amount of a Series is reduced to 10% or less of the initial outstanding aggregate principal amount of the Notes of such Series, the Servicer (provided that the Servicer is the Seller or an affiliate of the Seller) will have the option to cause the Trust to redeem the Notes of such Series at a purchase price that will be equal to the unpaid principal amount of such Notes plus accrued and unpaid interest on the unpaid principal amount of such Notes (and accrued and unpaid interest with respect to interest amounts that were due but not paid on a prior Payment Date) through the day preceding such Allocation Date at the Class A Interest Rate, the Class B Interest Rate and the Class C Interest Rate for such Notes, respectively. The Notes of such Series shall be surrendered for cancellation and following the redemption of such Notes, the Noteholders of such Series will have no further rights under such Notes. In

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the event that the Servicer fails for any reason to deposit the aggregate purchase price for the Series, payments would continue to be made to such Noteholders as described above under “— Payments”.

In any event, the last payment of principal and interest on the Notes of a Series will be due and payable not later than the related Series Termination Date for such Series. In the event that the Allocated Amount for such Series is greater than zero on such Series Termination Date, an Event of Default with respect to such Series shall occur.

Reports

No later than the third business day prior to each Allocation Date, the Servicer will forward to the Trust, the Indenture Trustee, the Paying Agent (if different), the applicable Rating Agencies and each provider of Series Enhancement a statement (the “Monthly Report”) prepared by the Servicer setting forth certain information with respect to the Trust Assets and each Series of Notes (unless otherwise indicated), including (a) with respect to the Accounts (i) the Portfolio Yield, (ii) the rate at which new cash advances and purchases of merchandise and services are made in the Accounts, (iii) the total payment rate on the Accounts, (iv) the aggregate principal balance of the Accounts and (v) the aggregate outstanding balance of the Accounts which were delinquent as of the close of business at the end of the calendar month immediately preceding such Allocation Date as a percentage of Receivables, (b) with respect to each Group (i) the weighted average interest rate for all Series issued with respect to such Group and the weighted average series servicing fee rates and the rate of other fees allocable to the Noteholders of all such Series, (ii) the amount of surplus finance charge collections, the required surplus finance charge amount and the excess of surplus finance charge collections over required surplus finance charge amount for each such Series (in each case expressed as a percentage of the allocated amount of such Series and on a dollar amount basis), (iii) the aggregate amount of Principal Collections and the Finance Charge Collections, (iv) the total monthly interest expense, (v) the total monthly servicing fee, trust, trustee and other similar fees paid and (vi) the Group One Investor Default Amount (or the equivalent with respect to another Group), and (c) with respect to the Notes of each Series, (i) the Class A Allocated Amount, the Class B Allocated Amount, the Class C Allocated Amount and the Class D Allocated Amount for such Series and such Allocation Date, (ii) the amount of the Class A Monthly Interest, Class B Monthly Interest, Class C Monthly Interest and Class D Monthly Interest for such Series and such Allocation Date and, during the Accumulation Period or any Early Amortization Period for such Series, the amount of Class A Monthly Principal, the Class B Monthly Principal, the Class C Monthly Principal and the Class D Monthly Principal for such Series and such Allocation Date, (iii) the amount on deposit in each of the related Funding Accounts on such Allocation Date, (iv) the Net Portfolio Yield, Required Cash Collateral Amount and Available Cash Collateral Amount for such Series and such Allocation Date, and (v) the amount, if any, of Investor Charge-Offs for such Series and such Allocation Date.

On each Interest Payment Date (including the Expected Final Payment Date) or Special Payment Date for each Series, as the case may be, the Monthly Report will include the following additional information with respect to the Notes of such Series: (a) the total amount paid thereon, (b) the amount of such payment allocable to principal on the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes, (c) the amount of such payment allocable to interest on the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes, (d) the amount, if any, by which the unpaid principal balance of the Class A Notes exceeds the Class A Allocated Amount, the amount, if any, by which the unpaid principal balance of the Class B Notes exceeds the Class B Allocated Amount, the amount, if any, by which the unpaid principal balance of the Class C Notes exceeds the Class C Allocated Amount, and the amount, if any, by which the unpaid principal balance of the Class D Notes exceeds the Class D Allocated Amount, in each case as of the Interest Payment Date or Special Payment Date, as the case may be, and (e) if the Revolving Period for such Series has been extended, the date on which the Accumulation Period for such Series will begin.

Copies of the reports described above will be available for review by Noteholders upon request in writing delivered to the Indenture Trustee and summaries of such reports will be available on the Internet at www.sedar.com.

On or before the last day of February of each calendar year, the Paying Agent, on behalf of the Trust, will furnish (or cause to be furnished) to each person who at any time during the preceding calendar year was a Noteholder of record a statement containing the information required to be provided by an issuer of indebtedness under the Tax Act for such preceding calendar year or the applicable portion thereof during which time such person was a Noteholder, together with such other customary information as is necessary to enable the Noteholders to prepare their tax returns.

List of Noteholders

In the event that Definitive Notes are issued at any time, upon written request to the Indenture Trustee by any Noteholder or group of Noteholders of record holding Notes evidencing not less than 20% of the aggregate unpaid principal

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amount of the Notes of all outstanding Series or Notes of any Series, as the case may be, the Indenture Trustee will afford such Noteholders access during normal business hours to the current list of Noteholders of all outstanding Series or of such Series, as the case may be, for purposes of communicating with other Noteholders with respect to their rights under the Note Issuance Agreement or any Series Supplement or under the Notes.

THE RECEIVABLES PURCHASE AGREEMENT

AND THE NOTE ISSUANCE AGREEMENT GENERALLY

The summary of the material terms of the Receivables Purchase Agreement, the Note Issuance Agreement and the related Series Supplement for each Series in the Prospectus does not purport to be complete and is qualified in its entirety by reference to the Receivables Purchase Agreement, the Note Issuance Agreement and the related Series Supplement.

The Seller Note

The Note Issuance Agreement authorizes the issuance of three types of certificates: (a) one or more series of Notes (each a “Series”), (b) a certificate issued to the Seller, and (c) supplemental certificates issued to transferees of part of a certificate issued to the Seller in exchange for the transferred portion thereof (the “Supplemental Notes”). The certificate issued to the Seller and any Supplemental Notes are collectively referred to herein as the “Seller Note”. MCCT issued the original Seller Note to Bank of Montreal pursuant to the Note Issuance Agreement, and pursuant to the Assignment and Assumption Agreement, the Trust has assumed all payment obligations of MCCT under the Seller Note that were outstanding on the Assignment Date.

The Seller Note represents a secured, limited recourse, debt obligation of the Trust. All of the Trust Assets that are not allocated to the Noteholders’ Allocation for any Series shall be held by the Indenture Trustee as security for the obligations of the Trust in favour of the holders of the Seller Note and shall comprise the Seller’s Allocation (the “Seller’s Allocation”). Holders of the Seller Note shall be entitled to receive payment only to the extent of, and recourse for the indebtedness evidenced by the Seller Note shall be limited to, the portion of the Trust Assets comprising the Seller’s Allocation allocated to the holders of the Seller Note. The principal amount of the Seller Note and the Seller’s Allocated Amount will fluctuate as the amount of the Receivables owned by the Trust changes from time to time. The “Seller’s Allocated Amount” is an amount equal to the aggregate of the total amount of Principal Receivables owned by the Trust at any one time and the principal amount on deposit in the Excess Funding Account at such time minus the aggregate Allocated Amounts for all outstanding Series and any Additional Securities at such time. Pursuant to the rights conferred by the Note Issuance Agreement and subject to the conditions therein contained, the Seller is entitled to require a partial redemption of the Seller Note. If this redemption right is exercised, it will be funded by the Trust through the issuance of additional Series or Additional Securities and any such issuance and redemption will have the effect of decreasing the Seller’s Allocation. See “Master Trust Provisions - New Issuances”. In addition, the Seller Note may be sold separately, in part, ranking equally or in subordinated form, in one or more public or private transactions.

Conveyance of Receivables

Pursuant to the Receivables Purchase Agreement, the Seller has sold and assigned to the Trust (or has sold and assigned to MCCT, who in turn has sold and assigned to the Trust pursuant to the Assignment and Assumption Agreement), on a fully-serviced basis, all of its interest in (a) as of the Trust Cut-Off Date, all of the Receivables in the Initial Accounts, (b) as of the date created, all of the Receivables in the New Accounts, (c) as of the applicable cut-off date, all of the Receivables in any Lump Sale Accounts, (d) as of the date created, all of the Receivables thereafter arising under the Accounts, and (e) the proceeds of all of the foregoing.

In connection with the transfer of any Receivables to the Trust, the Seller is required to indicate in its computer or other records that the Receivables have been conveyed to the Trust. In addition, the Seller will provide to the Trust (or, with respect to Receivables in existence prior to the Assignment Date, has provided to MCCT), with a copy to the Indenture Trustee, a computer file or a microfiche list containing a true and complete listing showing (a) for each Initial Account, as of the Trust Cut-Off Date, (b) for each New Account, as of the date originated, and (c) for each Lump Sale Account, as of the applicable cut-off date, the account number for such Account, the aggregate amount of Principal Receivables outstanding in such Account and the aggregate amount of Receivables outstanding in such Account. Bank of Montreal, as initial Servicer, will retain and will not deliver to the Trust or the Indenture Trustee any other records or agreements relating to the Accounts or the Receivables. Except as set forth above, the records and agreements relating to the Accounts and the Receivables will

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not be segregated from those relating to other credit card accounts and receivables, and the physical documentation relating to the Accounts or Receivables will not be stamped or marked to reflect the transfer of Receivables to the Trust.

Representations and Warranties

Pursuant to the Receivables Purchase Agreement, the Seller has made and will make representations and warranties to the Trust relating to the Accounts and the Receivables to the effect, among other things, that (a) each Account is an Eligible Account and (b) each of the Receivables existing in the Accounts is an Eligible Receivable. If the Seller breaches any such representation or warranty and such breach has a material adverse effect on the Trust’s interest in any Receivable (which determination shall be made without regard to whether funds are then available pursuant to any Series Enhancement) and remains unremedied for up to 60 days, or such longer period (not in excess of 150 days) as may be requested by the Seller, provided that such breach does not result in a Ratings Effect, subject to the provisions of the Note Issuance Agreement, after the earlier to occur of the discovery of such breach by the Seller or receipt of written notice of such breach by the Seller, then, upon receipt by the Seller from the Trust of a notice advising it of the desire that the Trust assign the relevant Receivables (the “Ineligible Receivables”) to the Seller or its designee, the Trust shall assign to the Seller all of the Trust’s interest in the Ineligible Receivables on the first Allocation Date following the Due Period in which such notice was received by the Seller.

On such Allocation Date, the amount payable by the Trust to the Seller pursuant to the Seller Note shall be reduced by an amount equal to the face amount of the Ineligible Receivables which are Principal Receivables, and the Servicer shall deduct the portion of the Ineligible Receivables which are Principal Receivables from the aggregate amount of Principal Receivables used to calculate the Seller’s Allocated Amount and the Seller’s Allocation and the principal allocation percentage and the floating allocation percentage for any Series or Additional Securities.

If upon the exclusion of an Ineligible Receivable from the calculation of the Seller’s Allocated Amount, the aggregate amount of Principal Receivables would be less than the Required Minimum Principal Balance, the Seller shall make a deposit, not later than 12:00 noon (Toronto time) on such Allocation Date, into the Excess Funding Account in immediately available funds in an amount equal to the amount by which the aggregate amount of Principal Receivables would be less than the Required Minimum Principal Balance (up to the amount of such Principal Receivables). Any such deposit shall constitute an adjustment to the purchase price of the Receivables.

The deposit of the required amount into the Excess Funding Account in connection with the reassignment of an Ineligible Receivable (the amount of any such deposit being referred to herein as a “Transfer Deposit Amount”) shall be considered a payment in full by the Seller to the Trust for such Ineligible Receivables.

Notwithstanding the foregoing, the Seller may elect not to purchase any Ineligible Receivables, in which case the Trust shall retain the Ineligible Receivables, the aggregate principal balance of Ineligible Receivables shall be excluded in calculating the Required Minimum Principal Balance and the amount payable under the Seller Note and the adjustments to the Seller’s Allocated Amount, the Seller’s Allocation, the principal allocation percentage and the floating allocation percentage for any Series or Additional Securities will be made as set out above and, if required, the Seller will also make the deposits into the Excess Funding Account referred to above. If Collections are subsequently received with respect to such Ineligible Receivables, the Seller Note will be adjusted upwards by the amount of such Collections.

