Document:

Exhibit 10.1

  

  

  

  
    FORM OF SUBORDINATED NOTE PURCHASE AGREEMENT

     

    This SUBORDINATED NOTE PURCHASE AGREEMENT (this “Agreement”) is dated as of May 27, 2020, and is made by and among Independent Bank Corporation, a Michigan corporation (the “Company”),
      and the  purchasers of the Subordinated Notes (as defined herein) identified on the signature pages hereto (each a “Purchaser” and collectively, the “Purchasers”).

     

    RECITALS

     

    WHEREAS, the Company has requested that the Purchasers purchase from the Company up to $40,000,000 in aggregate principal amount of Subordinated Notes, which
      aggregate amount is intended to be eligible to qualify as Tier 2 Capital (as defined herein).

     

    WHEREAS, the Company has engaged Keefe, Bruyette & Woods, Inc., as its exclusive placement agent (“Placement Agent”) for the offering of the
      Subordinated Notes.

     

    WHEREAS, each of the Purchasers is an institutional “accredited investor” as such term is defined in Rule 501 of Regulation D (“Regulation D”)
      promulgated under the Securities Act of 1933, as amended (the “Securities Act”) or a QIB (as defined below).

     

    WHEREAS, the offer and sale of the Subordinated Notes by the Company is being made in reliance upon the exemptions from registration available under Section
      4(a)(2) of the Securities Act and Rule 506(b) of Regulation D.

     

    WHEREAS, each Purchaser is willing to purchase from the Company a Subordinated Note in the principal amount set forth on such Purchaser’s respective signature
      page hereto (the “Subordinated Note Amount”) in accordance with the terms, subject to the conditions and in reliance on, the recitals, representations, warranties, covenants and agreements set forth herein and in the Subordinated Notes.

     

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

     

    AGREEMENT

     

    
      	
              1.

            	
              DEFINITIONS.

            

    

     

    1.1          Defined Terms.  The following capitalized terms used in this Agreement and in the
      Subordinated Notes have the meanings defined or referenced below.  Certain other capitalized terms used only in specific sections of this Agreement may be defined in such sections.

     

    “Affiliate(s)” means, with respect to any Person, such Person’s immediate family members, partners, members or parent and subsidiary corporations, and any other Person directly or indirectly
      controlling, controlled by, or under common control with said Person and their respective Affiliates.

     

    
      
        

    

    
    “Agreement” has the meaning set forth in the preamble hereto.

     

    “Bank” means Independent Bank, a Michigan banking corporation and wholly owned subsidiary of the Company.

     

    “Business Day” means any day other than a Saturday, Sunday or any other day on which banking institutions in the State of Michigan are
      permitted or required by any applicable law or executive order to close.

     

    “Bylaws” means the Amended and Restated Bylaws of the Company, as in effect on the Closing Date.

     

    “Charter” means the Articles of Incorporation of the Company, as restated and as in effect on the Closing Date.

     

    “Closing” has the meaning set forth in Section 2.5.

     

    “Closing Date” means May 27, 2020.

     

    “Company” has the meaning set forth in the preamble hereto and shall include any successors to the Company.

     

    “Company Covered Person” has the meaning set forth in Section 4.2.4.

     

    “Company’s Reports” means (i) Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 as filed with the SEC on March 6, 2020; (ii) Company’s Quarterly Report on Form 10-Q for the quarterly
      period ended March 31, 2020, as filed with the SEC on May 5, 2020; (iii) Company’s Definitive Proxy Statement on Schedule 14A related to its 2020 Annual Meeting of Shareholders, as filed with the SEC on March 6, 2020; (iv) the report on Form FRY-9LP
      filed by Company for the year ended December 31, 2019; and (v) the Consolidated Reports of Condition and Income (Call Report) on Form FFIEC 041 filed by the Bank for the period ended March 31, 2020.

     

    “Disbursements” has the meaning set forth in Section 3.1.

     

    “Disqualification Event” has the meaning set forth in Section 4.2.4.

     

    “Equity Interest” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a
      corporation, any and all equivalent ownership interests in a Person which is not a corporation, and any and all warrants, options or other rights to purchase any of the foregoing.

     

    “Event of Default” has the meaning set forth in the Subordinated Notes.

     

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

     

    “FDIC” means the Federal Deposit Insurance Corporation.

     

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

     

    “Governmental Agency(ies)” means, individually or collectively, any federal, state, county or local governmental department, commission,
      board, regulatory authority or agency (including, without limitation, each applicable Regulatory Agency) with jurisdiction over the Company or a Subsidiary.

     

    “Governmental Licenses” has the meaning set forth in Section 4.3.

     

    “Hazardous Materials” means flammable explosives, asbestos, urea formaldehyde insulation, polychlorinated biphenyls, radioactive
      materials, hazardous wastes, toxic or contaminated substances or similar materials, including, without limitation, any substances which are “hazardous substances,” “hazardous wastes,” “hazardous materials” or “toxic substances” under the Hazardous
      Materials Laws and/or other applicable environmental laws, ordinances or regulations.

     

    “Hazardous Materials Laws” mean any laws, regulations, permits, licenses or
      requirements pertaining to the protection, preservation, conservation or regulation of the environment which relates to real property, including:  the Clean Air Act, as amended, 42 U.S.C. Section 7401 et seq.; the Federal Water Pollution Control Act,
      as amended, 33 U.S.C. Section 1251 et seq.; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et seq.; the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (including the
      Superfund Amendments and Reauthorization Act of 1986), 42 U.S.C. Section 9601 et seq.; the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601 et seq.; the Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651, the
      Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Mine Safety and Health Act of 1977, as amended, 30 U.S.C. Section 801 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section 300f et seq.; and all
      comparable state and local laws and regulations.

     

    “Indebtedness” means:  (i) all items arising from the borrowing of money that, according to GAAP as in effect from time to time, would be included in determining total liabilities as shown on
      the consolidated balance sheet of the Company; and (ii) all obligations for indebtedness secured by any lien in property owned by the Company or any Subsidiary whether or not such obligations shall have been assumed; provided, however, Indebtedness shall not include deposits or other Indebtedness created, incurred or maintained in the ordinary course of the Company’s or the Bank’s business (including,
      without limitation, federal funds purchased, advances from any Federal Home Loan Bank, secured deposits of municipalities, letters of credit issued by the Company or the Bank or any other Subsidiary and repurchase arrangements) and consistent with
      customary banking practices and applicable laws and regulations.

     

    “Leases” means all leases, licenses or other documents providing for the use or occupancy of any portion of any Property, including all amendments, extensions, renewals, supplements,
      modifications, sublets and assignments thereof and all separate letters or separate agreements relating thereto.

     

    
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    “Material Adverse Effect” means any change or effect that (i) is or would be reasonably likely to be material and adverse to the financial condition, results of operations or business of the
      Company and its Subsidiaries, on a consolidated basis, or (ii) would materially impair the ability of the Company to perform its obligations under any of the Transaction Documents, or otherwise materially impede the consummation of the transactions
      contemplated hereby; provided, however, that “Material Adverse Effect” shall not be deemed to include the impact of (1) changes in banking and similar laws, rules or
      regulations of general applicability or interpretations thereof by Governmental Agencies, (2) changes in GAAP or regulatory accounting requirements applicable to financial institutions and their holding companies generally, (3) general economic or
      capital market conditions affecting financial institutions or their market prices generally and not specifically related to the Company, the Bank or the Purchasers, (4) direct effects of compliance with this Agreement on the operating performance of
      the Company, the Bank or the Purchasers, including expenses incurred by the Company, the Bank or the Purchasers in consummating the transactions contemplated by this Agreement, and (5) the effects of any action or omission taken by the Company with
      the prior written consent of the Purchasers, and vice versa, or as otherwise contemplated by this Agreement and the Subordinated Notes.

     

    “Maturity Date” means May 31, 2030.

     

    “Person” means an individual, a corporation (whether or not for profit), a partnership, a limited liability company, a joint venture, an association, a trust, an unincorporated organization, a
      government or any department or agency thereof (including a Governmental Agency) or any other entity or organization.

     

    “Placement Agent” has the meaning set forth in the Recitals.

     

    “Property” means any real property owned or leased by the Company or any Affiliate or Subsidiary of the Company.

     

    “Purchaser” or “Purchasers” has the meaning set forth in the preamble hereto.

     

    “QIB” has the meaning set forth in Section 5.8.

     

    “Regulation D” has the meaning set forth in the Recitals.

     

    “Regulatory Agency” means any federal or state agency charged with the supervision or regulation of depository institutions or holding companies of depository institutions, or engaged in the
      insurance of depository institution deposits, or any court, administrative agency or commission or other authority, body or agency having supervisory or regulatory authority with respect to the Company, the Bank or any of their Subsidiaries.

     

    “SEC” means the Securities and Exchange Commission.

     

    “Secondary Market Transaction” has the meaning set forth in Section 5.5.

     

    “Securities Act” has the meaning set forth in the Recitals.

     

    
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    “Subordinated Note” means the Subordinated Note (or collectively, the “Subordinated Notes”) in the form attached as Exhibit A hereto, as amended, restated, supplemented or
      modified from time to time, and each Subordinated Note delivered in substitution or exchange for such Subordinated Note.

     

    “Subordinated Note Amount” has the meaning set forth in the Recitals.

     

    “Subsidiary” or “Subsidiaries” means with respect to any Person, any corporation or entity in which a majority of the outstanding Equity Interest is directly or indirectly owned by such
      Person.

     

    “Tier 2 Capital” has the meaning given to the term “Tier 2 capital” in 12 C.F.R. Part 217, as amended, modified and supplemented and in effect from time to time or any replacement thereof.

     

    “Transaction Documents” has the meaning set forth in Section 3.2.1.1.

     

    1.2          Interpretations.  The foregoing definitions are equally applicable to both the
      singular and plural forms of the terms defined.  The words “hereof”, “herein” and “hereunder” and words of like import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  The
      word “including” when used in this Agreement without the phrase “without limitation,” shall mean “including, without limitation.” All references to time of day herein are references to Eastern Time unless otherwise specifically provided.  All
      references to this Agreement and Subordinated Notes shall be deemed to be to such documents as amended, modified or restated from time to time.  With respect to any reference in this Agreement to any defined term, (i) if such defined term refers to a
      Person, then it shall also mean all heirs, legal representatives and permitted successors and assigns of such Person, and (ii) if such defined term refers to a document, instrument or agreement, then it shall also include any amendment, replacement,
      extension or other modification thereof.

     

    1.3          Exhibits Incorporated.  All Exhibits attached are hereby incorporated into this
      Agreement.

     

    
      
        
          	
                  2.

                	
                  SUBORDINATED DEBT.

                

        

      

    

     

    2.1         Certain Terms.  Subject to the terms and conditions herein contained, the Company
      hereby agrees to issue and sell to the Purchasers, severally and not jointly, Subordinated Notes in an aggregate principal amount equal to the aggregate of the Subordinated Note Amounts.  The Purchasers, severally and not jointly, each agree to
      purchase the Subordinated Notes from the Company on the Closing Date in accordance with the terms of, and subject to the conditions and provisions set forth in, this Agreement and the Subordinated Notes.  The Subordinated Note Amounts shall be
      disbursed in accordance with Section 3.1.  The Subordinated Notes shall bear interest per annum as set forth in the Subordinated Notes.  The unpaid principal balance of the Subordinated Notes plus all accrued but unpaid interest thereon shall
      be due and payable on the Maturity Date, or such earlier date on which such amount shall become due and payable on account of (i) acceleration by the Purchasers in accordance with the terms of the Subordinated Notes and this Agreement or (ii) the
      Company’s delivery of a notice of redemption or repayment in accordance with the terms of the Subordinated Notes.

     

    
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    2.2          Subordination.  The Subordinated Notes shall be subordinated in accordance with the subordination
      provisions set forth therein.

     

    2.3          Maturity Date.  On the Maturity Date, all sums due and owing under this Agreement
      and the Subordinated Notes shall be repaid in full.  The Company acknowledges and agrees that the Purchasers have not made any commitments, either express or implied, to extend the terms of the Subordinated Notes past their Maturity Date, and shall
      not extend such terms beyond the Maturity Date unless the Company and the Purchasers hereafter specifically otherwise agree in writing.

     

    2.4          Unsecured Obligations.  The obligations of the Company to the Purchasers under the
      Subordinated Notes shall be unsecured and not covered by a guarantee of the Company or an Affiliate of the Company.

     

    2.5         The Closing.  The closing of the sale and purchase of the Subordinated Notes (the “Closing”)

      shall occur remotely via the electronic or other exchange of documents and signature pages, on the Closing Date, or at such other place or time or on such other date as the parties hereto may agree.

     

    2.6          Payments.  The Company agrees that matters concerning payments and application of
      payments shall be as set forth in this Agreement and in the Subordinated Notes.

     

    2.7          Right of Offset.  Each Purchaser hereby expressly waives any right of offset it may
      have against the Company or any of its Subsidiaries.

     

    2.8          Use of Proceeds.  The Company shall use the net proceeds from the sale of
      Subordinated Notes for general corporate purposes.

     

    
      	
              3.

            	
              DISBURSEMENT.

            

    

     

    3.1         Disbursement.  On the Closing Date, assuming all of the terms and conditions set
      forth in Section 3.2 have been satisfied by the Company and the Company has executed and delivered to each of the Purchasers this Agreement and such Purchaser’s Subordinated Note and any other related documents in form and substance
      reasonably satisfactory to the Purchasers, each Purchaser shall disburse in immediately available funds the Subordinated Note Amount set forth on each Purchaser’s respective signature page hereto to the Company in exchange for a Subordinated Note
      with a principal amount equal to such Subordinated Note Amount (the “Disbursement”).  The Company will deliver to the respective Purchaser one or more certificates representing the Subordinated Notes in definitive form (or provide evidence of
      the same with the original to be delivered by the Company by overnight delivery on the next calendar day in accordance with the delivery instructions of the Purchaser), registered in such names and denominations as such Purchasers may request.

     

    3.2          Conditions Precedent to Disbursement.

     

    3.2.1          Conditions to the Purchasers’ Obligation. The obligation of
      each Purchaser to consummate the purchase of the Subordinated Notes to be purchased by them at Closing and to effect the Disbursement is subject to delivery by or at the direction of the Company to such Purchaser each of the following (or written
      waiver by such Purchaser prior to the Closing of such delivery):

     

    
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    3.2.1.1       Transaction Documents.  This Agreement and the Subordinated Notes (collectively, the “Transaction
        Documents”), each duly authorized and executed by the Company.

     

    3.2.1.2       Authority Documents.

     

    (a)          A copy, certified by the Secretary or Assistant Secretary of the Company, of the Charter of the Company;

     

    (b)          A certificate of existence of the Company issued by the Secretary of State of the State of Michigan;

     

    (c)          A copy, certified by the Secretary or Assistant Secretary, of the Bylaws of the Company;

     

    (d)          A copy, certified by the Secretary or Assistant Secretary of the Company, of the resolutions of the board of directors of the Company, and any committee thereof,
      authorizing the execution, delivery and performance of the Transaction Documents;

     

    (e)          An incumbency certificate of the Secretary or Assistant Secretary of the Company certifying the names of the officer or officers of the Company authorized to sign the
      Transaction Documents and the other documents provided for in this Agreement; and

     

    (f)          The opinion of Varnum LLP, counsel to the Company, dated as of the Closing Date, substantially in the form set forth at Exhibit B attached hereto addressed to
      the Purchasers and Placement Agent.

     

    3.2.1.3       Other Documents.  Such other certificates, schedules, resolutions, notes and/or
      other documents which are provided for hereunder or as a Purchaser may reasonably request.

     

    3.2.2          Conditions to the Company’s Obligation.

     

    3.2.2.1      With respect to a given Purchaser, the obligation of the Company to consummate the sale of the Subordinated Notes and to effect the Closing is
      subject to delivery by or at the direction of such Purchaser to the Company of this Agreement, duly authorized and executed by such Purchaser.

     

    
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              4.

            	
              REPRESENTATIONS AND WARRANTIES OF COMPANY.

            

    

     

    The Company hereby represents and warrants to each Purchaser as follows:

     

    4.1          Organization and Authority.

     

    4.1.1          Organization Matters of the Company and Its Subsidiaries.

     

    4.1.1.1       The Company is a duly organized corporation, is validly existing and in good standing under the laws of the State of Michigan
      and has all requisite corporate power and authority to conduct its business and activities as presently conducted, to own its properties, and to perform its obligations under the Transaction Documents.  The Company is duly qualified as a foreign
      corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify
      or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.  The Company is duly registered as a bank holding company under the Bank Holding Company Act of 1956, as amended.

     

    4.1.1.2       The entities set forth on Schedule A attached hereto are the only direct or indirect Subsidiaries of the Company.  Each
      Subsidiary of the Company (other than the Bank) has been duly organized and is validly existing either as a corporation, limited liability company or other organization, or, in the case of the Bank, has been duly chartered and is validly existing as
      a Michigan banking corporation, in each case in good standing under the laws of the jurisdiction of its incorporation, formation or organization, has corporate or organizational power and authority to own, lease and operate its properties and to
      conduct its business and is duly qualified as a foreign corporation or other business entity to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of
      property or the conduct of business, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.  All of the issued and outstanding shares of capital stock or other equity
      interests in each Subsidiary of the Company (other than any Subsidiary that is a trust) have been duly authorized and validly issued, are fully paid and non-assessable and are owned by the Company, directly or through Subsidiaries of the Company,
      free and clear of any security interest, mortgage, pledge, lien, encumbrance or claim; none of the outstanding shares of capital stock of, or other Equity Interests in, any Subsidiary of the Company were issued in violation of the preemptive or
      similar rights of any security holder of such Subsidiary of the Company or any other entity.

     

    4.1.1.3       The Bank is Michigan banking corporation and a member of the Federal Reserve System.  The deposit accounts of the Bank are
      insured by the FDIC up to applicable limits.  The Bank has not received any notice or other information indicating that the Bank is not an “insured depository institution” as defined in 12 U.S.C. Section 1813, nor has any event occurred which could
      reasonably be expected to adversely affect the status of the Bank as an FDIC-insured institution.

     

    
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    4.1.2          Capital Stock and Related Matters.  The Charter of the Company authorizes the
      Company to issue 500,000,000 shares of common stock, no par value, and 200,000 shares of series preferred stock, no par value. As of the date of this Agreement, there are 21,890,953 shares of the Company’s common stock issued and outstanding and no
      shares of the Company’s preferred stock issued and outstanding.  All of the outstanding capital stock of the Company has been duly authorized and validly issued and is fully paid and non-assessable.  There are, as of the date hereof, no outstanding
      options, rights, warrants or other agreements or instruments obligating the Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of the capital stock of the Company or obligating the Company to grant, extend
      or enter into any such agreement or commitment to any Person other than the Company except pursuant to the Company’s equity incentive plans duly adopted by the Company’s Board of Directors or as otherwise disclosed in the Company’s Reports.

     

    4.2          No Impediment to Transactions.

     

    4.2.1          Transaction is Legal and Authorized.  The issuance of the Subordinated Notes, the
      borrowing of the aggregate of the Subordinated Note Amount, the execution of the Transaction Documents and compliance by the Company with all of the provisions of the Transaction Documents are within the corporate and other powers of the Company.

     

    4.2.2        Agreement.  This Agreement has been duly authorized, executed and delivered by the
      Company, and, assuming due authorization, execution and delivery by the other parties hereto, constitutes the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with its terms, except as enforcement
      thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally or by general equitable principles.

     

    4.2.3        Subordinated Notes.  The Subordinated
      Notes have been duly authorized by the Company and when executed by the Company and issued, delivered to and paid for by the Purchasers in accordance with the terms of the Agreement, will have been duly executed,

      authenticated, issued and delivered, and will constitute the legal, valid and binding obligations of the Company and enforceable in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
      moratorium or other similar laws relating to or affecting creditors’ rights generally or by general equitable principles.

     

    4.2.4         Exemption from Registration.  Neither the
      Company, nor any of its Subsidiaries or Affiliates, nor any Person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the offer or sale of the
      Subordinated Notes.  Assuming the accuracy of the representations and warranties of each Purchaser set forth in this Agreement, the Subordinated Notes will be issued in a transaction exempt from the registration requirements of the Securities Act. 
      No “bad actor” disqualifying event described in Rule 506(d)(1)(i)-(viii) of the Securities Act (a “Disqualification Event”) is applicable to the Company or, to the Company’s knowledge, any Person described in Rule 506(d)(1) (each, a “Company

        Covered Person”).  To the Company’s knowledge, no Company Covered Person is subject to a Disqualification Event.  The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e).

     

    
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    4.2.5          No Defaults or Restrictions.  Neither the execution and delivery of the
      Transaction Documents nor compliance with their respective terms and conditions will (whether with or without the giving of notice or lapse of time or both) (i) violate, conflict with or result in a breach of, or constitute a default under:  (1) the
      Charter or Bylaws of the Company; (2) any of the terms, obligations, covenants, conditions or provisions of any corporate restriction or of any contract, agreement, indenture, mortgage, deed of trust, pledge, bank loan or credit agreement, or any
      other agreement or instrument to which the Company or Bank, as applicable, is now a party or by which it or any of its properties may be bound or affected; (3) any judgment, order, writ, injunction, decree or demand of any court, arbitrator, grand
      jury, or Governmental Agency applicable to the Company or the Bank; or (4) any statute, rule or regulation applicable to the Company, except, in the case of items (2), (3) or (4), for such violations and conflicts that would not reasonably be
      expected to, singularly or in the aggregate, result in a Material Adverse Effect, or (ii) result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any property or asset of the Company.  Neither the Company
      nor the Bank is in default in the performance, observance or fulfillment of any of the terms, obligations, covenants, conditions or provisions contained in any indenture or other agreement creating, evidencing or securing Indebtedness of any kind or
      pursuant to which any such Indebtedness is issued, or any other agreement or instrument to which the Company or the Bank, as applicable, is a party or by which the Company or the Bank, as applicable, or any of its properties may be bound or affected,
      except, in each case, for defaults that would not reasonably be expected to, singularly or in the aggregate, result in a Material Adverse Effect.

     

    4.2.6          Governmental Consent.  No governmental orders, permissions, consents, approvals
      or authorizations are required to be obtained by the Company that have not been obtained, and no registrations or declarations are required to be filed by the Company that have not been filed in connection with, or, in contemplation of, the execution
      and delivery of, and performance under, the Transaction Documents, except for applicable requirements, if any, of the Securities Act, the Exchange Act or state securities laws or “blue sky” laws of the various states and any applicable federal or
      state banking laws and regulations.

     

    4.3          Possession of Licenses and Permits.  The Company and its Subsidiaries possess such
      permits, licenses, approvals, consents and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate Governmental Agencies necessary to conduct the business as described in the Company’s Reports except where the
      failure to possess such Governmental Licenses would not reasonably be expected to, singularly or in the aggregate, have a Material Adverse Effect. The Company and each Subsidiary of the Company is in compliance with the terms and conditions of all
      such Governmental Licenses, except where the failure so to comply would not reasonably be expected to, individually or in the aggregate, have a Material Adverse Effect. All of the Governmental Licenses are valid and in full force and effect, except
      where the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not reasonably be expected to have a Material Adverse Effect. Neither the Company nor any Subsidiary of the Company
      has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses.

     

    
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    4.4          Financial Condition.

     

    4.4.1         Company Financial Statements.  The financial statements of the Company included
      in the Company’s Reports (including the related notes, where applicable), which have been made available to the Purchasers (i) have been prepared from, and are in accordance with, the books and records of the Company; (ii) fairly present in all
      material respects the results of operations, cash flows, changes in shareholders’ equity and financial position of the Company and its consolidated Subsidiaries for the respective fiscal periods or as of the respective dates therein set forth
      (subject in the case of unaudited statements to recurring year-end audit adjustments normal in nature and amount), as applicable; (iii) complied as to form, as of their respective dates of filing, in all material respects with applicable accounting
      and banking requirements with respect thereto; and (iv) have been prepared in accordance with GAAP consistently applied during the periods involved, except, in each case, (x) as indicated in such statements or in the notes thereto, (y) for any
      statement therein or omission therefrom that was corrected, amended, or supplemented or otherwise disclosed or updated in a subsequent Company’s Report, and (z) to the extent that any unaudited interim financial statements do not contain the
      footnotes required by GAAP and were or are subject to normal and recurring year-end adjustments, which were not or are not expected to be material in amount, either individually or in the aggregate. The books and records of the Company have been, and
      are being, maintained in all material respects in accordance with GAAP and any other applicable legal and accounting requirements. The Company does not have any material liability of any nature whatsoever (whether absolute, accrued, contingent or
      otherwise and whether due or to become due), except for those liabilities that are reflected or reserved against on the consolidated balance sheet of the Company contained in the Company’s Reports for the Company’s most recently completed quarterly
      or annual fiscal period, as applicable, and for liabilities incurred in the ordinary course of business consistent with past practice or in connection with the Transaction Documents and the transactions contemplated hereby and thereby.

     

    4.4.2          Absence of Default.  Since the date of the last audited financial statements
      included in the Company’s Reports, no event has occurred which either of itself or with the lapse of time or the giving of notice or both, would give any creditor of the Company the right to accelerate the maturity of any material Indebtedness of the
      Company.  The Company is not in default under any other Lease, agreement or instrument, or any law, rule, regulation, order, writ, injunction, decree, determination or award, except for such defaults as would not reasonably be expected to result in a
      Material Adverse Effect.

     

    4.4.3          Solvency.  After giving effect to the consummation of the transactions
      contemplated by this Agreement, the Company has capital sufficient to carry on its business and transactions and is solvent and able to pay its debts as they mature.  No transfer of property is being made and no Indebtedness is being incurred in
      connection with the transactions contemplated by this Agreement with the intent to hinder, delay or defraud either present or future creditors of the Company or any Subsidiary of the Company.

     

    
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    4.4.4          Ownership of Property.  The Company and each of its Subsidiaries has good and
      marketable title as to all real property owned by it and good title to all assets and properties owned by the Company and such Subsidiary in the conduct of its businesses, whether such assets and properties are real or personal, tangible or
      intangible, including assets and property reflected in the most recent balance sheet contained in the Company’s Reports or acquired subsequent thereto (except to the extent that such assets and properties have been disposed of in the ordinary course
      of business, since the date of such balance sheet), subject to no encumbrances, liens, mortgages, security interests or pledges, except (i) those items which secure liabilities for public or statutory obligations or any discount with, borrowing from
      or other obligations to the Federal Home Loan Bank, inter-bank credit facilities, reverse repurchase agreements or any transaction by the Bank acting in a fiduciary capacity, (ii) statutory liens for amounts not yet delinquent or which are being
      contested in good faith and (iii) as would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.  The Company and each of its Subsidiaries, as lessee, has the right under valid and existing Leases of
      real and personal properties that are material to the Company or such Subsidiary, as applicable, in the conduct of its business to occupy or use all such properties as presently occupied and used by it.

     

    4.5          No Material Adverse Change.  Since the end of the latest audited financial
      statements included in the Company’s Reports, there has been no development or event which has had or would reasonably be expected to have a Material Adverse Effect.

     

    4.6          Legal Matters.

     

    4.6.1          Compliance with Law.  The Company and each of its Subsidiaries (i) has complied
      with and (ii) to the Company’s knowledge, is not under investigation with respect to, and, to the Company’s knowledge, has not been threatened to be charged with or given any notice of any material violation of, any applicable statutes, rules,
      regulations, orders and restrictions of any domestic or foreign government, or any instrumentality or agency thereof, having jurisdiction over the conduct of its business or the ownership of its properties, except where any such failure to comply or
      violation would not reasonably be expected to have a Material Adverse Effect.  The Company and each of its Subsidiaries is in compliance with, and at all times prior to the date hereof has been in compliance with its own privacy policies and written
      commitments to customers, consumers and employees, concerning data protection, the privacy and security of personal data, and the nonpublic personal information of its customers, consumers and employees, in each case except where any such failure to
      comply would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.

     

    4.6.2          Regulatory Enforcement Actions.  The Company, the Bank and its other Subsidiaries
      are in compliance in all material respects with all laws administered by and regulations of any Governmental Agency applicable to it or to them, except for such violations as would not reasonably be expected to have a Material Adverse Effect.  None
      of the Company, the Bank, the Company’s or the Bank’s Subsidiaries nor any of their officers or directors is now operating under any restrictions, agreements, memoranda, commitment letter, supervisory letter or similar regulatory correspondence, or
      other commitments (other than restrictions of general application) imposed by any Governmental Agency, nor are, to the Company’s knowledge any such restrictions threatened, or any agreements, memoranda or commitments being sought by any Governmental
      Agency.  To the Company’s knowledge, no legal or regulatory violations previously identified by, or penalties or other remedial action previously imposed by, any Governmental Agency remains unresolved.

     

    
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    4.6.3          Pending Litigation.  There are no actions, suits, proceedings or written
      agreements pending, or, to the Company’s knowledge, threatened or proposed, against the Company or any of its Subsidiaries at law or in equity or before or by any Governmental Agency, that would reasonably be expected to have a Material Adverse
      Effect or materially and adversely affect the issuance or payment of the Subordinated Notes; and neither the Company nor any of its Subsidiaries is a party to or named as subject to the provisions of any order, writ, injunction, or decree of, or any
      written agreement with, any court, commission, board or agency, domestic or foreign, that either separately or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.

     

    4.6.4          Environmental.  Except as would not, singularly or in the aggregate, reasonably
      be expected to result in a Material Adverse Effect, (i) no Property is or, to the Company’s knowledge, has been a site for the use, generation, manufacture, storage, treatment, release, threatened release, discharge, disposal, transportation or
      presence of any Hazardous Materials and neither the Company nor any of its Subsidiaries has engaged in such activities, and (ii) there are no claims or actions pending or, to the Company’s knowledge, threatened against the Company or any of its
      Subsidiaries by any Governmental Agency or by any other Person relating to any Hazardous Materials or pursuant to any Hazardous Materials Law.

     

    4.6.5        Brokerage Commissions.  Except for commissions paid to the Placement Agent,
      neither the Company nor any Affiliate of the Company is obligated to pay any brokerage commission or finder’s fee to any Person in connection with the transactions contemplated by this Agreement.

     

    4.6.6          Investment Company Act.  Neither the Company nor any of its Subsidiaries is an
      “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.

     

    4.7          No Misstatement.  No information, exhibit, report, schedule or document, when
      viewed together as a whole, furnished or made available by Company to Purchasers in connection with the negotiation, execution or performance of the Transaction Documents contains any untrue statement of a material fact, or omits to state a material
      fact necessary to make the statements contained therein, in light of the circumstances under which they were made, not misleading, except for any statement therein or omission therefrom which was corrected, amended or supplemented or otherwise
      disclosed or updated in a subsequent exhibit, report, schedule or document furnished or made available to Purchasers prior to the date hereof.

     

    4.8         Internal Accounting Controls.  The Company and the Bank have established and
      maintain a system of internal control over financial reporting that pertains to the maintenance of records that accurately and fairly reflect the transactions and dispositions of the Company’s assets (on a consolidated basis), provides reasonable
      assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that the Company’s and the Bank’s receipts and expenditures and receipts and expenditures of each of the Company’s other
      Subsidiaries are being made only in accordance with authorizations of the Company management and Board of Directors, and provides reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets
      of the Company on a consolidated basis that could have a Material Adverse Effect.  Such internal control over financial reporting is effective to provide reasonable assurance regarding the reliability of the Company’s financial reporting and the
      preparation of the Company’s financial statements for external purposes in accordance with GAAP.  Since the conclusion of the Company’s last completed fiscal year there has not been and there currently is not (i) any significant deficiency or
      material weakness in the design or operation of its internal control over financial reporting which is reasonably likely to adversely affect its ability to record, process, summarize and report financial information, or (ii) any fraud, whether or not
      material, that involves management or other employees who have a role in the Company’s or the Bank’s internal control over financial reporting.  The Company (A) has implemented and maintains disclosure controls and procedures reasonably designed and
      maintained to ensure that material information relating to the Company is made known to the Chief Executive Officer and the Chief Financial Officer of the Company by others within the Company and (B) has disclosed, based on its most recent evaluation
      prior to the date hereof, to the Company’s outside auditors and the audit committee of the Company’s Board of Directors (x) any significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting
      which are reasonably likely to adversely affect the Company’s internal controls over financial reporting.  Such disclosure controls and procedures are effective for the purposes for which they were established.

     

    
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    4.9         Tax Matters.  The Company, the Bank and each other Subsidiary of the Company have (i) filed all material foreign, U.S. federal, state and local tax returns, information returns and similar reports that are required to be filed, and all such tax returns are
        true, correct and complete in all material respects, and (ii) paid all material taxes required to be paid by it and any other material assessment, fine or penalty levied against it other than taxes (x) currently payable without penalty or interest,
        or (y) being contested in good faith by appropriate proceedings.

     

    4.10       Representations and Warranties Generally.  The representations and warranties of the
      Company set forth in this Agreement that do not contain a “Material Adverse Effect” qualification or other express materiality or similar qualification are true and correct in all material respects (i) as of the Closing Date and (ii) as otherwise
      specifically provided herein. The representations and warranties of Company set forth in this Agreement that contain a “Material Adverse Effect” qualification or any other express materiality or similar qualification are true and correct (a) as of
      the Closing Date and (b) as otherwise specifically provided herein.

     

    
      	
              5.

            	
              GENERAL COVENANTS, CONDITIONS AND AGREEMENTS.

            

    

     

    The Company hereby further covenants and agrees with each Purchaser as follows:

     

    5.1         Compliance with Transaction Documents.  The Company shall comply with, observe and
      timely perform each and every one of the covenants, agreements and obligations under the Transaction Documents.

     

    5.2         Affiliate Transactions.  The Company shall not itself, nor shall it cause, permit
      or allow any of its Subsidiaries to enter into any transaction, including, the purchase, sale or exchange of property or the rendering of any service, with any Affiliate of the Company except in the ordinary course of business and pursuant to the
      reasonable requirements of the Company’s or such Affiliate’s business and upon terms consistent with applicable laws and regulations and reasonably found by the appropriate board(s) of directors to be fair and reasonable and no less favorable to the
      Company or such Affiliate than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate.