The satisfaction by the Seller of the foregoing obligations constitutes the sole remedy available to the Trust respecting any breach of the representations and warranties referred to above, except as described under the second paragraph under “— Indemnification” below.

Pursuant to the Receivables Purchase Agreement, the Seller has also made representations and warranties to the Trust to the effect, among other things, that (a) it is a Canadian chartered bank and it has the authority to consummate the transactions contemplated by the Receivables Purchase Agreement, the Note Issuance Agreement and each Series Supplement and each of the Receivables Purchase Agreement, the Note Issuance Agreement and each Series Supplement constitutes a valid, binding and enforceable agreement of the Seller, and (b) the Receivables Purchase Agreement constitutes a valid sale, transfer and assignment to the Trust of all right, title and interest of the Seller in the Receivables, whether then existing or thereafter created and the proceeds thereof, until termination of the Receivables Purchase Agreement. In the event that the breach of any of such representations and warranties has a material adverse effect on the Trust’s interest in the Receivables (which determination shall be made without regard to whether funds are then available pursuant to any Series Enhancement), the Trust shall, by written notice to the Seller and the Servicer direct the Seller to accept the reassignment of the Receivables owned by the Trust within 60 days of such notice, or within such longer period (not in excess of 150 days)

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specified in such notice, as may be requested by the Seller and provided that such does not result in a Ratings Effect. The Seller will be obligated to accept the reassignment of such Receivables on the Allocation Date following the Due Period in which such reassignment obligation arises. The price for such reassignment will generally be equal to the aggregate allocated amounts of all Series on the Allocation Date on which the purchase is scheduled to be made plus accrued and unpaid interest on the unpaid principal amount of all Series and any interest amounts that were due but not paid on a prior date and interest on such overdue interest amounts (if the applicable Series Supplement so provides) at the applicable interest rates through the day preceding such Allocation Date, together with the satisfaction of all indebtedness of the Trust in respect of the Seller Note. The payment of such reassignment price, in immediately available funds, and surrender of the Seller Note will be considered a payment in full for all Receivables and the funds paid to the Trust by the Seller will be treated as collections and paid by the Trust to Noteholders of all Series in satisfaction of the redemption price of their certificates upon presentation and surrender of such certificates. If the Trust or the requisite percentage of holders of Notes of all Series give a notice as provided above, the obligation of the Seller to make any such deposit will constitute the sole remedy respecting a breach of the representations and warranties available to the Trust (or the Indenture Trustee on behalf of such Noteholders) or any provider of Series Enhancement, except as described under the second paragraph under “— Indemnification” below.

“Eligible Account” means a credit card account owned by Bank of Montreal which (a) is in existence and maintained by Bank of Montreal, (b) is payable in Canadian dollars, (c) in the case of the Initial Accounts or New Accounts, has a cardholder who has provided, as his most recent billing address, an address located in Canada or a military address for Canadian personnel, (d) has not been sold or pledged to any other party, (e) does not have Receivables which have been sold or pledged to any other party, and (f) in the case of the Initial Accounts or New Accounts, is a Canadian dollar consumer MasterCard credit card account.

“Eligible Receivable” means each Receivable (a) which has arisen under an Eligible Account, (b) which was created in compliance in all material respects with all requirements of law and pursuant to a credit card agreement which complies in all material respects with all requirements of law, (c) with respect to which all material consents, licences, approvals or authorizations of, or registrations or declarations with, any governmental authority required to be obtained, effected or given in connection with the creation of such Receivable or the execution, delivery, creation and performance by Bank of Montreal or by the original credit card issuer, if not Bank of Montreal, of the credit card agreement have been duly obtained, effected or given and are in full force and effect, (d) as to which immediately prior to its transfer to the Trust, the Seller will have good and marketable title, free and clear of all liens, encumbrances, charges and security interests in favour of persons claiming through or under the Seller, (e) which has been or will be the subject of a valid transfer and assignment from the Seller to the Trust of all the Seller’s right, title and interest therein (and in the proceeds thereof), effective until the termination of the Receivables Purchase Agreement, (f) which will at all times be the legal, valid and binding payment obligation of the cardholder thereof enforceable against such cardholder in accordance with its terms, subject to certain bankruptcy and equity-related exceptions, (g) which at the time of its transfer to the Trust has not been waived or modified except as permitted under the applicable credit card guidelines, (h) which is not at the time of its transfer to the Trust subject to any right of rescission, set-off, counterclaim or defense, other than certain bankruptcy and equity-related defenses, (i) as to which the Seller has satisfied all obligations to be fulfilled at the time it is transferred to the Trust, (j) as to which the Seller has done nothing, at the time of its transfer to the Trust, to impair the ownership rights of the Trust therein, and (k) which constitutes an “account”, “claim” or “book debt” under applicable law.

It is not anticipated or required that the Trust or the Indenture Trustee will make any initial or periodic general examination of any documents or records related to the Receivables or the Accounts for the purpose of establishing the presence or absence of defects, compliance with the Seller’s representations and warranties or for any other purpose. In addition, it is not anticipated or required that the Trust or the Indenture Trustee will make any initial or periodic general examination of the Servicer for the purpose of establishing the compliance by the Servicer with its representations or warranties or the performance by the Servicer of its obligations under the Receivables Purchase Agreement, the Note Issuance Agreement or any Series Supplement or for any other purpose.

Indemnification

The Note Issuance Agreement provides that the Servicer will indemnify the Trust and the Indenture Trustee from and against any loss, liability, expense, damage or injury suffered or sustained arising out of the Servicer’s actions or omissions with respect to the Trust pursuant to the Note Issuance Agreement, the Receivables Purchase Agreement and any Series Supplement. In the event of a Service Transfer, the successor Servicer will be obligated to indemnify and hold harmless the Seller for any losses, claims, damages and liabilities of the Seller as described in this paragraph arising from the actions or omissions of such successor Servicer.

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Under the Receivables Purchase Agreement, the Seller has agreed to be liable to the Trust and the Issuer Trustee for the entire amount of any losses, claims, damages or liabilities arising out of or based on a breach by the Seller of a material representation, warranty or covenant contained in the Receivables Purchase Agreement, the Note Issuance Agreement or any Series Supplement or deemed to be included therein. The Seller has agreed to pay, indemnify and hold harmless the Trust against and from any such losses, claims, damages or liabilities except to the extent that they arise from the gross negligence or wilful misconduct of the Trust or the Issuer Trustee.

Except as provided in the preceding two paragraphs, the Receivables Purchase Agreement and the Note Issuance Agreement provide that none of the Seller, the Servicer or any of their directors, officers, employees or agents will be under any other liability to the Trust (or any party claiming through or under the Trust, including the Indenture Trustee, the holders of Notes of any Series, any provider of Series Enhancement or any other person) for any action taken, or for refraining from taking any action, in good faith pursuant to the Receivables Purchase Agreement or the Note Issuance Agreement, as the case may be. However, neither the Seller nor the Servicer will be protected against any liability which would otherwise be imposed by reason of wilful misfeasance, bad faith or gross negligence with respect to the Receivables Purchase Agreement or gross negligence with respect to the Note Issuance Agreement of any such person in the performance of its duties or by reason of reckless disregard of its obligations and duties thereunder.

In addition, the Note Issuance Agreement provides that the Servicer is not under any obligation to appear in, prosecute or defend any legal action which is not incidental to its servicing responsibilities under the Note Issuance Agreement, the Receivables Purchase Agreement and each Series Supplement. The Servicer may, in its sole discretion, undertake any such legal action which it may deem necessary or desirable for the benefit of the Trust with respect to the Receivables Purchase Agreement, the Note Issuance Agreement and each Series Supplement and the rights and duties of the parties thereto.

Collection and Other Servicing Procedures

Pursuant to the Note Issuance Agreement, the Servicer is responsible for servicing, collecting, enforcing and administering the Receivables in accordance with customary and usual procedures for servicing credit card receivables, but in any event at least comparable with the policies and procedures and the degree of skill and care applied or exercised with respect to its own credit card receivables.

Bank of Montreal has covenanted that, except to the extent prohibited or as otherwise required by law or as is deemed by Bank of Montreal 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 will not take actions which would reduce the Portfolio Yield to less than the sum of (a) the weighted average interest rate of each class of Notes of each Series and (b) the weighted average of the series servicing fee rates for each class of Notes of each Series. In addition, Bank of Montreal has agreed that, except to the extent prohibited or as otherwise required by law, it will not reduce the Portfolio Yield below the highest interest rate of any Series.

Servicing activities to be performed by the Servicer include collecting and recording payments, communicating with cardholders, investigating payment delinquencies, evaluating the increase of credit limits and the issuance of credit cards, providing billing records to cardholders and maintaining internal records with respect to each Account. Managerial and custodial services performed by the Servicer on behalf of the Trust include providing assistance in any inspections of the documents and records relating to the Accounts and Receivables by the Trust pursuant to the Receivables Purchase Agreement and the Note Issuance Agreement, maintaining the agreements, documents and files relating to the Accounts and Receivables as custodian for the Trust and providing related data processing and reporting services for Noteholders of any Series and on behalf of the Trust.

Pursuant to the Note Issuance Agreement, Bank of Montreal, as Servicer, has the right to delegate any of its responsibilities and obligations as Servicer to any person who is a resident of Canada for purposes of the Tax Act and that agrees to conduct such duties in accordance with the Note Issuance Agreement and Bank of Montreal’s credit card guidelines. Notwithstanding any such delegation to any entity, the Servicer will continue to be liable for all of its obligations under the Note Issuance Agreement.

Servicer Covenants

In the Note Issuance Agreement, the Servicer has covenanted as to each Receivable and related Account that (a) it will duly fulfil all obligations on its part to be fulfilled under or in connection with the Receivable or Account, and will

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maintain in effect all qualifications required in order to service the Receivable or Account the failure to comply with which would have a material adverse effect on the Trust or the Trust’s ability to make required payments to Noteholders or any Series Enhancer, (b) it will not permit any rescission or cancellation of the Receivable except as ordered by a court of competent jurisdiction or other governmental authority, (c) it will do nothing to impair the rights of the Trust in the Receivable or the related Account or the rights of the Indenture Trustee or any provider of Series Enhancement, (d) it will not reschedule, revise or defer payments due on the Receivable except in accordance with its guidelines for servicing receivables, and (e) except in connection with its enforcement or collection of an Account, it will take no action to cause any Receivables to be evidenced by any instruments.

Under the terms of the Note Issuance Agreement, if (x) any of the representations, warranties or covenants of the Servicer contained in clauses (a) through (d) above with respect to any Receivable or the related Account is breached, and such breach has a material adverse effect on the Trust’s interest in such Receivable (which determination shall be made without regard to whether funds are then available to the Trust or any Noteholders of any Series pursuant to any Series Enhancement) and is not cured within 60 days, or such longer period (not in excess of 150 days) as may be agreed to by the Trust, of the earlier to occur of the discovery of such event by the Servicer, or receipt by the Servicer of written notice of such event given by the Trust, or (y) the Servicer fails to satisfy the covenant in clause (e) above with respect to any Receivable, then, if the Bank is the Servicer, the relevant Receivables will be dealt with in the manner set out under “— Representations and Warranties” above as if such Receivables were Ineligible Receivables (including the requirement, if applicable, to reduce the Seller’s Allocated Amount and the Seller’s Allocation and the principal allocation percentage and floating allocation percentage of any Series or Additional Securities and to make deposits into the Collection Account), and any amounts deposited into the Collection Account in connection therewith shall be considered a Transfer Deposit Amount under the Note Issuance Agreement.

If Bank of Montreal is not the Servicer and the Trust provides notice to the Servicer and Bank of Montreal of the Trust’s desire to assign the relevant Receivables to the Servicer, subject to a right of first refusal granted to Bank of Montreal, the Trust shall assign to the Servicer all of the Trust’s interest in such Receivables on the first Allocation Date following the Due Period in which such notice was received by the Servicer and Bank of Montreal. The Servicer shall pay for such Receivables by depositing an amount equal to the face amount of such Receivables into the Collection Account in immediately available funds on such Allocation Date. The amount of such deposit shall be deemed a Transfer Deposit Amount under the Note Issuance Agreement.

This assignment or transfer to the Servicer constitutes the sole remedy available to the Trust respecting any breach of the representations, warranties or covenants referred to above, except as described under the first paragraph under “— Indemnification” above.