     

    
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    5.3          Compliance with Laws.

     

    5.3.1          Generally.  The Company shall comply and cause the Bank and each of its other
      Subsidiaries to comply in all material respects with all applicable statutes, rules, regulations, orders and restrictions in respect of the conduct of its business and the ownership of its properties, except, in each case, where such noncompliance
      would not reasonably be expected to have a Material Adverse Effect.

     

    5.3.2          Regulated Activities.  The Company shall not itself, nor shall it cause, permit
      or allow the Bank or any other of its Subsidiaries to (i) engage in any business or activity not permitted by all applicable laws and regulations, except where such business or activity would not reasonably be expected to have a Material Adverse
      Effect or (ii) make any loan or advance secured by the capital stock of another bank or depository institution, or acquire the capital stock, assets or obligations of or any interest in another bank or depository institution, in each case other than
      in accordance with applicable laws and regulations and safe and sound banking practices.

     

    5.3.3         Taxes.  The Company shall and shall cause the Bank and any other of its
      Subsidiaries to promptly pay and discharge all taxes, assessments and other governmental charges imposed upon the Company, the Bank or any other of its Subsidiaries or upon the income, profits, or property of the Company or any Subsidiary and all
      claims for labor, material or supplies which, if unpaid, might by law become a lien or charge upon the property of the Company, the Bank or any other of its Subsidiaries.  Notwithstanding the foregoing, none of the Company, the Bank or any other of
      its Subsidiaries shall be required to pay any such tax, assessment, charge or claim, so long as the validity thereof shall be contested in good faith by appropriate proceedings, and appropriate reserves therefor shall be maintained on the books of
      the Company, the Bank or such other Subsidiary, as the case may be.

     

    5.3.4          Corporate Existence.  The Company shall do or cause to be done all things
      reasonably necessary to maintain, preserve and renew its corporate existence and that of the Bank and the other Subsidiaries and its and their rights and franchises, and comply in all material respects with all related laws applicable to the Company,
      the Bank or the other Subsidiaries; provided, however, that the Company may consummate a merger in which (i) the Company is the surviving entity or (ii) if the Company is not the surviving entity, the surviving entity assumes, by operation of
      law or otherwise, all of the obligations of the Company under the Subordinated Notes.

     

    
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    5.3.5          Dividends, Payments, and Guarantees During Event of Default.  Upon the occurrence of an Event of Default (as defined under the Subordinated Notes), until such Event of Default is cured by the Company or waived by the Noteholders (as defined under the Subordinated Notes)
      in accordance with Section 17 of the Subordinated Notes and except as required by any federal or state Governmental Agency, the Company shall not (a) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation
      payment with respect to, any of its capital stock; (b) make any payment of principal of, or interest or premium, if any, on, or repay, repurchase or redeem any of the Company’s Indebtedness that ranks equal with or junior to the Subordinated Notes;
      or (c) make any payments under any guarantee that ranks equal with or junior to the Subordinated Notes, other than (i) any dividends or distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of, any class of
      the Company’s common stock; (ii) any declaration of a non-cash dividend in connection with the implementation of a shareholders’ rights plan, or the issuance of stock under any such plan in the future, or the redemption or repurchase of any such
      rights pursuant thereto; (iii) as a result of a reclassification of the Company’s capital stock or the exchange or conversion of one class or series of the Company’s capital stock for another class or series of the Company’s capital stock; (iv) the
      purchase of fractional interests in shares of the Company’s capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (v) purchases of any class of the Company’s common
      stock related to or from any benefit plans for the Company’s directors, officers or employees or any of the Company’s dividend reinvestment plans.

     

    5.3.6          Tier 2 Capital.  If all or any portion of
      the Subordinated Notes ceases to be eligible, or there is a material risk that all or any portion of the Subordinated Notes will cease to be eligible, to qualify as Tier 2 Capital, other than due to the limitation imposed on the capital treatment of
      subordinated debt during the five (5) years immediately preceding the Maturity Date of the Subordinated Notes, the Company will promptly notify the Noteholders (as defined in the Subordinated Notes), and thereafter the Company and the Noteholders (as
      defined in the Subordinated Notes) will work together in good faith to execute and deliver all agreements as reasonably necessary in order to restructure the applicable portions of the obligations evidenced by the Subordinated Notes to be eligible to
      qualify as Tier 2 Capital; provided, however, that nothing contained in this Agreement shall limit the Company’s right to redeem the Subordinated Notes pursuant to the provisions of the Subordinated Notes, including (without limitation) upon the
      occurrence of a Tier 2 Capital Event as described in the Subordinated Notes.

     

    5.4         Absence of Control.  It is the intent of the parties to this Agreement that in no
      event shall the Purchasers, by reason of any of the Transaction Documents, be deemed to control, directly or indirectly, the Company, and the Purchasers shall not exercise, or be deemed to exercise, directly or indirectly, a controlling influence
      over the management or policies of the Company.

     

    5.5          Secondary Market Transactions.  To the extent and so long as not in violation of
      Section 6.4 hereof, each Purchaser shall have the right at any time and from time to time to securitize its Subordinated Notes or any portion thereof in a single asset securitization or a pooled loan securitization of rated single or multi-class
      securities secured by or evidencing ownership interests in the Subordinated Notes (each such securitization is referred to herein as a “Secondary Market Transaction”).  In connection with any such Secondary Market Transaction, the Company
      shall, at the Company’s expense, cooperate with the Purchasers and otherwise reasonably assist the Purchasers in satisfying the market standards to which the Purchasers customarily adhere or which may be reasonably required in the marketplace or by
      applicable rating agencies in connection with any such Secondary Market Transaction, but in no event shall the Company be required to incur any material costs or expenses in connection therewith.  Subject to any written confidentiality obligation,
      including the terms of any non-disclosure agreement between the Purchasers and the Company, all information regarding the Company may be furnished to any Person reasonably deemed necessary by the Purchaser in connection with participation in such
      Secondary Market Transaction.  All documents, financial statements, appraisals and other data relevant to the Company or the Subordinated Notes may be retained by any such Person, subject to the terms of any nondisclosure agreement between the
      Purchaser and the Company.

     

    
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    5.6          Bloomberg.  The Company shall use commercially reasonable efforts to cause within
      90 days after the Closing the Subordinated Notes to be (i) quoted on Bloomberg and (ii) assigned a CUSIP number.

     

    5.7         Rule 144A Information.  While any
      Subordinated Notes remain “restricted securities” within the meaning of the Securities Act, the Company will make available, upon request, to any seller of such Subordinated Notes the information specified in Rule 144A(d)(4) under the Securities Act,
      unless the Company is then subject to Section 13 or 15(d) of the Exchange Act.

     

    5.8         DTC Eligibility.  The Company shall use commercially reasonable efforts to provide
      that the Subordinated Notes owned by Noteholders that are Qualified Institutional Buyers within the meaning of Rule 144A under the Securities Act (“QIBs”) shall be issued in the form of one or more Global Subordinated Notes registered in the
      name of The Depository Trust Company or another organization registered as a clearing agency under the Exchange Act, and designated as depositary by the Company or any successor thereto or a nominee thereof and delivered to such depositary or a
      nominee thereof.

     

    5.9          Rating.  So long as any Subordinated Notes remain outstanding, the Company will use
      commercially reasonable efforts to maintain a rating by a nationally recognized statistical rating organization.

     

    
      	
              6.

            	
              REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.

            

    

     

    Each Purchaser hereby represents and warrants to the Company, and covenants with the Company, severally and not jointly, as follows:

     

    6.1         Legal Power and Authority.  It has all necessary power and authority to execute,
      deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby.  It is an entity duly organized, validly existing and in good standing under the laws its jurisdiction of organization.

     

    6.2        Authorization and Execution.  The execution, delivery and performance of this
      Agreement has been duly authorized by all necessary action on the part of such Purchaser, and, assuming due authorization, execution and delivery by the other parties hereto, this Agreement is a legal, valid and binding obligation of such Purchaser,
      enforceable against such Purchaser in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally or by
      general equitable principles.

     

    
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    6.3          No Conflicts.  Neither the execution, delivery or performance of the Transaction
      Documents nor the consummation of any of the transactions contemplated thereby will conflict with, violate, constitute a breach of or a default (whether with or without the giving of notice or lapse of time or both) under (i) its organizational
      documents, (ii) any agreement to which it is party, (iii) any law applicable to it or (iv) any order, writ, judgment, injunction, decree, determination or award binding upon or affecting it.

     

    6.4          Purchase for Investment.  It is purchasing the Subordinated Note for its own
      account and not with a view to distribution and with no present intention of reselling, distributing or otherwise disposing of the same.  It has no present or contemplated agreement, undertaking, arrangement, obligation, Indebtedness or commitment
      providing for, or which is likely to compel, a disposition of the Subordinated Notes in any manner.

     

    6.5          Institutional Accredited Investor.  It is and will be on the Closing Date (i) an
      institutional “accredited investor” as such term is defined in Rule 501(a) of Regulation D and as contemplated by subsections (1), (2), (3) and (7) of Rule 501(a) of Regulation D, and has no less than $5,000,000 in total assets, or (ii) a QIB.

     

    6.6          Financial and Business Sophistication.  It has such knowledge and experience in
      financial and business matters that it is capable of evaluating the merits and risks of the prospective investment in the Subordinated Notes.  It has relied solely upon its own knowledge of, and/or the advice of its own legal, financial or other
      advisors with regard to, the legal, financial, tax and other considerations involved in deciding to invest in the Subordinated Notes.

     

    6.7          Ability to Bear Economic Risk of Investment.  It recognizes that an investment in
      the Subordinated Notes is a speculative investment that involves substantial risk, including risks related to the Company’s business, operating results, financial condition and cash flows, including without limitation those described in the Company’s
      Reports, which risks it has carefully considered in connection with making an investment in the Subordinated Notes.  It has the ability to bear the economic risk of the prospective investment in the Subordinated Notes, including the ability to hold
      the Subordinated Notes indefinitely, and further including the ability to bear a complete loss of all of its investment in the Company.

     

    6.8        Access to Information.  It acknowledges that  (i) it is not being provided with the
      disclosures that would be required if the offer and sale of the Subordinated Notes were registered under the Securities Act, nor is it being provided with any offering circular, private placement memorandum or prospectus prepared in connection with
      the offer and sale of the Subordinated Notes; (ii) it has conducted its own examination of the Company and the terms of the Subordinated Notes to the extent it deems necessary to make its decision to invest in the Subordinated Notes; (iii) it has
      availed itself of publicly available financial and other information concerning the Company to the extent it deems necessary to make its decision to purchase the Subordinated Notes (including meeting with representatives of the Company); (iv) it has
      not received nor relied on any form of general solicitation or general advertising (within the meaning of Regulation D) from the Company in connection with the offer and sale of the Subordinated Notes; and (v) credit ratings may not reflect the
      potential risks related to the Subordinated Notes and credit ratings may be revised or withdrawn by the rating agency at any time.  It has reviewed the information set forth in the Company’s Reports, the exhibits and schedules thereto and hereto and
      otherwise disclosed to it.

     

    
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    6.9         Investment Decision.  It has made its own investment decision based upon its own
      judgment, due diligence and advice from such advisors as it has deemed necessary and not upon any view expressed by any other Person or entity, including the Placement Agent.  Neither such inquiries nor any other due diligence investigations
      conducted by it or its advisors or representatives, if any, shall modify, amend or affect its right to rely on the Company’s representations and warranties contained herein.  It is not relying upon, and has not relied upon, any advice, statement,
      representation or warranty made by any Person by or on behalf of the Company, including, without limitation, the Placement Agent, except for the express statements, representations and warranties of the Company made or contained in this Agreement. 
      Furthermore, it acknowledges that (i) the Placement Agent has not performed any due diligence review on behalf of it and (ii) nothing in this Agreement or any other materials presented by or on behalf of the Company to it in connection with the
      purchase of the Subordinated Notes constitutes legal, tax or investment advice.

     

    6.10       Private Placement; No Registration; Restricted Legends.  It understands and
      acknowledges that the Subordinated Notes are being sold by the Company without registration under the Securities Act in reliance on the exemption from federal and state registration set forth in, respectively, Rule 506(b) of Regulation D promulgated
      under Section 4(a)(2) of the Securities Act and Section 18 of the Securities Act, or any state securities laws, and accordingly, may be resold, pledged or otherwise transferred only if exemptions from the Securities Act and applicable state
      securities laws are available to it.  It is not subscribing for the Subordinated Notes as a result of or subsequent to any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over
      television or radio, or presented at any seminar or meeting. It further acknowledges and agrees that all certificates or other instruments representing the Subordinated Notes will bear the restrictive legend set forth in the form of Subordinated
      Note.  It further acknowledges its primary responsibilities under the Securities Act and, accordingly, will not sell or otherwise transfer the Subordinated Notes or any interest therein without complying with the requirements of the Securities Act
      and the rules and regulations promulgated thereunder and the requirements set forth in this Agreement. Neither the Placement Agent nor the Company have or has made or are or is making any representation, warranty or covenant, express or implied, as
      to the availability of any exemption from registration under the Securities Act or any applicable state securities laws for the resale, pledge or other transfer of the Subordinated Notes, or that the Subordinated Notes purchased by it will ever be
      able to be lawfully resold, pledged or otherwise transferred.

     

    6.11        Placement Agent.  It will purchase the Subordinated Note(s) directly from the
      Company and not from the Placement Agent and understands that neither the Placement Agent nor any other broker or dealer has any obligation to make a market in the Subordinated Notes.

     

    6.12        Tier 2 Capital.  If the Company provides notice as contemplated in Section
        5.3.6 of the occurrence of the event contemplated in such section, thereafter the Company and the Purchasers will work together in good faith to execute and deliver all agreements as reasonably necessary in order to restructure the applicable
      portions of the obligations evidenced by the Subordinated Notes to be eligible to qualify as Tier 2 Capital; provided, however, that nothing contained in this Agreement shall limit the Company’s right to redeem the Subordinated Notes upon the
      occurrence of a Tier 2 Capital Event as described in the Subordinated Notes.

     

    
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    6.13        Not Debt of the Bank, Not Savings Accounts, etc.  It acknowledges that the Company
      is a holding company and the Company’s rights and the rights of the Company’s creditors, including the Noteholders (as defined in the Subordinated Note), to participate in the assets of any Subsidiary during its liquidation or reorganization are
      structurally subordinate to the prior claims of the Subsidiary’s creditors.  It acknowledges and agrees that the Subordinated Notes are not savings accounts or deposits of the Bank and are not insured or guaranteed by the FDIC or any Governmental
      Agency, and that no Governmental Agency has passed upon or will pass upon the offer or sale of the Subordinated Notes or has made or will make any finding or determination as to the fairness of this investment.

     

    6.14        Accuracy of Representations.  It understands that each of the Placement
      Agent and the Company are relying and will rely upon the truth and accuracy of the foregoing representations, acknowledgements and agreements in connection with the transactions contemplated by this Agreement, and agrees that if any of the
      representations or acknowledgements made by it are no longer accurate as of the Closing Date, or if any of the agreements made by it are breached on or prior to the Closing Date, it shall promptly notify the Placement Agent and the Company.

     

    6.15       Representations and Warranties Generally.  The representations and warranties of
      such Purchaser set forth in this Agreement are true and correct as of the date hereof and will be true and correct as of the Closing Date and as otherwise specifically provided herein.  Any certificate signed by a duly authorized representative of
      such Purchaser and delivered to the Company or to counsel for the Company shall be deemed to be a representation and warranty by such Purchaser to the Company as to the matters set forth therein.

     

    
      	
              7.

            	
              MISCELLANEOUS.

            

    

     

    7.1         Prohibition on Assignment by the Company.  Except as described in Section 8(b)
      (Merger or Sale of Assets) of the Subordinated Notes, the Company may not assign, transfer or delegate any of its rights or obligations under this Agreement or the Subordinated Notes without the prior written consent of all the Noteholders (as
      defined in the Subordinated Note).

     

    7.2          Time of the Essence.  Time is of the essence for this Agreement.

     

    
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    7.3         Waiver or Amendment.  Except as may apply to any particular waiving or consenting
      Noteholder, no waiver or amendment of any term, provision, condition, covenant or agreement herein or in the Subordinated Notes shall be effective except with the consent of the holders of at least fifty percent (50%) of the aggregate principal
      amount (excluding any Subordinated Notes held by the Company or any of its Affiliates) of the Subordinated Notes at the time outstanding; provided, however, that
      without the consent of each holder of an affected Subordinated Note, no such amendment or waiver may:  (i) reduce the principal amount of the Subordinated Note; (ii) reduce the rate of or change the time for payment of interest on any Subordinated
      Note; (iii) extend the maturity of any Subordinated Note; (iv) change the currency in which payment of the obligations of the Company under this Agreement and the Subordinated Notes are to be made; (v) lower the percentage of aggregate principal
      amount of outstanding Subordinated Notes required to approve any amendment of this Agreement or the Subordinated Notes; (vi) make any changes to Section 6 (Failure to Make Payments) of the Subordinated Notes that adversely affects the rights of any
      holder of a Subordinated Note; or (vii) disproportionately and adversely affect the rights of any of the holders of the then outstanding Subordinated Notes.  Notwithstanding the foregoing, the Company may amend or supplement the Subordinated Notes
      without the consent of the holders of the Subordinated Notes to cure any ambiguity, defect or inconsistency or to provide for uncertificated Subordinated Notes in addition to or in place of certificated Subordinated Notes, or to make any change that
      does not adversely affect the rights of any holder of any of the Subordinated Notes.  No failure to exercise or delay in exercising, by a Purchaser or any holder of the Subordinated Notes, of any right, power or privilege hereunder shall operate as a
      waiver thereof, nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof, or the exercise of any other right or remedy provided by law.  The rights and remedies provided in this
      Agreement are cumulative and not exclusive of any right or remedy provided by law or equity.  No notice or demand on the Company in any case shall, in itself, entitle the Company to any other or further notice or demand in similar or other
      circumstances or constitute a waiver of the rights of the Purchasers to any other or further action in any circumstances without notice or demand.  No consent or waiver, expressed or implied, by the Purchasers to or of any breach or default by the
      Company in the performance of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of the same or any other obligations of the Company hereunder.  Failure on the part
      of the Purchasers to complain of any acts or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Purchasers of their rights hereunder or impair any rights, powers or
      remedies on account of any breach or default by the Company.

     

    7.4          Required Waiver Disclosure.  Appendix A
      hereto sets forth certain disclosures relating to the Placement Agent that the Company is required to provide to the Purchasers.

     

    7.5         Severability.  Any provision of this Agreement which is unenforceable or invalid or
      contrary to law, or the inclusion of which would adversely affect the validity, legality or enforcement of this Agreement, shall be of no effect and, in such case, all the remaining terms and provisions of this Agreement shall subsist and be fully
      effective according to the tenor of this Agreement the same as though any such invalid portion had never been included herein.  Notwithstanding any of the foregoing to the contrary, if any provisions of this Agreement or the application thereof are
      held invalid or unenforceable only as to particular persons or situations, the remainder of this Agreement, and the application of such provision to persons or situations other than those to which it shall have been held invalid or unenforceable,
      shall not be affected thereby, but shall continue valid and enforceable to the fullest extent permitted by law.

     

    7.6          Notices.  Any notice which any party hereto may be required or may desire to give
      hereunder shall be deemed to have been given if in writing and if delivered personally, or if mailed, postage prepaid, by United States registered or certified mail, return receipt requested, or if delivered by a responsible overnight commercial
      courier promising next business day delivery, addressed:

     

    
      21

      
        

    

    	 	
            if to the Company:

          	
            Independent Bank Corporation

              4200 E. Beltline Avenue NE

              Grand Rapids, MI 49525

              Tel: (616) 527-5820

            Attention: Steve Erickson, Chief Financial Officer

          
	 	 	 
	 	
            with a copy to:

          	
            Varnum LLP

            333 Bridge Street NW

            Grand Rapids, MI 49504

            Tel:  (616) 336-6000

            Attention:  Michael G. Wooldridge

          
	 	 	 
	 	
            if to the Purchasers:

          	
            To the address indicated on such Purchaser’s signature page.

          

    

    

    or to such other address or addresses as the party to be given notice may have furnished in writing to the party seeking or desiring to give notice, as a place for the giving of notice; provided that no change in
      address shall be effective until five (5) Business Days after being given to the other party in the manner provided for above.  Any notice given in accordance with the foregoing shall be deemed given when delivered personally or, if mailed, three (3)
      Business Days after it shall have been deposited in the United States mails as aforesaid or, if sent by overnight courier, the Business Day following the date of delivery to such courier (provided next business day delivery was requested).

     

    7.7         Successors and Assigns.  This Agreement shall inure to the benefit of the parties
      and their respective heirs, legal representatives, successors and assigns; except that (i) unless a Purchaser consents in writing, no assignment made by the Company in violation of this Agreement shall be effective or confer any rights on any
      purported assignee of the Company, and (ii) unless such assignment complies with the Assignment Form attached to the Subordinated Notes, no assignment made by a Purchaser shall be effective or confer any rights on any purported assignee of
      Purchaser.  The term “successors and assigns” will not include a purchaser of any of the Subordinated Notes from any Purchaser merely because of such purchase but shall include a purchaser of any of the Subordinated Notes pursuant to an assignment
      complying with the Assignment Form attached to the Subordinated Notes.

     

    7.8          No Joint Venture.  Nothing contained herein or in any document executed pursuant
      hereto and no action or inaction whatsoever on the part of a Purchaser, shall be deemed to make a Purchaser a partner or joint venturer with the Company.

     

    7.9          Documentation.  All documents and other matters required by any of the provisions
      of this Agreement to be submitted or furnished to a Purchaser shall be in form and substance satisfactory to such Purchaser.

     

    7.10       Entire Agreement.  This Agreement and the Subordinated Notes, along with any
      exhibits hereto and thereto, constitute the entire agreement between the parties hereto with respect to the subject matter hereof and may not be modified or amended in any manner other than by supplemental written agreement executed by the parties
      hereto.  No party, in entering into this Agreement, has relied upon any representation, warranty, covenant, condition or other term that is not set forth in this Agreement or in the Subordinated Notes.

     

    
      22

      
        

    

    7.11        Choice of Law.  This Agreement shall be governed by and construed in accordance
      with the laws of the State of New York without giving effect to its laws or principles of conflict of laws.  Nothing herein shall be deemed to limit any rights, powers or privileges which a Purchaser may have pursuant to any law of the United States
      of America or any rule, regulation or order of any department or agency thereof and nothing herein shall be deemed to make unlawful any transaction or conduct by a Purchaser which is lawful pursuant to, or which is permitted by, any of the foregoing.

     

    7.12        No Third Party Beneficiary.  This Agreement is made for the sole benefit of the
      Company and the Purchasers, and no other Person shall be deemed to have any privity of contract hereunder nor any right to rely hereon to any extent or for any purpose whatsoever, nor shall any other Person have any right of action of any kind hereon
      or be deemed to be a third party beneficiary hereunder; provided, that the Placement Agent may rely on the representations and warranties contained herein to the same extent as if it were a party to this
      Agreement.

     

    7.13        Legal Tender of United States.  All payments hereunder shall be made in coin or
      currency which at the time of payment is legal tender in the United States of America for public and private debts.

     

    7.14       Captions; Counterparts.  Captions contained in this Agreement in no way define,
      limit or extend the scope or intent of their respective provisions.  This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed
      to be an original and all of which taken together shall constitute but one and the same instrument.  In the event that any signature is delivered by facsimile transmission, or by e-mail delivery of a “.pdf” format data file, such signature shall
      create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile signature page were an original thereof.

     

    7.15       Knowledge; Discretion.  All references herein to a Purchaser’s or the Company’s
      knowledge shall be deemed to mean the knowledge of such party based on the actual knowledge of such party’s Chief Executive Officer and Chief Financial Officer or such other persons holding equivalent offices.  Unless specified to the contrary
      herein, all references herein to an exercise of discretion or judgment by a Purchaser, to the making of a determination or designation by a Purchaser, to the application of a Purchaser’s discretion or opinion, to the granting or withholding of a
      Purchaser’s consent or approval, to the consideration of whether a matter or thing is satisfactory or acceptable to a Purchaser, or otherwise involving the decision making of a Purchaser, shall be deemed to mean that such Purchaser shall decide using
      the reasonable discretion or judgment of a prudent lender.

     

    
      23

      
        

    

    7.16       Waiver Of Right To Jury Trial.  TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, THE
      PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT THAT THEY MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING IN ANY WAY IN CONNECTION WITH ANY OF THE TRANSACTION DOCUMENTS, OR ANY OTHER STATEMENTS OR ACTIONS OF THE COMPANY
      OR THE PURCHASERS.  THE PARTIES ACKNOWLEDGE THAT THEY HAVE BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL SELECTED OF THEIR OWN FREE WILL.  THE PARTIES FURTHER ACKNOWLEDGE THAT (I) THEY
      HAVE READ AND UNDERSTAND THE MEANING AND RAMIFICATIONS OF THIS WAIVER, (II) THIS WAIVER HAS BEEN REVIEWED BY THE PARTIES AND THEIR COUNSEL AND IS A MATERIAL INDUCEMENT FOR ENTRY INTO THIS AGREEMENT AND (III) THIS WAIVER SHALL BE EFFECTIVE AS TO EACH
      OF SUCH TRANSACTION DOCUMENTS AS IF FULLY INCORPORATED THEREIN.

     

    7.17        Expenses.  Except as otherwise provided in this Agreement, each of the parties will
      bear and pay all other costs and expenses incurred by it or on its behalf in connection with the transactions contemplated pursuant to this Agreement.

     

    7.18       Survival.  Each of the representations and warranties set forth in this Agreement
      shall survive the consummation of the transactions contemplated hereby for a period of one year after the date hereof.  Except as otherwise provided herein, all covenants and agreements contained herein shall survive until, by their respective terms,
      they are no longer operative.

     

    [Signature Pages Follow]

    

    

    
      24

      
        

    

    IN WITNESS WHEREOF, the Company has caused this Subordinated Note Purchase Agreement to be executed by its duly authorized representative as of the date first
      above written.

     

    	 	
            COMPANY:

          	 
	 	 	 	 
	 	
            INDEPENDENT BANK CORPORATION

          
	 	 	 	 
	 	By:	
            /s/ Stephen A. Erickson

          	 
	 	 	
            Name: Stephen A. Erickson

          	 
	 	 	
            Title:   Executive VP & CFO

          	 

    

    

    
      [Company Signature Page to Subordinated Note Purchase Agreement]

    

    

    

    
      
        

    

    IN WITNESS WHEREOF, the Purchaser has caused this Subordinated Note Purchase Agreement to be executed by its duly authorized representative as of the date
      first above written.

     

    	 	
            PURCHASER:

          
	 	 
	 	
            [INSERT PURCHASER’S NAME]

          
	 	 	 
	 	
            By:

            

          	 	 
	 	 	
            Name:    [●]

          	 
	 	 	
            Title:      [●]

          
	 	 	 
	 	
            Address of Purchaser:

          
	 	 
	 	
            [●]

          
	 	 
	 	
            Principal Amount of Purchased Subordinated Note:

          
	 	 
	 	
            $[●]

          

    

    

    
      [Purchaser Signature Page to Subordinated Note Purchase Agreement]

    

    

    

    
      
        

    

    
    EXHIBIT A

     

    FORM OF SUBORDINATED NOTE

     

    INDEPENDENT BANK CORPORATION

    5.95% FIXED-TO-FLOATING RATE SUBORDINATED NOTE DUE MAY 31, 2030

     

    THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT TO SENIOR INDEBTEDNESS (AS DEFINED IN SECTION 3 OF THIS SUBORDINATED NOTE) OF INDEPENDENT BANK CORPORATION
      (THE “COMPANY”), INCLUDING OBLIGATIONS OF THE COMPANY TO ITS GENERAL CREDITORS AND SECURED CREDITORS, AND IS UNSECURED.  IT IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES.  IN THE EVENT OF
      LIQUIDATION ALL HOLDERS OF SENIOR INDEBTEDNESS OF THE COMPANY SHALL BE ENTITLED TO BE PAID IN FULL WITH SUCH INTEREST AS MAY BE PROVIDED BY LAW BEFORE ANY PAYMENT SHALL BE MADE ON ACCOUNT OF PRINCIPAL OF OR INTEREST ON THIS SUBORDINATED NOTE.  AFTER
      PAYMENT IN FULL OF ALL SUMS OWING TO SUCH HOLDERS OF SENIOR INDEBTEDNESS, THE HOLDER OF THIS SUBORDINATED NOTE, TOGETHER WITH THE HOLDERS OF ANY OBLIGATIONS OF THE COMPANY RANKING ON A PARITY WITH THE SUBORDINATED NOTES, SHALL BE ENTITLED TO BE PAID
      FROM THE REMAINING ASSETS OF THE COMPANY THE UNPAID PRINCIPAL AMOUNT OF THIS SUBORDINATED NOTE PLUS ACCRUED AND UNPAID INTEREST THEREON BEFORE ANY PAYMENT OR OTHER DISTRIBUTION, WHETHER IN CASH, PROPERTY OR OTHERWISE, SHALL BE MADE (I) WITH RESPECT
      TO ANY OBLIGATION THAT BY ITS TERMS EXPRESSLY IS JUNIOR IN THE RIGHT OF PAYMENT TO THE SUBORDINATED NOTES, (II) WITH RESPECT TO ANY INDEBTEDNESS BETWEEN THE COMPANY AND ANY OF ITS SUBSIDIARIES OR AFFILIATES, OR (III) ON ACCOUNT OF ANY SHARES OF
      CAPITAL STOCK OF THE COMPANY.

     

    THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR FUND.

     

    THIS SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $250,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF.  ANY ATTEMPTED TRANSFER OF THIS SUBORDINATED NOTE IN A DENOMINATION OF
      LESS THAN $1,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER.  ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PAYMENTS ON
      THIS SUBORDINATED NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS SUBORDINATED NOTE.

     

    
      A-27

      
        

    

    THIS SUBORDINATED NOTE MAY BE SOLD ONLY IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS.  THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
        ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAWS.  NEITHER THIS SUBORDINATED NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
      DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

     

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

     

    CERTAIN ERISA CONSIDERATIONS:

     

    THE HOLDER OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR
      ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”) (EACH A “PLAN”), OR AN ENTITY WHOSE
      UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE
      FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN,
      ARE NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE AND HOLDING. ANY PURCHASER OR HOLDER OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING
      THEREOF THAT EITHER: (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN TO WHICH TITLE I OF ERISA OR SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH EMPLOYEE BENEFIT PLAN OR PLANS, OR ANY OTHER PERSON
      OR ENTITY USING THE “PLAN ASSETS” OF ANY SUCH EMPLOYEE BENEFIT PLAN OR PLANS TO FINANCE SUCH PURCHASE OR (II) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH FULL
      EXEMPTIVE RELIEF IS NOT AVAILABLE UNDER APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

     

    ANY FIDUCIARY OF ANY PLAN WHO IS CONSIDERING THE ACQUISITION OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN SHOULD CONSULT WITH HIS OR HER LEGAL COUNSEL PRIOR TO ACQUIRING THIS SUBORDINATED NOTE OR
      ANY INTEREST HEREIN.

     

    
      A-28

      
        

    

    
      	No. [●]	CUSIP [(QIB) 453838AE4]

            
	
               

            	
              [453838AF1]

            
	
               

            	
              ISIN [(QIB) US453838AE45]

            
	
               

            	
              [US453838AF10]

            

    

     

    

    INDEPENDENT BANK CORPORATION

     

    5.95% FIXED-TO-FLOATING RATE SUBORDINATED NOTE DUE MAY 31, 2030

     

    1.           Subordinated Notes.  This Subordinated Note is one of an issue of notes of Independent Bank Corporation, a Michigan corporation (the “Company”)

      designated as the “5.95% Fixed-to-Floating Rate Subordinated Notes due May 31, 2030” (the “Subordinated Notes”) issued pursuant to that Subordinated Note Purchase Agreement, dated as of May 27, 2020, by
      and among the Company and the several purchasers of the Subordinated Notes identified on the signature pages thereto (the “Purchase Agreement”).

     

    2.           Payment.  The Company, for value received, promises to pay to Cede & Co., or its registered assigns, the principal sum of [●] Dollars
      (U.S.) ($[●]), plus accrued but unpaid interest on May 31, 2030 (“Stated Maturity”) and to pay interest thereon (i) from and including May 27, 2020 (the “Issue Date”) to but excluding May 31, 2025 or the earlier redemption date
      contemplated by Section 4 of this Subordinated Note, at the rate of 5.95% per annum, computed on the basis of a 360-day year consisting of twelve 30-day months and payable semi-annually (each semi-annual period, a “Fixed Rate Period”)
      in arrears on May 31 and November 30 of each year (each payment date, a “Fixed Rate Interest Payment Date”), and (ii) from and including May 31, 2025 to but excluding the Stated Maturity or the earlier redemption date contemplated by Section

        4 of this Subordinated Note, at the rate per annum, reset quarterly, equal to the Floating Interest Rate (as defined below) determined on the Floating Interest Determination Date (as defined below) of the applicable interest period plus 582.5
      basis points, computed on the basis of a 360-day year and the actual number of days elapsed and payable quarterly in arrears (each quarterly period, a “Floating Rate Period”) on February 28, May 31, August 31 and November 30 of each year (each
      payment date, a “Floating Rate Interest Payment Date”).  Dollar amounts resulting from this calculation shall be rounded to the nearest cent, with one-half cent being rounded up. The term “Floating Interest Determination Date” means the
      date upon which the Floating Interest Rate is determined by the Calculation Agent (as defined below) pursuant to the Three-Month Term SOFR Conventions (as defined below).  Any payment of principal of or interest on this Subordinated Note that would
      otherwise become due and payable on a day which is not a Business Day shall become due and payable on the next succeeding Business Day, with the same force and effect as if made on the date for payment of such principal or interest, and no interest
      will accrue in respect of such payment for the period after such day; provided, that in the event that any scheduled Floating Rate Interest Payment Date falls on a day that is not a Business Day and the next succeeding Business Day falls in the next
      succeeding calendar month, such Floating Rate Interest Payment Date will be accelerated to the immediately preceding Business Day, and, in each such case, the amounts payable on such Business Day will include interest accrued to, but excluding, such
      Business Day.  Dollar amounts resulting from interest calculations will be rounded to the nearest cent, with one half cent being rounded upward.

     

    
      A-29

      
        

    

    (a)          The Company shall take such actions as are necessary to ensure that from the commencement of the Floating Rate Period for so long as any of the
      Subordinated Notes remain outstanding there will at all times be a Calculation Agent appointed to calculate Three-Month Term SOFR in respect of each Floating Rate Period. The calculation of Three-Month Term SOFR for each applicable Floating Rate
      Period by the Calculation Agent will (in the absence of manifest error) be final and binding. The Calculation Agent’s determination of any interest rate and its calculation of interest payments for any period will be maintained on file at the
      Calculation Agent’s principal offices, will be made available to any Noteholder (as defined below) upon request. The Calculation Agent may be removed by the Company at any time. If the Calculation Agent is unable or unwilling to act as Calculation
      Agent or is removed by the Company, the Company will promptly appoint a replacement Calculation Agent. The Calculation Agent may not resign its duties without a successor having been duly appointed; provided, that if a successor Calculation Agent has
      not been appointed by the Company and such successor accepted such position within thirty (30) days after the giving of notice of resignation by the Calculation Agent, then the resigning Calculation Agent may petition, at the expense of the Company,
      any court of competent jurisdiction for the appointment of a successor Calculation Agent with respect to such series. For the avoidance of doubt, if at any time there is no Calculation Agent appointed by the Company, then the Company shall be the
      Calculation Agent.

     

    (b)          An “Interest Payment Date” is either a Fixed Rate Interest Payment Date or a Floating Rate Interest Payment Date, as applicable.

     

    (c)          The “Floating Interest Rate” means:

     

    (i)          initially Three-Month Term SOFR (as defined below).

     

    (ii)         Notwithstanding the foregoing clause (i) of this Section 2(c):

     

    (1)          If the Calculation Agent determines prior to the relevant Floating Interest Determination Date that a Benchmark Transition Event and its related
      Benchmark Replacement Date (each of such terms as defined below) have occurred with respect to Three-Month Term SOFR, then the Company shall promptly provide notice of such determination to the Noteholders and Section 2(d) will thereafter
      apply to all determinations, calculations and quotations made or obtained for the purposes of calculating the Floating Interest Rate payable on the Subordinated Notes during a relevant Floating Rate Period.

     

    (2)          However, if the Calculation Agent determines that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect
      to Three-Month Term SOFR, but for any reason the Benchmark Replacement has not been determined as of the relevant Floating Interest Determination Date, the Floating Interest Rate for the applicable Floating Rate Period will be equal to the Floating
      Interest Rate on the last Floating Interest Determination Date for the Subordinated Notes, as determined by the Calculation Agent.

     

    (d)          Effect of Benchmark Transition Event.

     

    (i)          If the Calculation Agent determines that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference
      Time (as defined below) in respect of any determination of the Benchmark (as defined below) on any date, the Benchmark Replacement will replace the then-current Benchmark for all purposes relating to the Subordinated Notes during the relevant
      Floating Rate Period in respect of such determination on such date and all determinations on all subsequent dates.

     

    
      A-30

      
        

    

    (ii)       In connection with the implementation of a Benchmark Replacement, the Calculation Agent will have the right to make Benchmark Replacement Conforming
      Changes from time to time, and such changes shall become effective without consent from the Noteholders or any other party.

     

    (iii)       The Calculation Agent is expressly authorized to make certain determinations, decisions and elections under the Subordinated Notes, including with
      respect to the use of Three-Month Term SOFR as the Benchmark under this Section 2(d).  Any determination, decision or election that may be made by the Calculation Agent under the terms of the Subordinated Notes, including any determination
      with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date, and any decision to take or refrain from taking any action or any selection:

     

    (1)            will be conclusive and binding absent manifest error;

     

    (2)            if made by the Company as the Calculation Agent, will be made in the Company’s sole discretion;

     

    (3)           if made by the Calculation Agent other than the Company, will be made after consultation with the Company, and the Calculation Agent will not make
      any such determination, decision or election to which the Company reasonably objects; and

     

    (4)           notwithstanding anything to the contrary in this Subordinated Note or the Purchase Agreement, shall become effective without consent from the
      Noteholders or any other party.

     

    (iv)        If the Calculation Agent fails to make any determination, decision or election that it is required to make under the
        terms of the Subordinated Notes, then the Company will make such determination, decision or election on the same basis as described above.

     

    (v)        For the avoidance of doubt, after a Benchmark Transition Event and its related Benchmark Replacement Date have occurred, interest payable on this
      Subordinated Note for the Floating Rate Period will be an annual rate equal to the sum of the applicable Benchmark Replacement plus 582.5 basis points.

     

    (vi)        If the then-current Benchmark is Three-Month Term SOFR, the Calculation Agent will have the right to establish the Three-Month Term SOFR Conventions,
      and if any of the foregoing provisions concerning the calculation of the interest rate and the payment of interest during the Floating Rate Period are inconsistent with any of the Three-Month Term SOFR Conventions determined by the Calculation Agent,
      then the Three-Month Term SOFR Conventions as determined by the Calculation Agent will apply.

     

    (vii)       As used in this Subordinated Note:

     

    
      A-31

      
        

    

    (1)         “Benchmark” means, initially, Three-Month Term SOFR; provided that if the Calculation Agent determines on or prior to the Reference Time that
      a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement.

     

    (2)        “Benchmark Replacement” means the Interpolated Benchmark with respect to the then-current Benchmark; provided that if (a) the Calculation Agent
      cannot determine the Interpolated Benchmark as of the Benchmark Replacement Date or (b) the then-current Benchmark is Three-Month Term SOFR and a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to
      Three-Month Term SOFR (in which event no Interpolated Benchmark with respect to Three-Month Term SOFR shall be determined), then “Benchmark Replacement” means the first alternative set forth in the order below that can be determined by the
      Calculation Agent as of the Benchmark Replacement Date:

     

    a.        the sum of: (i) Compounded SOFR and (ii) the Benchmark Replacement Adjustment;

     

    b.       the sum of: (i) the alternate rate of interest that has been selected or recommended by the Relevant Governmental Body as the replacement for the
      then-current Benchmark for the applicable Corresponding Tenor and (ii) the Benchmark Replacement Adjustment;

     

    c.        the sum of: (i) the ISDA Fallback Rate and (ii) the Benchmark Replacement Adjustment;

     

    d.       the sum of: (i) the alternate rate of interest that has been selected by the Calculation Agent as the replacement for the then-current Benchmark for the
      applicable Corresponding Tenor giving due consideration to any industry-accepted rate of interest as a replacement for the then-current Benchmark for U.S. dollar denominated floating rate securities at such time and (ii) the Benchmark Replacement
      Adjustment.

     

    (3)          “Benchmark Replacement Adjustment” means the first alternative set forth in the order below that can be determined by the Calculation Agent
      as of the Benchmark Replacement Date:

     

    a.       the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has
      been selected or recommended by the Relevant Governmental Body for the applicable Unadjusted Benchmark Replacement;

     

    b.        if the applicable Unadjusted Benchmark Replacement is equivalent to the ISDA Fallback Rate, then the ISDA Fallback Adjustment;

     

    c.        the spread adjustment (which may be a positive or negative value or zero) that has been selected by the Calculation Agent giving due consideration to
      any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar denominated floating rate
      securities at such time.

     

    
      A-32

      
        

    

    (4)       “Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational
      changes (including changes to the definition of  “Floating Rate Period,” timing and frequency of determining rates with respect to each Floating Rate Period and making payments of interest, rounding of amounts or tenors, and other administrative
      matters) that the Calculation Agent decides may be appropriate to reflect the adoption of such Benchmark Replacement in a manner substantially consistent with market practice (or, if the Calculation Agent decides that adoption of any portion of such
      market practice is not administratively feasible or if the Calculation Agent determines that no market practice for use of the Benchmark Replacement exists, in such other manner as the Calculation Agent determines is reasonably necessary).

     

    (5)          “Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current
      Benchmark:

     

    a.        in the case of clause (a) of the definition of “Benchmark Transition Event,” the relevant Reference Time in respect of any determination; or

     

    b.      in the case of clause (b) or (c) of the definition of “Benchmark Transition Event,” the later of (i) the date of the public statement or
      publication of information referenced therein and (ii) the date on which the administrator of the Benchmark permanently or indefinitely ceases to provide the Benchmark; or

     

    c.        in the case of clause (d) of the definition of “Benchmark Transition Event,” the date of the public
      statement or publication of information referenced therein. and

     

    For the avoidance of doubt, for purposes of the definitions of Benchmark Replacement Date and Benchmark Transition Event, references to the Benchmark also include any reference rate
      underlying the Benchmark (for example, if the Benchmark becomes Compounded SOFR, references to the Benchmark would include SOFR).

     

    For the avoidance of doubt, if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark
      Replacement Date will be deemed to have occurred prior to the Reference Time for such determination.

     

    (6)         “Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:

     

    a.        if the Benchmark is Three-Month Term SOFR, (i) the Relevant Governmental Body has not selected or recommended a forward-looking term rate for a tenor
      of three months based on SOFR, (ii) the development of a forward-looking term rate for a tenor of three months based on SOFR that has been recommended or selected by the Relevant Governmental Body is not complete or (iii) the Company determines that
      use of a forward-looking rate for a tenor of three months based on SOFR is not administratively feasible;

     

    
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    b.        a public statement or publication of information by or on behalf of the administrator of the Benchmark announcing that such administrator has ceased or
      will cease to provide the Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark;

     

    c.       a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark, the central bank for the currency
      of the Benchmark, an insolvency official with jurisdiction over the administrator for the Benchmark, a resolution authority with jurisdiction over the administrator for the Benchmark or a court or an entity with similar insolvency or resolution
      authority over the administrator for the Benchmark, which states that the administrator of the Benchmark has ceased or will cease to provide the Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there
      is no successor administrator that will continue to provide the Benchmark; or

     

    d.        a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark announcing that the Benchmark is
      no longer representative.

     

    (7)         “Business Day” means any day that is not a Saturday or Sunday and that is not a day on which banks in the State of
      Michigan are generally authorized or required by law or executive order to be closed.

     

    (8)         “Calculation Agent” means the agent (which may be the Company or an affiliate of the Company) as may be appointed by the Company to act as
      Calculation Agent for the Subordinated Notes prior to the commencement of the Floating Rate Period to act in accordance with Section 2.

     

    (9)         “Compounded SOFR” means the compounded average of SOFRs for the applicable Corresponding Tenor, with the rate, or methodology for this rate,
      and conventions for this rate being established by the Calculation Agent in accordance with:

     

    a.        the rate, or methodology for this rate and conventions for this rate selected or recommended by the Relevant Governmental Body for determining
      compounded SOFR; provided that:

     

    b.        if, and to the extent that, the Calculation Agent determines that Compounded SOFR cannot be determined in accordance with clause (a) above,
      then the rate, or methodology for this rate, and conventions for this rate that have been selected by the Calculation Agent giving due consideration to any industry-accepted market practice for U.S. dollar denominated floating rate securities at such
      time.

     

    For the avoidance of doubt, the calculation of Compounded SOFR will exclude the Benchmark Replacement Adjustment plus 582.5 basis points.

     

    
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    (10)        “Corresponding Tenor” with respect to a Benchmark Replacement means a tenor (including overnight) having approximately the same length
      (disregarding Business Day adjustment) as the applicable tenor for the then-current Benchmark.

     

    (11)        “FRBNY” means the Federal Reserve Bank of New York.

     

    (12)        “FRBNY’s Website” means the website of the FRBNY at http://www.newyorkfed.org, or any successor source.

     

    (13)        “Interpolated Benchmark” with respect to the Benchmark means the rate determined for the Corresponding Tenor by interpolating on a linear
      basis between: (1) the Benchmark for the longest period (for which the Benchmark is available) that is shorter than the Corresponding Tenor and (2) the Benchmark for the shortest period (for which the Benchmark is available) that is longer than the
      Corresponding Tenor.

     

    (14)        “ISDA” means the International Swaps and Derivatives Association, Inc. or any successor thereto.

     

    (15)        “ISDA Definitions” means the 2006 ISDA Definitions published by the ISDA or any successor thereto, as amended or supplemented from time to
      time, or any successor definitional booklet for interest rate derivatives published from time to time.

     

    (16)       “ISDA Fallback Adjustment” means the spread adjustment (which may be a positive or negative value or zero) that would apply for derivatives
      transactions referencing the ISDA Definitions to be determined upon the occurrence of an index cessation event with respect to the Benchmark for the applicable tenor.

     

    (17)       “ISDA Fallback Rate” means the rate that would apply for derivatives transactions referencing the ISDA Definitions to be effective upon the
      occurrence of an index cessation date with respect to the Benchmark for the applicable tenor excluding the applicable ISDA Fallback Adjustment.

     

    (18)       “Reference Time” with respect to any determination of the Benchmark means (a) if the Benchmark is Three-Month Term SOFR, the time determined by
      the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions, and (b) if the Benchmark is not Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Benchmark Replacement Conforming
      Changes.

     

    (19)      “Relevant Governmental Body” means the Board of Governors of the Federal Reserve System (the “Federal Reserve”) and/or the FRBNY, or a
      committee officially endorsed or convened by the Federal Reserve and/or the FRBNY or any successor thereto.

     

    (20)       “SOFR” means the daily secured overnight financing rate published by the FRBNY, as the administrator of the benchmark, (or a successor
      administrator) on the FRBNY’s Website (or such successor’s website).

     

    
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    (21)        “Term SOFR” means the forward-looking term rate for the applicable Corresponding Tenor based on SOFR that has been selected or recommended by
      the Relevant Governmental Body.

     

    (22)       “Term SOFR Administrator” means any entity designated by the Relevant Governmental Body as the administrator of Term SOFR (or successor
      administrator).

     

    (23)        “Three-Month Term SOFR” means the rate for Term SOFR for a tenor of three months that is published by the Term SOFR Administrator at the
      Reference Time for any Floating Rate Period, as determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions. All percentages used in or resulting from any calculation of Three-Month Term SOFR shall be rounded, if
      necessary, to the nearest one-hundred-thousandth of a percentage point, with 0.000005% rounded up to 0.00001%.

     

    (24)       “Three-Month Term SOFR Conventions” means any determination, decision or election with respect to any technical, administrative or operational
      matter (including with respect to the manner and timing of the publication of Three-Month Term SOFR, or changes to the definition of “Floating Rate Period”, timing and frequency of determining Three-Month Term SOFR with respect to each Floating Rate
      Period and making payments of interest, rounding of amounts or tenors, and other administrative matters) that the Calculation Agent decides may be appropriate to reflect the use of Three-Month Term SOFR as the Benchmark in a manner substantially
      consistent with market practice (or, if the Calculation Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Calculation Agent determines that no market practice for the use of Three-Month Term
      SOFR exists, in such other manner as the Calculation Agent determines is reasonably necessary).

     

    (25)       “Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

     

    
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    3.           Subordination.

     

    (a)        The indebtedness of the Company evidenced by this Subordinated Note, including the principal and interest on this Subordinated Note, shall be
      subordinate and junior in right of payment to the prior payment in full of all existing claims of creditors of the Company whether now outstanding or subsequently created, assumed, guaranteed or incurred (collectively, “Senior Indebtedness”),
      which shall consist of principal of (and premium, if any) and interest, if any, on: (i) all indebtedness and obligations of, or guaranteed or assumed by, the Company for money borrowed, whether or not evidenced by bonds, debentures, securities, notes
      or other similar instruments, and including, but not limited to, all obligations to the Company’s general creditors and secured creditors; (ii) any deferred obligations of the Company for the payment of the purchase price of property or assets
      acquired other than in the ordinary course of business; (iii) all obligations, contingent or otherwise, of the Company in respect of any letters of credit, bankers’ acceptances, security purchase facilities and similar direct credit substitutes; (iv)
      any capital lease obligations of the Company; (v) all obligations of the Company in respect of interest rate swap, cap or other agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts,
      commodity contracts and other similar arrangements or derivative products; (vi) any obligation of the Company to its general creditors, as defined for purposes of the capital adequacy regulations of the Federal Reserve applicable to the Company, as
      the same may be amended or modified from time to time; (vii) all obligations that are similar to those in clauses (i) through (vi) of other persons for the payment of which the Company is responsible or liable as obligor, guarantor or otherwise
      arising from an off-balance sheet guarantee; (viii) all obligations of the types referred to in clauses (i) through (vii) of other persons secured by a lien on any property or asset of the Company; and (ix) in the case of (i) through (viii) above,
      all amendments, renewals, extensions, modifications and refundings of such indebtedness and obligations; except “Senior Indebtedness” does not include (A) the Subordinated Notes, (B) any obligation that by
      its terms expressly is junior to, or ranks equally in right of payment with, the Subordinated Notes, or (C) any indebtedness between the Company and any of its subsidiaries or Affiliates.  This Subordinated Note is not secured by any assets of the
      Company or any subsidiary or Affiliate of the Company.  The term “Affiliate(s)” means, with respect to any Person (as such term is defined in the Purchase Agreement), such Person’s immediate family members, partners, members or parent and
      subsidiary corporations, and any other Person directly or indirectly controlling, controlled by, or under common control with said Person and their respective Affiliates.

     

    (b)         In the event of any liquidation of the Company, holders of Senior Indebtedness of the Company shall be entitled to be paid in full with such interest
      as may be provided by law before any payment shall be made on account of principal of or interest on this Subordinated Note.  Additionally, in the event of any insolvency, dissolution, assignment for the benefit of creditors or any liquidation or
      winding up of or relating to the Company, whether voluntary or involuntary, holders of Senior Indebtedness shall be entitled to be paid in full before any payment shall be made on account of the principal of or interest on the Subordinated Notes,
      including this Subordinated Note.  In the event of any such proceeding, after payment in full of all sums owing with respect to the Senior Indebtedness, the registered holders of the Subordinated Notes from time to time (each a “Noteholder”
      and, collectively, the “Noteholders”), together with the holders of any obligations of the Company ranking on a parity with the Subordinated Notes, shall be entitled to be paid from the remaining assets of the Company the unpaid principal
      thereof, and the unpaid interest thereon before any payment or other distribution, whether in cash, property or otherwise, shall be made (i) with respect to any obligation that by its terms expressly is junior to in the right of payment to the
      Subordinated Notes, (ii) with respect to any indebtedness between the Company and any of its subsidiaries or Affiliates or (iii) on account of any capital stock.

     

    
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    (c)         If there shall have occurred and be continuing (i) a default in any payment with respect to any Senior Indebtedness or (ii) an event of default with
      respect to any Senior Indebtedness as a result of which the maturity thereof is accelerated, unless and until such payment default or event of default shall have been cured or waived or shall have ceased to exist, no payments shall be made by the
      Company with respect to the Subordinated Notes, notwithstanding the provisions of Section 18 hereof.  The provisions of this paragraph shall not apply to any payment with respect to which Section 3(b) above would be applicable.

     

    (d)         Nothing herein shall act to prohibit, limit or impede the Company from issuing additional debt of the Company having the same rank as the Subordinated
      Notes or which may be junior or senior in rank to the Subordinated Notes.  Each Noteholder, by its acceptance hereof, agrees to and shall be bound by the provisions of this Section 3.  Each Noteholder, by its acceptance hereof, further
      acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration for each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after
      the issuance of the Subordinated Notes, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in
      acquiring and continuing to hold or in continuing to hold such Senior Indebtedness.

     

    4.           Redemption.

     

    (a)          Redemption Prior to Fifth Anniversary.  This Subordinated Note shall not be redeemable by the Company in whole or in part prior to the fifth
      anniversary of the Issue Date, except in the event of: (i) a Tier 2 Capital Event (as defined below); (ii) a Tax Event (as defined below); or (iii) an Investment Company Event (as defined below).  Upon the occurrence of a Tier 2 Capital Event, a Tax
      Event or an Investment Company Event, subject to Section 4(f) below, the Company may redeem this Subordinated Note in whole, but not in part, at any time, upon giving not less than 10 calendar days’ notice to the Noteholders at an amount
      equal to 100% of the outstanding principal amount being redeemed plus accrued and unpaid interest, to but excluding the redemption date.  “Tier 2 Capital Event” means the receipt by the Company of an opinion of counsel to the Company to the
      effect that there is a material risk that the Subordinated Note no longer qualifies to be eligible for treatment as “Tier 2” Capital (as defined by the Federal Reserve) (or its then equivalent) as a result of a change in law or regulation, or
      interpretation or application of law or regulation by any judicial, legislative or regulatory authority that becomes effective after the Issue Date.  “Tax Event” means the receipt by the Company of an opinion of counsel to the Company that as
      a result of any amendment to, or change (including any final and adopted (or enacted) prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or as a
      result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, there is a material risk that interest payable by the Company on the Subordinated Notes is not, or within 120 days after the
      receipt of such opinion will not be, deductible by the Company, in whole or in part, for United States federal income tax purposes.  “Investment Company Event” means the receipt by the Company of an opinion of counsel to the Company to the
      effect that there is a material risk that the Company is or, within 120 days after the receipt of such opinion will be, required to register as an investment company pursuant to the Investment Company Act of 1940, as amended.

     

    
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    (b)         Redemption on or after Fifth Anniversary.  On or after the fifth anniversary of the Issue Date, subject to Section 4(f) below, this
      Subordinated Note shall be redeemable at the option of and by the Company, in whole or in part at any time and from time to time upon any Interest Payment Date, at an amount equal to 100% of the outstanding principal amount being redeemed plus
      accrued but unpaid interest, to but excluding the redemption date, but in all cases in a principal amount with integral multiples of $1,000.  In addition, on or after the fifth anniversary of the Issue Date, subject to Section 4(f), the
      Company may redeem all or a portion of the Subordinated Notes, at any time upon the occurrence of a Tier 2 Capital Event, Tax Event or an Investment Company Event.

     

    (c)          Partial Redemption.   If less than the then outstanding principal amount of this Subordinated Note is redeemed, (i) a new Subordinated Note
      shall be issued representing the unredeemed portion without charge to the holder thereof and (ii) such redemption shall be effected on a pro rata basis as to the Noteholders.  For purposes of clarity, upon a partial redemption, a like percentage of
      the principal amount of every Subordinated Note held by every Noteholder shall be redeemed.

     

    (d)          No Redemption at Option of Noteholder.  This Subordinated Note is not subject to redemption at the option of the holder of this Subordinated
      Note.

     

    (e)          Effectiveness of Redemption.  If notice of redemption has been duly given and notwithstanding that this Subordinated Note has been called for
      redemption but has not yet been surrendered for cancellation, on and after the date fixed for redemption interest shall cease to accrue on the portion of this Subordinated Note called for redemption, this Subordinated Note shall no longer be deemed
      outstanding with respect to the portion called for redemption and all rights with respect to the portion of this Subordinated Note called for redemption shall forthwith on such date fixed for redemption cease and terminate unless the Company shall
      default in the payment of the redemption price, except only the right of the Noteholder to receive the amount payable on such redemption, without interest.

     

    (f)          Regulatory Approvals. Any such redemption shall be subject to receipt of any and all required federal and state regulatory approvals,
      including, but not limited to, the consent of the Federal Reserve.  In the case of any redemption of this Subordinated Note pursuant to paragraph (b) of this Section 4, the Company will give the Noteholder notice of redemption, which notice
      shall indicate the aggregate principal amount of Subordinated Notes to be redeemed, not less than 30 nor more than 45 calendar days prior to the proposed redemption date.

     

    (g)         Purchase and Resale of the Subordinated Notes. Subject to any required federal and state regulatory approvals and the provisions of this
      Subordinated Note, the Company shall have the right to purchase any of the Subordinated Notes at any time in the open market, private transactions or otherwise.  If the Company purchases any Subordinated Notes, it may, in its discretion, hold, resell
      or cancel any of the purchased Subordinated Notes.

     

    
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    5.           Events of Default; Acceleration.

     

    (a)          Each of the following events shall constitute an “Event of Default”:

     

    (i)          the entry of a decree or order for relief in respect of the Company by a court having jurisdiction in the premises in an involuntary case or proceeding under any
      applicable bankruptcy, insolvency, or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, and such decree or order will have continued unstayed and in effect for a period of 90 consecutive days;

     

    (ii)          the commencement by the Company of a voluntary case under any applicable bankruptcy, insolvency or reorganization law, now or hereafter in effect of the United States or
      any political subdivision thereof, or the consent by the Company to the entry of a decree or order for relief in an involuntary case or proceeding under any such law;

     

    (iii)        the Company (A) becomes insolvent or is unable to pay its debts as they mature, (B) makes an assignment for the benefit of creditors, (C) admits in writing its inability
      to pay its debts as they mature, or (D) ceases to be a bank holding company or financial holding company under the Bank Holding Company Act of 1956, as amended;

     

    (iv)         the failure of the Company to pay any installment of interest on any of the Subordinated Notes as and when the same will become due and payable, and the continuation of
      such failure for a period of 30 days;

     

    (v)          the failure of the Company to pay all or any part of the principal of any of the Subordinated Notes as and when the same will become due and payable;

     

    (vi)        the liquidation of the Company (for the avoidance of doubt, “liquidation” does not include any merger, consolidation, sale of equity or assets or reorganization (exclusive
      of a reorganization in bankruptcy) of the Company or any of its subsidiaries);

     

    (vii)       the failure of the Company to perform any other covenant or agreement on the part of the Company contained in the Subordinated Notes, and the continuation of such failure
      for a period of 30 days after the date on which notice specifying such failure, stating that such notice is a “Notice of Default” hereunder and demanding that the Company remedy the same, will have been given, in the manner set forth in Section
        22, to the Company by a Noteholder; or

     

    (viii)      the default by the Company under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company having an aggregate principal amount
      outstanding of at least $25,000,000, whether such indebtedness now exists or is created or incurred in the future, which default (A) constitutes a failure to pay any portion of the principal of such indebtedness when due and payable after the
      expiration of any applicable grace period or (B) results in such indebtedness becoming due or being declared due and payable prior to the date on which it otherwise would have become due and payable without, in the case of clause (A), such
      indebtedness having been discharged or, in the case of clause (B), without such indebtedness having been discharged or such acceleration having been rescinded or annulled.

     

    
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    (b)          Unless the principal of this Subordinated Note already shall have become due and payable, if an Event of Default described in Section 5(a)(i)
      or Section 5(a)(ii) shall have occurred and be continuing, Noteholders holding not less than twenty percent (20%) in aggregate principal amount of the Subordinated Notes at the time outstanding, by notice in writing to Company, may declare
      the principal amount of all outstanding Subordinated Notes to be due and payable immediately and, upon any such declaration, the same shall become and shall be immediately due and payable.  The Company waives demand, presentment for payment, notice
      of nonpayment, notice of protest, and all other notices.  Notwithstanding the foregoing, because the Company will treat the Subordinated Notes as Tier 2 Capital, upon the occurrence of an Event of Default other than an Event of Default described in Section 5(a)(i)
      or Section 5(a)(ii), the Noteholders may not accelerate the Stated Maturity of the Subordinated Notes and make the principal of, and any accrued and unpaid interest on, the Subordinated Notes, immediately due and payable.  The Company, within 45 calendar days after the receipt of written notice from any Noteholder of the occurrence of an Event of Default with respect to this Subordinated Note, shall notify all Noteholders, at
      their addresses shown on the Security Register (as defined in Section 14 below), of such written notice of Event of Default, unless such Event of Default shall have been cured or waived before the giving of such notice as certified by the
      Company in writing to the Noteholder or Noteholders who provided written notice of such Event of Default.

     

    6.           Failure to Make Payments.  In the event of any failure by the Company to make any required payment of principal or interest on this
      Subordinated Note (and in the case of payment of interest, such failure to pay shall have continued for 30 calendar days), the Company will, upon demand of the Noteholders, pay to the Noteholders the amount then due and payable on this Subordinated
      Note for principal and interest (without acceleration of this Subordinated Note in any manner), with interest on the overdue principal and interest at the rate borne by this Subordinated Note, to the extent permitted by applicable law.  If the
      Company fails to pay such amount upon such demand, the Noteholders may, among other things, institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce
      the same against the Company and collect the amounts adjudged or decreed to be payable in the manner provided by law out of the property of the Company.

     

    Upon the occurrence of a failure by the Company to make any required payment of principal or interest on this Subordinated Note, or an Event of Default until such Event of Default is cured by the
      Company or waived pursuant to Section 17 of this Subordinated Note, the Company shall not, except as required by any federal or state governmental agency: (a) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or
      make a liquidation payment with respect to, any of the Company’s capital stock; (b) make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any indebtedness of the Company that ranks equal with or junior to
      the Subordinated Notes; or (c) make any payments under any guarantee that ranks equal with or junior to the Subordinated Notes, other than (i) any dividends or distributions in shares of, or options, warrants or rights to subscribe for or purchase
      shares of, any class of the Company’s common stock; (ii) any declaration of a non-cash dividend in connection with the implementation of a shareholders’ rights plan, or the issuance of stock under any such plan in the future, or the redemption or
      repurchase of any such rights pursuant thereto; (iii) as a result of a reclassification of the Company’s capital stock or the exchange or conversion of one class or series of the Company’s capital stock for another class or series of the Company’s
      capital stock; (iv) the purchase of fractional interests in shares of the Company’s capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (v) purchases of any class of
      the Company’s common stock related to or from any benefit plans for the Company’s directors, officers or employees or any of the Company’s dividend reinvestment plans (the foregoing clauses (i) through (v) are collectively referred to as the “Permitted

        Dividends”).

     

    
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    7.           Affirmative Covenants of the Company.

     

    (a)          Notice of Certain Events.  To the extent permitted by applicable statute, rule or regulation, the Company shall provide written notice to the
      Noteholder of the occurrence of any of the following events as soon as practicable, but in no event later than fifteen (15) Business Days following the Company becoming aware of the occurrence of such event:

     

    (i)          The Bank (as defined in the Purchase Agreement) is no longer “adequately capitalized” as contemplated by applicable federal banking laws and regulations; or

     

    (ii)         The Company, or any officer of the Company (in such capacity), becomes subject to any formal, written regulatory enforcement action (as defined by the applicable regulatory agency).

     

    (b)          Payment of Principal and Interest.  The Company covenants and agrees for the benefit of the Noteholders that it
      will duly and punctually pay the principal of, and interest on, this Subordinated Note, in accordance with the terms hereof.

     

    (c)        Maintenance of Office. The Company will maintain an office or agency in the State of Michigan, where Subordinated
      Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Subordinated Notes may be served.  The Company may also from time to time designate one or more other offices
      or agencies where the Subordinated Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided that no such designation or rescission will in any manner relieve the Company of its
      obligation to maintain an office or agency in the State of Michigan.  The Company will give prompt written notice to the Noteholders of any such designation or rescission and of any change in the location of any such other office or agency.

     

    (d)         Corporate Existence. The Company will do or cause to be done all things necessary to preserve and keep in full
      force and effect: (i) the corporate existence of the Company; (ii) the existence (corporate or other) of each subsidiary; and (iii) the rights (charter and statutory), licenses and franchises of the Company and each of its subsidiaries; provided,
      however, that the Company will not be required to preserve the existence (corporate or other) of any of its subsidiaries or any such right, license or franchise of the Company or any of its subsidiaries if the Board of Directors of the Company
      determines that the preservation thereof is no longer desirable in the conduct of the business of the Company and its subsidiaries taken as a whole and that the loss thereof will not be disadvantageous in any material respect to the Noteholders;
      provided, further, that the Company may consummate a merger in which (i) the Company is the surviving entity or (ii) if the Company is not the surviving entity, the surviving entity assumes, by operation of law or otherwise, all of the obligations of
      the Company under the Subordinated Notes.

     

    
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    (e)          Maintenance of Properties. The Company will, and will cause each subsidiary to, cause all its properties used or
      useful in the conduct of its business to be maintained and kept in good condition, repair and working order and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and
      improvements thereof, all as in the judgment of the Company may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided, however, that nothing in this Section will
      prevent the Company or any subsidiary from discontinuing the operation and maintenance of any of their respective properties if such discontinuance is, in the judgment of the Board of Directors of the Company or of any subsidiary, as the case may be,
      desirable in the conduct of its business.

     

    (f)          Compliance Certificate.  The Company will deliver to the Noteholders, within 120 days after the end of each
      fiscal year, an Officer’s Certificate covering the preceding fiscal year, stating whether or not, to the best of his or her knowledge, the Company is in default in the performance and observance of any of the terms, provisions and conditions of this
      Subordinated Note (without regard to notice requirements or periods of grace) and if the Company will be in default, specifying all such defaults and the nature and status thereof of which he or she may have knowledge.

     

    (g)         Compliance with Laws.  The Company shall comply with the requirements of all laws, regulations, orders and decrees applicable to it or its
      properties, except for such noncompliance that would not reasonably be expected to have a Material Adverse Effect (as such term is defined in the Purchase Agreement) on the Company and its subsidiaries taken as a whole.

     

    (h)        Taxes and Assessments.  The Company shall punctually pay and discharge all material taxes, assessments, and other governmental charges or
      levies imposed upon it or upon its income or upon any of its properties; provided, that no such taxes, assessments or other governmental charges need be paid if they are being contested in good faith by the Company.