Certain Matters Regarding the Servicer

The Servicer may not resign from its obligations and duties under the Note Issuance Agreement, except upon determination that such duties are no longer permissible under applicable law. No such resignation will become effective until a successor to the Servicer has assumed the Servicer’s responsibilities and obligations under the Note Issuance Agreement. Notwithstanding the foregoing, Bank of Montreal may delegate its servicing obligations to any person which meets certain eligibility standards set forth in the Note Issuance Agreement and such delegation shall not relieve Bank of Montreal of its obligations and duties under the Note Issuance Agreement.

Any person into which, in accordance with the Note Issuance Agreement, Bank of Montreal or the Servicer may be amalgamated or consolidated or any person resulting from any amalgamation, arrangement or consolidation to which Bank of Montreal or the Servicer is a party, or any person succeeding to the business of Bank of Montreal or the Servicer, will be the successor to Bank of Montreal as servicer, or the Servicer, as the case may be, under the Note Issuance Agreement.

Servicer Default

In the event of any Servicer Default (as defined below), the Indenture Trustee may, or upon notice from Noteholders holding Notes evidencing more than 50% of the aggregate unpaid principal amount of all outstanding Series, the Indenture Trustee shall, by written notice (a “Termination Notice”) to the Servicer, the Trust, the applicable Rating Agencies and any provider of Series Enhancement, terminate all of the rights and obligations of the Servicer, as servicer, under the Note Issuance Agreement. If the Indenture Trustee within 60 days after giving a Termination Notice is unable to obtain any bids from eligible Servicers and the Seller delivers an officer’s certificate to the effect that the Servicer cannot in good faith cure the Servicer Default which gave rise to the Termination Notice, then the Seller shall have a right of first refusal to purchase

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the Receivables owned by the Trust. The purchase price for such a purchase shall be paid on an Allocation Date and shall generally be equal to the allocated amount of each Series on such Allocation Date plus accrued and unpaid interest at the applicable interest rate (together with, if applicable, interest on interest amounts that were due and not paid on a prior Allocation Date), through the day preceding such Allocation Date.

The Indenture Trustee shall, promptly after giving a Termination Notice, appoint a successor Servicer (a “Service Transfer”). Prior to any Service Transfer, the Indenture Trustee will seek to obtain bids from potential Servicers meeting certain eligibility requirements set forth in the Note Issuance Agreement to serve as a successor Servicer for servicing compensation not in excess of the Servicing Fee plus any amounts payable to the Seller as Servicer, pursuant to the terms of any Series Enhancement agreement. If a successor Servicer has not been appointed or has not accepted its appointment at the time when the Servicer ceases to act as Servicer, the Indenture Trustee without further action shall automatically be appointed as successor Servicer until such time as a successor Servicer which is not an affiliate of the Seller can be appointed. The appointment of any successor Servicer other than the Indenture Trustee shall be subject to (i) in the case of DBRS, satisfaction of the Rating Agency Condition, and (ii) in the case of Moody’s, at least ten Business Days’ prior written notice of such appointment (or such shorter period as may be acceptable to Moody’s). Additional Rating Agencies may request one or both of the foregoing. The rights and interests of the Seller under the Note Issuance Agreement, the Receivables Purchase Agreement and any Series Supplement will not be affected by any Termination Notice or Service Transfer.

A “Servicer Default” refers to any of the following events:

(a) any failure by the Servicer to make such payment, transfer or deposit, or to give instructions or to give notice to the Trust to make such payment, transfer or deposit, on the date the Servicer is required to do so under the Note Issuance Agreement, the Receivables Purchase Agreement or any Series Supplement, which is not cured within a five business day grace period;

(b) failure on the part of the Servicer duly to observe or perform in any material respect any other covenants or agreements of the Servicer in the Note Issuance Agreement, the Receivables Purchase Agreement or any Series Supplement which has a material adverse effect on the Noteholders of any Series or class (which determination shall be made without regard to whether funds are then available pursuant to any Series Enhancement) and which continues unremedied for a period of 60 days after written notice, or the Servicer assigns or delegates its duties under the Note Issuance Agreement, except as specifically permitted thereunder;

(c) any representations, warranty or certification made by the Servicer in the Note Issuance Agreement, or any Series Supplement or in any certificate delivered pursuant thereto proves to have been incorrect when made, which has a material adverse effect on the Noteholders of any Series or class (which determination shall be made without regard to whether funds are then available pursuant to any Series Enhancement), and which material adverse effect continues for a period of 60 days after written notice; or

(d) the occurrence of certain events of bankruptcy, insolvency or receivership with respect to the Servicer.

Notwithstanding the foregoing, a delay in or failure of performance referred to under clause (a) above for a period of five business days or referred to under clause (b) or (c) above for a period of 60 business days after the applicable cure periods, shall not constitute a Servicer Default if such delay or failure could not be prevented by the exercise of reasonable diligence by the Servicer and such delay or failure was caused by an act of God or other similar occurrence. Upon the occurrence of any such event, the Servicer shall not be relieved from using its best efforts to perform its obligations in a timely manner in accordance with the terms of the Note Issuance Agreement and the Servicer shall provide the Trust, the Indenture Trustee, the Seller, any provider of Series Enhancement and the Noteholders of each Series prompt notice of such failure or delay by it, together with a description of its efforts to so perform its obligations. The Servicer shall immediately notify the Trust and the Indenture Trustee in writing of any Servicer Default.

Evidence as to Compliance

The Note Issuance Agreement provides that on or before March 31 of each calendar year, the Servicer will cause a firm of nationally recognized Canadian independent chartered accountants (who may also render other services to the Servicer or the Seller) to furnish a report to the Trust, the Indenture Trustee, the applicable Rating Agencies and each provider of Series Enhancement to the effect that such firm has examined certain documents and records relating to the servicing of the Accounts and Receivables, compared the information contained in the Servicer’s certificates delivered during

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the period covered by the report with such documents and records and that, on the basis of such examination, such firm is of the opinion that such servicing was conducted in compliance with the Note Issuance Agreement and the applicable provisions of each Series Supplement except for such exceptions or errors as such firm shall believe to be immaterial and such other exceptions as shall be set forth in such statement.

The Note Issuance Agreement provides for delivery to the Trust, the Indenture Trustee, the applicable Rating Agencies and each provider of Series Enhancement on or before March 31 of each calendar year, of a statement signed by an officer of the Servicer to the effect that the Servicer has, or has caused to be, fully performed its obligations in all material respects under the Note Issuance Agreement throughout the preceding year or, if there has been a default in the performance of any such obligation, specifying the nature and status of the default.

Copies of all statements, certificates and reports furnished to the Indenture Trustee will be available for review by Noteholders upon request in writing delivered to the Indenture Trustee.

Amendments

The Note Issuance Agreement, the Receivables Purchase Agreement and any Series Supplement may be amended from time to time (including in connection with the issuance of a Supplemental Note) by agreement of the Trust, the Seller, the Servicer and the Indenture Trustee (and, in certain circumstances a provider of Series Enhancement) without the consent of the Noteholders of any Series provided that such amendment (i) will not have or is not reasonably expected to have at any time in the future, an Adverse Effect, and (ii) will not be a significant change (as interpreted in accordance with generally accepted accounting principles) to Noteholders (as determined in consideration of any applicable accounting guidelines); provided, however, that in each case, a Ratings Effect shall not occur.

The Note Issuance Agreement, the Receivables Purchase Agreement and any Series Supplement may also be amended from time to time (including in connection with the issuance of a Supplemental Note) by the Seller, the Servicer, the Trust and the Indenture Trustee for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Note Issuance Agreement, the Receivables Purchase Agreement or any Series Supplement or for modifying in any manner the rights of such Noteholders, with (i) in the case of the Note Issuance Agreement, the consent of the holders of any Series (other than the Seller or its affiliates) evidencing not less than 662/3% of the aggregate unpaid principal amount of the Notes adversely affected or (ii) in the case of the Receivables Purchase Agreement, with the consent of the holders of any Series (other than the Seller, its affiliates and their respective agents), evidencing not less than 51% of the aggregate unpaid amount of the Notes adversely affected. No such amendment, however, may (a) reduce in any manner the amount of or delay the timing of any payments to be made to Noteholders or deposits of amounts to be so paid or the amount available under any Series Enhancement without the consent of each affected Noteholder, (b) change the definition or the manner of calculating the amounts to which any Noteholder is entitled without the consent of each affected Noteholder, (c) reduce the aforesaid percentage required to consent to any such amendment, without the consent of each Noteholder, (d) adversely affect the rating of any Series or class by the applicable rating agencies without the consent of the holders of Notes of such Series or evidencing not less than 662/3% of the aggregate unpaid principal amount of the Notes of such Series or class, or (e) be a significant change (as interpreted in accordance with generally accepted accounting principles) to Noteholders without the consent of Noteholders of not less than 51% of the aggregate unpaid principal amount of the Notes. Promptly following the execution of any such amendment (other than an amendment described in the preceding paragraph), the Indenture Trustee will furnish written notice of the substance of such amendment to each Noteholder and the Servicer shall provide notice of the substance of such amendment to each applicable Rating Agency and each Series Enhancer. Notwithstanding the foregoing, no amendment may be made to the Note Issuance Agreement, the Receivables Purchase Agreement or any Series Supplement which would adversely affect in any material respect the interests of the provider of any Series Enhancement without the consent of the provider of such Series Enhancement.

MATERIAL CONTRACTS

Unless otherwise specified in the pricing supplement for Notes of a Series, the following are the contracts which can reasonably be regarded as material to investors purchasing Notes of any Series:

(a) the Declaration of Trust described under the heading “The Trust”;

(b) the Assignment and Assumption Agreement described under the heading “Transaction Structure Summary - The Trust”;

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(c) the Administration Agreement described under the heading “The Administrator”;

(d) the Receivables Purchase Agreement described under the heading “Transaction Structure Summary – The Trust”;

(e) the Note Issuance Agreement described under the heading “The Trustees – The Indenture Trustee”;

(f) the Series Supplement for each Series described under the headings “Master Trust Provisions” and “Series Provisions”;

(g) the Dealer Agreement described under the heading “Plan of Distribution”; and

(h) the Seller’s Securities Law Indemnity Covenant described under the heading “Seller’s Securities Law Indemnity Covenant”.

The agreements referred to above may be inspected during normal business hours at the offices of the Issuer Trustee located at 100 University Avenue, 9th Floor, Toronto, Ontario M5J 2Y1.

RISK FACTORS

Set forth below is a summary of the material risks associated with an investment in the Notes.

Series Considerations

Lack of Marketability of Notes. There is currently no secondary market for the Notes and there is no assurance that one will develop. The Dealers expect, but are not obligated, to make a market in the Notes. There can be no assurance that a secondary market will develop or, if it does, that it will provide holders of Notes with liquidity of investment or that it will continue for the life of the Notes. Accordingly, this investment should only be considered by those persons who are able to bear the economic risk of the investment until the related Expected Final Payment Date.

Payments. The Receivables may be paid at any time and there is no assurance that there will continue to be new Receivables created in the Accounts, that Receivables will continue to be added to the Trust or that any particular pattern of cardholder repayments will occur. The full payment of the Allocated Amount on the Expected Final Payment Date for a Series is primarily dependent on the rate of cardholder repayments and will not be made if such repayment amounts are insufficient to pay the Allocated Amount of such Series in full. No assurance can be given as to the cardholder monthly payment rates which will actually occur in any future period. The actual rate of accumulation of principal in the related Principal Funding Account will depend, among other factors, on the rate of repayment, the timing of the receipt of repayments and the rate of default by cardholders, and no assurance can be given that the Allocated Amount of such Series will be paid on its Expected Final Payment Date. See “The Credit Card Business of Bank of Montreal” for a discussion of factors which affect payments of the Receivables.

The Receivables Purchase Agreement provides that the Seller will be required to make a Lump Sale of Receivables to the Trust in the event that the sum of the amount of Principal Receivables and the amounts on deposit or to be deposited in the Excess Funding Account is not maintained at a level equal to the Required Minimum Principal Balance. The Required Minimum Principal Balance may be reduced under certain circumstances described herein under “Master Trust Provisions — Acquisition of Additional Trust Assets”. In such circumstances, if the Seller fails to make such required Lump Sale of Receivables within five business days of the day on which it is required to make such Lump Sale pursuant to the Receivables Purchase Agreement, unless the Required Minimum Principal Balance has been reduced, an Amortization Event will occur. To date, the Seller has not been required to make a Lump Sale.

In addition, a decrease in the effective yield on the Receivables due to, among other things, a change in the periodic finance charges applicable to the Accounts, an increase in the level of delinquencies or increased convenience use, when cardholders pay their Receivables early and thus avoid all finance charges on purchases, could cause an Amortization Event to occur as well as result in decreased protection to Noteholders against defaults under the Accounts. Unless otherwise provided in the applicable Series Supplement (and set out in the applicable pricing supplement), if the amount of Surplus Finance Charge Collections with respect to a Series averaged over a period of three consecutive Due Periods is less than or equal to a specified amount (the “Required Surplus Finance Charge Amount”) for the last of such three consecutive Due Periods, an Amortization Event will occur with respect to such Series. In addition, if at any time the total amount of Principal

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Receivables is less than the aggregate outstanding principal amounts for all outstanding Series, and the amount of Surplus Finance Charge Collections for such Series averaged over the previous three-month Due Periods is less than or equal to a specified amount (the “Additional Required Surplus Finance Charge Amount”) an Amortization Event will occur with respect to such Series. If applicable, the Required Surplus Finance Charge Amount for each Series will be specified in the applicable Series Supplement and cannot be less than zero. If applicable, the Additional Required Surplus Finance Charge Amount for each Series will also be specified in the related Series Supplement and will be a greater amount than the Required Surplus Finance Charge Amount for such Series. Pursuant to the related Series Supplement, the Seller will be permitted to change the Required Surplus Finance Charge Amount for such Series upon providing notice to the Trust, the Indenture Trustee, each applicable Rating Agency and the Servicer (if not the Seller) and, provided that in the case of an increase in such amount, such increase will not, in the reasonable belief of the Seller at the time of such increase or at a future date, cause an Adverse Effect, and provided further that any such change will result in a similar change being made to the Additional Required Surplus Finance Charge Amount for such Series. Although a change in the Required Surplus Finance Charge Amount, and a resulting change in the Additional Surplus Finance Charge Amount, would not cause an Amortization Event with respect to the applicable Series at the time of such changes, any increase in such amounts would make the occurrence of an Amortization Event more likely. See “The Credit Card Business of Bank of Montreal” and see also “Series Provisions — Amortization Events” for a discussion of other events which might lead to the commencement of an Early Amortization Period. If a Seller Insolvency Event occurs, the Indenture Trustee may, in certain circumstances, promptly sell or otherwise liquidate the Receivables. The proceeds from the sale of the Receivables will be treated as Collections on the Receivables and allocated accordingly among holders of Notes of all Series and the Seller Note.

Ratings of the Notes. It is a condition to the closing of the issuance of a Series of Notes that such Notes receive an Approved Rating by at least two Rating Agencies. The rating of the Notes of a Series will be based primarily on the value of the Receivables, the extent of the Available Cash Collateral Amount, the subordination of the Class B Notes, Class C Notes and Class D Notes to the Class A Notes, the subordination of the Class C Notes and Class D Notes to the Class B Notes, and the subordination of the Class D Notes to the Class C Notes, in each case with respect to such Series, and the credit ratings of the Servicer and the Seller.

The ratings of the Notes are not a recommendation to purchase, hold or sell the Notes, inasmuch as such ratings do not comment as to market price or suitability for a particular investor. There is no assurance that the ratings of the Notes will remain for any given period of time or that such ratings will not be lowered or withdrawn entirely by any Rating Agency if in its judgment circumstances so warrant. Although the ratings of the Notes address the likelihood of the ultimate payment of principal and interest on the Notes, the Rating Agencies do not evaluate, and the ratings of the Notes do not address, the likelihood that the outstanding principal amount of the Notes of a Series will be paid by its Expected Final Payment Date. The ratings also do not address the possibility of the occurrence of an Amortization Event, which could result in the payment of the outstanding principal amount of the Notes of such Series prior to its Expected Final Payment Date. In addition, the ratings take into consideration the capacity of those parties in a key support relationship to the Trust and the Notes and the degree of covenant protection available to investors as contained in the Material Contracts.

Effect of Subordination — Class B Notes. The Class B Notes of each Series will be subordinated in right of payment of principal to the Class A Notes of such Series. Payments of principal in respect of such Class B Notes will not commence until after the final principal payment with respect to such Class A Notes has been made as described herein, except that following the occurrence of an Amortization Event with respect to such Series, principal of such Class B Notes may be payable from amounts on deposit in the related Cash Collateral Account to the extent not required to pay the principal amount of such Class A Notes. Moreover, the Allocated Amount of a Series is subject to reduction as a result of Investor Charge-Offs and the application of Subordinated Principal Collections to pay or fund the Class A Required Amount, the Class B Required Amount or the Class C Required Amount for any Due Period, in each case with respect to such Series. Any reductions in the Allocated Amount for a Series will first be allocated to reduce the Class D Allocated Amount and, after the Class D Allocated Amount has been reduced to zero, to the Class C Allocated Amount, and after the Class C Allocated Amount has been reduced to zero, to the Class B Allocated Amount, in each case for such Series. If the Allocated Amount for a Series suffers such reductions that the Class B Allocated Amount for such Series shall be reduced to an amount less than the outstanding principal amount of the Class B Notes of such Series, the collections of Finance Charge Receivables available to the Class B Noteholders of such Series in future Due Periods will be reduced and principal and interest payments on such Class B Notes may be delayed or reduced. In addition, in the event of a sale of the Receivables due to a Seller Insolvency Event or a sale or repurchase of the Noteholders’ Allocation of a Series in the event of a Servicer Default, the portion of the net proceeds of such sale allocable to pay principal of such Noteholders’ Allocation will first be used to pay amounts due to the Class A Noteholders of such Series and any remainder will be used to pay amounts due to Class B Noteholders of such Series, thereby causing a loss to such Class B Noteholders if such portion plus any amount available to be withdrawn from the related Cash Collateral Account are insufficient to pay such Class B Noteholders in full. If such

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Class B Allocated Amount is reduced to zero, the Class A Noteholders of such Series will bear directly the credit and other risks associated with such Series’ Noteholders’ Allocation of the Receivables in the Trust.

Effect of Subordination — Class C Notes. The Class C Notes of each Series are subordinated in right of payment of principal to the Class A Notes and Class B Notes of such Series. Payments of principal in respect of such Class C Notes will not commence until after the final principal payment with respect to such Class A Notes and Class B Notes has been made as described herein, except that following the occurrence of an Amortization Event with respect to such Series, principal of such Class C Notes may be payable from amounts on deposit in the related Cash Collateral Account to the extent not required to pay the principal amount of such Class A Notes and Class B Notes. Moreover, the Allocated Amount of a Series is subject to reduction as a result of Investor Charge-Offs and the application of Subordinated Principal Collections to pay or fund the Class A Required Amount, the Class B Required Amount or the Class C Required Amount for any Due Period, in each case for such Series. Any reductions in the Allocated Amount of a Series will first be allocated to reduce the Class C Allocated Amount of such Series. If the Allocated Amount for a Series suffers such reductions that such Class C Allocated Amount shall be reduced to an amount less than the outstanding principal amount of the Class C Notes of such Series, the collections of Finance Charge Receivables available to such Class C Noteholders in future Due Periods will be reduced and principal and interest payments on such Class C Notes may be delayed or reduced. In addition, in the event of a sale of the Receivables due to a Seller Insolvency Event or a sale or repurchase of the Noteholders’ Allocation of a Series in the event of a Servicer Default, the portion of the net proceeds of such sale allocable to pay principal of such Series’ Noteholders’ Allocation will first be used to pay amounts due to the Class A Noteholders and Class B Noteholders of such Series and any remainder will be used to pay amounts due to Class C Noteholders of such Series, thereby causing a loss to such Class C Noteholders if such portion plus any amount available to be withdrawn from the related Cash Collateral Account are insufficient to pay such Class C Noteholders in full. If such Class C Allocated Amount is reduced to zero, the Class B Noteholders of such Series will bear directly the credit and other risks associated with such Series’ Noteholders’ Allocation of the Receivables in the Trust.

Effect of Subordination — Class D Notes. The Class D Notes of each Series are subordinated in right of payment of principal to the Class A Notes, the Class B Notes and the Class C Notes of such Series. Payments of principal in respect of such Class D Notes will not commence until after the final principal payment with respect to such Class A Notes , Class B Notes and Class C Notes has been made as described herein, except that following the occurrence of an Amortization Event with respect to such Series, principal of such Class D Notes may be payable from amounts on deposit in the related Cash Collateral Account to the extent not required to pay the principal amount of such Class A Notes, Class B Notes and Class C Notes. Moreover, the Allocated Amount of a Series is subject to reduction as a result of Investor Charge-Offs and the application of Subordinated Principal Collections to pay or fund the Class A Required Amount, Class B Required Amount or Class C Required Amount for any Due Period, in each case for such Series. Any reductions in the Allocated Amount of a Series will first be allocated to reduce the Class D Allocated Amount of such Series. If the Allocated Amount for a Series suffers such reductions that such Class D Allocated Amount shall be reduced to an amount less than the outstanding principal amount of the Class D Notes of such Series, the collections of Finance Charge Receivables available to such Class D Noteholders in future Due Periods will be reduced and principal and interest payments on such Class D Notes may be delayed or reduced. In addition, in the event of a sale of the Receivables due to a Seller Insolvency Event or a sale or repurchase of the Noteholders’ Allocation of a Series in the event of a Servicer Default, the portion of the net proceeds of such sale allocable to pay principal of such Series’ Noteholders’ Allocation will first be used to pay amounts due to the Class A Noteholders, Class B Noteholders and Class C Noteholders of such Series and any remainder will be used to pay amounts due to Class D Noteholders of such Series, thereby causing a loss to such Class D Noteholders if such portion plus any amount available to be withdrawn from the related Cash Collateral Account are insufficient to pay such Class D Noteholders in full. If such Class D Allocated Amount is reduced to zero, the Class C Noteholders of such Series will bear directly the credit and other risks associated with such Series’ Noteholders’ Allocation of the Receivables in the Trust.

Control. Subject to certain limited exceptions, Noteholders of a Series holding a specified percentage of the aggregate outstanding principal amount of the Notes may take certain actions, or direct certain actions to be taken, under the Note Issuance Agreement or the related Series Supplement, including directing the Indenture Trustee to take certain actions, amending such Series Supplement and declaring certain Amortization Events and Servicer Defaults with respect to such Series. In such cases (subject to certain exceptions), when determining whether the required percentage of Noteholders of a Series have given their approval or consent, the Class A Noteholders, the Class B Noteholders, the Class C Noteholders and the Class D Noteholders of such Series will be treated as a single class. Accordingly, such Class A Noteholders will have the power to determine whether any such action is taken without regard to the position or the interests of such Class B Noteholders, Class C Noteholders or Class D Noteholders relating to such action. The Class B Noteholders, Class C Noteholders and Class D Noteholders will not have similar power. In order to make such determinations, the Class B Noteholders, Class C Noteholders and Class D Noteholders of a Series will need the approval or consent of Class A Noteholders owning a substantial portion of the Class A Notes of such Series.

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Historical Increases in Losses and Delinquencies. The loss and delinquency rates for the portfolio of Accounts increased during the 2009, 2010 and 2011 fiscal years, but have declined during the 2012 fiscal year. The Trust is unable to determine whether such rates will continue to decline, remain constant or increase in light of the recent recessionary economic conditions. To the extent that losses allocable to a Series exceed the amounts available to cover those losses, the Trust may not be able to make the required payments of principal and interest due on such Series.

Master Trust Considerations

Issuance of Additional Series. The Trust, as a master trust, may issue additional Series from time to time. While the terms of any Series will be specified in a Series Supplement, the provisions of a Series Supplement and, therefore, the terms of any additional Series, will not be subject to the prior review or consent of holders of the Notes of any previously issued Series. Such terms may include methods for determining applicable investor percentages and allocating collections, provisions creating different or additional security or other Series Enhancement, provisions subordinating such Series to another Series or other Series (if the Series Supplement relating to such Series so permits) to such Series, and any other amendment or supplement to the Note Issuance Agreement which is made applicable only to such Series. The obligation of the Trust to issue any new Series is subject to the following conditions, among others: (a) such issuance will not result in any applicable Rating Agency reducing or withdrawing its rating of the Notes of any outstanding Series (any such reduction or withdrawal is referred to herein as a “Ratings Effect”), and (b) the Seller shall have delivered to the Trust and any provider of Series Enhancement a certificate of an authorized officer to the effect that, in the reasonable belief of the Seller, such issuance will not (i) at the time of its occurrence or at a future date, cause the occurrence of an Amortization Event for any Series, (ii) result in the amount of Surplus Finance Charge Collections for any Series averaged over any three consecutive Due Periods to not be in excess of the Required Surplus Finance Charge Amount for such Series for the last of such three consecutive Due Periods, or (iii) adversely affect in any manner the timing or amount of payments to Noteholders of any Series (any of the conditions referred to in the preceding clauses (i), (ii) and (iii) are referred to herein as an “Adverse Effect”). There can be no assurance, however, that the terms of any other Series, including any Series issued from time to time hereafter, might not have an impact on the timing or amount of payments received by a Noteholder. In addition, the Series Supplements relating to Series which are part of a Group as described herein may provide that collections of Receivables allocable to such Series will be reallocated among all Series in the Group. Consequently, the issuance of new Series in a Group may have the effect of reducing the amount of Collections of Receivables which are reallocated to the Notes of existing Series in such Group. For example, in Group One, which provides for the reallocation of Finance Charge Collections allocable to a Series among all Series in such Group, an additional Series which is issued with a larger claim with respect to monthly interest than that of previously issued Series in Group One (due to a higher interest rate) will receive a proportionately larger reallocation of Group One Investor Finance Charge Collections. Such issuance will reduce the amount of Group One Investor Finance Charge Collections which are reallocated to the existing Series in Group One. See “Master Trust Provisions - New Issuances”.