     

    8.           Negative Covenants of the Company.

     

    (a)          Limitation on Dividends.  The Company shall not declare or pay any dividend or make any distribution on capital stock or other equity
      securities of any kind of the Company if the Company is not “well capitalized” for regulatory capital purposes immediately prior to the declaration of such dividend or distribution, except for Permitted Dividends.

     

    (b)          Merger or Sale of Assets.  The Company shall not merge into another entity, effect a Change in Bank Control (as defined below), or convey,
      transfer or lease all or substantially all of  its properties and assets to any person, unless:

     

    
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    (i)          the continuing entity into which the Company is merged or the person which acquires by conveyance or transfer or which leases all or substantially
      all of the properties and assets of the Company shall be a corporation, association or other legal entity organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and expressly assumes the
      due and punctual payment of the principal of and any premium and interest on the Subordinated Notes according to their terms, and the due and punctual performance of all covenants and conditions hereof on the part of the Company to be performed or
      observed; and

     

    (ii)         immediately after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an
      Event of Default, shall have happened and be continuing.

     

    “Change in Bank Control” means the sale, transfer, lease or conveyance by the Company, or an issuance of stock by the Bank, in either case resulting in ownership by the Company of less than 80% of the Bank.

     

    9.           Global Subordinated Notes.

     

    (a)         The Company shall use its commercially reasonable efforts to provide that the Subordinated Notes owned by Noteholders that are Qualified Institutional Buyers shall be issued in the form
      of one or more Global Subordinated Notes (each a “Global Subordinated Note”) registered in the name of The Depository Trust Company or another organization registered as a clearing agency under the Securities Exchange Act of 1934, as amended
      (the “Exchange Act”), and designated as Depositary by the Company or any successor thereto (the “Depositary”) or a nominee thereof and delivered to such Depositary or a nominee thereof.

     

    (b)         Notwithstanding any other provision herein, no Global Subordinated Note may be exchanged in whole or in part for Subordinated Notes registered, and no transfer of a Global Subordinated
      Note in whole or in part may be registered, in the name of any person other than the Depositary for such Global Subordinated Note or a nominee thereof unless (i) such Depositary advises the Company in writing that such Depositary is no longer willing
      or able to properly discharge its responsibilities as Depositary with respect to such Global Subordinated Note, and no qualified successor is appointed by the Company within 90 days of receipt by the Company of such notice, (ii) such Depositary
      ceases to be a clearing agency registered under the Exchange Act and no successor is appointed by the Company within 90 days after obtaining knowledge of such event, (iii) the Company elects to terminate the book-entry system through the Depositary
      or (iv) an Event of Default shall have occurred and be continuing.  Upon the occurrence of any event specified in clause (i), (ii), (iii) or (iv) of this Section 9(b), the Company or its agent shall notify the Depositary and instruct the
      Depositary to notify all owners of beneficial interests in such Global Subordinated Note of the occurrence of such event and of the availability of Subordinated Notes to such owners of beneficial interests requesting the same.

     

    
      A-44

      
        

    

    (c)          If any Global Subordinated Note is to be exchanged for other Subordinated Notes or canceled in part, or if another Subordinated Note is to be exchanged in whole or in part for a
      beneficial interest in any Global Subordinated Note, then either (i) such Global Subordinated Note shall be so surrendered for exchange or cancellation as provided in this Section 9 or (ii) the principal amount thereof shall be reduced or
      increased by an amount equal to the portion thereof to be so exchanged or canceled, or equal to the principal amount of such other Subordinated Note to be so exchanged for a beneficial interest therein, as the case may be, by means of an appropriate
      adjustment made on the records of the Company or, if applicable, the Company’s registrar and transfer agent (“Registrar”), whereupon the Company or, if applicable, the Registrar, in accordance with the applicable rules and procedures of the
      Depositary (“Applicable Depositary Procedures”), shall instruct the Depositary or its authorized representative to make a corresponding adjustment to its records.  Upon any such surrender or adjustment of a Global Subordinated Note by the
      Depositary, accompanied by registration instructions, the Company shall execute and deliver any Subordinated Notes issuable in exchange for such Global Subordinated Note (or any portion thereof) in accordance with the instructions of the Depositary.

     

    (d)         Every Subordinated Note executed and delivered upon registration of transfer of, or in exchange for or in lieu of, a Global Subordinated Note or any portion thereof shall be executed and
      delivered in the form of, and shall be, a Global Subordinated Note, unless such Subordinated Note is registered in the name of a person other than the Depositary for such Global Subordinated Note or a nominee thereof.

     

    (e)         The Depositary or its nominee, as the registered owner of a Global Subordinated Note, shall be the holder of such Global Subordinated Note for all purposes under this Subordinated Note,
      and owners of beneficial interests in a Global Subordinated Note shall hold such interests pursuant to Applicable Depositary Procedures.  Accordingly, any such owner’s beneficial interest in a Global Subordinated Note shall be shown only on, and the
      transfer of such interest shall be effected only through, records maintained by the Depositary or its nominee or its Depositary participants.  If applicable, the Registrar shall be entitled to deal with the Depositary for all purposes relating to a
      Global Subordinated Note (including the payment of principal and interest thereon and the giving of instructions or directions by owners of beneficial interests therein and the giving of notices) as the sole holder of the Subordinated Note and shall
      have no obligations to the owners of beneficial interests therein.  The Registrar shall have no liability in respect of any transfers effected by the Depositary.

     

    (f)          The rights of owners of beneficial interests in a Global Subordinated Note shall be exercised only through the Depositary and shall be limited to those established by law and agreements
      between such owners and the Depositary and/or its participants.

     

    (g)          No holder of any beneficial interest in any Global Subordinated Note held on its behalf by a Depositary shall have any rights with respect to such Global Subordinated Note, and such
      Depositary may be treated by the Company and any agent of the Company as the owner of such Global Subordinated Note for all purposes whatsoever.  Neither the Company nor any agent of the Company will have any responsibility or liability for any
      aspect of the records relating to or payments made on account of beneficial ownership interests of a Global Subordinated Note or maintaining, supervising or reviewing any records relating to such beneficial ownership interests.  Notwithstanding the
      foregoing, nothing herein shall prevent the Company or any agent of the Company from giving effect to any written certification, proxy or other authorization furnished by a Depositary or impair, as between a Depositary and such holders of beneficial
      interests, the operation of customary practices governing the exercise of the rights of the Depositary (or its nominee) as holder of any Subordinated Note.

     

    
      A-45

      
        

    

    (h)         The Company, within 45 calendar days after the receipt of written notice from the Noteholder or any other holder of the Subordinated Notes of the occurrence of an Event of Default with
      respect to this Subordinated Note, shall notify all the Noteholders, at their addresses shown on the Security Register (as defined in Section 14 below), such written notice of Event of Default, unless such Event of Default shall have been
      cured or waived before the giving of such notice as certified by the Company in writing.

     

    10.         Denominations.  The Subordinated Notes are issuable only in registered form without interest coupons in minimum denominations of $250,000 and
      integral multiples of $1,000 in excess thereof.

     

    11.         Charges and Transfer Taxes.  No service charge will be made for any registration of transfer or exchange of this Subordinated Note, or any
      redemption or repayment of this Subordinated Note, or any conversion or exchange of this Subordinated Note for other types of securities or property, but the Company may require payment of a sum sufficient to pay all taxes, assessments or other
      governmental charges that may be imposed in connection with the transfer or exchange of this Subordinated Note from the Noteholder requesting such transfer or exchange.

     

    12.         Payment Procedures.  Payment of the principal and interest payable on the Stated Maturity will be made by check, by wire transfer or by
      Automated Clearing House (ACH) transfer in immediately available funds to a bank account in the United States designated by the Noteholder if such Noteholder shall have previously provided wire instructions to the Company, upon presentation and
      surrender of this Subordinated Note at the Payment Office (as defined in Section 22 below) or at such other place or places as the Company shall designate by notice to the Noteholders as the Payment Office, provided that this Subordinated
      Note is presented to the Company in time for the Company to make such payments in such funds in accordance with its normal procedures.  Payments of interest (other than interest payable on the Stated Maturity) shall be made by wire transfer in
      immediately available funds or check mailed to the registered Noteholder, as such person’s address appears on the Security Register (as defined below).  Interest payable on any Interest Payment Date shall be payable to the Noteholder in whose name
      this Subordinated Note is registered at the close of business on the fifteenth calendar day prior to the applicable Interest Payment Date, without regard to whether such date is a Business Day, except that interest not paid on the Interest Payment
      Date, if any, will be paid to the Noteholder in whose name this Subordinated Note is registered at the close of business on a special record date fixed by the Company (a “Special Record Date”), notice of which shall be given to the Noteholder
      not less than 10 calendar days prior to such Special Record Date.  To the extent permitted by applicable law, interest shall accrue, at the rate at which interest accrues on the principal of this Subordinated Note, on any amount of principal or
      interest on this Subordinated Note not paid when due.  All payments on this Subordinated Note shall be applied first against interest due hereunder; and then against principal due hereunder.  The Noteholder acknowledges and agrees that the payment of
      all or any portion of the outstanding principal amount of this Subordinated Note and all interest hereon shall be pari passu in right of payment and in all other respects to the other Subordinated Notes.  In
      the event that the Noteholder receives payments in excess of its pro rata share of the Company’s payments to the Noteholders of all of the Subordinated Notes, then the Noteholder shall hold in trust all such excess payments for the benefit of the
      holders of the other Subordinated Notes and shall pay such amounts held in trust to such other Noteholders upon demand by such Noteholders.

     

    
      A-46

      
        

    

    13.         Form of Payment.  Payments of principal and interest on this Subordinated Note shall be made in such coin or currency of the United States of
      America as at the time of payment shall be legal tender for the payment of public and private debts.

     

    14.        Registration of Transfer, Security Register.  Except as otherwise provided herein, this Subordinated Note is transferable in whole or in part,
      and may be exchanged for a like aggregate principal amount of Subordinated Notes of other authorized denominations, by the Noteholder in person, or by its attorney duly authorized in writing, at the Payment Office or the office of the Registrar.  The
      Company or its agent (the “Registrar”) shall maintain a register providing for the registration of the Subordinated Notes and any exchange or transfer thereof (the “Security Register”).  Upon surrender or presentation of this
      Subordinated Note for exchange or registration of transfer, the Company or the Registrar shall execute and deliver in exchange therefor a Subordinated Note or Subordinated Notes of like aggregate principal amount, each in a minimum denomination of
      $250,000 or any amount in excess thereof which is an integral multiple of $1,000 (and, in the absence of an opinion of counsel satisfactory to the Company to the contrary, bearing the restrictive legend(s) set forth hereinabove) and that is or are
      registered in such name or names requested by the Noteholder.  Any Subordinated Note presented or surrendered for registration of transfer or for exchange shall be duly endorsed and accompanied by a written instrument of transfer in such form as is
      attached hereto and incorporated herein, duly executed by the Noteholder or its attorney duly authorized in writing, with such tax identification number or other information for each person in whose name a Subordinated Note is to be issued, and
      accompanied by evidence of compliance with any restrictive legend(s) appearing on such Subordinated Note or Subordinated Notes as the Company may reasonably request to comply with applicable law.  No exchange or registration of transfer of this
      Subordinated Note shall be made on or after (i) the fifteenth (15th) day immediately preceding the Stated Maturity or (ii) the due delivery of notice of redemption.

     

    15.        Priority.  The Subordinated Notes rank pari passu among themselves and pari passu, in the event of any insolvency proceeding, dissolution, assignment for the benefit of creditors, reorganization, restructuring of debt, marshaling of assets and liabilities or similar proceeding or any liquidation or
      winding up of the Company with all other present or future unsecured subordinated debt obligations of the Company, except any unsecured subordinated debt that, pursuant to its express terms, is senior or subordinate in right of payment to the
      Subordinated Notes and all Senior Indebtedness.

     

    16.         Ownership.  Prior to due presentment of this Subordinated Note for registration of transfer, the Company may treat the Noteholder in whose
      name this Subordinated Note is registered in the Security Register as the absolute owner of this Subordinated Note for receiving payments of principal and interest on this Subordinated Note and for all other purposes whatsoever, whether or not this
      Subordinated Note be overdue, and the Company shall not be affected by any notice to the contrary.

     

    17.         Waiver and Consent.

     

    
      A-47

      
        

    

    (a)         Any consent or waiver given by the holder of this Subordinated Note shall be conclusive and binding upon such Noteholder and upon all future holders
      of this Subordinated Note and of any Subordinated Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Subordinated Note.  This
      Subordinated Note may also be amended or waived pursuant to, and in accordance with, the provisions of Section 7.3 of the Purchase Agreement.  No delay or omission of the holder of this Subordinated Note to exercise any right or remedy accruing upon
      any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Any insured depository institution which shall be a holder of this Subordinated Note or which otherwise shall have
      any beneficial ownership interest in this Subordinated Note shall, by its acceptance of such Subordinated Note (or beneficial interest therein), be deemed to have waived any right of offset with respect to the repayment of the indebtedness evidenced
      thereby.

     

    (b)         No waiver or amendment of any term, provision, condition, covenant or agreement in the Subordinated Notes shall be effective except with the consent
      of the Noteholders holding at least fifty percent (50%) in aggregate principal amount (excluding any Subordinated Notes held by the Company or any of its Affiliates) of the Subordinated Notes at the time outstanding; provided, however, that without the consent of each Noteholder of an affected Subordinated Note, no such amendment or waiver may:  (i) reduce the principal amount of any Subordinated Note;
      (ii) reduce the rate of or change the time for payment of interest on any Subordinated Note; (iii) extend the maturity of any Subordinated Note; (iv) change the currency in which payment of the obligations of the Company under the Subordinated Notes
      are to be made; (v) lower the percentage of aggregate principal amount of outstanding Subordinated Notes required to approve any amendment of the Subordinated Notes; (vi) make any changes to Section 6 (Failure to Make Payments) of the
      Subordinated Notes that adversely affects the rights of any Noteholder; or (vii) disproportionately affect any of the Noteholders of the then outstanding Subordinated Notes.  Notwithstanding the foregoing, the Company may amend or supplement the
      Subordinated Notes without the consent of the Noteholders to cure any ambiguity, defect or inconsistency or to provide for uncertificated Subordinated Notes in addition to or in place of certificated Subordinated Notes, or to make any change that
      does not adversely affect the rights of any Noteholder of any of the Subordinated Notes.  No failure to exercise or delay in exercising, by any Noteholder of the Subordinated Notes, of any right, power or privilege hereunder shall operate as a waiver
      thereof, nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof, or the exercise of any other right or remedy provided by law, except as restricted hereby.  The rights and remedies
      provided in this Subordinated Note are cumulative and not exclusive of any right or remedy provided by law or equity.  No notice or demand on the Company in any case shall, in itself, entitle the Company to any other or further notice or demand in
      similar or other circumstances or constitute a waiver of the rights of the Noteholders to any other or further action in any circumstances without notice or demand.  No consent or waiver, expressed or implied, by the Noteholders to or of any breach
      or default by the Company in the performance of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of the same or any other obligations of the Company hereunder. 
      Failure on the part of the Noteholders to complain of any acts or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Noteholders of their rights hereunder or impair
      any rights, powers or remedies on account of any breach or default by the Company.

     

    
      A-48

      
        

    

    18.         Absolute and Unconditional Obligation of the Company.  No provisions of this Subordinated Note shall alter or impair the obligation of the
      Company, which is absolute and unconditional, to pay the principal and interest on this Subordinated Note at the times, places and rate, and in the coin or currency, herein prescribed.

     

    19.         Successors and Assigns.  This Subordinated Note shall be binding upon the Company and inure to the benefit of the Noteholder and its
      respective successors and permitted assigns.  The Noteholder may assign all, or any part of, or any interest in, the Noteholder’s rights and benefits hereunder.  To the extent of any such assignment, such assignee shall have the same rights and
      benefits against the Company and shall agree to be bound by and to comply with the terms and conditions of the Purchase Agreement as it would have had if it were the Noteholder hereunder.

     

    20.          No Sinking Fund; Convertibility.  This Subordinated Note is not entitled to the benefit of any sinking fund.  This Subordinated Note is not
      convertible into or exchangeable for any of the equity securities, other securities or assets of the Company or any subsidiary.

     

    21.         No Recourse Against Others.  No recourse under or upon any obligation, covenant or agreement contained in this Subordinated Note, or for any
      claim based thereon or otherwise in respect thereof, will be had against any past, present or future shareholder, employee, officer, or director, as such, of the Company or of any predecessor or successor, either directly or through the Company or
      any predecessor or successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the
      acceptance of this Subordinated Note by the holder of this Subordinated Note and as part of the consideration for the issuance of this Subordinated Note.

     

    22.        Notices.  All notices to the Company under this Subordinated Note shall be in writing and addressed to the Company at 4200 E. Beltline Avenue
      NE, Grand Rapids, Michigan 49525, Attention: Steve Erickson, Chief Financial Officer, or to such other address as the Company may provide to the Noteholders (the “Payment Office”).  All notices to the Noteholders shall be deemed to have been
      given if in writing and if delivered personally, or if mailed, postage prepaid, by United States registered or certified mail, return receipt requested, or if delivered by a responsible overnight commercial courier promising next business day
      delivery. Any notice given in accordance with the foregoing shall be deemed given when delivered personally or, if mailed, three (3) Business Days after it shall have been deposited in the United States mails as
      aforesaid or, if sent by overnight courier, the Business Day following the date of delivery to such courier (provided next business day delivery was requested).

     

    23.        Further Issues.  The Company may, without the consent of the Noteholders, create and issue additional notes having the same terms and
      conditions of the Subordinated Notes (except for the Issue Date) so that such further notes shall be consolidated and form a single series with the Subordinated Notes.

     

    24.         Governing Law; Interpretation.  THIS SUBORDINATED NOTE WILL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND WILL BE GOVERNED BY, AND
      CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF.  THIS SUBORDINATED NOTE IS INTENDED TO MEET THE CRITERIA FOR QUALIFICATION OF THE OUTSTANDING PRINCIPAL AS TIER 2 CAPITAL UNDER THE
      REGULATORY GUIDELINES OF THE FEDERAL RESERVE, AND THE TERMS HEREOF SHALL BE INTERPRETED IN A MANNER TO SATISFY SUCH INTENT.

     

    
      A-49

      
        

    

    IN WITNESS WHEREOF, the undersigned has caused this Subordinated Note to be duly executed and attested.

     

    	 	
            INDEPENDENT BANK CORPORATION

          
	 	 
	 	
            By:

          	 
	 	 	
            Name:

          	
            William B. Kessel

          
	 	 	
            Title:

          	
            President & CEO

          

    

    

    	
            ATTEST:

          	 
	 	 
	 	 
	
            Name: Stephen A. Erickson

          	 
	
            Title:  Executive VP & CFO

          	 

    

    

    
      A-50

      
        

    

    ASSIGNMENT FORM

     

    To assign this Subordinated Note, fill in the form below: (I) or (we) assign and transfer this Subordinated Note to:

     

    
      
 

    (Print or type assignee’s name, address and zip code)

    

    

    
      

    (Insert assignee’s social security or tax I.D. No.)

    

    

    and irrevocably appoint _______________________ agent to transfer this Subordinated Note on the books of the Company. The agent may substitute another to act for him.

    

    

    

    

    
      	Date:	
               

            	
               

            	Your signature:	
               

            

      	
               

            	
               

            	
               

            	
              
                (Sign exactly as your name appears on the face of this Subordinated Note)

              

            
	
               

            	
               

            	
               

            	
               

            
	
               

            	
               

            	
               

            	Tax Identification No:	
               

            

    

    

    

    Signature Guarantee:_________________________________________________________________________________________ (Signatures must be guaranteed by an eligible guarantor institution (banks,
      stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)).

    

    

    The undersigned certifies that it [is / is not] an Affiliate of the Company and that, to its knowledge, the proposed transferee [is / is not] an Affiliate of the Company.

     

    In connection with any transfer or exchange of this Subordinated Note occurring prior to the date that is one year after the later of the date of original issuance of this Subordinated Note and the
      last date, if any, on which this Subordinated Note was owned by the Company or any Affiliate of the Company, the undersigned confirms that this Subordinated Note is being:

     

    CHECK ONE BOX BELOW:

     

    
      	☐	
              (1)

            	
              acquired for the undersigned’s own account, without transfer;

            
	 	 	

            
	☐	
              (2)

            	
              transferred to the Company;

            
	 	 	

            
	
              ☐

            	
              (3)

            	
              transferred in accordance and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”);

            
	 	 	

            
	☐	
              (4)

            	
              transferred under an effective registration statement under the Securities Act;

            

      

      

      
        A-51

        
          

      

      	☐	
              (5)

            	
              transferred in accordance with and in compliance with Regulation S under the Securities Act;

            
	 	 	

            
	☐	
              (6)

            	
              transferred to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act);

            
	 	 	

            
	☐	
              (7)

            	
              transferred to an “accredited investor” (as defined in Rule 501(a)(4) under the Securities Act), not referred to in item (6) that has been provided with the information designated under Section 4(d) of the
                Securities Act of 1933; or

            
	 	 	

            
	☐	
              (7)

            	
              transferred in accordance with another available exemption from the registration requirements of the Securities Act.

            

    

     

    

    Unless one of the boxes is checked, the Company will refuse to register this Subordinated Note in the name of any person other than the registered holder thereof; provided, however, that if box (5), (6), (7) or (8) is
      checked, the Company may require, prior to registering any such transfer of this Subordinated Note, in its sole discretion, such legal opinions, certifications and other information as the Company may reasonably request to confirm that such transfer
      is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act such as the exemption provided by Rule 144 under such Act.

     

    
      	
               

            	
              Signature:

              

            	
               

            

    

     

    

    Signature Guarantee:______________________________________________________________________(Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan
      associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17Ad-l5).

     

    TO BE COMPLETED BY PURCHASER IF BOX (1) OR (3) ABOVE IS CHECKED.

    

    

    The undersigned represents and warrants that it is purchasing this Subordinated Note for its own account or an account with respect to which it exercises sole investment discretion and that it and
      any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding
      the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the exemption
      from registration provided by Rule 144A.

     

    
      	
              Date: 

              

            	
               

            	
               

            	Signature: 	
               

            

    

    

    

    
      A-52

      
        

    

    
    EXHIBIT B

     

    OPINION OF COUNSEL

     

    1.          Each of the Company and the Bank (i) is validly existing and is in good standing under the laws of its jurisdiction of organization, (ii) has all requisite corporate or similar power and
      authority to carry on its business as currently conducted and (iii) is duly qualified or licensed to do business and is in good standing as a foreign corporation, partnership or other entity as the case may be, in each jurisdiction in which such
      qualification or licensing is required, whether by reason of the ownership or leasing of  property or the conduct of business, except where the failure to be so qualified or in good standing would not, individually or in the aggregate, reasonably be
      expected to have a Material Adverse Effect.

     

    2.           The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under the Transaction Documents to which it is a party and to consummate the
      transactions contemplated by the Transaction Documents.

     

    3.           The Company is a registered bank holding company under the Bank Holding Company Act of 1956, as amended.

     

    4.           The Bank is a Michigan banking corporation validly existing under the laws of Michigan and is in good standing under such laws and holds the requisite authority from the Michigan
      Department of Insurance and Financial Services to do business as a Michigan banking corporation.

     

    5.           The Agreement has been duly and validly authorized, executed and delivered by the Company.  The Agreement constitutes a legal valid and binding obligation of Company, enforceable against
      Company in accordance with its terms, except that the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in
      effect relating to creditors’ rights generally and (ii) general principles of equity (whether applied by a court of law or equity) and the discretion of the court before which any proceeding therefor may be brought.

     

    6.          The execution and delivery by the Company of, and the performance by the Company on the date hereof of its agreements and obligations under, the Transaction Documents do not (i) to such
      counsel’s knowledge, violate any applicable provisions of the Michigan Business Corporation Act, (ii) to such counsel’s knowledge, violate any court order or judgment of any agency or court of the State of Michigan having jurisdiction over the
      Company and known to such counsel or (iii) violate the Charter or Bylaws, each as currently in effect.

     

    
      B-1

      
        

    

    7.          The Subordinated Notes have been duly and validly authorized by the Company and when duly executed, authenticated,  issued and delivered to and paid for by the Purchasers in accordance
      with the terms of this Agreement, will constitute valid and legally binding obligations of the Company, and enforceable against the Company in accordance with their terms, except that the enforcement thereof may be subject to (i) bankruptcy,
      insolvency, reorganization, receivership, moratorium, fraudulent conveyance, fraudulent transfer or other similar laws now or hereafter in effect relating to creditors’ rights generally and (ii) general principles of equity (whether applied by a
      court of law or equity) and the discretion of the court before which any proceeding therefor may be brought.

     

    8.           Assuming the accuracy of the representations and warranties of each of the Purchasers and the Company set forth in the Agreement, the offer and sale of the Subordinated Notes in
      accordance with the Agreement will be issued in a transaction exempt from the registration requirements of the Securities Act.

     

    
      B-2

      
        

    

    SCHEDULE A

     

    DIRECT AND INDIRECT SUBSIDIARIES

     

    	1.	
            Independent Bank

          

    	2.	
            IB Wealth Management, Inc.

          

    	3.	
            IB Insurance Services, Inc.

          

    	4.	
            Independent Title Services, Inc.

          

    	5.	
            IBC Capital Finance III

          

    	6.	
            IBC Capital Finance IV

          

    	7.	
            Midwest Guaranty Trust I

          

    	8.	
            TCSB Statutory Trust I

          

    	9.	
            Independent Life Insurance Trust

          

    	10.	
            Land Holdings, LLC

          

    	11.	
            Jarco investments, LLC

          

     

    
      
        

    

    APPENDIX A

     

    Required Waiver Disclosure

     

    Stifel, Nicolaus & Company, Incorporated (“Stifel”) is a broker dealer affiliate of KBW. On December 6, 2016, a final judgment (the “Judgment”) was entered against Stifel by the United States District
      Court for the Eastern District of Wisconsin (Civil Action No. 2:11-cv-00755) resolving a civil lawsuit filed by the U.S. Securities & Exchange Commission (the “SEC”) in 2011 involving violations of several antifraud provisions of the
      federal securities laws in connection with the sale of synthetic collateralized debt obligations to five Wisconsin school districts in 2006.  As a result of the Judgment: (i) Stifel is required to cease and desist from committing or causing any
      violations and any future violations of Section 17(a)(2) and 17(a)(3) of the Securities Act; and (ii) Stifel and a former employee were jointly liable to pay disgorgement and prejudgment interest of $2.5 million. Stifel was also required to pay a
      civil penalty of $22.0 million, of which disgorgement and civil penalty Stifel was required to pay $12.5 million to the school districts involved in this matter.

    

    

    Simultaneously with the entry of the Judgment, the SEC issued an Order granting Stifel a waiver from, among other things, the application of the disqualification provisions of Rule 506(d)(1)(ii) of Regulation D under
      the Securities Act.

    

    

    A copy of the Judgment is available on the SEC’s website at:

    https://www.sec.gov/litigation/litreleases/2016/lr23700-final-judgment.pdf.Exhibit 4.1

 

HONDA AUTO RECEIVABLES 2020-2 OWNER TRUST,

as Issuer,

and

CITIBANK, N.A.,

as Indenture Trustee

 

 

 

 

INDENTURE

Dated May 27, 2020

 

 

 

 

     

     

    

 

CROSS REFERENCE TABLE*

 

	TIA Section	Indenture Section
	 	 
	310	(a)(1)	6.11
	 	(a)(2)	6.11
	 	(a)(3)	6.10; 6.11
	 	(a)(4)	N.A.**
	 	(a)(5)	6.11
	 	(b)	6.08; 6.11
	 	(c)	N.A.**
	311	 (a)	6.12
	 	(b)	6.12
	 	(c)	N.A.
	312	(a)	7.01
	 	(b)	7.02
	 	(c)	7.02
	313	 (a)	7.04
	 	(b)(1)	7.04
	 	(b)(2)	7.04
	 	(c)	7.04; 11.05
	 	(d)	7.04
	314	 (a)	7.03
	 	(b)	11.15
	 	(c)(1)	11.01
	 	(c)(2)	11.01
	 	(c)(3)	11.01
	 	(d)	11.01
	 	(e)	11.01
	 	(f)	11.01
	315	 (a)	6.01
	 	(b)	6.05; 11.01
	 	(c)	6.01
	 	(d)	6.01
	 	(e)	5.13
	316	(a)	1.01
	 	(a)(1)(A)	5.11
	 	(a)(1)(B)	5.12
	 	(a)(2)	N.A.
	 	(b)	5.07
	 	(c)	N.A.
	317	 (a)(1)	5.03
	 	(a)(2)	5.03
	 	(b)	3.03
	318	 (a)	11.07

 

 

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

**
        N.A. means Not Applicable.

 

    i

     

    

 

TABLE OF CONTENTS

 

Page

 

	 	 	 	 
	ARTICLE I	DEFINITIONS AND INCORPORATION BY REFERENCE	2
	 	 	 	 
	Section
    1.01.	 	Definitions	2
	 	 	 	 
	Section
    1.02.	 	Incorporation by Reference
    of Trust Indenture Act	2
	 	 	 	 
	ARTICLE II	THE NOTES	2
	 	 	 	 
	Section
    2.01.	 	Form	2
	 	 	 	 
	Section
    2.02.	 	Execution, Authentication
    and Delivery	3
	 	 	 	 
	Section
    2.03.	 	Temporary Notes	3
	 	 	 	 
	Section
    2.04.	 	Note Register, Registration
    of Transfer and Exchange	3
	 	 	 	 
	Section
    2.05.	 	Mutilated, Destroyed,
    Lost or Stolen Notes	7
	 	 	 	 
	Section
    2.06.	 	Persons Deemed Owner	8
	 	 	 	 
	Section
    2.07.	 	Payment of Principal
    and Interest, Defaulted Interest	8
	 	 	 	 
	Section
    2.08.	 	Cancellation	9
	 	 	 	 
	Section
    2.09.	 	Book-Entry Notes	9
	 	 	 	 
	Section
    2.10.	 	Notices to Clearing Agency	10
	 	 	 	 
	Section
    2.11.	 	Definitive Notes	10
	 	 	 	 
	Section
    2.12.	 	Release of Collateral	11
	 	 	 	 
	Section
    2.13.	 	Tax Treatment; Tax Information	11
	 	 	 	 
	Section
    2.14.	 	Employee Benefit Plans	12
	 	 	 	 
	ARTICLE III	COVENANTS	12
	 	 	 	 
	Section
    3.01.	 	Payment of Principal
    and Interest	12
	 	 	 	 
	Section
    3.02.	 	Maintenance of Office
    or Agency	12
	 	 	 	 
	Section
    3.03.	 	Money for Payments to
    be Held in Trust	12
	 	 	 	 
	Section
    3.04.	 	Existence	14
	 	 	 	 
	Section
    3.05.	 	Protection of Owner Trust
    Estate	14
	 	 	 	 
	Section
    3.06.	 	Opinions as to Owner
    Trust Estate	15
	 	 	 	 
	Section
    3.07.	 	Performance of Obligations;
    Servicing of Receivables	15
	 	 	 	 
	Section
    3.08.	 	Negative Covenants	17
	 	 	 	 
	Section
    3.09.	 	Annual Statement as to
    Compliance	18
	 	 	 	 
	Section
    3.10.	 	Issuer May Consolidate,
    etc., Only on Certain Terms	18
	 	 	 	 
	Section
    3.11.	 	Successor or Transferee	20
	 	 	 	 
	Section
    3.12.	 	No Other Business	20
	 	 	 	 
	Section
    3.13.	 	No Borrowing	20
	 	 	 	 

 

    	 	-i-	 

     

    

 

	Section
    3.14.	 	Servicer’s
    Obligations	20
	 	 	 	 
	Section
    3.15.	 	Guarantees, Loans, Advances
    and Other Liabilities	20
	 	 	 	 
	Section
    3.16.	 	Capital Expenditures	20
	 	 	 	 
	Section
    3.17.	 	Removal of Administrator	20
	 	 	 	 
	Section
    3.18.	 	Restricted Payments	20
	 	 	 	 
	Section
    3.19.	 	Notice of Events of Default	21
	 	 	 	 
	Section
    3.20.	 	Further Instruments and
    Acts	21
	 	 	 	 
	Section
    3.21.	 	Compliance with Laws	21
	 	 	 	 
	ARTICLE IV	SATISFACTION
                                         AND DISCHARGE	21
	 	 	 	 
	Section
    4.01.	 	Satisfaction and Discharge
    of Indenture	21
	 	 	 	 
	Section
    4.02.	 	Application of Trust
    Money	22
	 	 	 	 
	Section
    4.03.	 	Repayment of Monies Held
    by Paying Agent	23
	 	 	 	 
	ARTICLE V	REMEDIES	23
	 	 	 	 
	Section
    5.01.	 	Events of Default	23
	 	 	 	 
	Section
    5.02.	 	Acceleration of Maturity,
    Rescission and Annulment	24
	 	 	 	 
	Section
    5.03.	 	Collection of Indebtedness
    and Suits for Enforcement by Indenture Trustee	25
	 	 	 	 
	Section
    5.04.	 	Remedies, Priorities	27
	 	 	 	 
	Section
    5.05.	 	Optional Preservation
    of the Receivables	29
	 	 	 	 
	Section
    5.06.	 	Limitation of Suits	29
	 	 	 	 
	Section
    5.07.	 	Unconditional Rights
    of Noteholders to Receive Principal and Interest	30
	 	 	 	 
	Section
    5.08.	 	Restoration of Rights
    and Remedies	30
	 	 	 	 
	Section
    5.09.	 	Rights and Remedies Cumulative	30
	 	 	 	 
	Section
    5.10.	 	Delay or Omission Not
    a Waiver	30
	 	 	 	 
	Section
    5.11.	 	Control by Noteholders	30
	 	 	 	 
	Section
    5.12.	 	Waiver of Past Defaults	31
	 	 	 	 
	Section
    5.13.	 	Undertaking for Costs	31
	 	 	 	 
	Section
    5.14.	 	Waiver of Stay or Extension
    Laws	31
	 	 	 	 
	Section
    5.15.	 	Action on Notes	32
	 	 	 	 
	Section
    5.16.	 	Performance and Enforcement
    of Certain Obligations	32
	 	 	 	 
	ARTICLE VI	THE
                                         INDENTURE TRUSTEE	32
	 	 	 	 
	Section
    6.01.	 	Duties of Indenture Trustee	32
	 	 	 	 
	Section
    6.02.	 	Rights of Indenture Trustee	34
	 	 	 	 
	Section
    6.03.	 	Individual Rights of
    Indenture Trustee	36

 