Acquisition of Additional Trust Assets. The Seller is permitted, and in some cases will be obligated, to designate Additional Accounts, the Receivables in which will be conveyed to the Trust. Additional Accounts may be subject to different eligibility criteria than the Initial Accounts. See “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Representations and Warranties”. Such Additional Accounts may include accounts originated using criteria different from those which were applied to the Initial Accounts because such accounts were originated at a later date or were part of a portfolio of credit card accounts which were not part of the Portfolio or which were acquired from another credit card issuer. Moreover, Additional Accounts may not be accounts of the same type previously purchased by the Trust. Consequently, there can be no assurance that such Additional Accounts will be of the same credit quality as the Initial Accounts or the Additional Accounts the Receivables in which have been previously purchased by the Trust. In addition, such Additional Accounts may consist of credit card accounts which have different terms than the Initial Accounts, including lower periodic finance charges, which may have the effect of reducing the average yield on the portfolio of Accounts. The designation of Additional Accounts will be subject to the satisfaction of certain conditions described herein under “Master Trust Provisions - Acquisition of Additional Trust Assets”.

Certain Legal Aspects. The sale of the Receivables by the Seller to the Trust is intended to be a true sale for legal purposes. As a sale, the Accounts would not form part of the assets of Bank of Montreal and, accordingly, would not be available to its creditors. However, if insolvency proceedings were commenced by or against Bank of Montreal, it is possible that an administrator, receiver, conservator or creditor of Bank of Montreal may attempt to argue that the transaction between the Seller and the Trust is other than a true sale of the Receivables. This position, if accepted by a court, could prevent timely or ultimate payment of amounts due to the Trust and, consequently, the Noteholders. While Bank of Montreal is the Servicer, cash collections held by Bank of Montreal may, subject to certain conditions, be commingled and used for the benefit of Bank of Montreal prior to each Allocation Date and, in the event of the bankruptcy, insolvency, receivership or

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administration of Bank of Montreal, the ability of the Trust to enforce its rights to the Collections in a timely manner may be adversely affected and Collections that have been commingled may be unrecoverable. Unless otherwise agreed to by the applicable Rating Agency, if the short-term rating of Bank of Montreal is reduced below required levels, Bank of Montreal will, within five business days, commence the deposit of collections directly into the Collection Account within two business days of the day of processing. If a receiver or administrator of Bank of Montreal were to be appointed or a Seller Insolvency Event were to occur, then an Amortization Event would occur and, pursuant to the terms of the Receivables Purchase Agreement and the Note Issuance Agreement, new Principal Receivables would not be transferred to the Trust. If a receiver or administrator is appointed for the Servicer, and no Servicer Default other than receivership, administration or insolvency of the Servicer exists, the receiver or administrator may have the power to prevent the Trust from appointing a successor Servicer.

Reliance on Bank of Montreal as Servicer. The servicing of the Receivables, including the collection and allocation thereof, and making the required deposits into and withdrawals from the Collection Account and the various Series accounts, is to be performed by Bank of Montreal, as the initial Servicer. Investors are relying on Bank of Montreal’s good faith, expertise, historical performance, technical resources and judgment in servicing the Receivables. It is possible that a material disruption in collecting the Receivables may ensue if a Servicer Default occurs and a successor Servicer assumes Bank of Montreal’s servicing obligations. In addition, the collection results achieved by a successor Servicer may differ materially from the results achieved during the time Bank of Montreal is the Servicer. In the event of a Servicer Default, the Trust is permitted to appoint a successor Servicer. In the event that there is a Servicer Default and the Indenture Trustee cannot find a suitable successor Servicer, the Indenture Trustee will automatically serve as successor Servicer until a suitable successor Servicer is found. The Indenture Trustee does not have sufficient systems, resources or personnel to fulfill its duties as successor Servicer in the same manner as the Servicer.

Social, Legal, Economic and Other Factors. Changes in credit card use and payment patterns by cardholders result from a variety of economic, legal and social factors. Economic factors include the rate of inflation, unemployment levels and relative interest rates. The use of incentive programs (e.g., gift awards for card usage) may affect card use. The Trust is unable to determine and has no basis to predict whether or to what extent changes in applicable laws or other economic or social factors will affect card use or repayment patterns. See “The Accounts”.

Recessionary Economic Conditions and Loss and Delinquency Experience May Reduce Payments on Notes. During periods of economic recession, high unemployment, increased mortgage defaults and personal bankruptcy rates and low consumer and business confidence, credit card activity generally declines and delinquency and loss rates generally increase, resulting in a decrease in the amount of collections, including with respect to finance charges. These changes in credit card activity, delinquency and loss rates and the attendant reductions in the amount of collections with respect to finance charges, may be material. The Trust cannot predict how or when these or other factors will affect repayment patterns or credit card activity and, consequently, the timing and amount of payments on a Series of Notes could be affected.

Competition in the Credit Card Industry. The credit card industry is highly competitive and operates in a legal and regulatory environment increasingly focused on the cost of services charged for credit cards. There is increased use of advertising, target marketing, pricing competition and incentive programs. New credit card issuers may seek to expand or enter the market. New federal, provincial or territorial laws and amendments to existing laws may be enacted to regulate further the credit card industry or to reduce finance charges or other fees or charges applicable to credit card accounts. In addition, certain credit card issuers assess periodic finance charges or other fees or charges at rates lower than the rate currently being assessed on most of the Accounts. Bank of Montreal may also solicit existing cardholders to open other credit card accounts which offer certain benefits not available under the Accounts, including lower periodic finance charges. If cardholders choose to utilize competing sources of credit, the rate at which new Receivables are generated in the Accounts may be reduced and certain purchase and payment patterns with respect to Receivables may be affected. The Trust will be dependent upon the Seller’s continued ability to generate new Receivables. If the rate at which new Receivables are generated declines significantly and the Seller does not sell Additional Accounts to the Trust, an Amortization Event could occur.

The Ability of Bank of Montreal to Change Terms of the Accounts. Pursuant to the Receivables Purchase Agreement, the Seller does not transfer to the Trust the Accounts but only the Receivables arising in the Accounts. As owner of the Accounts, Bank of Montreal will have the right to determine the periodic finance charge and the fees which will be applicable from time to time to the Accounts, to alter the minimum monthly payment required under the Accounts and to change various other terms with respect to the Accounts. A decrease in the periodic finance charge would decrease the effective yield on the Accounts and could result in the occurrence of an Amortization Event. Under the Receivables Purchase Agreement, Bank of Montreal has agreed that, except to the extent prohibited or as otherwise required by law or unless, in its

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good faith judgment, it deems it necessary to maintain on a competitive basis its credit card business, it will not take actions which would reduce the Portfolio Yield to less than the sum of (a) the weighted average interest rate of each class of Notes of each Series and (b) the weighted average of the Series Servicing Fee Rate allocable to each class of Notes of each Series. The term “Portfolio Yield” means, with respect to any Due Period, the annualized percentage equivalent of a fraction the numerator of which is the amount of Finance Charge Collections for the immediately preceding Due Period after subtracting therefrom the amount of Receivables which were charged-off as uncollectible in such immediately preceding Due Period, and the denominator of which is the total amount of Principal Receivables and the principal amount on deposit in the Excess Funding Account as of the last day of such immediately preceding Due Period; provided, however, that with respect to any Due Period in which a Lump Sale of Receivables or redemption of Receivables arising in Accounts occurs, the denominator will be the aggregate of the average daily amount of Principal Receivables for such Due Period and the principal amount on deposit in the Excess Funding Account on the last day of such Due Period. In addition, Bank of Montreal has also agreed that, except to the extent prohibited or as otherwise required by law, it will not take any action which would reduce the Portfolio Yield to less than the highest Series interest rate for any outstanding Series or class. In addition, Bank of Montreal has agreed that, upon the occurrence of the Amortization Event, it will not, except to the extent prohibited or as otherwise required by law, reduce the periodic finance charges on the Accounts to a rate that would result in the Net Portfolio Yield falling below 1.00% per annum. “Net Portfolio Yield” means, for any time of determination with respect to all Series in a Group, the amount by which the Portfolio Yield at such time exceeds the sum of (x) the weighted average of the interest rates of each outstanding Series in such Group at such time and (y) the weighted average of the monthly servicing and administration fees of each outstanding Series in such Group at such time. Except as specified above, there are no restrictions on the ability of Bank of Montreal to change the terms of the Accounts. There can be no assurances that changes in applicable law, changes in the marketplace or prudent business practice might not result in a determination by Bank of Montreal to decrease customer finance charges or otherwise take actions which would change other Account terms. In servicing the Accounts, the Servicer is required to exercise the same care and apply the same policies that it exercises in handling similar matters for its own or other comparable accounts.

Noteholder Action. Subject to certain exceptions, the Noteholders of each Series may take certain actions, or direct certain actions to be taken, under the Note Issuance Agreement or the related Series Supplement. However, under certain circumstances, the consent or approval of a specified percentage of the aggregate unpaid principal amount of the Notes of all outstanding Series will be required to direct certain actions, including requiring the appointment of a successor Servicer following a Servicer Default, amending the Receivables Purchase Agreement or the Note Issuance Agreement under certain circumstances and directing a reassignment of the entire portfolio of Accounts. In addition, following the occurrence of a Seller Insolvency Event, the Trust Assets may, in certain circumstances, be liquidated unless the holders of Notes evidencing more than 50% of the aggregate unpaid principal amount of each Series or each class of each Series (along with any other holders of the Seller Notes) direct the Indenture Trustee not to sell or otherwise liquidate the Receivables.

Consumer Protection Laws. The relationship between the cardholders and Bank of Montreal, as credit card issuer, is regulated by the Bank Act (Canada) and certain provincial and territorial consumer protection legislation which differs in each province but has a fairly consistent impact. The legislation in certain provinces and territories limits liability for unauthorized use and imposes disclosure requirements before or when an account is opened and at the end of billing cycles. The information to be disclosed includes the total cost of credit, including all fees and charges. Most provinces and territories also have legislation that regulates the use of consumer reports with respect to the issuance of credit and legislation that regulates collection practices. The Trust may be liable for certain violations of consumer protection legislation either as assignee from the Seller with respect to obligations arising before the transfer of the Receivables to the Trust or as the party directly responsible for obligations arising after the transfer. In addition, a cardholder may be entitled to assert such violations by way of a defense or set-off against the obligation to pay the amount of Receivables owing or a portion thereof. Receivables that were not created in compliance in all material respects with the requirements of such laws may, if such non-compliance has a material adverse effect on the interest of the Trust therein, be reassigned by the Trust to the Seller. The Servicer has also agreed in the Note Issuance Agreement to indemnify the Trust, among other things, for any liability arising from such violations by the Servicer. For a discussion of the Trust’s rights if the Receivables were not created in compliance in all material respects with applicable laws, see “The Receivables Purchase Agreement and the Note Issuance Agreement Generally - Representations and Warranties”.

Application of the Bankruptcy and Insolvency Act (Canada) to the Seller could affect the interests of the Trust in the Receivables if such laws result in any Receivables being charged-off as uncollectible. Under “Series Provisions” see “Investor Charge-Offs; Other Reductions of the Allocated Amount” and “Defaulted Receivables; Recoveries; Rebates and Fraudulent Charges”.

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Limited Recourse. The Notes of any Series and the Seller Notes will be secured by the assets of the Trust (the “Secured Property”), including the Receivables. Recourse by Noteholders to the Secured Property will be limited to (i) varying percentages of collections on the Receivables related to that Series, (ii) collections allocable to the Noteholders’ Allocation for other Series that are reallocated to the Notes of a Series as described herein, and (iii) the Series Enhancement for a Series pledged by the Trust to the Indenture Trustee as security for the obligations of the Trust to the Noteholders (collectively, the “Noteholders’ Allocation”). In certain circumstances, Collections allocated to the Noteholders’ Allocation may be reallocated to the Noteholders’ Allocation for other Series which may subsequently be issued by the Trust. All security for the Notes will be held by the Indenture Trustee on behalf of the Noteholders.

Reliance on Historical Data; Impact of Defaults on Repayment. There can be no assurance that the delinquency, default and net loss trends or the collections and principal repayment data and other historical information summarized in the tables under the heading “The Credit Card Business of Bank of Montreal” will continue to be representative of the performance of the Portfolio. To the extent that defaults and delinquencies allocable to the Trust’s securities exceed the amounts available to cover those losses received in respect of the Trust’s securities, the Trust may not be able to make the required payment of interest and principal due on the Trust’s securities.

PLAN OF DISTRIBUTION

Pursuant to a dealer agreement dated as of April 30, 2013 (the “Dealer Agreement”) made between BMO Nesbitt Burns Inc., CIBC World Markets Inc., Desjardins Securities Inc., HSBC Securities (Canada) Inc., Laurentian Bank Securities Inc., Merrill Lynch Canada Inc., National Bank Financial Inc., RBC Dominion Securities Inc., Scotia Capital Inc. and TD Securities Inc. and such other dealers as may be selected from time to time by the Issuer and the Seller (collectively, the “Dealers”), the Dealers are authorized as agents of the Issuer to solicit offers to purchase the Notes in all provinces and territories of Canada, directly or indirectly through other investment dealers. The rate of commission payable in connection with sales by the Dealers as agents of Notes shall be as determined from time to time by mutual agreement of the Issuer and the Dealers and will be set forth in the applicable pricing supplement.

The Dealer Agreement also provides that the Notes may be purchased from time to time by any of the Dealers, as principal, at such prices as may be agreed between the Issuer and the Dealer for resale to the public at prices to be negotiated with purchasers. Such resale prices may vary during the period of distribution and as between purchasers. The Dealer’s compensation will be increased or decreased by the amount by which the aggregate price paid for the Notes by purchasers exceeds or is less than the aggregate proceeds paid by the Dealer to the Issuer.

The Issuer may also offer the Notes directly to the public from time to time pursuant to any applicable statutory registration exemptions at such prices and upon such terms as may be agreed upon by the purchaser, in which case no commission will be paid to the Dealers. Notes may be sold at fixed prices or at non-fixed prices (that is, at prices determined by reference to the prevailing price of a specified security in a specific market), at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at prices to be negotiated with purchasers. Accordingly, the price at which Notes will be offered and sold to the public may vary as between purchasers and during the period of distribution of the Notes in which case the Dealers’ overall compensation will vary depending upon the aggregate price paid for the Notes by the purchasers.

The Issuer will have the sole right to accept offers to purchase Notes and may, in its absolute discretion, reject any proposed purchase of Notes in whole or in part. Each Dealer will have the right, in its discretion reasonably exercised, to reject any offer to purchase Notes received by it in whole or in part. The obligations of the Dealers under the Dealer Agreement may be terminated at their discretion on the basis of their assessment of the state of the financial markets and may also be terminated upon the occurrence of certain stated events.

The Notes will not be listed on any securities exchange. The Notes have not been and will not be registered under the United States Securities Act of 1933, as amended, (the “1933 Act”) or under any state securities laws and may not be offered, sold or delivered in the United States (as defined in Regulation S under the 1933 Act) except to persons who are “qualified institutional buyers” (as defined in Rule 144A under the 1933 Act (“Rule 144A”)) in reliance upon the exemption from the registration requirements of Rule 144A and exemptions from applicable state securities laws. Each issue of Notes will be a new issue of securities with no established trading market. In addition, until 40 days after the commencement of any offering of the Notes, an offer or sale of the Notes within the United States by a Dealer (whether or not participating in such offering) may violate the registration requirements of the 1933 Act if such offer or sale is made otherwise than in accordance with Rule 144A.

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In connection with any offering of Notes, the Dealers may, subject to the foregoing, over-allot or effect transactions that stabilize or maintain the market price of the Notes offered at a level above that which might otherwise prevail in the open market. Such transactions, if commenced, may be discontinued at any time. Any Dealers to or through whom Notes are sold may make a market in the Notes, but such Dealers will not be obligated to do so and may discontinue any market making at any time without notice. No assurance can be given that a trading market in the Notes of any issue will develop or as to the liquidity of any trading market for the Notes.

BMO Nesbitt Burns Inc. is an indirect wholly-owned subsidiary of Bank of Montreal. As a result of the relationship between Bank of Montreal (and its affiliates) and the Trust, the Trust may be considered to be a “connected issuer” of BMO Nesbitt Burns Inc. under applicable securities legislation. All proceeds of this offering will be used by the Trust to redeem a portion of the Seller Note and none will be applied directly for the benefit of BMO Nesbitt Burns Inc.

The Seller and the Trust have agreed to indemnify each Dealer against certain liabilities, including liabilities under applicable securities laws, or to contribute with respect to any payment that such Dealer may be required to make in respect thereof.

SELLER’S SECURITIES LAW INDEMNITY COVENANT

Under a securities law indemnity covenant (the “Seller’s Securities Law Indemnity Covenant”), the Seller will represent and warrant to the Trust, the Issuer Trustee and the Dealers and covenant and agree to protect and indemnify the Trust, the Issuer Trustee and the Dealers against all fees, payments, obligations, losses, claims, damages, liabilities, costs and expenses caused or incurred by reason of (i) a breach of any material representation or warranty or non-fulfilment of any covenant in a Material Contract; (ii) any information or statement in the Prospectus, any pricing supplement or any document incorporated by reference herein or therein containing any untrue statement of a material fact or omitting to state any material fact that is required to be stated or that is necessary to be stated in order to make the statements contained in the Prospectus, any pricing supplement or any document incorporated by reference herein or therein, in light of the circumstances under which they were made, not misleading; and (iii) any order made or any inquiry, investigation or proceeding being commenced or threatened by any securities regulatory authority or other governmental authority in Canada or in any of the jurisdictions in which the Notes are offered for sale based upon any alleged circumstance described in (ii) above, and (iv) any prohibition or restriction affecting the trading in or sale or distribution of any of such Notes which may be ordered by any one or more competent authorities of any jurisdiction in which the Notes are offered for sale if such prohibition or restriction is based upon any alleged circumstance described in (ii) above.

USE OF PROCEEDS

The manner in which the Trust will use the proceeds of an offering of a Series of Notes will be specified in the applicable pricing supplement.

RATINGS

It is a condition of the closing of the offering of each Series of Notes that each class of Notes be assigned the Approved Ratings specified in the related Series Supplement (and set out in the applicable pricing supplement) on the related closing date by at least two of Moody’s Investors Service, Inc. (“Moody’s”), DBRS Limited (“DBRS”), S&P and Fitch Ratings Ltd. (“Fitch”) (each of Moody’s, DBRS, S&P and Fitch is referred to hereinafter as a “Rating Agency” and collectively as the “Rating Agencies”).

An “Approved Rating” means a rating from a Rating Agency which falls within one of the following generic rating categories of the Rating Agency or a rating category that replaces a category listed below:

Rating Agency Long-Term Short-Term

DBRS ....................................................................... AAA, AA, A or BBB R-1 or R-2 Moody’s ................................................................... Aaa, Aa, A or Baa P-1, P-2 or P-3 S&P .......................................................................... AAA, AA, A or BBB A-1+, A-1, A-2 or A-3 Fitch .......................................................................... AAA, AA, A or BBB F1+, F1, F2 or F3

The ratings of the Notes assigned by DBRS address the risk that the Trust will fail to satisfy its obligations in accordance with the terms of the Notes. The ratings of the Notes assigned by Moody’s address the expected loss posed to investors. However, the rating agencies do not evaluate and the ratings do not address the likelihood that the outstanding

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principal amount of the Notes of a Series will be paid by their Expected Final Payment Date. A rating is based primarily on the credit underlying the Receivables, the level of enhancement provided with respect to the Notes and the subordination of payments of interest and principal, all as described in the Prospectus and any pricing supplement. There is no assurance that a rating will remain for any given period of time or that a rating will not be lowered or withdrawn entirely by a rating agency if in its judgment circumstances so warrant. A revision or withdrawal of such rating may have an adverse effect on the market price of the Notes. The ratings of the Notes are not a recommendation to purchase, hold or sell the Notes, inasmuch as such ratings do not comment as to market price or suitability for a particular investor. The ratings also do not address the possibility of the occurrence of an Amortization Event with respect to the Series, either of which events could result in the partial or complete payment of the outstanding principal amount of Notes of a Series prior to their Expected Final Payment Date. In addition, the ratings take into consideration the capacity of those parties in a key support relationship to the Trust and the Notes and the degree of covenant protection available to investors as contained in the Material Contracts. Certain changes to the arrangements referred to herein are subject to the satisfaction of the Rating Agencies.

Any rating of the Notes by a Rating Agency will indicate:

• its view on the likelihood that Noteholders will receive required interest and principal payments; and

• its evaluation of the Receivables and the availability of any credit support for the Notes.

Among the things a rating will not indicate are:

• the likelihood that interest or principal payments will be paid on a scheduled date;

• the likelihood that an Amortization Event will occur;

• the marketability of the Notes;

• the market price of the Notes; or

• whether the Notes are an appropriate investment for any purchaser.

A rating will not be a recommendation to buy, sell or hold the Notes. A rating may be lowered or withdrawn at any time by a Rating Agency.

Rating agencies other than those requested could assign a rating to the Notes and such a rating could be lower than any rating assigned by a Rating Agency and disclosed herein. Payments were, or reasonably will be, made by the Trust to each applicable Rating Agency in connection with the ratings of the Notes and in connection with ratings of other notes of the Trust that are outstanding, or will be outstanding, and continue in effect, and payments were made to DBRS and Moody’s during the last two years in connection with the ratings of other notes issued by the Trust. No payments were made to DBRS or Moody’s in respect of any other service provided to the Trust by such Rating Agencies during the last two years.

Moody’s Ratings. Definitions of the ratings categories of Moody’s in which Moody’s may be asked to rate the Notes are set forth below in descending order of ranking:

Aaa

Obligations that are rated “Aaa” are judged to be of the highest quality with minimal credit risk.

Aa

Obligations that are rated “Aa” are judged to be of high quality and are subject to very low credit risk.

A

Obligations which are rated “A” are considered upper-medium grade and are subject to low credit risk.

Baa

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Obligations which are rated “Baa” are subject to moderate credit risk. They are considered medium-grade obligations and as such may possess certain speculative characteristics.

Moody’s has five (5) ratings categories that rank below the ratings categories on the Notes. These lower ranking ratings categories range from “Ba” to “C” and are assigned to obligations that have significant speculative characteristics. The ratings from “Aa” through “Caa” may have the numerical modifiers 1, 2 and 3 applied to them. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category, the modifier 2 indicates a mid-range ranking and the modifier 3 indicates a ranking in the lower end of the generic rating category.

DBRS Ratings. Definitions of the ratings categories of DBRS in which DBRS may be requested to rate the Notes are set forth below in descending order of ranking:

AAA

An obligation rated “AAA” is of the highest credit quality, with exceptionally strong protection for the timely repayment of principal and interest. “AAA” is the highest rating assigned to long-term obligations.

AA

An obligation rated “AA” is of superior credit quality, and protection of interest and principal is considered high. “AA” is the second highest rating category assigned to long-term obligations.

A

An obligation rated “A” is of satisfactory credit quality. Protection of interest and principal is still substantial, but the degree of strength is less than with “AA” rated securities. While a respectable rating, obligations are considered to be more susceptible to adverse economic conditions and have greater cyclical tendencies than higher rated securities. “A” is the third highest rating category assigned to long-term obligations.

BBB

An obligation rated “BBB” is of adequate credit quality. Protection of interest and principal is considered acceptable, but the obligation is fairly susceptible to adverse changes in financial and economic conditions, or there may be other adverse conditions present which reduce the strength of such obligation.