    	 	-ii-	 

     

    

 

	Section
    6.04.	 	Indenture
    Trustee’s Disclaimer	36
	 	 	 	 
	Section
    6.05.	 	Notice of Defaults	36
	 	 	 	 
	Section
    6.06.	 	Reports by Indenture
    Trustee to Noteholders	36
	 	 	 	 
	Section
    6.07.	 	Compensation and Indemnity	36
	 	 	 	 
	Section
    6.08.	 	Replacement of Indenture
    Trustee	37
	 	 	 	 
	Section
    6.09.	 	Successor Indenture Trustee
    by Merger	39
	 	 	 	 
	Section
    6.10.	 	Appointment of Co-Trustee
    or Separate Trustee	39
	 	 	 	 
	Section
    6.11.	 	Eligibility, Disqualification	40
	 	 	 	 
	Section
    6.12.	 	Preferential Collection
    of Claims Against Issuer	41
	 	 	 	 
	Section
    6.13.	 	Representations and Warranties
    of Indenture Trustee	41
	 	 	 	 
	ARTICLE VII	NOTEHOLDERS’ LISTS AND REPORTS	42
	 	 	 	 
	Section
    7.01.	 	Issuer to Furnish Indenture
    Trustee Names and Addresses of Noteholders	42
	 	 	 	 
	Section
    7.02.	 	Preservation of Information;
    Communications, Reports and Certain Documents to Noteholders	42
	 	 	 	 
	Section
    7.03.	 	Reports by Issuer	43
	 	 	 	 
	Section
    7.04.	 	Reports by Indenture
    Trustee	44
	 	 	 	 
	Section
    7.05.	 	Noteholder and Note Owner
    Demand for Asset Representations Review	44
	 	 	 	 
	Section
    7.06.	 	Voting of Notes Held
    by Honda Parties	45
	 	 	 	 
	ARTICLE VIII	ACCOUNTS, DISBURSEMENTS AND RELEASES	45
	 	 	 	 
	Section
    8.01.	 	Collection of Money	45
	 	 	 	 
	Section
    8.02.	 	Accounts	45
	 	 	 	 
	Section
    8.03.	 	General Provisions Regarding
    Accounts	48
	 	 	 	 
	Section
    8.04.	 	Release of Owner Trust
    Estate	49
	 	 	 	 
	Section
    8.05.	 	Opinion of Counsel	49
	 	 	 	 
	ARTICLE IX	SUPPLEMENTAL INDENTURES	50
	 	 	 	 
	Section
    9.01.	 	Supplemental Indentures
    Without Consent of Noteholders	50
	 	 	 	 
	Section
    9.02.	 	Supplemental Indentures
    With Consent of Noteholders	51
	 	 	 	 
	Section
    9.03.	 	Execution of Supplemental
    Indentures	52
	 	 	 	 
	Section
    9.04.	 	Effect of Supplemental
    Indenture	52
	 	 	 	 
	Section
    9.05.	 	Conformity with Trust
    Indenture Act	53
	 	 	 	 
	Section
    9.06.	 	Reference in Notes to
    Supplemental Indentures	53
	 	 	 	 
	ARTICLE X	REDEMPTION OF NOTES	53
	 	 	 	 
	Section
    10.01.	 	Redemption	53
	 	 	 	 
	Section
    10.02.	 	Form of Redemption Notice	53
	 	 	 	 
	Section
    10.03.	 	Notes Payable on Redemption
    Date	54

 

    	 	-iii-	 

     

    

 

	ARTICLE XI	MISCELLANEOUS	54
	 	 	 	 
	Section
    11.01.	 	Compliance Certificates
    and Opinions, etc	54
	 	 	 	 
	Section
    11.02.	 	Form of Documents Delivered
    to Indenture Trustee	56
	 	 	 	 
	Section
    11.03.	 	Acts of Noteholders	57
	 	 	 	 
	Section
    11.04.	 	Notices, etc., to Indenture
    Trustee, Issuer and Rating Agencies	57
	 	 	 	 
	Section
    11.05.	 	Notices to Noteholders;
    Waiver	58
	 	 	 	 
	Section
    11.06.	 	Alternate Payment and
    Notice Provisions	58
	 	 	 	 
	Section
    11.07.	 	Conflict with Trust Indenture
    Act	59
	 	 	 	 
	Section
    11.08.	 	Effect of Headings and
    Table of Contents	59
	 	 	 	 
	Section
    11.09.	 	Successors and Assigns	59
	 	 	 	 
	Section
    11.10.	 	Separability	59
	 	 	 	 
	Section
    11.11.	 	Benefits of Indenture	59
	 	 	 	 
	Section
    11.12.	 	Legal Holidays	59
	 	 	 	 
	Section
    11.13.	 	Governing Law; Submission
    to Jurisdiction; Waiver of Jury Trial	59
	 	 	 	 
	Section
    11.14.	 	Counterparts; Electronic
    Transmission	60
	 	 	 	 
	Section
    11.15.	 	Recording of Indenture	61
	 	 	 	 
	Section
    11.16.	 	Trust Obligation	61
	 	 	 	 
	Section
    11.17.	 	No Petition	61
	 	 	 	 
	Section
    11.18.	 	Inspection	61
	 	 	 	 
	Section
    11.19.	 	[Reserved]	62
	 	 	 	 
	Section
    11.20.	 	Disclosure of Tax Treatment	62
	 	 	 	 
	Section
    11.21.	 	Intent of the Parties;
    Reasonableness	62
	 	 	 	 
	Section
    11.22.	 	Owner Trustee	63
	 	 	 	 
	Section
    11.23.	 	U.S.A. Patriot Act	63
	 	 	 	 
	Section
    11.24.	 	Communications with Rating
    Agencies	63

 

    	 	-iv-	 

     

    

 

 

SCHEDULES

 

	Schedule
    A – Schedule of Receivables	S-A-1
	 	 
	EXHIBITS	 
	 	 
	Exhibit A – Form
    of Class A-1, A-2, A-3 and A-4 Notes	A-1
	Exhibit B – Form
    of Transferor Certificate for Retained Notes	B-1
	Exhibit C – Form
    of Investment Letter for Retained Notes	C-1
	Exhibit D – Servicing
    Criteria to be Addressed in Assessment of Compliance	D-1
	Exhibit E – Form
    of Monthly 15GA-1 Report	E-1

 

    	 	-v-	 

     

    

 

This Indenture, dated May 27, 2020, is between
Honda Auto Receivables 2020-2 Owner Trust, a Delaware statutory trust (the “Issuer”), Citibank, N.A., as indenture
trustee (the “Indenture Trustee” and “Citibank”).

 

Each party agrees as follows for the benefit
of the other party and for the equal and ratable benefit of the holders of the Issuer’s Class A-1 0.27234% Asset Backed Notes,
Class A-2 0.74% Asset Backed Notes, Class A-3 0.82%
Asset Backed Notes, Class A-4 1.09% Asset Backed Notes.

 

GRANTING CLAUSE

 

The Issuer hereby Grants to the Indenture
Trustee at the Closing Date, on behalf of and for the benefit of the Noteholders, without recourse, all of the Issuer’s right,
title and interest in, to and under (i) the Receivables and all monies due thereon and payments received thereon on and after May
1, 2020; (ii) the security interests in the Financed Vehicles; (iii) any proceeds of any physical damage insurance policies covering
the Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables
or the Obligors; (iv) any proceeds of Dealer Recourse; (v) the right to realize upon any property (including the right to receive
future Liquidation Proceeds) that shall have secured a Receivable and have been repossessed by or on behalf of the Issuer; (vi)
all funds, and all investment property, from time to time carried in or credited to the Accounts, including the Reserve Fund Initial
Deposit and the Yield Supplement Account Deposit and in all investment income and proceeds thereof; (vii) the rights of the Seller
under the Receivables Purchase Agreement including, but not limited to, the representations and warranties set forth in Sections
2.02 and 2.03 therein and the rights of the Issuer under the Sale and Servicing Agreement; and (viii) all proceeds of every kind
and nature whatsoever in respect of any or all of the foregoing, including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts, accounts receivable, notes, drafts, acceptances,
chattel paper, checks, deposit accounts, insurance proceeds, condemnation awards, rights to payment of any and every kind and other
forms of obligations and receivables, instruments and other property which at any time constitute all or part of or are included
in the proceeds of any of the foregoing as each such term is defined in Section 1.01 (collectively, the “Collateral”).

 

The foregoing Grant is made in trust to
secure (i) the payment of principal of and interest on, and any other amounts owing in respect of, the Notes, equally and ratably
without prejudice, priority or distinction, except as expressly provided in this Indenture and the Sale and Servicing Agreement
and (ii) to secure compliance with the provisions of this Indenture, all as provided in this Indenture.

 

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

 

     

     

    

 

ARTICLE
I

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01. Definitions. Except
as otherwise specified herein or as the context may otherwise require, defined terms used in this Indenture shall have the meanings
ascribed thereto in the Sale and Servicing Agreement.

 

Section 1.02. Incorporation by Reference
of Trust Indenture Act. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference
in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings:

 

“Commission” means the
Securities and Exchange Commission.

 

“indenture securities”
means the Notes.

 

“indenture security holder”
means a Noteholder.

 

“indenture to be qualified”
means this Indenture.

 

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

 

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

 

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

 

ARTICLE
II

THE NOTES

 

Section 2.01. Form. The Class A-1
Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, in each case together with the Indenture Trustee’s
certificate of authentication, shall be in substantially the form set forth in Exhibit A with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers
or other marks of identification and such legends or endorsements placed thereon as may, consistently herewith, be determined by
the officers executing such Notes, as evidenced by their execution of the Notes. Any portion of the text of any Note may be set
forth on the reverse thereof, with an appropriate reference thereto on the face of the Note.

 

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

 

    	 	2	 

     

    

 

Each Note shall be dated the date of its
authentication. The terms of the Notes are the terms of this Indenture.

 

Section 2.02. Execution, Authentication
and Delivery. The Notes shall be executed on behalf of the Issuer by any of its Authorized Officers. The signature of any such
Authorized Officer on the Notes may be manual, facsimile or scanned. Notes bearing the manual, facsimile or scanned signature of
individuals who were at any time Authorized Officers of the Issuer shall bind the Issuer, notwithstanding that such individuals
or any of them have ceased to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices
at the date of such Notes.

 

The Indenture Trustee shall, upon Issuer Order, authenticate
and deliver for original issue the following aggregate principal amount of Notes: (i) $253,000,000 of Class A-1 Notes, (ii) $476,000,000
of Class A-2 Notes, (iii) $476,000,000 of Class A-3 Notes and (iv) $110,790,000 of Class A-4 Notes. The aggregate principal amount
of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4 Notes outstanding at any time may not exceed such respective
amounts except as provided in Section 2.05.

 

Each Note shall be dated the date of its
authentication. The Notes shall be issuable as registered Notes in minimum denominations of $1,000 and in integral multiples of
$1,000 in excess thereof.

 

No Note shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication
substantially in the form provided for herein executed by the Indenture Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.

 

Section 2.03. Temporary Notes. Pending
the preparation of Definitive Notes pursuant to Section 2.11, the Issuer may execute, and upon receipt of an Issuer Order the Indenture
Trustee shall authenticate and deliver, temporary Notes that are printed, lithographed, typewritten, mimeographed or otherwise
produced, of the tenor of the Definitive Notes in lieu of which they are issued and with such variations not inconsistent with
the terms of this Indenture as the officers executing such Notes may determine, as evidenced by their execution of such Notes.

 

If temporary Notes are issued, the Issuer
shall cause Definitive Notes to be prepared without unreasonable delay. After the preparation of Definitive Notes, the temporary
Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at the office or agency of the Issuer to
be maintained as provided in Section 3.02, without charge to the related Noteholder. Upon surrender for cancellation of any one
or more temporary Notes, the Issuer shall execute, and the Indenture Trustee shall authenticate and deliver in exchange therefor,
a like tenor and principal amount of Definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall
in all respects be entitled to the same benefits under this Indenture as Definitive Notes.

 

    	 	3	 

     

    

 

Section 2.04. Note Register, Registration
of Transfer and Exchange. The Issuer shall cause to be kept a register (the “Note Register”) in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for the registration of Notes and the registration
of all transfers of Notes. The Indenture Trustee initially shall be the “Note Registrar” for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any resignation of any Note Registrar, the Issuer shall promptly
appoint a successor or, if it elects not to make such an appointment, assume the duties of Note Registrar.

 

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

 

Upon surrender for registration of
transfer of any Note at the office or agency of the Issuer to be maintained as provided in Section 3.02, provided that the
requirements of Section 8-401 of the UCC are met, the Issuer shall execute, and the Indenture Trustee shall authenticate and
the Noteholder shall obtain from the Indenture Trustee, in the name of the designated transferee or transferees, one or more
new Notes of the same Class in any authorized denominations, of a like aggregate principal amount.

 

At the option of the Noteholder, Notes may
be exchanged for other Notes of the same Class in any authorized denominations, of a like aggregate principal amount, upon surrender
of the Notes to be exchanged at such office or agency. Whenever any Notes are so surrendered for exchange, provided that the requirements
of Section 8-401 of the UCC are met (as determined by the Issuer), the Issuer shall execute, and the Indenture Trustee shall authenticate
and the Noteholder shall obtain from the Indenture Trustee, the Notes which the Noteholder making the exchange is entitled to receive.

 

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

 

Every Note presented or surrendered for
registration of transfer or exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer in form satisfactory
to the Indenture Trustee duly executed by, the Noteholder thereof or such Noteholder’s attorney duly authorized in writing,
with such signature guaranteed by an “eligible guarantor institution” meeting the requirements of the Note Registrar,
which requirements include membership or participation in the Securities Transfer Agent’s Medallion Program (“STAMP”)
or such other “signature guarantee program” as may be determined by the Note Registrar in addition to, or in substitution
for, STAMP, all in accordance with the Exchange Act.

 

No service charge shall be made to a Noteholder
for any registration of transfer or exchange of Notes, but the Issuer or the Indenture Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of
Notes, other than exchanges pursuant to Section 2.03 or 9.06 not involving any transfer.

 

    	 	4	 

     

    

 

Neither the Issuer nor the Note Registrar
will be required to register transfers or exchanges of Notes that will be redeemed within fifteen (15) days after the requested
date of transfer or exchange.

 

Any Notes issued to and beneficially owned
by the Issuer or any other person treated as the same person as the Issuer for U.S. federal income tax purposes may not be sold,
pledged, or otherwise transferred unless counsel satisfactory to the Indenture Trustee has rendered an opinion to the effect that
such Notes to be sold, pledged, or otherwise transferred will be characterized as indebtedness for U.S. federal income tax purposes
after such sale, pledge, or other transfer. Any attempted sale, pledge, or other transfer in contravention of this paragraph will
be void ab initio and the purported transferor will continue to be treated as the owner of such Notes. If for tax or other
reasons it may be necessary to track any Notes, tracking conditions such as requiring separate CUSIPs or definitive form instruments
may be required by the Sponsor or the Administrator as a condition to such transfer.

 

Section 2.04A.  Transfer Restrictions
on the Retained Notes.

 

(a)       On
the Closing Date, each of the Retained Notes will be registered in the name of the Sponsor and issued in physical form as a Definitive
Note in the applicable form of Exhibit A hereto. No transfer of a Retained Note, other than to an Affiliate of the Sponsor,
shall be made unless such transfer is made pursuant to, (i) an effective registration statement under the Securities Act and any
applicable state securities laws or, (ii) is exempt from the registration requirements under the Securities Act and such state
securities laws. Except in the case of a transfer by the Sponsor to an Affiliate, in the event that a transfer is to be made in
reliance upon an exemption from the Securities Act and state securities laws, in order to assure compliance with the Securities
Act and such laws, the Noteholder desiring to effect such transfer and such Noteholder’s prospective transferee shall each
certify to the Owner Trustee, the Issuer, the Indenture Trustee and the Sponsor in writing the facts surrounding the transfer in
substantially the forms set forth in Exhibit B (the “Transferor Certificate”) and Exhibit C (the
 “Investment Letter”). Except in the case of a transfer by the Sponsor to an Affiliate, there shall also be delivered
to the Owner Trustee, the Issuer and the Indenture Trustee an opinion of counsel that such transfer may be made pursuant to an
exemption from the Securities Act and state securities laws, which opinion of counsel shall not be an expense of the Issuer, the
Owner Trustee or the Indenture Trustee; provided that such opinion of counsel in respect of the applicable state securities laws
may be a memorandum of law rather than an opinion if such counsel is not licensed in the applicable jurisdiction. If the Sponsor
subsequently transfers any of the Retained Notes in a transaction exempt from the registration requirements under the Securities
Act pursuant to Section 4(2) thereof and any Noteholder intends to transfer such Retained Notes pursuant to Rule 144A, the Sponsor
shall provide to any Noteholder and any prospective transferee designated by any such Noteholder information regarding such Retained
Notes and the Receivables and such other information as shall be necessary to satisfy the condition to eligibility set forth in
Rule 144A(d)(4) for transfer of any such Retained Notes without registration thereof under the Securities Act pursuant to the registration
exemption provided by Rule 144A, in each case with the cost of the provision of such information to be borne by the requesting
noteholder. Each Noteholder desiring to effect such a transfer shall, and does hereby agree to, indemnify the Issuer, the Owner
Trustee, the Indenture Trustee, the Depositor and AHFC (in any capacity) against any liability that may result if the transfer
is not so exempt or is not made in accordance with federal and state securities laws.

 

    	 	5	 

     

    

 

(b)       By
directly or indirectly acquiring any Retained Note in a transaction pursuant to Rule 144A, each underwriter, transferee and owner
of an ownership or beneficial interest will be required to represent, warrant and agree (if in Definitive Note form) or will be
deemed to represent, warrant and agree (if in Book Entry Note form) as follows:

 

(i)       it
understands that the Retained Notes have not been registered under the Securities Act, but were retained by the Sponsor, and may
not be sold except as permitted in the following sentence. It understands and agrees, on its own behalf and on behalf of any accounts
for which it is acting as hereinafter stated, (x) that such Retained Notes are being offered only in a transaction not involving
any public offering within the meaning of the Securities Act and (y) that such Retained Notes may be resold, pledged or transferred
only (i) to the Sponsor or an Affiliate, (ii) to an “accredited investor” as defined in Rule 501(a)(1),(2),(3) or (7)
of Regulation D under the Securities Act (an “Accredited Investor”) acting for its own account (and not for the account
of others) or as a fiduciary or agent for others (which others also are Accredited Investors unless the holder is a bank acting
in its fiduciary capacity) that executes a certificate substantially in the form of the Investment Letter, (iii) so long as such
Retained Note is eligible for resale pursuant to Rule 144A under the Securities Act, to a person whom it reasonably believes after
due inquiry is a “qualified institutional buyer” as defined in Rule 144A, acting for its own account (and not for the
account of others) or as a fiduciary or agent for others (which others also are “qualified institutional buyers”) to
whom notice is given that the resale, pledge or transfer is being made in reliance on Rule 144A or (iv) in a sale, pledge or other
transfer made in a transaction otherwise exempt from the registration requirements of the Securities Act, in which case the Sponsor
shall require that both the prospective transferor and the prospective transferee certify to the Indenture Trustee and the Sponsor
in writing the facts surrounding such transfer, which certification shall be in form and substance reasonably satisfactory to the
Issuer, the Owner Trustee, the Indenture Trustee and the Sponsor. Except in the case of a transfer described in clauses (i) or
(iii) above, the Sponsor shall require that a written opinion of counsel (which will not be at the expense of the Sponsor, any
affiliate of the Sponsor, the Owner Trustee or the Indenture Trustee), reasonably satisfactory to the Issuer and the Sponsor, be
delivered to the Issuer, the Owner Trustee, the Indenture Trustee and the Sponsor to the effect that such transfer will not violate
the Securities Act, and will be effected in accordance with any applicable securities laws of each state of the United States.
It will notify any purchaser of the Retained Notes from it of the above resale restrictions, if then applicable. It further understands
that in connection with any transfer of the Retained Notes by it that the Issuer and the Sponsor may request, and if so requested
it will furnish, such certificates and other information as they may reasonably require to confirm that any such transfer complies
with the foregoing restrictions;

 

(ii)       if
eligible for resale pursuant to Rule 144A, it is a “qualified institutional buyer” as defined under Rule 144A under
the Securities Act and is acquiring the Retained Notes for its own account (and not for the account of others) or as a fiduciary
or agent for others (which others also are “qualified institutional buyers”). It is familiar with Rule 144A under the
Securities Act and is aware that the seller of the Retained Notes and other parties intend to rely on the foregoing representations,
warranties and acknowledgements and the exemption from the registration requirements of the Securities Act provided by Rule 144A;

 

    	 	6	 

     

    

 

(iii)       if
in Definitive Note form, it satisfies the requirements of Section 2.14 of this Indenture;

 

(iv)       it
understands that the Indenture Trustee, the Sponsor and others will rely upon the truth and accuracy of the foregoing acknowledgments,
representations and agreements, and it agrees that if any of the acknowledgments, representations and warranties deemed to have
been made by it by its purchase of the Retained Notes, for its own account or for one or more accounts as to each of which it exercises
sole investment discretion, are no longer accurate, it shall promptly notify the Sponsor; and

 

(v)       the
Indenture Trustee and the Sponsor are entitled to rely upon the foregoing representations, warranties and acknowledgements and
are irrevocably authorized to produce the foregoing representations, warranties and acknowledgments or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby.

 

(c)       In
the case of a transfer of the Retained Notes to an Affiliate of the Sponsor, the Sponsor shall provide a written representation
to the Issuer, the Indenture Trustee and the Owner Trustee that the transferee is an Affiliate of the Sponsor, and the Issuer,
the Indenture Trustee and the Owner Trustee may conclusively rely on such representation.

 

Section 2.05. Mutilated, Destroyed, Lost
or Stolen Notes. If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence
to its satisfaction of the destruction, loss or theft of any Note, (ii) there is delivered to the Indenture Trustee such security
or indemnity as may be required by it to hold the Issuer and the Indenture Trustee harmless and (iii) the requirements of Section
8-405 of the UCC are met, then, in the absence of notice to the Issuer, the Note Registrar or the Indenture Trustee that such Note
has been acquired by a Protected Purchaser, the Issuer shall execute, and upon its written request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note
of the same Class; provided, however, that if any such destroyed, lost or stolen Note, but not a mutilated Note, shall have become
or within seven (7) days shall be due and payable, or shall have been called for redemption, instead of issuing a replacement Note,
the Issuer may pay such destroyed, lost or stolen Note when so due or payable or upon the Redemption Date without surrender thereof.
If, after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a Protected Purchaser of the original Note in lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the
Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered
or any assignee of such Person, except a protected purchaser, and shall be entitled to recover upon the security or indemnity provided
therefor to the extent of any loss, damage, cost or expense incurred by the Issuer or the Indenture Trustee in connection therewith.

 

    	 	7	 

     

    

 

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

 

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

 

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

 

Section 2.06. Persons Deemed Owner.
Prior to due presentment for registration of transfer of any Note, the Issuer, the Indenture Trustee and any of their respective
agents may treat the Person in whose name any Note is registered (as of the day of determination) as the owner of such Note for
the purpose of receiving payments of principal of and interest, if any, on such Note and for all other purposes whatsoever, whether
or not such Note be overdue, and none of the Issuer, the Indenture Trustee or any of their respective agents shall be affected
by notice to the contrary.

 

Section 2.07. Payment of Principal and
Interest, Defaulted Interest.

 

(a)       Each
Class of Notes shall accrue interest at the related Interest Rate, and such interest shall be due and payable on each Payment Date
as specified therein, subject to Sections 3.01 and 11.12 hereof. Any installment of interest or principal, if any, payable on any
Note that is punctually paid or duly provided for by the Issuer on the applicable Payment Date shall be paid to the Person in whose
name such Note (or one or more Predecessor Notes) is registered on the Record Date by check mailed first-class postage prepaid
to such Person’s address as it appears on the Note Register on such Record Date, except that, unless Definitive Notes have
been issued pursuant to Section 2.11, with respect to Notes registered on the Record Date in the name of the nominee of the Clearing
Agency (initially, such nominee to be Cede & Co.), payment will be made by wire transfer in immediately available funds to
the account designated by such nominee and except for the final installment of principal payable with respect to such Note on a
Payment Date, a Redemption Date or on the related Final Scheduled Payment Date, as the case may be (and except for the Redemption
Price for any Note called for redemption pursuant to Section 10.01), which shall be payable as provided below. The funds represented
by any such checks returned undelivered shall be held in accordance with Section 3.03.

 

    	 	8	 

     

    

 

(b)       The
principal of each Note shall be payable as provided in Section 8.02(d) hereof. Notwithstanding the foregoing, the entire unpaid
principal amount of the Notes shall be due and payable, if not previously paid, on the related Final Scheduled Payment Date or
the date on which an Event of Default shall have occurred and be continuing, if the Indenture Trustee or Noteholders representing
not less than a majority of the Outstanding Amount have declared the Notes to be immediately due and payable in the manner provided
in Section 5.02. All principal payments on each Class of Notes shall be made pro rata to the Noteholders of such Class entitled
thereto. The Indenture Trustee shall notify the Person in whose name a Note is registered at the close of business five (5) Business
Days preceding the Payment Date on which the Issuer expects that the final installment of principal of and interest on such Note
will be paid. Such notice shall be mailed or transmitted by facsimile prior to such final Payment Date and shall specify that such
final installment will be payable only upon presentation and surrender of such Note and shall specify the place where such Note
may be presented and surrendered for payment of such installment; provided, however, if a Definitive Note is held by the Sponsor
or any of its Affiliates, then the final installment of principal of and interest on such Note may be paid prior to the surrender
of the Note. Notices in connection with redemptions of Notes shall be mailed to Noteholders as provided in Section 10.02.

 

(c)       If
the Issuer defaults in a payment of interest on the Notes, the Issuer shall pay defaulted interest (plus interest on such defaulted
interest to the extent lawful) at the applicable Interest Rate in any lawful manner. The Issuer may pay such defaulted interest
to the Persons who are Noteholders on a subsequent special record date, which date shall be at least five (5) Business Days prior
to the next payment date. The Issuer shall fix or cause to be fixed any such special record date and related payment date, and,
at least fifteen (15) days before any such special record date, the Issuer shall mail to each Noteholder a notice that states the
special record date, the payment date and the amount of defaulted interest to be paid.

 

Section 2.08. Cancellation. All Notes
surrendered for payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than the Indenture
Trustee, be delivered to the Indenture Trustee and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Issuer
may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Indenture Trustee. No
Notes shall be authenticated in lieu of or in exchange for any Notes cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Notes may be held or disposed of by the Indenture Trustee in accordance with its standard
retention or disposal policy as in effect at the time unless the Issuer shall direct by an Issuer Order that they be destroyed
or returned to it; provided, that such Issuer Order is timely and the Notes have not been previously disposed of by the Indenture
Trustee.

 

Section 2.09. Book-Entry Notes. The
Non-Retained Notes, upon original issuance, will be issued in the form of a typewritten Note or Notes representing the Book-Entry
Notes, to be delivered to the Indenture Trustee, as agent for The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Issuer. The Book-Entry Notes shall be registered initially on the Note Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no Note Owner will receive a definitive Note representing such Note Owner’s
interest in such Note, except as provided in Section 2.11. Unless and until definitive, fully registered Notes (the “Definitive
Notes”) have been issued to such Note Owners pursuant to Section 2.11:

 

    	 	9	 

     

    

 

(i)       the
provisions of this Section shall be in full force and effect;

 

(ii)       the
Note Registrar and the Indenture Trustee shall be entitled to deal with the Clearing Agency for all purposes of this Indenture
(including the payment of principal of and interest on the Notes and the giving of instructions or directions hereunder) as the
sole holder of the Notes, and shall have no obligation to the Note Owners;

 

(iii)       to
the extent that the provisions of this Section conflict with any other provisions of this Indenture, the provisions of this Section
shall control;

 

(iv)       the
rights of Note Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and
agreements between such Note Owners and the Clearing Agency and/or the Clearing Agency Participants. Pursuant to the Note Depository
Agreement, unless and until Definitive Notes are issued pursuant to Section 2.11, the Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit payments of principal of and interest on the Notes to such Clearing
Agency Participants; and

 

(v)       whenever
this Indenture requires or permits actions to be taken based upon instructions or directions of Noteholders evidencing a specified
percentage of the Outstanding Amount, the Clearing Agency shall be deemed to represent such percentage only to the extent that
it has received instructions to such effect from Note Owners and/or Clearing Agency Participants owning or representing, respectively,
such required percentage of the beneficial interest in the Notes and has delivered such instructions to the Indenture Trustee.

 

Section 2.10. Notices to Clearing Agency.
Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes
shall have been issued to such Note Owners pursuant to Section 2.11, the Indenture Trustee shall give all such notices and communications
specified herein to be given to Noteholders to the Clearing Agency, and shall have no obligation to such Note Owners.

 

Section 2.11. Definitive Notes. On
the Closing Date, the Retained Notes will be issued in physical form as Definitive Notes in the applicable form of Exhibit A
hereto and registered in the name of the Sponsor. The Non-Retained Notes will be issued on the Closing Date as Book-Entry Notes;
however, if at anytime (i)(A) the Administrator advises the Indenture Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to the Book-Entry Notes and (B) neither the Indenture Trustee
nor the Administrator is able to locate a qualified successor, (ii) the Administrator at its option advises the Indenture Trustee
in writing that it elects to terminate the book-entry system through the Clearing Agency or (iii) after the occurrence of an Event
of Default or a Servicer Default, Owners of Book-Entry Notes representing beneficial interests aggregating at least a majority
of the Outstanding Amount of such Notes advise the Indenture Trustee and the Clearing Agency Participants through the Clearing
Agency, in writing that the continuation of a book-entry system through the Clearing Agency is no longer in the best interests
of such Note Owners, then, in each case, the Indenture Trustee shall notify all Note Owners of the related Class of Notes through
the Clearing Agency of the occurrence of any such event and of the availability of Definitive Notes of the related Class of Notes
to Note Owners requesting the same. Upon surrender to the Indenture Trustee of the Note or Notes representing the Book-Entry Notes
by the Clearing Agency, accompanied by registration instructions, the Issuer shall execute and the Indenture Trustee shall authenticate
the Definitive Notes in accordance with the instructions of the Clearing Agency. None of the Issuer, the Note Registrar or the
Indenture Trustee shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be protected
in relying on, such instructions. Upon the issuance of Definitive Notes of a Class, the Indenture Trustee shall recognize the holders
of the Definitive Notes as Noteholders hereunder. Except in the case of a Noteholder who is an Affiliate of the Sponsor, subsequent
Noteholders of Notes that were initially Retained Notes shall have the right, but at such Noteholders sole cost and expense, to
request that such Retained Notes be converted to Book Entry Notes and the Issuer, the Indenture Trustee, the Administrative Agent
and the Sponsor agree to cooperate and use reasonable efforts to effect such conversion.

 

    	 	10	 

     

    

 

Section 2.12. Release of Collateral.
Subject to Section 11.01 and the terms of the other Basic Documents, the Indenture Trustee shall release property from the lien
of this Indenture only upon receipt of an Issuer Request accompanied by an Officer’s Certificate, an Opinion of Counsel and
(except in the case of a full redemption under Section 10.01) Independent Certificates in accordance with TIA §§ 314(c)
and 314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates to the effect that the TIA does not require any
such Independent Certificates.

 

Section 2.13. Tax Treatment; Tax Information.

 

(a)       The
Issuer has entered into this Indenture, and the Notes will be issued (other than Notes beneficially owned by the Issuer or any
other person treated as the same person as the Issuer for U.S. federal income tax purposes unless transferred in accordance with
Section 2.04), with the intention that, for all purposes including U.S. federal income, state and local income and franchise tax
purposes, the Notes will qualify as indebtedness secured by the Owner Trust Estate. The Issuer, by entering into this Indenture,
and each Noteholder, by its acceptance of a Note (and each Note Owner by its acceptance of an interest in the applicable Book-Entry
Note), agree to treat the Notes (other than Notes beneficially owned by the Issuer or any other person treated as the same person
as the Issuer for U.S. federal income tax purposes unless transferred in accordance with Section 2.04) for all purposes including
U.S. federal income, state and local income and franchise tax purposes as indebtedness.

 

(b)       Each
Noteholder, by its acceptance of a Note, and Note Owner, if different, by its acceptance of a beneficial interest in a Note, agrees
to provide and shall provide to the person making payments on the Note to it (or other person responsible for withholding of taxes)
with the Tax Information, and will update or replace such Tax Information when it becomes incorrect or obsolete, at any time required
by applicable law or promptly upon request. Each Noteholder and Note Owner is deemed to understand, acknowledge and agree that
the Indenture Trustee, Paying Agent and Issuer (or other person responsible for withholding of taxes) have the right to withhold
on payments with respect to a Note (without any corresponding gross-up) where an applicable party fails to comply with the requirements
set forth in the preceding sentence or the Indenture Trustee, Paying Agent or Issuer (or other person responsible for withholding
of taxes) is otherwise required to so withhold under applicable law.