DBRS has six (6) ratings categories, ranging from “BB” to “D”, that rank below the ratings categories on the Notes. Five of the lower ranking rating categories, ranging from “BB” to “C”, are assigned to obligations that are regarded as having significant speculative characteristics. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions. An obligation rated “D” implies that the issuer has either not met a scheduled payment of interest or principal, that the issuer has made it clear that it will miss such a payment in the near future, or in certain cases that there has been a distressed exchange by such issuer. The ratings with the rating categories from “AA” to “CCC” are denoted by the subcategories “high” and “low”. The absence of either a “high” or “low” designation indicates the rating is in the “middle” of the particular rating category.

The DBRS long-term debt rating scale is meant to give an indication of the risk that a borrower will not fulfill its full obligations in a timely manner, with respect to both interest and principal commitments.

DBRS ratings represent an evaluation which is based solely on credit related factors and not market risk factors. The most obvious example of a market risk factor would be the potential impact that changing interest rates could have on a fixed pay security.

S&P Ratings. Definitions of the ratings categories in which S&P may be asked to rate the Notes are set forth below in descending order of ranking:

AAA

An obligation rated “AAA” has the highest rating assigned by S&P. The obligor’s capacity to meet its financial commitments on the obligation is extremely strong.

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AA

An obligation rated “AA” has the second highest rating assigned by S&P. The obligor’s capacity to meet its financial commitment on the obligation is very strong.

A

An obligation rated “A” is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rated categories. However, the obligor’s capacity to meet its financial commitment on the obligation is still strong.

BBB

An obligation rated “BBB” exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.

“AAA” is the highest ranking ratings category of S&P. S&P has six ratings categories that rank below the ratings categories on the Notes. Five of these lower ranking ratings categories range from “BB” to “C” and are assigned to obligations that have significant speculative characteristics. An obligation rated “D” is in payment default. The ratings from “AA” to “CCC” may be modified by the addition of a plus or minus sign to show relative standing within rating categories. If a rating has not been modified, this indicates that the rating ranks in the middle range of the particular rating category.

Fitch Ratings. Definitions of the ratings categories in which Fitch may be asked to rate the Notes are set forth below in descending order of ranking:

AAA

A “AAA” rating denotes the lowest expectation of default risk. Such rating is assigned only in cases of exceptionally strong capacity for payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.

AA

A “AA” rating denotes expectations of very low default risk. It indicates very strong capacity for payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

A

A “A” rating denotes expectations of low default risk. The capacity for payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to adverse business or economic conditions than is the case for higher ratings.

BBB

A “BBB rating indicates that expectations of default risk are currently low. The capacity for payment of financial commitments is considered adequate but adverse business or economic conditions are more likely to impair this capacity.

“AAA” is the highest ranking ratings category of Fitch. Fitch has six ratings categories that rank below the ratings categories on the Notes. Five of these lower ranking ratings categories range from “BB” to “C” and are assigned to obligations that have significant speculative characteristics and default risks. An obligation rated “D” is in payment default. The ratings from “AA” to “B” may be modified by the addition of a plus or minus sign to show relative standing within rating categories. If a rating has not been modified, this indicates that the rating ranks in the middle range of the particular rating category.

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BOOK-ENTRY REGISTRATION

Book-Entry Registration

Each class of Notes will initially be represented by one or more fully registered book-entry only notes (each, a “Book-Entry Note”) held by, or on behalf of, CDS, as custodian of the Book-Entry Notes and registered in the name of CDS, or its nominee. Registration of ownership and transfers of the Notes will be made only through the depository service of CDS. Except as described below, no purchaser of a Note will be entitled to a definitive Note or other instrument from the Trust or CDS evidencing that purchaser’s beneficial ownership thereof, and no holder of an interest in a Book-Entry Note (a “Book-Entry Note Owner”) will be shown on the records maintained by CDS, except through the book-entry accounts of a participant in the depository system of CDS (a “Participant”) acting on behalf of such Book-Entry Note Owner.

Transfers of beneficial ownership of Notes represented by Book-Entry Notes will be effected through records maintained by CDS or its nominee for such Book-Entry Notes (with respect to interests of Participants) and on the records of Participants (with respect to persons other than Participants). Book-Entry Note Owners that are not Participants but desire to purchase, sell or otherwise transfer ownership of, or other interests in, Notes may do so only through Participants. In addition, Book-Entry Note Owners will receive all distributions on the Notes from the Paying Agent through Participants. Under a book-entry format, Book-Entry Note Owners may experience some delay in their receipt of payments, since such payments will be forwarded by the Paying Agent to CDS or its nominee. CDS will forward such payments to its Participants, which thereafter will forward them to Book-Entry Note Owners.

The ability of a Book-Entry Note Owner to pledge Notes or to otherwise act with respect to such owner’s interest in the Notes (other than through a Participant) may be limited due to the lack of physical Notes.

Definitive Notes

Unless and until Notes are issued in fully registered, certificated form (collectively, “Definitive Notes”) Book-Entry Note Owners will not be recognized by the Trust, the Indenture Trustee or the Paying Agent as Noteholders. Definitive Notes will be issued to Book-Entry Note Owners or their respective nominees, rather than to CDS or its nominee, only if (a) the Trust, upon the direction of the Seller, advises the Issuer Trustee in writing that CDS is no longer willing or able to discharge its responsibilities as depository with respect to the Notes or ceases to be a recognized clearing agency (a “Clearing Agency”) under the Securities Act (Ontario) or other applicable Canadian securities legislation and the Issuer Trustee, the Trust and the Seller are unable to locate a qualified successor, (b) the Trust, upon the direction of the Seller, advises the Issuer Trustee in writing that it elects to terminate the book-based system with respect to the Notes through a Clearing Agency or (c) after the occurrence of a Servicer Default, Book-Entry Note Owners representing in aggregate not less than 50% of the aggregate unpaid principal amount of the affected Series or class advise the Issuer Trustee and the Clearing Agency through the Participants in writing that the continuation of a book-based system through the Clearing Agency with respect to such Notes is no longer in the best interest of the Book-Entry Note Owners of such Series or class.

Upon the occurrence of any event described in the immediately preceding paragraph, the Indenture Trustee will be required to notify all Book-Entry Note Owners through CDS of the occurrence of any such event and of the availability of Definitive Notes for such Series or class. Upon surrender by CDS of the relevant Book-Entry Note or Notes and instructions from CDS for re-registration, the Indenture Trustee will issue Definitive Notes for the applicable Series or class and thereafter the Indenture Trustee and the Trust will recognize the registered Noteholders of such Definitive Notes as the Noteholders of such Series or class under the Note Issuance Agreement.

Payments of interest, principal and other amounts with respect to Definitive Notes will thereafter be made by the Paying Agent in accordance with the procedures set forth in the Note Issuance Agreement directly to holders of Definitive Notes in whose names the Definitive Notes were registered at the close of business on the applicable Record Date. The final payment on any Definitive Note, however, will be made only upon presentation and surrender of such Definitive Note at the office or agency specified by the Indenture Trustee in the notice of final distribution to the Noteholders.

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

The following summary fairly describes the principal Canadian federal income tax considerations generally applicable to a person who acquires Notes pursuant to the Prospectus and who, at all relevant times and for purposes of the Tax Act, is or is deemed to be a resident of Canada, holds the Notes as capital property, is not affiliated with the Trust and the Dealers and deals with the Trust and the Dealers at arm’s length (a “Holder”). Generally, the Notes will constitute capital

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property to a Holder provided the Holder does not hold the Notes in the course of carrying on a business and does not acquire them as part of an adventure or concern in the nature of trade. Certain Holders who might not otherwise be considered to hold their Notes as capital property may, in certain circumstances, be entitled to have the Notes, and all other “Canadian securities” as defined in the Tax Act, owned by such Holder in the taxation year in which the election is made, and in all subsequent taxation years, deemed to be capital property by making the irrevocable election permitted by subsection 39(4) of the Tax Act. Holders whose Notes might not otherwise be considered to be capital property should consult their own tax advisors concerning this election. This summary is not applicable to a Holder an interest in which would be a “tax shelter investment”, a Holder to whom the “functional currency” reporting rules apply, a Holder which is a “financial institution” for purposes of certain rules applicable to securities held by financial institutions (referred to as the “mark-to-market” rules), each as defined in the Tax Act, or a Holder which enters into a “derivative forward agreement” with respect to the Notes, as defined in the amendments to the Tax Act proposed in the 2013 federal budget. Such Holders should consult their own tax advisers.

This summary is based upon the facts set out in the Prospectus, the current provisions of the Tax Act, all specific proposals to amend the Tax Act (the “Proposed Amendments”) publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof and counsel’s understanding of the current published administrative and assessing policies and practices of the Canada Revenue Agency. This summary assumes that the Proposed Amendments will be enacted as currently proposed, but there can be no assurance that the Proposed Amendments will be enacted as proposed, or at all. This summary does not otherwise take into account or anticipate any changes in the law or administrative or assessing practice, whether by judicial, governmental or legislative decision or action, nor does it take into account tax legislation or considerations of any province, territory or foreign jurisdiction, which may differ from those discussed herein.

This summary is of a general nature only and is not intended to be and should not be construed to be, legal or tax advice to any particular Holder. This summary is not exhaustive of all Canadian federal income tax considerations. Accordingly, prospective purchasers of Notes should consult their own tax advisers having regard to their own particular circumstances. If the principal Canadian federal income tax considerations applicable to any particular Series of Notes are materially different from those that are described in this summary, such Canadian federal income tax considerations will be summarised in the applicable pricing supplement related to that particular Series of Notes.

Interest

A Holder that is a corporation, partnership, unit trust or a trust of which a corporation or partnership is a beneficiary will be required to include in computing its income for a taxation year any interest that accrues or is deemed to accrue to such Holder to the end of that year or that becomes receivable or is received by it before the end of that year, to the extent that such interest was not included in the Holder’s income for a preceding taxation year. Any other Holder, including an individual, will be required to include in computing its income for a taxation year any interest on the Notes that is received or receivable by such Holder in that year (depending on the method regularly followed by the Holder in computing income) to the extent that such interest was not included in computing the Holder’s income for a preceding taxation year.

Disposition

On a disposition or a deemed disposition of a Note (which will include a redemption or repayment at maturity), a Holder will generally be required to include in computing its income for the taxation year in which the disposition occurs all interest that has accrued on the Note to that time except to the extent that such interest has otherwise been included in the Holder’s income for that year or a preceding taxation year.

In general, on a disposition or a deemed disposition of a Note, a Holder will realize a capital gain (or a capital loss) equal to the amount, if any, by which the proceeds of disposition, net of any amount included in the Holder’s income as interest and any reasonable costs of disposition, exceed (or are less than) the adjusted cost base of the Note to the Holder immediately before the disposition or deemed disposition.

Generally, one-half of any capital gain (a “taxable capital gain”) realized by a Holder in a taxation year must be included in computing such Holder’s income for that taxation year, and one-half of any capital loss (an “allowable capital loss”) realized by a Holder in a taxation year must be deducted from any taxable capital gains realized by the Holder in the year. Allowable capital losses in excess of taxable capital gains realized in a particular taxation year may be carried back and deducted in any of the three preceding taxation years or carried forward and deducted in any following taxation year against taxable capital gains realized in such years, subject to and in accordance with the provisions of the Tax Act.

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Refundable Tax

Tax payable by a Holder that is throughout the year a “Canadian-controlled private corporation” (as defined in the Tax Act) may include a refundable tax on “aggregate investment income” (as defined in the Tax Act), which generally includes interest income and net taxable capital gains.

AUDITORS, TRANSFER AGENT AND REGISTRAR

The auditors of the Trust are KPMG LLP. BNY Trust Company of Canada is the transfer agent and registrar for the Trust’s securities. Registers for the registration and transfer of the Trust’s securities are kept by BNY Trust Company of Canada at its principal office in Toronto, Ontario.

PROMOTER

Bank of Montreal has taken the initiative in organizing the Trust, and as such may be considered to be a “promoter” of the Trust within the meaning of the securities legislation of certain provinces and territories of Canada. See “The Trust” and “The Seller”. The Trust will receive the proceeds of each offering of Notes made hereunder and will apply such proceeds in the manner specified in the related pricing supplement.

Under the Administration Agreement, the Seller will provide services required in connection with the offering of the Notes and the ongoing operations, maintenance and regulatory compliance of the Trust. See “The Administrator”. Under a Seller’s Securities Law Indemnity Covenant, Bank of Montreal, as Seller, will agree to indemnify the Trust for any losses, claims, damages, liabilities, costs and expenses caused or incurred by reason of a breach of certain representations, warranties and covenants of the Seller in respect of certain information contained in the Prospectus and any pricing supplement. See “Seller’s Securities Law Indemnity Covenant”.