 

    	 	11	 

     

    

 

Section 2.14. Employee Benefit Plans.
The transfer of a Definitive Note shall not be registered unless the prospective transferee (and if the transferee is a Plan, its
fiduciary) has represented in writing to the Indenture Trustee that either (i) it is not acquiring such Note with the assets of
a Benefit Plan Investor or a Plan that is subject to Similar Law; or (ii) its acquisition and holding of such Note will not give
rise to, in the case of a Benefit Plan Investor, a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975
of the Code or, in the case of a Plan that is subject to Similar Law, a violation of Similar Law. Any Person that acquires a beneficial
interest in a Book Entry Note shall be deemed to make the same representations as set forth above in this Section 2.14.

 

ARTICLE
III

COVENANTS

 

Section 3.01. Payment of Principal and
Interest. The Issuer will duly and punctually pay the principal of and interest, if any, on the Notes in accordance with the
terms of the Notes and this Indenture. Without limiting the foregoing, subject to Section 8.02(c), the Issuer will cause to be
distributed all amounts on deposit in the Note Distribution Account on a Payment Date deposited therein in accordance with Section
8.02(d). Amounts properly withheld under the Code by any Person from a payment to any Noteholder of interest and/or principal shall
be considered as having been paid by the Issuer to such Noteholder for all purposes of this Indenture.

 

Section 3.02. Maintenance of Office or
Agency. The Issuer will maintain an office or agency where Notes may be surrendered for registration of transfer or exchange,
and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served and such office initially
will be located in Jersey City, New Jersey. The Issuer hereby initially appoints the Indenture Trustee to serve as its agent for
the foregoing purposes. The Issuer will give prompt written notice to the Indenture Trustee of the location, and of any change
in the location, of any such office or agency. If at any time the Issuer shall fail to maintain any such office or agency or shall
fail to furnish the Indenture Trustee with the address thereof, such surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Issuer hereby appoints the Indenture Trustee as its agent to receive all such surrenders, notices
and demands, provided that the Indenture Trustee shall not serve as an agent or office for the purpose of service of process on
behalf of the Issuer.

 

Section 3.03. Money for Payments to be
Held in Trust. As provided in Sections 5.04 and 8.02, all payments of amounts due and payable with respect to any Notes that
are to be made from amounts withdrawn from the Collection Account and the Note Distribution Account pursuant to Section 8.02(c)
shall be made on behalf of the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts so withdrawn from the
Collection Account and the Note Distribution Account for payments of Notes shall be paid over to the Issuer except as provided
in this Section.

 

On or before the Business Day immediately
preceding each Payment Date and Redemption Date, the Issuer shall deposit or cause to be deposited in the Collection Account (to
be transferred to the Note Distribution Account on the related Payment Date) an aggregate sum sufficient to pay the amounts then
becoming due under the Notes, such sum to be held in trust for the benefit of the Persons entitled thereto, and (unless the Paying
Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee in writing of its action or failure so to act.

 

    	 	12	 

     

    

 

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

 

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

 

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

 

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

 

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

 

(v)       comply
with all requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding
taxes imposed thereon (including obtaining and retaining from Persons entitled to payments with respect to the Notes any Tax Information
and making any withholdings with respect to the Notes as required by the Code and paying over such withheld amounts to the appropriate
governmental authority) and

 

(vi)       comply
with any applicable reporting requirements in connection with any payments made by it on any Notes and any withholding of taxes
therefrom, and, upon request, provide any Tax Information to the Issuer.

 

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

 

    	 	13	 

     

    

 

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

 

Section 3.04. Existence. The Issuer
will keep in full effect its existence, rights and franchises as a statutory trust under the laws of the State of Delaware (unless
it becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other State or of the United States,
in which case the Issuer will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction)
and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary
to protect the validity and enforceability of this Indenture, the Notes, the Collateral and each other instrument or agreement
included in the Owner Trust Estate in connection with this Indenture and the other Basic Documents and the transactions contemplated
hereby and thereby until such time as the Issuer shall terminate in accordance with the terms hereof.

 

Section 3.05. Protection of Owner Trust
Estate. The Issuer intends the security interest Granted pursuant to this Indenture in favor of the Indenture Trustee on behalf
of the Noteholders to be prior to all other liens in respect of the Owner Trust Estate, and the Issuer shall take all actions necessary
to obtain and maintain, for the benefit of the Indenture Trustee on behalf of the Noteholders, a first lien on and a first priority,
perfected security interest in the Owner Trust Estate. The Issuer will from time to time execute and deliver all such supplements
and amendments hereto and all such financing statements, continuation statements, instruments of further assurance and other instruments,
all as prepared by the Administrator and delivered to the Issuer, and will take such other action necessary or advisable to:

 

(i)       grant
more effectively any portion of the Owner Trust Estate;

 

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

 

    	 	14	 

     

    

 

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

 

(iv)       enforce
any of the Collateral;

 

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

 

(vi)       pay
all taxes or assessments levied or assessed upon the Owner Trust Estate when due.

 

Financing statements filed pursuant to such
appointment may describe the Owner Trust Estate in the same manner as described herein or may describe the collateral subject thereto
as “All of the Debtor’s personal property and other assets, whether now owned or existing or hereafter acquired or
arising, together with all products and proceeds thereof, substitutions and replacements therefor, and additions and accessions
thereto.”

 

Section 3.06. Opinions as to Owner Trust
Estate.

 

(a)       Promptly
after the execution and delivery of this Indenture, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel to
the effect that, in the opinion of such counsel, either (i) all financing statements and continuation statements have been executed
and filed that are necessary to create and continue the Indenture Trustee’s first priority perfected security interest in
the collateral for the benefit of the Noteholders, and reciting the details of such filings or referring to prior Opinions of Counsel
in which such details are given, or (ii) no such action shall be necessary to perfect such security interest.

 

(b)       Within
ninety (90) days after the beginning of each fiscal year of the Issuer (commencing with the first fiscal year that begins on a
date that is more than three months after the Cutoff Date), the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel,
dated as of a date during such 90-day period, stating that, in the opinion of such counsel, either (i) all financing statements
and continuation statements have been filed that are necessary to create and continue the Indenture Trustee’s first priority
perfected security interest in the collateral for the benefit of the Noteholders, and reciting the details of such filings or referring
to prior Opinions of Counsel in which such details are given, or (ii) no such action shall be necessary to perfect such security
interest.

 

Section 3.07. Performance of Obligations;
Servicing of Receivables.

 

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

 

    	 	15	 

     

    

 

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

 

(c)       The
Issuer will and will cause the Administrator to, punctually perform and observe all of its obligations and agreements contained
in this Indenture, the other Basic Documents and in the instruments and agreements included in the Owner Trust Estate, including
but not limited to filing or causing to be filed all UCC financing statements and continuation statements required to be filed
by the terms of this Indenture and the other Basic Documents in accordance with and within the time periods provided for herein
and therein. Except as otherwise expressly provided therein, the Issuer shall not waive, amend, modify, supplement or terminate
any Basic Document or any provision thereof without the written consent of the Indenture Trustee or the Noteholders of at least
a majority of the Outstanding Amount or such greater percentage as may be specified in the particular provision.

 

(d)       If
the Issuer shall have knowledge of the occurrence of a Servicer Default, the Issuer shall promptly provide written notice to a
Responsible Officer of the Indenture Trustee and to the Administrator thereof, and shall specify in such notice the action, if
any, the Issuer is taking with respect of such default. If a Servicer Default shall arise from the failure of the Servicer to perform
any of its duties or obligations under the Sale and Servicing Agreement with respect to the Receivables, the Issuer shall take
all reasonable steps available to it to remedy such failure. The Administrator shall, in accordance with Section 1.02(c) of the
Administration Agreement, make such notice available to each Rating Agency.

 

(e)       As
promptly as possible after the giving of notice of termination to the Servicer of the Servicer’s rights and powers pursuant
to Section 7.01 of the Sale and Servicing Agreement, the Issuer shall promptly notify a Responsible Officer of the Indenture Trustee
and the Indenture Trustee shall appoint a Successor Servicer, and such Successor Servicer shall accept its appointment by a written
assumption in a form acceptable to the Indenture Trustee. In the event that a Successor Servicer has not been appointed and accepted
its appointment at the time when the Servicer ceases to act as Servicer, the Indenture Trustee without further action shall automatically
be appointed the Successor Servicer. The Indenture Trustee may resign as the Servicer by giving written notice of such resignation
to the Issuer and in such event will be released from such duties and obligations, such release not to be effective until the date
a new servicer enters into a servicing agreement as provided below. Upon delivery of any such notice to the Issuer, the Issuer
shall obtain a new servicer as the Successor Servicer under the Sale and Servicing Agreement. As soon as such a Successor Servicer
is appointed, the Issuer shall notify the Indenture Trustee of such appointment, specifying in such notice the name and address
of such Successor Servicer. Any Successor Servicer other than the Indenture Trustee shall (i) be an established financial institution
having a net worth of not less than $50,000,000 and whose regular business includes the servicing of motor vehicle receivables
and (ii) enter into a servicing agreement with the Issuer and the Seller having substantially the same provisions as the provisions
of the Sale and Servicing Agreement applicable to the Servicer. If within thirty (30) days after the delivery of the notice referred
to above, the Issuer shall not have obtained such a new servicer, the Indenture Trustee may appoint, or may petition a court of
competent jurisdiction to appoint, a Successor Servicer. In connection with any such appointment, the Issuer may make such arrangements
for the compensation of such successor as it and such successor shall agree, subject to the limitations set forth below and in
the Sale and Servicing Agreement, and in accordance with Section 7.02 of the Sale and Servicing Agreement, the Issuer and the Seller
shall enter into an agreement with such successor for the servicing of the Receivables (such agreement to be in form and substance
satisfactory to the Indenture Trustee). If the Indenture Trustee shall succeed to the Servicer’s duties as servicer of the
Receivables as provided herein, it shall do so in its individual capacity and not in its capacity as Indenture Trustee and, accordingly,
the provisions of Article VI shall be inapplicable (except as set forth in the proviso contained in Section 6.01(a)) to the Indenture
Trustee in its duties as the successor to the Servicer and the servicing of the Receivables. In case the Indenture Trustee shall
become successor to the Servicer under the Sale and Servicing Agreement, the Indenture Trustee shall be entitled to appoint as
Servicer any one of its Affiliates or agents, provided that it shall be fully liable for the actions and omissions of such Affiliate
or agent in such capacity as Successor Servicer.

 

    	 	16	 

     

    

 

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

 

(i)       except
as expressly permitted by Section 3.10(b) and the Basic Documents, sell, transfer, exchange or otherwise dispose of any of the
properties or assets of the Issuer, including those included in the Owner Trust Estate, unless directed to do so by the Indenture
Trustee;

 

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

 

(iii)       (A)
permit the validity or effectiveness of this Indenture to be impaired, or permit the lien created by this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any Person to be released from any covenants or obligations with
respect to the Notes under this Indenture except as may be expressly permitted hereby, (B) permit any lien, charge, excise, claim,
security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise
arise upon or burden the Owner Trust Estate or any part thereof or any interest therein or the proceeds thereof (other than tax
liens, mechanics’ liens and other liens that arise by operation of law, in each case on any of the Financed Vehicles and
arising solely as a result of an action or omission of the related Obligor) or (C) permit the lien created by this Indenture not
to constitute a valid first priority (other than with respect to any such tax, mechanics’ or other lien) security interest
in the Owner Trust Estate; or

 

(iv)       dissolve
or liquidate in whole or in part.

 

    	 	17	 

     

    

 

Section 3.09. Annual Statement as to
Compliance.

 

(a)       The
Issuer will deliver to the Indenture Trustee, within 90 days after the end of each fiscal year of the Issuer (commencing with the
fiscal year ended March 31, 2021), an Officer’s Certificate stating, as to the Authorized Officer signing such Officer’s
Certificate, that:

 

(i)       a
review of the activities of the Issuer during such year (since the Closing Date, in the case of the first of such Officer’s
Certificate) and of its performance under this Indenture has been made under such Authorized Officer’s supervision; and

 

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

 

(b)       On
or before June 1st of each calendar year in which a Form 10-K is required to be filed on behalf of the Issuer, commencing
in 2021, the Indenture Trustee shall deliver to the Issuer and the Administrator a report regarding the Indenture Trustee’s
assessment of compliance with each of the Servicing Criteria specified on Exhibit D hereto during the immediately preceding
reporting year accompanied by an attestation report by a registered public accounting firm, in each case as required under Rules
13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such report shall be signed by an authorized officer
of the Indenture Trustee, and shall address each of the Servicing Criteria specified on Exhibit D hereto.

 

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

 

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

 

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

 

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

 

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

 

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

 

    	 	18	 

     

    

 

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

 

(vi)       the
Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate and an Opinion of Counsel (which shall describe
the actions taken as required by clause (v) above or that no actions will be taken) each stating that such consolidation or merger
comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied
with (including any filing required by the Exchange Act).

 

(b)       The
Issuer shall not convey or transfer all or substantially all of its properties or assets, including those included in the Owner
Trust Estate, to any Person (except as expressly permitted by the Basic Documents), unless:

 

(i)       the
Person that acquires by conveyance or transfer the properties or assets of the Issuer shall (A) be a United States citizen or a
Person organized and existing under the laws of the United States or any State, (B) expressly assume, by an indenture supplemental
hereto, executed and delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the due and punctual payment
of the principal of and interest on all Notes and the performance or observance of every agreement and covenant of this Indenture
and each other Basic Document on the part of the Issuer to be performed or observed, all as provided herein, (C) expressly agree
by means of such supplemental indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate
to the rights of Noteholders, (D) unless otherwise provided in such supplemental indenture, expressly agree to indemnify, defend
and hold harmless the Issuer against and from any loss, liability or expense arising under or related to this Indenture and the
Notes and (E) expressly agree by means of such supplemental indenture that such Person (or if a group of Persons, then one specified
Person) shall make all filings with the Commission (and any other appropriate Person) required by the Exchange Act in connection
with the Notes;

 

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

 

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

 

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

 

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

 

(vi)       the
Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate and an Opinion of Counsel (which shall describe
the actions taken as required by clause (v) above or that no actions will be taken) each stating that such conveyance or transfer
and such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such
transaction have been complied with (including any filing required by the Exchange Act).

 

    	 	19	 

     

    

 

Section 3.11. Successor or Transferee.

 

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

 

(b)       Upon
a conveyance or transfer of all of the properties or assets of the Issuer pursuant to Section 3.10(b), the Issuer will be released
from every covenant and agreement of this Indenture to be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery of written notice to the Indenture Trustee stating that the Issuer is to be so released.

 

Section 3.12. No Other Business.
The Issuer shall not engage in any business other than financing, purchasing, owning, selling and managing the Receivables in the
manner contemplated by this Indenture and the other Basic Documents and activities incidental thereto.

 

Section 3.13. No Borrowing. The Issuer
shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness except for (i)
the Notes and (ii) any other indebtedness permitted by or arising under the other Basic Documents.

 

Section 3.14. Servicer’s Obligations.
The Issuer shall cause the Servicer to comply with Sections 3.10, 3.11, 3.12, 4.10 and Article VIII of the Sale and Servicing Agreement.

 

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

 

Section 3.16. Capital Expenditures.
The Issuer shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty).

 

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

 

    	 	20	 

     

    

 

Section 3.18. Restricted Payments.
Except as expressly permitted by the Basic Documents, the Issuer shall not, directly or indirectly, (i) pay any dividend or make
any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the
Owner Trustee or any owner of a beneficial interest in the Issuer or otherwise with respect to any ownership or equity interest
or security in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership
or equity interest or security or (iii) set aside or otherwise segregate any amounts for any such purpose; provided, however, that
the Issuer may make, or cause to be made, (a) distributions as contemplated by, and to the extent funds are available for such
purpose under this Indenture, the Sale and Servicing Agreement or the Trust Agreement, (b) payments to the Indenture Trustee pursuant
to Section 1.02(b)(ii) of the Administration Agreement. The Issuer will not, directly or indirectly, make payments to or distributions
from the Collection Account except in accordance with this Indenture and the Basic Documents.

 

Section 3.19. Notice of Events of Default.
The Issuer shall give a Responsible Officer of the Indenture Trustee and each Rating Agency prompt written notice of each Event
of Default hereunder and each default on the part of the Servicer or the Seller of its obligations under the Sale and Servicing
Agreement.

 

Section 3.20. Further Instruments and
Acts. Upon request of the Indenture Trustee, the Issuer will execute and deliver such further instruments and do such further
acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.

 

Section 3.21. Compliance with Laws.
The Issuer shall comply with the requirements of all applicable laws, the non-compliance with which would, individually or in the
aggregate, materially and adversely affect the ability of the Issuer to perform its obligations under the Notes, this Indenture
or any Basic Document.

 

ARTICLE
IV

SATISFACTION AND DISCHARGE

 

Section 4.01. Satisfaction and Discharge
of Indenture. This Indenture shall cease to be of further effect with respect to the Notes except as to (i) rights of registration
of transfer and exchange, (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive
payments of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.05, 3.08, 3.10, 3.12, 3.13, 3.20 and 3.22, (v)
the rights, obligations and immunities of the Indenture Trustee hereunder (including the rights of the Indenture Trustee under
Section 6.07 and the obligations of the Indenture Trustee under Section 4.02) and (vi) the rights of Noteholders as beneficiaries
hereof with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the Indenture Trustee,
on written demand of and at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge
of this Indenture with respect to the Notes, when

 

(i)       either

 

(A)       all
Notes theretofore authenticated and delivered (other than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.05 and (ii) Notes for whose payment money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in
Section 3.03) have been delivered to the Indenture Trustee for cancellation; or

 

    	 	21	 

     

    

 

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

 

(1)       have
become due and payable,

 

(2)       will
become due and payable at the Class A-4 Final Scheduled Payment Date within one year, or

 

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

 

and the Issuer, in the case of clauses (1), (2) or (3)
above, has irrevocably deposited or caused to be irrevocably deposited with the Indenture Trustee cash or direct obligations of
or obligations guaranteed by the United States (which will mature prior to the date such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Indenture
Trustee for cancellation when due to the related Final Scheduled Payment Date or Redemption Date (if Notes shall have been called
for redemption pursuant to Section 10.01), as the case may be;

 

(ii)       the
Issuer has paid or performed or caused to be paid or performed all amounts and obligations which the Issuer may owe to or on behalf
of the Indenture Trustee for the benefit of the Noteholders, under this Indenture or the Notes; and

 

(iii)       the
Issuer has delivered to the Indenture Trustee an Officer’s Certificate, an Opinion of Counsel and (if required by the TIA
or the Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements
of Section 11.01(a) and, subject to Section 11.02, each stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.

 

Section 4.02. Application of Trust Money.
All monies deposited with the Indenture Trustee pursuant to Section 4.01 shall be held in trust in a segregated non-interest bearing
account and applied by it, (a) in accordance with the provisions of the Notes, the Sale and Servicing Agreement and this Indenture,
to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Noteholders of the
particular Notes for the payment or redemption of which such monies have been deposited with the Indenture Trustee, of all sums
due and to become due thereon for principal and interest; but such monies need not be segregated from other funds of the Issuer
except to the extent required herein or in the Sale and Servicing Agreement or required by law and (b) in accordance with instructions
from the Administrator, on which instructions the Indenture Trustee may conclusively rely.

 

    	 	22	 

     

    

 

 

Section 4.03. Repayment of Monies Held
by Paying Agent. In connection with the satisfaction and discharge of this Indenture with respect to the Notes, all monies
then held by any Paying Agent other than the Indenture Trustee under the provisions of this Indenture with respect to such Notes
shall, upon demand of the Issuer, be paid to the Indenture Trustee to be held and applied according to Section 3.03 and thereupon
such Paying Agent shall be released from all further liability with respect to such monies.

 

ARTICLE
V

REMEDIES

 

Section 5.01. Events of Default.
 “Event of Default”, wherever used herein, means any one of the following events (whatever the reason for such Event
of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree
or order of any court or any order, rule or regulation of any administrative or governmental body):

 

(i)       default
by the Issuer in the payment of any interest on any Note when the same becomes due and payable, and such default shall continue
for a period of five (5) Business Days or more;

 

(ii)       default
by the Issuer in the payment of the principal of or any installment of the principal of any Note at the Final Scheduled Payment
Date for such Class of Notes;

 

(iii)       any
failure by the Issuer to duly observe or perform in any material respect any covenant or agreement made in this Indenture (other
than a covenant or agreement, a default in the observance or performance of which is elsewhere in this Section specifically dealt
with), which failure shall materially and adversely affect the rights of the Noteholders and shall continue or not be cured for
a period of sixty (60) days (or for such longer period not in excess of ninety (90) days as may be reasonably necessary to remedy
such failure; provided the Issuer notifies the Indenture Trustee that it is a breach of the type capable of remedy within ninety
(90) days) after there shall have been given, by registered or certified mail, to the Issuer by the Indenture Trustee or to the
Issuer and the Indenture Trustee by the Noteholders of at least 25% of the Outstanding Amount, a written notice specifying such
default and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder;

 

(iv)       any
representation or warranty of the Issuer made in this Indenture or in any certificate or other writing delivered pursuant hereto
or in connection herewith proving to have been incorrect in any material respect as of the time when the same shall have been made,
which incorrect statement shall materially and adversely affect the rights of the Noteholders and the circumstance or condition
in respect of which such misrepresentation or warranty was incorrect shall not have been eliminated or otherwise cured, for a period
of sixty (60) days (or for such longer period not in excess of ninety (90) days as may be reasonably necessary to remedy such incorrect
statement; provided the Issuer notifies the Indenture Trustee that it is a breach of the type capable of remedy within ninety (90)
days) after there shall have been given, by registered or certified mail, to the Issuer by the Indenture Trustee or to the Issuer
and the Indenture Trustee by the Noteholders of at least 25% of the Outstanding Amount, a written notice specifying such incorrect
representation or warranty and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder;

 

    	 	23	 

     

    

 

(v)       (A)
the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Issuer or any substantial
part of its property in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now
or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for
the Issuer or for any substantial part of its property, or ordering the winding-up or liquidation of the Issuer’s affairs,
and such decree or order shall remain unstayed and in effect for a period of ninety (90) consecutive days; or (B) the commencement
by the Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter
in effect, or the consent by the Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent
by the Issuer to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official for the Issuer or for any substantial part of its property, or the making by the Issuer of any general assignment
for the benefit of creditors, or the failure by the Issuer generally to pay its debts as such debts become due, or the taking of
action by the Issuer in furtherance of any of the foregoing;

 

provided, however, that (A) if any delay or failure of
performance referred to in clause (i) above shall have been caused by Force Majeure or other similar occurrences, the grace period
referred to in such clause shall be extended for an additional sixty (60) days, (B) if any delay or failure of performance referred
to in clause (ii) above shall have been caused by Force Majeure or other similar occurrences, the grace period referred to in such
clause shall be extended for an additional sixty (60) days and (C) if any delay or failure of performance referred to in clause
(iii) or (iv) above shall have been caused by Force Majeure or other similar occurrences, the grace period referred to in such
clause shall be extended for an additional sixty (60) days.

 

The Issuer shall deliver to a Responsible Officer of the Indenture
Trustee, within five (5) Business Days after learning of the occurrence thereof, written notice in the form of an Officer’s
Certificate of any event which with the giving of notice and the lapse of time would become an Event of Default under clause (iii)
or (iv) above, its status and what action the Issuer is taking or proposes to take with respect thereto.

 

Section 5.02. Acceleration of Maturity,
Rescission and Annulment.

 

(a)       If
an Event of Default should occur and be continuing, then and in every such case the Noteholders representing not less than a majority
of the Outstanding Amount or the Indenture Trustee, at the request or direction of the Noteholders of Notes representing not less
than a majority of the Outstanding Amount, may declare all the Notes to be immediately due and payable, by a notice in writing
to the Issuer (and to the Indenture Trustee if given by Noteholders), and upon any such declaration the unpaid principal amount
of such Notes, together with accrued and unpaid interest thereon through the date of acceleration, shall become immediately due
and payable.

 

    	 	24	 

     

    

 

(b)       At
any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money
due has been obtained by the Indenture Trustee as hereinafter in this Article provided, the Noteholders of Notes representing a
majority of the Outstanding Amount, by written notice to the Issuer and the Indenture Trustee, may rescind and annul such declaration
and its consequences if:

 

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

 

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

 

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

 

(ii)       all
Events of Default, other than the nonpayment of the principal of the Notes that has become due solely by such acceleration, have
been cured or waived as provided in Section 5.12.

 

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

 

Section 5.03. Collection of Indebtedness
and Suits for Enforcement by Indenture Trustee.

 

(a)       The
Issuer covenants that if the Notes are accelerated following the occurrence of an Event of Default, the Issuer will, upon demand
of the Indenture Trustee, pay to it, for the benefit of the Noteholders, the whole amount then due and payable on such Notes for
principal and interest, with interest on the overdue principal and, to the extent payment at such rate of interest shall be legally
enforceable, on overdue installments of interest at the related Interest Rate and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements
and advances of the Indenture Trustee and its agents and counsel.

 

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

 

(c)       If
an Event of Default occurs and is continuing, the Indenture Trustee may, as more particularly provided in Section 5.04, in its
discretion, proceed to protect and enforce its rights and the rights of the Noteholders, by such appropriate Proceedings as the
Indenture Trustee shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy
or legal or equitable right vested in the Indenture Trustee by this Indenture or by law.

 

    	 	25	 

     

    

 

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

 

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

 

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

 

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

 

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

 

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

 

    	 	26	 

     

    

 

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

 

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

 

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

 

Section 5.04. Remedies, Priorities.

 

(a)       If
an Event of Default shall have occurred and be continuing, the Indenture Trustee may do one or more of the following (subject to
Sections 5.02 and 5.05):

 

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

 

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

 

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

 

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

 

    	 	27	 

     

    

 

provided, however, that the Indenture Trustee may not sell or
otherwise liquidate the Owner Trust Estate following an Event of Default, unless (A) the Noteholders of 100% of the Outstanding
Amount consent thereto, (B) the proceeds of such sale or liquidation distributable to the Noteholders and Certificateholders are
sufficient to discharge in full all amounts then due and unpaid upon such Notes and Certificates for principal and interest or
(C) the Indenture Trustee determines that the Owner Trust Estate will not continue to provide sufficient funds for the payment
of principal of and interest on the Notes and Certificates as would have become due if the Notes and Certificates had not been
declared due and payable, and the Indenture Trustee obtains the consent of Noteholders of 100% of the Outstanding Amount. In determining
such sufficiency or insufficiency with respect to clause (B) and (C) above, the Indenture Trustee may, but need not, obtain, at
the expense of the Issuer, and rely upon an opinion of an Independent investment banking or accounting firm of national reputation
as to the feasibility of such proposed action and as to the sufficiency of the Owner Trust Estate for such purpose.

 

(b)       If
the Indenture Trustee collects any money or property pursuant to this Article, it shall pay out the money or property in the following
order and priority:

 

(i)       on
a pro rata basis, to the Indenture Trustee, the Delaware Trustee and the Owner Trustee, any amounts due under the Trust Agreement
or Section 6.07 hereof;

 

(ii)       to
the Servicer, for amounts due and unpaid in respect of Nonrecoverable Advances under the Sale and Servicing Agreement;

 

(iii)       to
the Servicer, for amounts due and unpaid in respect of the Total Servicing Fee under the Sale and Servicing Agreement;

 

(iv)       to
the Asset Representations Reviewer, any amounts due under the Asset Representations Review Agreement that were not previously paid;

 

(v)       to
the Noteholders of the Notes of each Class, the Note Interest Distributable Amount ratably in proportion to the Note Interest Distributable
Amount for each Class at their respective Interest Rates;

 

(vi)       to
the Noteholders of Class A-1 Notes, the Outstanding Amount of the Class A-1 Notes, until the Class A-1 Notes are paid in full;

 

(vii)       to
the Noteholders of the Class A-2, Class A-3 and Class A-4 Notes, pro rata in proportion to the Outstanding Amount of each such
Class, until the Class A-2, Class A-3 and Class A-4 Notes are paid in full;

 

(viii)       to
the Certificate Distribution Account for distribution to the Certificateholders, the Certificate Interest Distributable Amount;

 

(ix)       to
the Certificate Distribution Account for distribution to the Certificateholders, the outstanding principal amount of the Trust
Certificates; and

 

(x)       to
the Seller, any remaining amount.

 

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

 

    	 	28	 

     

    

 

Section 5.05. Optional Preservation of
the Receivables. If the Notes have been declared to be due and payable under Section 5.02 following an Event of Default and
such declaration and its consequences have not been rescinded and annulled, the Indenture Trustee may, but need not, elect to maintain
possession of the Owner Trust Estate. It is the desire of the parties hereto and the Noteholders that there be at all times sufficient
funds for the payment of any principal of and interest on the Notes, and the Indenture Trustee shall take such desire into account
when determining whether or not to maintain possession of the Owner Trust Estate. In determining whether to maintain possession
of the Owner Trust Estate, the Indenture Trustee may, but need not, obtain, at the expense of the Issuer, and rely upon an opinion
of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and
as to the sufficiency of the Owner Trust Estate for such purpose.

 

Section 5.06. Limitation of Suits.
No Noteholder shall have any right to institute any Proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:

 

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

 

(ii)       the
Event of Default arises from the failure to remit payments when due or the Noteholders of not less than 25% of the Outstanding
Amount have made written request to the Indenture Trustee to institute such Proceeding in respect of such Event of Default in its
own name as Indenture Trustee hereunder;

 

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

 

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

 

(v)       no
direction inconsistent with such written request has been given to the Indenture Trustee during such 60-day period by the Noteholders
of a majority of the Outstanding Amount.

 

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

 

In the event the Indenture Trustee shall receive conflicting
or inconsistent requests and indemnity from two or more groups of Noteholders, each representing less than a majority of the Outstanding
Amount, the Indenture Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture. The Indenture Trustee shall not be liable for any such determination made in good faith.

 

    	 	29	 

     

    

 

Section 5.07. Unconditional Rights of
Noteholders to Receive Principal and Interest. Notwithstanding any other provisions in this Indenture, the Noteholder of any
Note shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest, if any, on
such Note on or after the respective due dates thereof expressed in such Note or in this Indenture (or, in the case of redemption,
on or after the Redemption Date) and to institute suit for the enforcement of any such payment, and such right shall not be impaired
without the consent of such Noteholder.

 

Section 5.08. Restoration of Rights and
Remedies. If the Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this
Indenture and such Proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the Indenture Trustee and the Noteholders shall, subject
to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted.

 

Section 5.09. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be exclusive
of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate
right or remedy.

 

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

 

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

 

(i)       such
direction shall not be in conflict with any rule of law or with this Indenture;

 

(ii)       subject
to the terms of Section 5.04, any direction to the Indenture Trustee to sell or liquidate the Owner Trust Estate shall be by the
Noteholders of Notes representing not less than 100% of the Outstanding Amount;

 

    	 	30	 

     

    

 

(iii)       if
the conditions set forth in Section 5.05 have been satisfied and the Indenture Trustee elects to retain the Owner Trust Estate
pursuant to such Section, then any direction to the Indenture Trustee by the Noteholders of Notes representing less than 100% of
the Outstanding Amount to sell or liquidate the Owner Trust Estate shall be of no force and effect; and

 

(iv)       the
Indenture Trustee may take any other action deemed proper by the Indenture Trustee that is not inconsistent with such direction.

 

Notwithstanding the rights of Noteholders set forth in this
Section, subject to Section 6.01, the Indenture Trustee need not take any action for which it will not be adequately indemnified
or might materially adversely affect the rights of any Noteholders not consenting to such action.

 

Section 5.12. Waiver of Past Defaults.
Prior to the declaration of the acceleration of the maturity of the Notes as provided in Section 5.02, the Noteholders of Notes
of not less than a majority of the Outstanding Amount may waive any past Default or Event of Default and its consequences except
a Default (i) in payment of principal of or interest on any of the Notes or (ii) in respect of a covenant or provision hereof which
cannot be modified or amended without the consent of each Noteholder. In the case of any such waiver, the Issuer, the Indenture
Trustee and the Noteholders shall respectively be restored to their former positions and rights hereunder; but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any right consequent thereto. Upon any such waiver, such
Default shall cease to exist and be deemed to have been cured and not to have occurred, and any Event of Default arising therefrom
shall be deemed to have been cured and not to have occurred, for every purpose of this Indenture.

 

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

 

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

 

    	 	31	 

     

    

 

Section 5.15. Action on Notes. The
Indenture Trustee’s right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the
seeking, obtaining or application of any other relief under or with respect to this Indenture. Neither the lien of this Indenture
nor any rights or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the
Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Owner Trust Estate
or upon any of the assets of the Issuer. Any money or property collected by the Indenture Trustee shall be applied in accordance
with Section 5.04(b).

 

Section 5.16. Performance and Enforcement
of Certain Obligations.

 

(a)       Promptly
following a request from the Indenture Trustee to do so and at the Administrator’s expense, the Issuer shall take all such
lawful action as the Indenture Trustee may request to compel or secure the performance and observance by the Seller or the Servicer,
as applicable, of each of their obligations to the Issuer under or in connection with the Sale and Servicing Agreement in accordance
with the terms thereof, and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuer under
or in connection with the Sale and Servicing Agreement to the extent and in the manner directed by the Indenture Trustee, including
the transmission of notices of default on the part of the Seller or the Servicer thereunder and the institution of legal or administrative
actions or proceedings to compel or secure performance by the Seller or the Servicer of each of their obligations under the Sale
and Servicing Agreement.

 

(b)       If
an Event of Default has occurred and is continuing, the Indenture Trustee may, and at the direction (which direction shall be in
writing) of the Noteholders of at least 66 2/3% of the Outstanding Amount shall, exercise all rights, remedies, powers, privileges
and claims of the Issuer against the Seller or the Servicer under or in connection with the Sale and Servicing Agreement, including
the right or power to take any action to compel or secure performance or observance by the Seller or the Servicer, as applicable,
of each of their obligations to the Issuer thereunder and to give any consent, request, notice, direction, approval, extension
or waiver under the Sale and Servicing Agreement, as applicable, and any right of the Issuer to take such action shall be suspended.

 

ARTICLE
VI

THE INDENTURE TRUSTEE

 

Section 6.01. Duties of Indenture Trustee.

 

(a)       If
an Event of Default has occurred and is continuing of which a Responsible Officer of the Indenture Trustee has actual knowledge,
the Indenture Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill
in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs;
provided, however, that if the Indenture Trustee shall assume the duties of the Servicer pursuant to Section 3.07(e), the Indenture
Trustee in performing such duties shall use the degree of care and skill customarily exercised by a prudent institutional servicer
with respect to installment sale contracts that it services for itself or others.

 

    	 	32	 

     

    

 

(b)       Except
during the continuance of an Event of Default of which a Responsible Officer of the Indenture Trustee has actual knowledge:

 

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

 

(ii)       in
the absence of bad faith on its part, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished to the Indenture Trustee and conforming to the requirements
of this Indenture; however, the Indenture Trustee shall examine the certificates and opinions specifically required to be furnished
pursuant to any provision of this Indenture to determine whether or not they conform to the requirements of this Indenture.

 

(c)       The
Indenture Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own
willful misconduct, except that:

 

(i)       this
paragraph does not limit the effect of Section 6.01(b);

 

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

 

(iii)       the
Indenture Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.11.

 

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

 

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

 

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

 

(g)       No
provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable
grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured
to it.

 

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

 

    	 	33	 

     

    

 

(i)       The
Indenture Trustee shall not be charged with knowledge of any Event of Default or any breach of a representation or warranty, as
made in the Receivables Purchase Agreement, unless either (i) a Responsible Officer shall have actual knowledge of such Event of
Default or breach, as applicable, or (ii) written notice of such Event of Default, or breach, as applicable, shall have been received
by a Responsible Officer of the Indenture Trustee in accordance with the provisions of this Indenture. The receipt by the Indenture
Trustee of a Review Report shall not obligate the Indenture Trustee to exercise its rights to enforce repurchase obligations under
the Receivables Purchase Agreement unless the Indenture Trustee is directed to do so by a Noteholder or Note Owner.

 

(j)       The
Indenture Trustee shall have no duty (A) to see to any recording, filing, or depositing of this Indenture or any agreement referred
to herein or any financing statement or continuation statement evidencing a security interest, or to see to the maintenance of
any such recording or filing or depositing or to any rerecording, refiling or redepositing of any thereof, (B) to see to any insurance,
(C) to see to the payment or discharge of any tax, assessment, or other governmental charge or any lien or encumbrance of any kind
owing with respect to, assessed or levied against, any part of the Owner Trust Estate, or (D) to confirm or verify the contents
of any reports or certificates of the Servicer delivered to the Indenture Trustee pursuant to this Indenture believed by the Indenture
Trustee to be genuine and to have been signed or presented by the proper party or parties.

 

Section 6.02. Rights of Indenture Trustee.

 

(a)       Except
as otherwise provided in the second succeeding sentence, the Indenture Trustee may conclusively rely on, and shall be protected
in acting or refraining from acting upon, any resolution, Officer’s Certificate, Opinion of Counsel, certificate of auditors,
Independent Certificate or any other document believed by it to be genuine and to have been signed or presented by the proper person.
The Indenture Trustee need not investigate any fact, calculation or matter stated in the document. Notwithstanding the foregoing,
the Indenture Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Indenture Trustee that shall be specifically required to be furnished pursuant to any provision of
this Indenture, shall examine them to determine whether they comply as to form to the requirements of this Indenture.

 

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

 

(c)       The
Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall not be responsible for any misconduct or negligence
on the part of, or for the supervision of, any such agent, attorney, custodian or nominee appointed with due care by it hereunder.

 

    	 	34	 

     

    

 

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

 

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

 

(f)       The
Indenture Trustee shall be under no obligation to exercise any of the trusts or powers vested in it by this Indenture or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request, order or direction of any of the Noteholders,
pursuant to the provisions of this Indenture, other than requests, demands or directions relating to an asset representations review
pursuant to Section 7.05, unless such Noteholders shall have offered to the Indenture Trustee security or indemnity reasonably
satisfactory to the Indenture Trustee against the costs, expenses and liabilities which may be incurred therein or thereby; provided,
however, nothing contained herein shall relieve the Indenture Trustee of the obligation, upon the occurrence of an Event of Default
of which a Responsible Officer of the Indenture Trustee shall have actual knowledge (which has not been cured), to exercise such
of the rights and powers vested in it by this Indenture, and to use the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of such person’s own affairs.

 

(g)       The
right of the Indenture Trustee to perform any discretionary act enumerated in this Indenture shall not be construed as a duty,
and the Indenture Trustee shall not be answerable in the performance of such act for other than its negligence or willful misconduct.

 

(h)       The
Indenture Trustee shall not be required to give any bond or surety in respect of the execution of the Owner Trust Estate created
hereby or the powers granted hereunder.

 

(i)       All
rights of action and claims under this Indenture or the Note may be prosecuted and enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any proceeding relating thereto, any such proceeding instituted by
the Indenture Trustee shall be brought in its own name or in its capacity as Indenture Trustee. Any recovery of judgment shall,
after provision for the payments to the Indenture Trustee provided for in Section 6.07, be for the ratable benefit of the Noteholders
in respect of which such judgment has been recovered.

 

(j)       In
no event shall the Indenture Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder
arising out of or caused by, directly or indirectly, Force Majeure; it being understood that the Indenture Trustee shall use reasonable
efforts which are consistent with accepted practices in the banking industry to resume performances as soon as practicable under
the circumstances.

 

    	 	35	 

     

    

 

(k)       The
Indenture Trustee shall not be obligated to monitor, supervise or enforce the performance of the Depositor or Sponsor under the
Basic Documents, except as otherwise expressly required herein or therein.

 

(l)       The
Indenture Trustee shall not be required to take any action it is directed to take under this Indenture if the Indenture Trustee
reasonably determines in good faith that the action so directed would involve the Indenture Trustee in personal liability or violate
applicable law binding upon it (which determination may be based on an Opinion of Counsel).

 

Section 6.03. Individual Rights of Indenture
Trustee. The Indenture Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise
deal with the Issuer or its Affiliates with the same rights it would have if it were not Indenture Trustee. Any Paying Agent, Note
Registrar, co-registrar or co-paying agent may do the same with like rights. However, the Indenture Trustee must comply with Sections
6.11 and 6.12.

 

Section 6.04. Indenture Trustee’s
Disclaimer. The Indenture Trustee shall not be responsible for and makes no representation as to the validity or adequacy of
this Indenture, the Owner Trust Estate or the Notes, it shall not be accountable for the Issuer’s use of the proceeds from
the Notes, and it shall not be responsible for any statement of the Issuer in this Indenture or in any document issued in connection
with the sale of the Notes or in the Notes other than the Indenture Trustee’s certificate of authentication. The Indenture
Trustee shall have no responsibility for filing any financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien granted to it hereunder or to record this Indenture.

 

Section 6.05. Notice of Defaults.
If a Default occurs and is continuing and if it is known to a Responsible Officer of the Indenture Trustee, the Indenture Trustee
shall mail to each Noteholder notice of the Default within ninety (90) days after it occurs. Except in the case of a Default in
payment of principal of or interest on any Note (including payments pursuant to the mandatory redemption provisions of such Note),
the Indenture Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of Noteholders.

 

Section 6.06. Reports by Indenture Trustee
to Noteholders. The Indenture Trustee shall make available to each Noteholder such information as may be required to enable
each Noteholder to prepare its respective U.S. federal and state income tax returns. The Indenture Trustee will make documents
or information which it is required to provide available to the Noteholders, including, without limitation, the Servicer’s
Certificate, and the Indenture Trustee will post at https://sf.citidirect.com information regarding principal and interest due
and paid on the Notes. The Indenture Trustee shall have the right to change the way such statements are distributed in order to
make such distribution more convenient and/or more accessible to the above parties and the Indenture Trustee shall provide timely
and adequate notification to all above parties regarding any such changes; provided, however, that the Indenture Trustee will also
mail copies of any such statements to any Noteholders who so request in writing.

 

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Section 6.07. Compensation and Indemnity.
The Issuer shall, or shall cause the Administrator to, (i) pay to the Indenture Trustee from time to time reasonable compensation
for its services, which compensation shall not be limited by any law on compensation of a trustee of an express trust, (ii) reimburse
the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it (including reasonable expenses incurred
pursuant to Section 7.05), including without limitation, costs of collection, in addition to the compensation for its services,
which expenses shall include the reasonable compensation and expenses, disbursements and advances of the Indenture Trustee’s
agents, counsel, accountants and experts and (iii) indemnify the Indenture Trustee and its officers, directors, employees and agents
against any and all loss, liability or expense (including reasonable attorneys’ fees and expenses) incurred by it in connection
with the administration of this trust and the performance of its duties hereunder (including any reasonable legal fees and expenses
incurred by the Indenture Trustee in connection with the enforcement of any indemnification or other obligation of the Issuer)
not resulting from its own willful misconduct, negligence or bad faith. The Indenture Trustee shall notify the Issuer and the Administrator
promptly of any claim for which it may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and the Administrator
shall not relieve the Issuer or the Administrator of its obligations hereunder. The indemnities contained in this Section 6.07
shall survive the resignation or removal of the Indenture Trustee or the termination of this Indenture. Absent an Event of Default,
in the event of any claim, action or proceeding for which indemnity will be sought pursuant to this Section 6.07, the Indenture
Trustee’s choice of legal counsel shall be subject to the approval of the Depositor (or if the Depositor is no longer an
owner, the designee of the Depositor), which approval shall not be unreasonably withheld, conditioned, delayed or denied. Neither
the Issuer nor the Administrator need reimburse any expense or indemnify against any loss, liability or expense incurred by the
Indenture Trustee (1) through the Indenture Trustee’s own willful misconduct, negligence or bad faith or (2) in the case
of the inaccuracy of any representation or warranty contained in Section 6.13 expressly made by the Indenture Trustee.

 

The Issuer’s payment obligations to
the Indenture Trustee pursuant to this Section shall survive the discharge of this Indenture and the resignation or discharge of
the Indenture Trustee and shall extend to any co-trustee or separate trustee appointed pursuant to Section 6.10 hereunder. When
the Indenture Trustee incurs expenses after the occurrence of a Default specified in Section 5.01 (iv) or (v) with respect to the
Issuer, the expenses are intended to constitute expenses of administration under Title 11 of the United States Code or any other
applicable federal or state bankruptcy, insolvency or similar law.

 

Anything in this Indenture to the contrary
notwithstanding, in no event shall the Indenture Trustee be liable for special, indirect or consequential loss or damage of any
kind whatsoever (including but not limited to lost profits, other than interest due but not paid on the Notes), even if the Indenture
Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

 

Section 6.08. Replacement of Indenture
Trustee. No resignation or removal of the Indenture Trustee and no appointment of a successor Indenture Trustee shall become
effective until the acceptance of appointment by the successor Indenture Trustee pursuant to this Section. The Indenture Trustee
may resign at any time by so notifying the Issuer. Noteholders representing a majority of the Outstanding Amount may remove the
Indenture Trustee at any time (with thirty-one (31) days’ prior notice) and appoint a successor Indenture Trustee by so notifying
the Indenture Trustee in writing. The Issuer shall remove the Indenture Trustee (with thirty-one (31) days’ prior notice)
if:

 

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

 

(ii)       a
court having jurisdiction in the premises in respect of the Indenture Trustee in an involuntary case or proceeding under federal
or state banking or bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency
or other similar law, shall have entered a decree or order granting relief or appointing a receiver, liquidator, assignee, custodian,
trustee, conservator, sequestrator (or similar official) for the Indenture Trustee or for any substantial part of the Indenture
Trustee’s property, or ordering the winding-up or liquidation of the Indenture Trustee’s affairs, provided any such
decree or order shall have continued unstayed and in effect for a period of thirty (30) consecutive days;

 

(iii)       the
Indenture Trustee commences a voluntary case under any federal or state banking or bankruptcy laws, as now or hereafter constituted,
or any other applicable federal or state bankruptcy, insolvency or other similar law, or consents to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator or other similar official for the
Indenture Trustee or for any substantial part of the Indenture Trustee’s property, or makes any assignment for the benefit
of creditors or fails generally to pay its debts as such debts become due or takes any corporate action in furtherance of any of
the foregoing; or

 

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

 

If the Indenture Trustee resigns or is removed
or if a vacancy exists in the office of the Indenture Trustee for any reason (the Indenture Trustee in such event being referred
to herein as the retiring Indenture Trustee), the Issuer shall promptly appoint a successor Indenture Trustee.

 

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

 

If a successor Indenture Trustee does not
take office within sixty (60) days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee,
the Issuer or the Noteholders of a majority in Outstanding Amount may petition any court of competent jurisdiction for the appointment
of a successor Indenture Trustee.

 

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

 

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Any resignation or removal of the Indenture
Trustee and appointment of a successor Indenture Trustee pursuant to the provisions of this Section shall not become effective
until acceptance of appointment by the successor Indenture Trustee pursuant to this Section and payment of all fees and expenses
owed to the outgoing Indenture Trustee. Notwithstanding the replacement of the Indenture Trustee pursuant to this Section, the
Issuer’s and the Administrator’s obligations under Section 6.07 shall continue for the benefit of the retiring Indenture
Trustee.

 

Section 6.09. Successor Indenture Trustee
by Merger. If the Indenture Trustee consolidates or merges with, converts or transfers all or substantially all its corporate
trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation shall,
without any further act, be the successor Indenture Trustee; provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. The Indenture Trustee shall provide the Administrator prior written notice of any such
transaction, and in accordance with Section 1.02(c) of the Administration Agreement, the Administrator will make such notice available
to each Rating Agency.

 

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

 

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

 

(a)       Notwithstanding
any other provision of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Owner Trust Estate may at the time be located, the Indenture Trustee and the Administrator, acting jointly, shall
have the power and may execute and deliver all instruments to appoint one or more Persons to act as a co-trustee or co-trustees,
or separate trustee or separate trustees, of all or any part of the Trust, and to vest in such Person or Persons, in such capacity
and for the benefit of the Noteholders, such title to the Owner Trust Estate or any part thereof, and, subject to the other provisions
of this Section, such powers, duties, obligations, rights and trusts as the Indenture Trustee may consider necessary or desirable.
If the Administrator shall not have joined in such appointment within fifteen (15) days after its receipt of a request to do so,
the Indenture Trustee alone shall have the power to make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section 6.11 and no notice to Noteholders of the appointment
of any co-trustee or separate trustee shall be required under Section 6.08.

 

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

 

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

 

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

 

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

 

(c)       Any
notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee
shall refer to this Indenture and the conditions of this Article. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with
the Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture, specifically
including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to,
the Indenture Trustee. Every such instrument shall be filed with the Indenture Trustee and a copy thereof given to the Administrator.

 

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

 

Section 6.11. Eligibility, Disqualification.
The Indenture Trustee shall at all times satisfy the requirements of TIA § 310(a). The Indenture Trustee shall have a combined
capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition, and the time
deposits of the Indenture Trustee shall have a rating that is otherwise acceptable to the Rating Agencies, such that the rating
of the Indenture Trustee, the Owner Trustee or any other bank would not in and of itself result in a qualification, downgrade or
withdrawal of any of the then-current ratings assigned thereby to the Notes (as evidenced by written notice to the Indenture Trustee,
Owner Trustee or any other bank). The Indenture Trustee shall comply with TIA § 310(b); provided, however, that there shall
be excluded from the operation of TIA § 310(b)(1) any indenture or indentures under which other securities of the Issuer are
outstanding if the requirements for such exclusion set forth in TIA § 310(b)(1) are met.

 

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In the event that, (A) the Indenture Trustee
(i) or any of its directors or executive officers is an underwriter, or (ii) directly or indirectly, controls or is controlled
by, or is in common control with, an underwriter; and (B) an Event of Default occurs, the Indenture Trustee shall comply with TIA
 § 310(b). For this purpose only and pursuant to TIA § 310(b), an “underwriter” means any person who, within
one year prior to the occurrence of the Event of Default, was an underwriter of any of the notes outstanding at the time of such
Event of Default.

 

Section 6.12. Preferential Collection
of Claims Against Issuer. The Indenture Trustee shall comply with TIA § 311 (a), excluding any creditor relationship listed
in TIA § 311(b). An Indenture Trustee who has resigned or been removed shall be subject to TIA § 31l(a) to the extent
indicated.

 

Section 6.13. Representations and Warranties
of Indenture Trustee. The Indenture Trustee hereby makes the following representations and warranties on which the Issuer and
Noteholders shall rely:

 

(i)       it
is a national banking association duly organized, validly existing and in good standing under the laws of the United States of
America;

 

(ii)       it
has full power, authority and legal right to execute, deliver, and perform this Indenture and shall have taken all necessary action
to authorize the execution, delivery and performance by it of this Indenture;

 

(iii)       assuming
the necessary authorization, execution and delivery thereof by the other parties thereto, the duties and obligations of the Indenture
Trustee under the Indenture constitute the valid, legal and binding obligations of the Indenture Trustee enforceable in accordance
with its terms except as enforcement may be limited by bankruptcy, insolvency, reorganization or similar laws or equitable principles
limiting creditors’ rights generally, and provided that no representation is expressed as to the availability of equitable
remedies;

 

(iv)       that
to the best knowledge of the Indenture Trustee, the Indenture Trustee is not in breach of or default under any law or administrative
rule or regulation of the United States of America, or any department, division, agency or instrumentality thereof, or any applicable
court or administrative decree or order, and which would materially impair the ability of the Indenture Trustee to perform its
obligations under the Indenture; and

 

(v)       that
to the best knowledge of the Indenture Trustee, no authorization, consent or other order of any state or federal government authority
or agency having jurisdiction over the trust powers of the Indenture Trustee are required to be obtained by the Indenture Trustee
for the valid authorization, execution and delivery by the Indenture Trustee of the Indenture or the authentication of the Notes.

 

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ARTICLE
VII

 

NOTEHOLDERS’ LISTS AND REPORTS

 

Section 7.01. Issuer to Furnish Indenture
Trustee Names and Addresses of Noteholders. If Definitive Notes are issued, the Issuer will furnish or cause to be furnished
to the Indenture Trustee (i) not more than five (5) days after the earlier of (a) each Record Date and (b) three months after the
last Record Date, a list, in such form as the Indenture Trustee may reasonably require, of the names and addresses of the Noteholders
as of such Record Date, and (ii) at such other times as the Indenture Trustee may request in writing, within thirty (30) days after
receipt by the Issuer of any such request, a list of similar form and content as of a date not more than ten (10) days prior to
the time such list is furnished; provided, however, that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.

 

Section 7.02. Preservation of Information;
Communications, Reports and Certain Documents to Noteholders.

 

(a)          The Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses
of the Noteholders contained in the most recent list furnished to the Indenture Trustee as provided in Section 7.01 and the
names and addresses of Noteholders received by the Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee
may destroy any list furnished to it as provided in such Section 7.01 upon receipt of a new list so furnished.

 

(b)          Noteholders
may communicate pursuant to TIA § 312(b) with other Noteholders with respect to their rights under this Indenture or under
the Notes. A Noteholder or Note Owner, as applicable, that seeks to communicate with other Noteholders or Note Owners, as applicable,
about the exercise of Noteholder and Note Owner rights under this Indenture or the other Basic Documents may send a request to
the Issuer or the Servicer to include information regarding the communication in the Form 10-D to be filed by the Servicer, on
behalf of the Issuer, with the Securities and Exchange Commission relating to the Collection Period in which such request was received.
Each request must include (i) the name of the requesting Noteholder or Note Owner, (ii) the method by which the other Noteholders
or Note Owners, as applicable, may contact the requesting Noteholder or Note Owner and (iii) in the case of a Note Owner, a certification
from that Note Owner that it is a Note Owner, together with at least one form of documentation, acceptable to the Indenture Trustee,
evidencing its ownership of a Note, including, but not limited to, a trade confirmation, account statement, letter from a broker
or dealer or other similar document. On receipt of such a request, the Servicer will include in the Form 10-D to be filed (i) a
statement that the Issuer has received a request from a Noteholder or a Note Owner, as applicable, that is interested in communicating
with other Noteholders or Note Owners, as applicable, about a possible exercise of rights under this Indenture or the other Basic
Documents, (ii) the name of the requesting Noteholder or Note Owner, (iii) the date the request was received and (iv) a description
of the date and method by which the other Noteholders or Note Owners, as applicable, may contact the requesting Noteholder or Note
Owner.

 

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

 

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(d)          The
Indenture Trustee will provide to Securityholders the reports, certificates, opinions and documents specified in Section 3.15 of
the Sale and Servicing Agreement, upon written request to the Indenture Trustee.

 

(e)          The
Indenture Trustee shall, no later than the third Business Day after the last day of each calendar month, provide notice to American
Honda Finance Corporation and American Honda Receivables LLC (each, a “Honda Party,” and together, the “Honda
Parties”) in the form set forth as Exhibit E hereto (or such other form or format as the Honda Parties may otherwise
specify) of the request or any requests of (i) all demands communicated to the Indenture Trustee for the repurchase or replacement
of any Receivable for breach of the representations and warranties concerning such Receivable relating to the Issuer and (ii) any
actions taken by the Indenture Trustee with respect to such demand communicated to the Indenture Trustee in respect of any Receivables.
In addition, the Indenture Trustee shall, upon written request of either Honda Party, at any time they reasonably feel necessary,
provide notification to the Honda Parties with respect to any actions taken by the Indenture Trustee as soon as practicable and
in any event within five (5) Business Days of receipt of such request. Such notices shall be provided to the Honda Parties in accordance
with Section 11.04(iv) of this Indenture. The Indenture Trustee and the Issuer acknowledge and agree that the purpose of this Section
7.02(e) is to facilitate compliance by the Honda Parties with Rule 15Ga-1 under the Securities Exchange Act of 1934, as amended,
and Items 1104(e), 1121(c) and 1125 of Regulation AB (the “Repurchase Rules and Regulations”). The Indenture
Trustee acknowledges that interpretations of the requirements of the Repurchase Rules and Regulations may change over time, whether
due to interpretive guidance provided by the Commission or its staff, consensus among participants in the asset-backed securities
markets, advice of counsel, or otherwise, and agrees to comply with reasonable written requests (including email in PDF format)
made by the Honda Parties in good faith for delivery of information in its possession under these provisions on the basis of evolving
interpretations of the Repurchase Rules and Regulations. The Indenture Trustee shall cooperate fully with the Honda Parties to
deliver any and all records and any other information in its possession and necessary in the good faith determination of the Honda
Parties to permit them to comply with the provisions of Repurchase Rules and Regulations. In no event shall the Indenture Trustee
have any responsibility or liability in connection with any filing required to be made by a securitizer under the Repurchase Rules
and Regulations.

 

Section 7.03. Reports by Issuer.

 

(a)          The
Issuer shall:

 

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

 

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

 

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(iii)          supply
to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders described in TIA § 313(c)) such
summaries of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this
Section 7.03(a) and by rules and regulations prescribed from time to time by the Commission.

 

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

 

Section 7.04. Reports by Indenture Trustee.
If required by TIA § 313(a), within sixty (60) days after each December 31st (commencing December 31st,
2020), the Indenture Trustee shall mail to each Noteholder as required by TIA § 313(c) a brief report dated as of such date
that complies with TIA § 313(a). The Indenture Trustee also shall comply with TIA § 313(b).

 

A copy of each report at the time of its
mailing to Noteholders shall be filed by the Indenture Trustee with the Commission and each stock exchange, if any, on which the
Notes are listed. The Issuer shall promptly notify the Indenture Trustee in writing if and when the Notes are listed on any stock
exchange and of any delisting thereof.

 

Section 7.05. Noteholder and Note Owner
Demand for Asset Representations Review. If the Delinquency Percentage on any Payment Date meets or exceeds the Delinquency
Trigger for that Payment Date, the Servicer shall notify the Noteholders and Note Owners on the Form 10-D filed for that Payment
Date. On or after such Payment Date, an Investor may make a demand on the Indenture Trustee, in accordance with Section 11.03
to cause a vote of the Investors about whether to direct the Asset Representations Reviewer to conduct an Asset Representations
Review under the Asset Representations Review Agreement. The Servicer shall notify Investors of the initiation of such a vote on
the Form 10-D filed for that Payment Date. If Investors of at least 5% in the aggregate of the Outstanding Amount of the Notes,
as of the filing of the Form 10-D that disclosed that the Delinquency Trigger was met or exceeded, demand a vote within ninety
(90) days after the filing of the Form 10-D in which the occurrence of the Delinquency Trigger being met or exceeded was reported,
the Indenture Trustee, in accordance with its standard internal vote solicitation process, will promptly request a vote of the
Noteholders (through the Clearing Agency) and Note Owners. The Indenture Trustee shall set a record date for purposes of determining
the identity of Noteholders or Note Owners, as applicable, entitled to vote in accordance with TIA Section 316(c) as of the
date of filing of the Form 10-D that disclosed that the Delinquency Trigger was met or exceeded. The vote will be initiated no
later than ninety (90) days after the filing of the Form 10-D reporting that the Delinquency Percentage met or exceeded the Delinquency
Trigger for that Payment Date and will remain open until one hundred fifty (150) days after such Form 10-D filing. The Servicer
shall pay the costs, expenses and liabilities incurred by the Indenture Trustee, the Owner Trustee and the Issuer in connection
with the voting process, including the costs and expenses of counsel to such parties. If the Investors of a majority of the Outstanding
Amount of Notes (out of those that are voted) vote in favor of an Asset Representations Review, the Indenture Trustee will promptly
notify the Asset Representations Reviewer, the Issuer, the RPA Seller, the Administrator and the Servicer of such vote. Following
the completion of the voting process, the next Form 10-D filed by the Depositor will disclose whether or not the Noteholders and
Note Owners have voted for an Asset Representations Review.

 

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Section 7.06. Voting of Notes Held by
Honda Parties. If any of the Notes are held by any of the Honda Parties or any of their Affiliates, such Notes shall not be
considered for purposes of determining whether a specified percentage of the Outstanding Amount has voted to take any action under
this Indenture or any other Basic Document.

 

ARTICLE
VIII

 

ACCOUNTS, DISBURSEMENTS AND RELEASES

 

Section 8.01. Collection of Money.
Except as otherwise expressly provided herein, the Indenture Trustee may demand payment or delivery of, and shall receive and collect,
directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable
to or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall apply all such money received
by it as provided in this Indenture. Except as otherwise expressly provided in this Indenture, if any default occurs in the making
of any payment or performance under any agreement or instrument that is part of the Owner Trust Estate, the Indenture Trustee may
take such action as may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a Default or Event of Default under this Indenture
and any right to proceed thereafter as provided in Article V.

 

Section 8.02. Accounts.

 

(a)           Pursuant
to Section 4.01 of the Sale and Servicing Agreement, there has been established and there shall be maintained an Eligible Account
(initially at the Securities Intermediary) in the name, and under the sole dominion and control, of the Indenture Trustee until
the Outstanding Amount has been reduced to zero, and thereafter, in the name, and under the sole dominion and control, of the Owner
Trustee, which is designated as the Yield Supplement Account.

 

(b)          On
or prior to the Closing Date, the Issuer shall cause the Servicer to establish and maintain, in the name of the Indenture Trustee,
Eligible Accounts for the benefit of the (i) Securityholders, the Collection Account, the Yield Supplement Account and the Reserve
Fund and (ii) Noteholders, the Note Distribution Account as provided in Section 4.01 of the Sale and Servicing Agreement.

 

(c)           On
or before each Payment Date, with respect to the preceding Collection Period, all amounts required to be deposited in the Collection
Account will be deposited as provided in Sections 4.02 and 4.05 of the Sale and Servicing Agreement. On or before each Payment
Date, all amounts required to be deposited in the Note Distribution Account with respect to the preceding Collection Period pursuant
to Sections 4.06 and 4.07 of the Sale and Servicing Agreement will be transferred from the Collection Account, the Reserve Fund
and/or the Yield Supplement Account to the Note Distribution Account.

 

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(d)           On
each Payment Date and Redemption Date, the Indenture Trustee shall distribute all amounts on deposit in the Note Distribution Account
to Noteholders, in respect of the Notes to the extent of amounts due and unpaid on the Notes for principal and interest (including
any premium), in the amounts and order as set forth in the Servicer’s Certificate which shall be in the following amounts
and in the following order of priority (except as otherwise provided in Section 5.04(b)):

 

(i)            the
Note Interest Distributable Amount; provided, that if there are not sufficient funds in the Note Distribution Account to pay the
allocable portion of the Note Interest Distribution Amount with respect to each Class of Notes, the amount in the Note Distribution
Account shall be applied to the payment of such amount pro rata on the basis of the total Note Interest Distributable Amount due
on the Notes;

 

(ii)           the
Note Principal Distributable Amount (first to the Class A-1 Notes until the Class A-1 Notes are paid in full, second to the Class
A-2 Notes until paid in full, third to the Class A-3 Notes until paid in full, and fourth to the Class A-4 Notes until paid in
full);

 

(iii)          notwithstanding
clause (ii) above, on each Payment Date after the Notes have been accelerated as provided in Section 5.02(a) following the occurrence
of an Event of Default, until such time as the Notes have been paid in full, the Note Principal Distributable Amount shall be paid
first to the Class A-1 Notes until the Class A-1 Notes are paid in full and then to the Class A-2, Class A-3 and Class A-4 Notes
on a pro rata basis based on the Outstanding Amount of each such Class of Notes; and

 

(iv)          in
the event that there are insufficient funds in the Note Distribution Account, an amount will be withdrawn from the Reserve Fund
pursuant to Section 4.07(b) of the Sale and Servicing Agreement.

 

The Indenture Trustee shall, subject to
Article VI, make the distributions on the Notes in a manner consistent with the Servicer’s Certificate and will, upon the
request of the Issuer, confirm to the Issuer that it has made such payments in accordance with the Servicer’s Certificate.

 

(e)           The
Securities Intermediary.

 

(i)            Citibank
is hereby appointed as the initial securities intermediary with respect to the Collection Account, the Yield Supplement Account
and the Reserve Fund (the “Securities Intermediary”) and Citibank hereby accepts such appointment as Securities
Intermediary. The Securities Intermediary hereby agrees with the parties hereto that the jurisdiction of the Securities Intermediary
with respect to the Collection Account, the Yield Supplement Account and the Reserve Fund shall be the State of New York. The Securities
Intermediary hereby represents and covenants that it is not and will not be (as long as it is the Securities Intermediary hereunder)
a party to any agreement that is inconsistent with the provisions of this Indenture. The Securities Intermediary hereby agrees
that any item of property credited to the Collection Account, the Yield Supplement Account or the Reserve Fund shall not be subject
to any security interest, lien, encumbrance or right of setoff in favor of the Securities Intermediary or anyone claiming through
the Securities Intermediary (other than the Indenture Trustee).

 

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(ii)           It
is the intent of the Indenture Trustee and the Issuer that each of the Collection Account, the Yield Supplement Account and the
Reserve Fund shall be a securities account of the Indenture Trustee and not an account of the Issuer. In furtherance thereof, the
Securities Intermediary agrees to comply with entitlement orders with respect to and with instructions directing the disposition
of funds held in or credited to the Collection Account, the Yield Supplement Account and the Reserve Fund originated by the Indenture
Trustee without further consent by the Issuer, the Servicer or any other person or entity. The Securities Intermediary hereby covenants
that it will not agree with any person or entity other than the Indenture Trustee, the Issuer and the Servicer that it will comply
with entitlement orders originated by any person or entity, or instructions regarding the disposition of funds, with respect to
such Accounts other than the Indenture Trustee, the Issuer and the Servicer. The Securities Intermediary hereby agrees (A) to treat
all Account Property as Financial Assets, and (B) that all Account Property will be physically delivered to (accompanied by any
required endorsements) to, or credited to an account in the name of, the Securities Intermediary in accordance with the Securities
Intermediary’s customary procedures such that the Securities Intermediary establishes a Security Entitlement in favor of
the Indenture Trustee with respect thereto over which the Indenture Trustee has Control.

 

(iii)          Any successor Securities Intermediary shall be required to make the same representations and
covenants as set forth above in clauses (i) and (ii).

 

(iv)          Nothing
herein shall imply or impose upon the Securities Intermediary any duties or obligations other than those expressly set forth herein
and those applicable to a securities intermediary under the UCC (and the Securities Intermediary shall be entitled to all of the
protections available to a securities intermediary under the UCC). Without limiting the foregoing, nothing herein shall imply or
impose upon the Securities Intermediary any duties of a fiduciary nature (such as the fiduciary duties of the Indenture Trustee
hereunder).

 

(v)           The
rights and powers granted herein to the Indenture Trustee, and the covenants and obligations of the Securities Intermediary hereunder,
have been granted in order to perfect the Indenture Trustee’s security interest in the Collection Account, the Yield Supplement
Account and the Reserve Fund, and such rights, powers, covenants and obligations hereunder shall continue in effect with respect
to the Collection Account, the Yield Supplement Account and the Reserve Fund until the Outstanding Amount of the Notes has been
reduced to zero.

 

(vi)          The
Indenture Trustee, to the extent it is acting in the capacity as Securities Intermediary with respect to the Accounts, represents,
warrants and covenants that:

 

(A)       it
is a “securities intermediary,” as such term is defined in Section 8-102(a)(14)(B) of the relevant UCC;

 

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(B)        pursuant
to Section 8-110(e)(1) of the relevant UCC for purposes of the relevant UCC, the jurisdiction of the Securities Intermediary is
the law of the State of New York; and

 

(C)        the
Securities Intermediary has and shall continue to have at all relevant times one or more offices in the United States of America
engaged in a business or other regular activity of maintaining securities accounts.

 

(vii)         To
the extent that there are any other agreements with the Indenture Trustee or the Securities Intermediary governing the Accounts,
the parties agree that each and every such agreement is hereby amended to provide that with respect to the Accounts, the law applicable
to all issues specified in Article 2(1) of the Hague Securities Convention shall be the laws of the State of New York.