INTEREST OF EXPERTS

As at the date hereof, the partners and associates of Osler, Hoskin & Harcourt LLP, and the partners and associates of Bennett Jones LLP, as a group, beneficially own, directly or indirectly, less than 1% of the securities of the Trust as of the date of the Prospectus.

LEGAL MATTERS

Unless otherwise specified in the applicable pricing supplement, certain legal matters relating to the Notes will be passed upon on the related Series Issuance Date by Osler, Hoskin & Harcourt LLP, on behalf of the Seller and the Trust, and by Bennett Jones LLP, on behalf of the Dealers.

STATUTORY RIGHTS OF WITHDRAWAL AND RESCISSION

Securities legislation in certain of the provinces and territories of Canada provides purchasers with the right to withdraw from an agreement to purchase securities. This right may be exercised within two business days after receipt or deemed receipt of a short form base shelf prospectus and any amendment and any applicable pricing supplement relating to the securities purchased by the purchaser. In several of the provinces and territories, securities legislation further provides a purchaser with remedies for rescission or, in some jurisdictions, revisions of the price or damages where the short form base shelf prospectus and any amendment (including any pricing supplement) contains a misrepresentation or is not delivered to the purchaser, provided that such remedies for rescission, revisions of the price or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for the particulars of these rights or consult with a legal adviser.

UNDERTAKING

The Issuer has filed with the local securities regulatory authority or regulator in each of the provinces and territories of Canada (the “Securities Regulators”), an undertaking that the Issuer will not distribute credit card receivables-backed securities of a type that, at the time of distribution have not previously been distributed by prospectus, without pre-clearing with the applicable Securities Regulators the disclosure to be contained in the pricing supplement pertaining to the distribution of such novel securities.

CERTIFICATE OF THE TRUST AND THE PROMOTER

Dated: April 30, 2013

This short form prospectus, together with the documents incorporated in this prospectus by reference, will, as of the date of the last supplement to this prospectus relating to the securities offered by this prospectus and the supplement(s), constitute full, true and plain disclosure of all material facts relating to the securities offered by this prospectus and the supplement(s), as required by the securities legislation of each of the provinces and territories of Canada.

MASTER CREDIT CARD TRUST II by its Administrator,

BANK OF MONTREAL

(Signed) CATHRYN E. CRANSTON Senior Vice-President, Finance & Treasurer

(Signed) HELEN KILLOCH Vice-President and Chief Accountant

BANK OF MONTREAL (As Promoter)

(Signed) MARK WHITE Senior Vice-President, Capital Management and

Optimization

(Signed) CATHRYN E. CRANSTON Senior Vice-President, Finance & Treasurer

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CERTIFICATE OF THE DEALERS

Dated: April 30, 2013

To the best of our knowledge, information and belief, this short form prospectus, together with the documents incorporated in this prospectus by reference, will, as of the date of the last supplement to this prospectus relating to the securities offered by this prospectus and the supplement(s), constitute full, true and plain disclosure of all material facts relating to the securities offered by the Prospectus and the supplement(s), as required by the securities legislation of each of the provinces and territories of Canada.

BMO NESBITT BURNS INC.

By: (Signed) Sumant Inamdar

CIBC WORLD MARKETS INC. DESJARDINS SECURITIES INC. HSBC SECURITIES CANADA

By: (Signed) Sean Mann By: (Signed) Ryan Godfrey

By: (Signed) Robert Buttke

LAURENTIAN BANK SECURITIES INC. MERRILL LYNCH CANADA INC. NATIONAL BANK FINANCIAL INC

.

By: (Signed) Thomas Berky By: (Signed) Jonathan Zamir By: (Signed) Richard Bryan

RBC DOMINION SECURITIES INC. SCOTIA CAPITAL INC. TD SECURITIES INC.

By: (Signed) Nur Khan By: (Signed) Douglas J. Noe By: (Signed) Peter O’Sullivan

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INDEX OF DEFINED TERMS

1933 Act .................................................................. 60 Accounts ................................................................. 14 Accumulation Period ............................................... 8 Accumulation Period Length ................................ 27 Additional Accounts .............................................. 16 Additional Required Surplus Finance

Charge Amount .............................................. 55 Adjustment Payment ............................................. 38 Adverse Effect ........................................................ 57 Allocated Amount .................................................. 28 Allocation Date ......................................................... 7 allowable capital loss ............................................. 66 Amortization Event ............................................... 40 Approved Rating.................................................... 61 Assignment and Assumption Agreement ............... 6 Assignment Date ...................................................... 6 Available Cash Collateral Amount ...................... 39 Available Investor Principal Collections ............. 36 Book-Entry Note .................................................... 65 Book-Entry Note Owner ....................................... 65 Cash Collateral Account ....................................... 39 CDS ......................................................................... 45 Class A Additional Interest ................................... 33 Class A Allocated Amount” .................................. 33 Class A Interest Rate ............................................. 32 Class A Interest Shortfall ...................................... 33 Class A Monthly Interest ...................................... 32 Class A Noteholders ................................................. 8 Class A Notes .......................................................... 23 Class A Required Amount .................................... 35 Class B Additional Interest ................................... 33 Class B Allocated Amount .................................... 33 Class B Interest Rate ............................................. 32 Class B Interest Shortfall ...................................... 33 Class B Monthly Interest....................................... 32 Class B Noteholders ................................................. 8 Class B Notes .......................................................... 23 Class B Required Amount..................................... 35 Class C Additional Interest ................................... 33 Class C Allocated Amount .................................... 33 Class C Interest Rate ............................................. 32 Class C Interest Shortfall ...................................... 33 Class C Monthly Interest ...................................... 32 Class C Noteholders ................................................. 8 Class C Notes .......................................................... 23 Class C Required Amount .................................... 35 Class C Subordinated Principal Collections

Allocation Percentage ..................................... 34 Class D Additional Interest ................................... 33 Class D Allocated Amount .................................... 34 Class D Interest Rate ............................................. 32 Class D Interest Shortfall ...................................... 33 Class D Monthly Interest ...................................... 32

Class D Noteholders ................................................. 8 Class D Notes .......................................................... 23 Class D Required Amount .................................... 35 Class D Subordinated Principal Collections

Allocation Percentage ..................................... 34 Clearing Agency ..................................................... 65 Collection Account ................................................. 19 Collections ................................................................ 7 Commingling Conditions ...................................... 21 Controlled Accumulation Amount ....................... 36 Controlled Payment Amount .................................. 8 DBRS ...................................................................... 61 Dealer Agreement .................................................. 60 Dealers ................................................................ 1, 60 Declaration of Trust ................................................ 6 Defaulted Amounts ................................................ 22 Defaulted Receivables ............................................ 38 Deficit Controlled Accumulation Amount ........... 36 Determination Date ................................................. 7 Due Period .............................................................. 20 Early Amortization Period ...................................... 8 Eligible Account ..................................................... 49 Eligible Deposit Account ....................................... 19 Eligible Institution ................................................. 19 Eligible Investments .............................................. 20 Eligible Receivable ................................................. 49 Event of Default ..................................................... 42 Excess Funding Account ....................................... 21 Excess Principal Collections ................................. 30 Expected Final Payment Date ................................. 8 Finance Charge Collections .................................. 22 Finance Charge Receivables ................................. 12 Fitch ........................................................................ 61 Floating Allocation Percentage ............................. 28 Funding Accounts .................................................. 37 Group ...................................................................... 18 Group One Investor Additional Amounts ........... 29 Group One Investor Default Amount .................. 29 Group One Investor Finance Charge

Collections ....................................................... 29 Group One Investor Monthly Interest ................. 29 Group One Investor Monthly Servicing and

Administration Fees ....................................... 29 Holder ..................................................................... 65 Indenture Trustee .................................................. 11 Ineligible Receivables ............................................ 48 Initial Accounts ...................................................... 14 Interchange ............................................................ 13 Interest Funding Account ..................................... 24 Interest Period ....................................................... 34 Investment Proceeds .............................................. 37 Investor Charge-Off .............................................. 38 Investor Default Amount ...................................... 32

iv

Investor Finance Charge Collections ................... 27 Investor Principal Collections .............................. 28 Issuer ......................................................................... 1 Issuer Trustee ........................................................... 1 Lump Sale ............................................................... 15 Lump Sale Accounts .............................................. 14 MCCT ....................................................................... 6 Monthly Administration Fee ................................ 11 Monthly Indenture Trustee Fee ........................... 30 Monthly Principal .................................................. 36 Monthly Report...................................................... 46 Monthly Servicing Fee ........................................... 30 Monthly Trust Fee ................................................. 30 Moody’s .................................................................. 61 MTN Program ......................................................... 1 National Instrument ................................................ 1 Net Portfolio Yield ................................................. 59 New Accounts ......................................................... 14 New Issuance .......................................................... 18 Note Issuance Agreement ........................................ 7 Noteholders .............................................................. 9 Noteholders’ Allocation ......................................... 60 Notes ......................................................................... 1 Original Receivables Purchase Agreement ........... 6 Partial Commingling Condition ........................... 21 Participant .............................................................. 65 Participation Interests ........................................... 15 Paying Agent .......................................................... 38 Payment Date ......................................................... 34 Payment Rate ......................................................... 42 Portfolio .................................................................. 15 Portfolio Yield ........................................................ 59 Previously Issued Series .......................................... 6 Principal Allocation Percentage ........................... 28 Principal Collections .............................................. 22 Principal Funding Account ................................... 25 Principal Funding Account Balance .................... 37 Principal Receivables ............................................ 12 Principal Receivables Discount ............................ 16 Principal Shortfalls ................................................ 30 Principal Terms ..................................................... 18 Proposed Amendments .......................................... 66 Prospectus ................................................................ 1 Rating Agencies ..................................................... 61 Rating Agency Condition ...................................... 20 Ratings Effect ......................................................... 57 Reallocated Investor Finance Charge

Collections ....................................................... 29 Receivables ............................................................... 7 Receivables Purchase Agreement ........................... 7 Record Date ............................................................ 45 Redeemed Accounts ............................................... 17 Redemption Date ................................................... 17 Required Cash Collateral Amount ....................... 39

Required Draw Amount ........................................ 35 Required Minimum Principal Balance ................ 15 Required Surplus Finance Charge Amount ........ 54 RRIFs ........................................................................ 6 RRSPs ....................................................................... 6 Rule 144A ............................................................... 60 Second Amended and Restated Certificate

Issuance Agreement.......................................... 6 Secured Property ................................................... 60 Securities Regulators ............................................. 67 Seller ......................................................................... 1 Seller Insolvency Event ......................................... 16 Seller Note .............................................................. 47 Seller Servicing Fee ............................................... 45 Seller’s Allocated Amount .................................... 47 Seller’s Allocation .................................................. 47 Seller’s Securities Law Indemnity Covenant ...... 61 Series ......................................................................... 1 Series 2008-1 Notes ................................................ 17 Series 2008-4 Notes ................................................ 17 Series 2011-1 Notes ................................................ 17 Series 2011-2 Notes ................................................ 17 Series 2012-1 Notes ................................................ 17 Series 2012-2 Notes ................................................ 17 Series Adjusted Allocated Amount ...................... 22 Series Allocable Defaulted Amount ...................... 22 Series Allocable Finance Charge Collections ...... 22 Series Allocable Miscellaneous Payments ............ 22 Series Allocable Principal Collections .................. 22 Series Allocation Percentage ................................. 22 Series Enhancement ................................................ 7 Series Issuance Date ................................................ 7 Series Servicing Fee ............................................... 45 Series Servicing Fee Rate ...................................... 45 Series Supplement .................................................. 23 Series Termination Date.......................................... 9 Service Transfer ..................................................... 52 Servicer ..................................................................... 7 Servicer Default ..................................................... 52 Servicing Fee .......................................................... 45 Special Payment Date ............................................ 34 Subordinated Principal Collections ..................... 35 Subordinated Principal Collections

Allocation Percentage ..................................... 36 Supplemental Notes ............................................... 47 Surplus Finance Charge Collections .................... 39 Tax Act ..................................................................... 6 taxable capital gain ................................................ 66 Termination Notice ................................................ 51 TFSAs ....................................................................... 6 Transfer Deposit Amount ..................................... 48 Trust ......................................................................... 1 Trust Adjusted Allocated Amount ....................... 22 Trust Assets .............................................................. 7

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Trust Cut-Off Date ................................................ 14 Unallocated Principal Collections ........................ 30