 

Section 8.03. General Provisions Regarding
Accounts.

 

(a)           So
long as no Default or Event of Default shall have occurred and be continuing, all or a portion of the funds in the Reserve Fund
and the Yield Supplement Account shall be invested in Eligible Investments and reinvested by the Securities Intermediary upon the
written direction of the Servicer, subject to the provisions of Section 4.01(b) of the Sale and Servicing Agreement. All income
or other gain from investments of monies deposited in the Reserve Fund and the Yield Supplement Account shall be credited to such
Account, and any loss resulting from such investments shall be charged to such Account.

 

(b)           To
the extent that the Servicer is required to remit all payments received from or on behalf of the Obligors on or in respect of the
Receivables and all Net Liquidation Proceeds daily to the Collection Account as provided in Section 4.02 of the Sale and Servicing
Agreement, all or a portion of the funds in the Collection Account may be invested in Eligible Investments and reinvested by the
Securities Intermediary upon the written direction of the Servicer, subject to the provisions of Section 4.01(b) of the Sale and
Servicing Agreement. All income or other gain from investments of monies deposited in the Collection Account, if any, shall be
paid to the Servicer as part of the Supplemental Servicing Fee, and any loss resulting from such investments shall be charged to
the Collection Account in accordance with Section 4.01(b) of the Sale and Servicing Agreement.

 

(c)           Subject
to Section 6.01(c), the Securities Intermediary shall not in any way be held liable by reason of any insufficiency in any of the
Reserve Fund, the Yield Supplement Account or the Collection Account resulting from any loss on any Eligible Investment included
therein except for losses attributable to the Securities Intermediary’s failure to make payments on such Eligible Investments
issued by the Securities Intermediary, in its commercial capacity as principal obligor and not as trustee, in accordance with their
terms.

 

(d)           If
(i) the Servicer shall have failed to give investment directions for any funds on deposit in the Reserve Fund, Yield Supplement
Account or Collection Account to the Securities Intermediary by 2:00 P.M., New York Time (or such other time as may be agreed by
the Issuer and the Securities Intermediary) on any Business Day or (ii) to the knowledge of a Responsible Officer of the Indenture
Trustee a Default or Event of Default shall have occurred and be continuing with respect to the Notes but the Notes shall not have
been declared due and payable pursuant to Section 5.02 or (iii) if such Notes shall have been declared due and payable following
an Event of Default but amounts collected or receivable from the Owner Trust Estate are being applied in accordance with Section
5.05 as if there had not been such a declaration, then the Indenture Trustee upon actual knowledge by a Responsible Officer of
such event shall, in the case of clause (i) above, maintain such funds in cash or, in the case of clauses (ii) or (iii) above,
to the fullest extent practicable, invest and reinvest funds in the Reserve Fund, Yield Supplement Account or Collection Account
as specified in the most recent investment direction received by the Securities Intermediary from the Servicer.

 

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Section 8.04. Release of Owner Trust
Estate.

 

(a)           Subject
to the payment of its fees and expenses pursuant to Section 6.07, the Indenture Trustee may, and when required by the provisions
of this Indenture shall, execute instruments to release property from the lien of this Indenture, or convey the Indenture Trustee’s
interest in the same, in a manner and under circumstances that are not inconsistent with the provisions of this Indenture. No party
relying upon an instrument executed by the Indenture Trustee as provided in this Article shall be bound to ascertain the Indenture
Trustee’s authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies.

 

(b)           The
Indenture Trustee shall, at such time as there are no Notes Outstanding and all sums due the Indenture Trustee pursuant to Section
6.07 have been paid, release any remaining portion of the Owner Trust Estate that secured the Notes from the lien of this Indenture
and release to the Issuer or any other Person entitled thereto any funds then on deposit in the Accounts. The Indenture Trustee
shall release property from the lien of this Indenture pursuant to this Section 8.04(b) only upon receipt of an Issuer Request
accompanied by an Officer’s Certificate, an Opinion of Counsel and (if required by the TIA) Independent Certificates in accordance
with TIA §§ 314(c) and 314(d)(1) meeting the applicable requirements of Section 11.01. Such release shall be deemed to
have been made upon completion of the requirements set forth in the foregoing sentence.

 

Section 8.05. Opinion of Counsel.
The Indenture Trustee shall receive at least seven (7) days written notice when requested by the Issuer, unless such notice requirement
is waived by the Indenture Trustee, to take any action pursuant to Section 8.04(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, as a condition to such action, an Opinion of Counsel, in form and substance
satisfactory to the Indenture Trustee, stating the legal effect of any such action, outlining the steps required to complete the
same, and concluding that all conditions precedent to the taking of such action have been complied with and such action will not
materially and adversely impair the security for the Notes or the rights of the Noteholders in contravention of the provisions
of this Indenture; provided, however, that such Opinion of Counsel shall not be required to express an opinion as to the fair value
of the Owner Trust Estate. Counsel rendering any such opinion may rely, without independent investigation, on the accuracy and
validity of any certificate or other instrument delivered to the Indenture Trustee in connection with any such action.

 

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ARTICLE
IX

 

SUPPLEMENTAL INDENTURES

 

Section 9.01. Supplemental Indentures
Without Consent of Noteholders.

 

(a)          Without
the consent of the Noteholders of any Notes but with prior notice from the Administrator to each Rating Agency, the Issuer and
the Indenture Trustee, when authorized by an Issuer Order, at any time and from time to time, may enter into one or more indentures
supplemental hereto (which shall conform to the provisions of the TIA as in force at the date of the execution thereof), in form
satisfactory to the Indenture Trustee, for any of the following purposes:

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(viii)        to
correct any manifest error in the terms of this Indenture as compared to the terms expressly set forth in the Prospectus.

 

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

 

(b)          The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also without the consent of any of the Noteholders but
with prior notice from the Administrator to each Rating Agency, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying
in any manner the rights of the Noteholders under this Indenture; provided, however, that such action shall not, as evidenced by
an Opinion of Counsel, adversely affect in any material respect the interests of any Noteholder whose written consent has not been
obtained.

 

Section 9.02. Supplemental Indentures
With Consent of Noteholders. The Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may, with prior
notice from the Administrator to each Rating Agency and with the written consent of the Noteholders of not less than a majority
of the Outstanding Amount, by Act of such Noteholders delivered to the Issuer, the Indenture Trustee (which consent shall not be
unreasonably withheld), enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to,
or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the
Noteholders under this Indenture; provided, however, that no such supplemental indenture shall, without the written consent of
the Noteholder of each Outstanding Note affected thereby:

 

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

 

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

 

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

 

(iv)       reduce
the percentage of the Outstanding Amount required to direct the Indenture Trustee to direct the Issuer to sell or liquidate the
Owner Trust Estate pursuant to Section 5.04 or amend the provisions of this Article which specify the percentage of the Outstanding
Amount required to amend this Indenture or the other Basic Documents;

 

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

 

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

 

(vii)         amend
the provisions of Section 7.06 regarding the voting of Notes held by the Honda Parties, if any.

 

The Administrator shall certify to the Indenture
Trustee whether or not any Notes would be affected by any supplemental indenture and any such certification shall be conclusive
upon all Noteholders, whether theretofore or thereafter authenticated and delivered hereunder.

 

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

 

Promptly after the execution by the Issuer
and the Indenture Trustee of any supplemental indenture pursuant to this Section, the Indenture Trustee shall mail to the Noteholders
to which such amendment or supplemental indenture relates a notice setting forth in general terms the substance of such supplemental
indenture. Any failure of the Indenture Trustee to mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such supplemental indenture.

 

Section 9.03. Execution of Supplemental
Indentures. In executing, or permitting the additional trusts created by, any supplemental indenture permitted by this Article
or the modification thereby of the trusts created by this Indenture, the Trustees shall be entitled to receive, and subject to
Sections 6.01 and 6.02, shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustees may, but shall not be obligated to, enter into any such supplemental
indenture that affects the respective Trustee’s own rights, duties, liabilities or immunities under this Indenture or otherwise.
No supplemental indenture that adversely affects a Trustee shall be effective without its prior written consent.

 

Section 9.04. Effect of Supplemental
Indenture. Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and
shall be deemed to be modified and amended in accordance therewith with respect to the Notes affected thereby, and the respective
rights, limitations of rights, obligations, duties, liabilities and immunities under this Indenture of the Indenture Trustee, the
Issuer and the Noteholders shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms
and conditions of this Indenture for any and all purposes.

 

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Section 9.05. Conformity with Trust Indenture
Act. Every amendment of this Indenture and every supplemental indenture executed pursuant to this Article shall conform to
the requirements of the TIA as then in effect so long as this Indenture shall then be qualified under the TIA.

 

Section 9.06. Reference in Notes to Supplemental
Indentures. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may,
and if required by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided
for in such supplemental indenture. If the Issuer or the Indenture Trustee shall so determine, new Notes so modified as to conform,
in the opinion of the Indenture Trustee and the Issuer, to any such supplemental indenture may be prepared and executed by the
Issuer and authenticated and delivered by the Indenture Trustee in exchange for Outstanding Notes.

 

ARTICLE
X

 

REDEMPTION OF NOTES

 

Section 10.01. Redemption. The Outstanding
Notes are subject to redemption in whole, but not in part, pursuant to Section 8.01 of the Sale and Servicing Agreement, on any
Payment Date on which the Servicer exercises its option to purchase the Owner Trust Estate pursuant to said Section, for a purchase
price equal to the Redemption Price; provided that the Issuer has available funds sufficient to pay the Redemption Price. The Administrator
shall make notice available to each Rating Agency of such redemption. If the outstanding Notes are to be redeemed pursuant to this
Section, the Servicer or the Issuer shall furnish written notice of such election to the Indenture Trustee not later than ten (10)
days prior to the Redemption Date and the Issuer shall deposit by 8:00 A.M., Los Angeles time, on the Redemption Date with the
Indenture Trustee in the Note Distribution Account the Redemption Price of the Notes to be redeemed, whereupon all such Notes shall
be due and payable on the Redemption Date upon the furnishing of a notice complying with Section 10.02 to each Noteholder.

 

Section 10.02. Form of Redemption Notice.
Notice of redemption under Section 10.01 shall be given by the Indenture Trustee by first-class mail, postage prepaid, by electronic
mail in accordance with Section 11.04, or by facsimile, mailed or transmitted prior to the applicable Redemption Date to each Noteholder,
as of the close of business on the Record Date preceding the applicable Redemption Date, at such Noteholder’s address or
facsimile number appearing in the Note Register.

 

All notices of redemption shall include
the following information:

 

(i)            the
Redemption Date;

 

(ii)           the
Redemption Price;

 

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(iii)           the
CUSIP number;

 

(iv)          the place where such Notes are to be surrendered for payment of the Redemption Price (which shall be
the office or agency of the Issuer to be maintained as provided in Section 3.02); and

 

(v)           that
on the Redemption Date, the Redemption Price will become due and payable upon each Note and that interest thereon shall cease to
accrue from and after the Redemption Date.

 

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

 

Section 10.03. Notes Payable on Redemption
Date. The Notes or portions thereof to be redeemed shall, following notice of redemption as required by Section 10.02, on the
Redemption Date become due and payable at the Redemption Price and (unless the Issuer shall default in the payment of the Redemption
Price) no interest shall accrue on the Redemption Price for any period after the date to which accrued interest is calculated for
purposes of calculating the Redemption Price.

 

ARTICLE
XI

MISCELLANEOUS

 

Section 11.01. Compliance Certificates
and Opinions, etc.

 

(a)           Upon
any application or request by the Issuer to the Indenture Trustee to take any action that is not specifically required by any provision
of this Indenture, the Issuer shall furnish to the Indenture Trustee (i) an Officer’s Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed action have been complied with, (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with and (iii) (if required
by the TIA and except in the case of a full redemption under Section 10.01) an Independent Certificate from a firm of certified
public accountants meeting the applicable requirements of this Section. Upon any application or request by the Issuer to the Indenture
Trustee to take any action under any provision of this Indenture wherein such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture, no additional certificate or opinion need be furnished.

 

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

 

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

 

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

 

(iii)      a
statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary
to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with;
and

 

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

 

(b)           (i)        Prior to the deposit of any
Collateral or other property or securities with the Indenture Trustee that is to be made the basis for the release of any property
or securities subject to the lien of this Indenture, the Issuer shall, in addition to any obligation imposed in Section 11.01 (a)
or elsewhere in this Indenture, furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion
of each person signing such certificate as to the fair value (within ninety (90) days of such deposit) to the Issuer of the Collateral
or other property or securities to be so deposited.

 

(ii)       Whenever
the Issuer is required to furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of
any signer thereof as to the matters described in clause (i) above, the Issuer shall also deliver to the Indenture Trustee an Independent
Certificate as to the same matters, if the fair value to the Issuer of the securities to be so deposited and of all other such
securities made the basis of any such withdrawal or release since the commencement of the then-current fiscal year of the Issuer,
as set forth in the certificates delivered pursuant to clause (i) above and this clause (ii), is 10% or more of the Outstanding
Amount, but such a certificate need not be furnished with respect to any securities so deposited, if the fair value thereof to
the Issuer as set forth in the related Officer’s Certificate is less than $25,000 or less than one percent of the Outstanding
Amount of the Notes.

 

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(iii)       Other
than with respect to any release described in clause (A) or (B) of Section 11.01(b)(v), whenever any property or securities are
to be released from the lien of this Indenture, the Issuer shall also furnish to the Indenture Trustee an Officer’s Certificate
certifying or stating the opinion of each person signing such certificate as to the fair value (within ninety (90) days of such
release) of the property or securities proposed to be released and stating that in the opinion of such person the proposed release
will not impair the security under this Indenture in contravention of the provisions hereof.

 

(iv)       Whenever
the Issuer is required to furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of
any signer thereof as to the matters described in clause (iii) above, the Issuer shall also furnish to the Indenture Trustee an
Independent Certificate as to the same matters if the fair value of the property or securities and of all other property (other
than property described in clauses (A) or (B) of Section 11.01 (b)(v)) released from the lien of this Indenture since the commencement
of the then-current calendar year, as set forth in the certificates required by clause (iii) above and this clause (iv), equals
10% or more of the Outstanding Amount, but such certificate need not be furnished in the case of any release of property or securities
if the fair value thereof as set forth in the related Officer’s Certificate is less than $25,000 or less than one percent
of the then Outstanding Amount.

 

(v)       Notwithstanding
Section 2.12 or any other provision of this Section, the Issuer may, without compliance with the requirements of the other provisions
of this Section, (A) collect, liquidate, sell or otherwise dispose of Receivables and Financed Vehicles as and to the extent permitted
or required by the Basic Documents and (B) make cash payments out of the Accounts as and to the extent permitted or required by
the Basic Documents.

 

Section 11.02. Form of Documents Delivered
to Indenture Trustee. In any case where several matters are required to be certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that
they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters
and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in
one or several documents.

 

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

 

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

 

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

 

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Section 11.03. Acts of Noteholders.

 

(a)           Any
request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken
by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders
in person or by agents duly appointed in writing; and except as herein otherwise expressly provided such action shall become effective
when such instrument or instruments are delivered to the Indenture Trustee and, where it is hereby expressly required, to the Issuer.
Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the
 “Act” of the Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.01) conclusive
in favor of the Indenture Trustee and the Issuer, if made in the manner provided in this Section.

 

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

 

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

 

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

 

Section 11.04. Notices, etc., to Indenture
Trustee, Issuer and Rating Agencies. (a) Any request, demand, authorization, direction, notice, consent, waiver or Act of Noteholders
or other documents provided or permitted by this Indenture shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or Act of Noteholders is to be made upon, given or furnished to or filed with:

 

(i)       the
Indenture Trustee by any Noteholder or by the Issuer shall be sufficient for every purpose hereunder if made, given, furnished
or filed in writing and mailed first-class, postage prepaid, overnight delivery service or facsimile to or with the Indenture Trustee
at its Corporate Trust Office, or (as to notices sent by the Issuer to the Indenture Trustee only) if sent by electronic mail,
to an address provided by the Indenture Trustee in writing, or

 

(ii)       the
Issuer by the Indenture Trustee or by any Noteholder shall be sufficient for every purpose hereunder if in writing and mailed first-class,
postage prepaid, overnight delivery service or facsimile to the Issuer addressed to the address set forth on Schedule A to the
Sale and Servicing Agreement or at any other address previously furnished in writing to the Indenture Trustee by the Issuer or
the Administrator. The Issuer shall promptly transmit any notice received by it from the Noteholders to the Indenture Trustee.

 

(iii)       (a)
Notices required to be given to each Rating Agency by the Issuer or the Administrator shall be in writing, personally delivered,
couriered or mailed by certified mail, return receipt requested, electronic mail (if an address therefore has been provided by
the respective party in writing) or overnight delivery service to the address set forth for such Rating Agency on Schedule A to
the Sale and Servicing Agreement; or at such other address (including electronic mail addresses) as shall be designated by written
notice to the party or parties providing notice under this paragraph.

 

    	 	 56	 

     

    

 

(b)           Notwithstanding
subsection (iii)(a) above, notices required to be given to each Rating Agency by the Issuer or the Administrator, as the case may
be, may be made available by the Administrator through a website post, provided that the Administrator shall inform or cause each
Rating Agency to be informed in writing (including by electronic mail) that a notice has been posted.

 

(i)       Notices
required to be given to the Honda Parties pursuant to Section 7.02(e) shall be in writing, personally delivered or mailed
by certified mail, return receipt requested, or overnight delivery service, by facsimile or by electronic mail (if an address therefore
has been provided by the Honda Parties in writing) to the address set forth on Schedule A to the Sale and Servicing Agreement.

 

Section 11.05. Notices to Noteholders;
Waiver. Where this Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at such Noteholder’s address as it appears on the Note Register, not later than the latest date, and not earlier than
the earliest date, prescribed for the giving of such notice. In any case where notice to Noteholders is given by mail, neither
the failure to mail such notice nor any defect in any notice so mailed to any particular Noteholder shall affect the sufficiency
of such notice with respect to other Noteholders, and any notice that is mailed in the manner herein provided shall conclusively
be presumed to have been duly given.

 

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

 

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

 

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

 

Section 11.06. Alternate Payment and
Notice Provisions. Notwithstanding any provision of this Indenture or any of the Notes to the contrary, the Issuer may enter
into any agreement with any Noteholder of a Note providing for a method of payment, or notice by the Indenture Trustee or any Paying
Agent to such Noteholder, that is different from the methods provided for in this Indenture for such payments or notices. The Issuer
will furnish to the Indenture Trustee a copy of each such agreement and the Indenture Trustee will cause payments to be made and
notices to be given in accordance with such agreements.

 

    	 	 57	 

     

    

 

Section 11.07. Conflict with Trust Indenture
Act. If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in
this Indenture by any of the provisions of the Trust Indenture Act, such required provision shall control.

 

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

 

Section 11.08. Effect of Headings and
Table of Contents. The Article and Section headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.

 

Section 11.09. Successors and Assigns.
All covenants and agreements in this Indenture and the Notes by the Issuer shall bind its successors and assigns, whether so expressed
or not. All agreements of the Indenture Trustee in this Indenture shall bind its successors, co-trustees and agents.

 

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

 

Section 11.11. Benefits of Indenture.
Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto, the Trustees
and their successors hereunder, the Noteholders, and any other party secured hereunder, and any other Person with an ownership
interest in any part of the Owner Trust Estate, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

Section 11.12. Legal Holidays. In
any case where the date on which any payment is due shall not be a Business Day, then (notwithstanding any other provision of the
Note’s or this Indenture) payment need not be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the date on which nominally due, and no interest shall accrue for the period from and after
any such nominal date.

 

Section 11.13. Governing Law; Submission
to Jurisdiction; Waiver of Jury Trial. THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL
BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Regardless
of any provision in any other agreement, for purposes of the UCC, New York shall be deemed to be the Securities Intermediary’s
jurisdiction, and the law of the State of New York shall govern all issues specified in Article 2(1) of the Hague Securities Convention.

 

    	 	 58	 

     

    

 

Each of the parties hereto hereby submits
to the exclusive jurisdiction of the United States District Court for the Southern District of New York and of any New York State
court sitting in New York City for purposes of all legal proceedings arising out of or relating to this Indenture or the transactions
contemplated hereby. Each of the parties hereto hereby further irrevocably waives any claim that any such courts lack jurisdiction
over such party, and agrees not to plead or claim, in any legal action or proceeding with respect to this Indenture in any of the
aforesaid courts, that any such court lacks jurisdiction over such party. Each of the parties hereto irrevocably waives, to the
fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a court has been brought in an inconvenient forum.

 

Each party hereto hereby waives, to the
fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any litigation directly or indirectly
arising out of, under or in connection with this Indenture.

 

Section 11.14. Counterparts; Electronic
Transmission.

 

(a)           This Indenture may be executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. Delivery of an
executed counterpart of a signature page of this Indenture by telecopy, e-mailed .pdf or any other electronic means that
reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart
of this Indenture. The words “execution,” “signed,” “signature,” “delivery,”
and words of like import in or relating to any document to be signed in connection with this Indenture and the transactions
contemplated hereby shall be deemed to include electronic signatures, deliveries or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical
delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act or any other similar
state laws based on the Uniform Electronic Transactions Act.

 

(b)           The
Indenture Trustee, the Owner Trustee, the Delaware Trustee and the Issuer are authorized to accept written instructions, directions,
reports, notices or other communications signed manually, by way of faxed signatures, or delivered by Electronic Transmission.
In the absence of bad faith or negligence on its part, each of the Indenture Trustee, the Owner Trustee, the Delaware Trustee and
the Issuer may conclusively rely on the fact that the Person sending instructions, directions, reports, notices or other communications
or information by Electronic Transmission is, in fact, a Person authorized to give such instructions, directions, reports, notices
or other communications or information on behalf of the party purporting to send such Electronic Transmission and, in the absence
of bad faith or negligence, shall not have any liability for any losses, liabilities, costs or expenses incurred or sustained by
any party as a result of such reliance upon or compliance with such instructions, directions, reports, notices or other communications
or information to the Indenture Trustee, the Owner Trustee, the Delaware Trustee or the Issuer, including, without limitation,
the risk of either the Indenture Trustee, the Owner Trustee, the Delaware Trustee or the Issuer acting on unauthorized instructions,
notices, reports or other communications or information, and the risk of interception and misuse by third parties.

 

    	 	 59	 

     

    

 

Section 11.15. Recording of Indenture.
If this Indenture is subject to recording in any appropriate public recording offices, such recording is to be effected by the
Issuer and at its expense accompanied by an Opinion of Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee) to the effect that such recording is necessary either for the protection of the
Noteholders or any other Person secured hereunder or for the enforcement of any right or remedy granted to the Indenture Trustee
under this Indenture.

 

Section 11.16. Trust Obligation.
No recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture
Trustee on the Notes or under this Indenture or any certificate or other writing delivered in connection herewith or therewith,
against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director, employee or agent of the Indenture Trustee or the Owner
Trustee in its individual capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee
or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person
may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee have no such obligations in their
individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable
law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such
entity. For all purposes of this Indenture, in the performance of any duties or obligations of the Issuer hereunder, the Owner
Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust
Agreement as if specifically set forth herein.

 

Section 11.17. No Petition. The Indenture
Trustee, by entering into this Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree that they will not
at any time institute against the Issuer, or join in any institution against the Issuer of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any U.S. federal or state bankruptcy or similar law in connection
with any obligations relating to the Notes, this Indenture or any of the other Basic Documents.

 

Section 11.18. Inspection. The Issuer
agrees that, on reasonable prior notice, it will permit any representative of the Indenture Trustee, during the Issuer’s
normal business hours, to examine all the accounting books, records, reports and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified public accountants, and to discuss the Issuer’s
affairs, finances and accounts with the Issuer’s officers and Independent certified public accountants, all at such reasonable
times and as often as may be reasonably requested. Notwithstanding anything herein to the contrary, the foregoing shall not be
construed to prohibit (i) the disclosure of any and all information that is or becomes publicly known, or information obtained
by the Indenture Trustee from sources other than the Servicer or the Issuer, (ii) the disclosure of any and all information (A)
if required to do so by any applicable law, rule or regulation, (B) to any government agency or regulatory body having or claiming
authority to regulate or oversee any aspects of the Indenture Trustee’s business or that of its affiliates, (C) pursuant
to any subpoena, civil investigative demand or similar demand or request of any court, regulatory authority, arbitrator or arbitration
to which the Indenture Trustee or any affiliate or an officer, director, employer or shareholder thereof is a party, (D) in any
preliminary or final offering circular, registration statement or contract or other document pertaining to the transactions contemplated
by the Agreement approved in advance by the Servicer or the Issuer or (E) to any affiliate, independent or internal auditor, agent,
employee or attorney of the Indenture Trustee having a need to know the same for reasons directly related to the ability of the
Indenture Trustee to perform its duties hereunder, provided that the Indenture Trustee advises such recipient of the confidential
nature of the information being disclosed, or (iii) any other disclosure authorized by the Servicer or the Issuer.

 

    	 	 60	 

     

    

 

Section 11.19. [Reserved]

 

Section 11.20. Disclosure of Tax Treatment.
Notwithstanding the foregoing or anything herein to the contrary, all persons (and their respective employees, representatives
or other agents) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the
transaction described herein and all materials of any kind (including opinions or other tax analyses) that are provided to the
recipient relating to such tax treatment and tax structure. However, any such information relating to the tax treatment or tax
structure shall be required to be kept confidential to the extent necessary to comply with any applicable securities laws.

 

Section 11.21. Intent of the Parties;
Reasonableness. The Indenture Trustee and Issuer acknowledge and agree that the purpose of Section 3.09 and 7.02(e) of this
Indenture is to facilitate compliance by the Issuer and the Depositor with the provisions of Regulation AB and related rules and
regulations of the Commission.

 

Neither the Issuer nor the Administrator
(acting on behalf of the Issuer) shall exercise its right to request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with federal securities laws, including the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder. Each of the parties hereto agrees that (a) the obligations
of the parties hereunder shall be interpreted in such a manner as to accomplish compliance with Regulation AB, (b) the parties’
obligations hereunder will be supplemented and modified as necessary to be consistent with any such amendments, interpretive advice
or guidance from the Securities and Exchange Commission, convention or consensus among active participants in the asset-backed
securities markets, or otherwise in respect of the requirements of Regulation AB as they may be applied by the Securities and Exchange
Commission to the Issuer in connection with the Notes and (c) the parties shall comply with reasonable requests made by or on behalf
of the Issuer or the Indenture Trustee for delivery of additional or different information, to the extent such information is available,
as the person requesting such information may determine in good faith is necessary for it to comply with the provisions of Regulation
AB. Any and all expenses incurred by the Indenture Trustee in compliance with this Section shall be considered indemnities payable
in accordance with Section 6.07 hereof.

 

    	 	 61	 

     

    

 

The Issuer (or the Administrator, acting
on behalf of the Issuer) shall cooperate with the Indenture Trustee by providing timely notice of requests for information under
these provisions and by reasonably limiting such requests to information required, in the reasonable judgment of the Issuer to
comply with Regulation AB.

 

Section 11.22. Owner Trustee. The
parties hereto agree that this Indenture is executed and delivered by the Owner Trustee, not individually or personally but solely
as owner trustee of the Issuer, in the exercise of the powers and authority conferred and vested in it under the Amended and Restated
Trust Agreement; each of the representations, undertakings and agreements herein made on the part of the Issuer are made and intended
not as personal representations, undertakings and agreements by The Bank of New York Mellon or BNY Mellon Trust of Delaware but
are made and intended for the purpose of binding only the Issuer; and under no circumstances shall The Bank of New York Mellon
or BNY Mellon Trust of Delaware be personally liable for the inaccuracy or breach of any statements made by the Issuer in this
Indenture.

 

Section 11.23. U.S.A. Patriot Act.
The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Indenture Trustee, like all financial
institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record
information that identifies each person or legal entity that establishes a relationship or opens an account with the Indenture
Trustee. The parties to this Indenture agree that they will provide the Indenture Trustee with such information about the Owner
Trustee as it may request in order for the Indenture Trustee to satisfy the requirements of the U.S.A. Patriot Act.

 

Section 11.24. Communications with Rating
Agencies. If the Indenture Trustee shall receive any written or oral communication from any Rating Agency (or any of their
respective officers, directors or employees) with respect to the transactions contemplated hereby or under the Basic Documents
or in any way relating to the Notes, the Indenture Trustee agrees to refrain from communicating with such Rating Agency and to
promptly notify the Administrator of such communication. The Indenture Trustee agrees to coordinate with the Administrator with
respect to any communication received from a Rating Agency and further agrees that in no event shall the Indenture Trustee engage
in any oral communication with respect to the substance of the transactions contemplated hereby or under the Basic Documents or
in any way relating to the Notes, with any Rating Agency (or any of their respective officers, directors or employees) without
the participation of the Administrator.

 

The Indenture Trustee will not be responsible
for delays attributable to the Administrator’s failure to deliver any information related to any communication with a Rating
Agency (with respect to this section, the “Information”), defects in the Information supplied to the Rating
Agency or Administrator or other circumstances beyond the control of the Indenture Trustee. The Indenture Trustee shall be under
no obligation to make any determination as to the veracity or applicability of any Information provided to it, or whether any such
Information is required to be maintained on a website or other public medium.

 

    	 	 62	 

     

    

 

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

 

	 	HONDA AUTO RECEIVABLES 2020-2 OWNER TRUST,
	 	 	 
	 	By:       The Bank of New York Mellon, not in its individual capacity but solely as Owner Trustee on behalf of the Trust
	 	 	 
	 	 	 
	 	By:	/s/ Christine Conway
	 	 	Name: Christine Conway
	 	 	Title: Vice President

 

	 	CITIBANK, N.A.,
		not in its individual capacity but solely as Indenture
Trustee and as Securities Intermediary
	 	 
	 	 	 
	 	By:	/s/ Louis Piscitelli
	 	 	Name: Louis Piscitelli
	 	 	Title: Senior Trust Officer

 

Agreed to with respect to Section 7.02(b):

 

 

AMERICAN HONDA FINANCE

CORPORATION,
as Servicer  

	 	 	 
	By:	 /s/ Paul C. Honda
	 
	 	Name:	Paul C. Honda	 
	 	Title:	Vice President and Assistant Secretary	 
	 	 	 

 

    	 	S-1	 

     

    

 

	STATE OF	New York	)	 
	 	 	)	 ss
	COUNTY OF	New York	)	 

 

On May 8, 2020 before me, Helen
Choi, Notary Public, personally appeared Christine Conway, Vice President.

 

 

	x	personally known to me, or	 
	 	 	 
	 ̈	
        proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s) is/are subscribed to the within instrument,

 

and acknowledged to me that he/she executed the same in his/her
authorized capacity, and that by his/her signature on the instrument the person, or the entity upon behalf of which such person
acted, executed the instrument.

 

WITNESS my hand and official seal.

 

 

	Signature	/s/ Helen Choi	 	[Seal]	 

 

     

     

    

 

	STATE OF	New York	)	 
	 	 	)	 ss
	COUNTY OF	New York	)	 

 

On May 27, 2020 before me, Kate
Molina, Notary Public, personally appeared Louis Piscitelli, of Citibank, N.A.

 

 

	x	personally known to me, or	 
	 	 	 
	 ̈	
        proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s) is/are subscribed to the within instrument,

 

and acknowledged to me that he/she executed the same in his/her
authorized capacity, and that by his/her signature on the instrument the person, or the entity upon behalf of which such person
acted, executed the instrument.

 

WITNESS my hand and official seal.

 

 

	Signature	/s/ Kate Molina	 	[Seal]	 

 

     

     

    

 

 

 

SCHEDULE A

 

SCHEDULE OF RECEIVABLES

To be provided to the Indenture Trustee

 

Schedule A-1

 

    	 		 

     

    

 

EXHIBIT A

 

FORM OF CLASS [A-1] [A-2] [A-3] [A-4] NOTE

 

[For Retained Notes: THIS NOTE HAS NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR UNDER THE SECURITIES OR BLUE SKY
LAWS OF ANY STATE IN THE UNITED STATES OR ANY FOREIGN SECURITIES LAWS. NO SALE, PLEDGE OR OTHER TRANSFER OF THIS NOTE MAY BE MADE
BY ANY PERSON UNLESS EITHER (i) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE BY THE SPONSOR TO AN AFFILIATE, (ii) SUCH
SALE, PLEDGE OR OTHER TRANSFER IS MADE TO AN ACCREDITED INVESTOR THAT EXECUTES A NOTE, SUBSTANTIALLY IN THE FORM SPECIFIED IN THE
INDENTURE, TO THE EFFECT THAT IT IS AN ACCREDITED INVESTOR ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS
A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE ACCREDITED INVESTORS UNLESS THE HOLDER IS A BANK ACTING IN ITS FIDUCIARY
CAPACITY), (iii) SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT, SUCH SALE, PLEDGE OR
OTHER TRANSFER IS MADE TO A PERSON WHO THE PROSPECTIVE TRANSFEROR REASONABLY BELIEVES AFTER DUE INQUIRY IS A QUALIFIED INSTITUTIONAL
BUYER, ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO
ARE QUALIFIED INSTITUTIONAL BUYERS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, OR (iv) SUCH SALE, PLEDGE OR OTHER TRANSFER IS OTHERWISE MADE IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE 1933 ACT, IN WHICH CASE THE SPONSOR SHALL REQUIRE THAT BOTH THE PROSPECTIVE TRANSFEROR AND THE PROSPECTIVE TRANSFEREE CERTIFY
TO THE ISSUER, THE OWNER TRUSTEE, THE INDENTURE TRUSTEE AND THE SPONSOR IN WRITING THE FACTS SURROUNDING SUCH TRANSFER, WHICH CERTIFICATION
SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE SPONSOR. EXCEPT IN THE CASE OF A TRANSFER DESCRIBED IN CLAUSES (i) OR (iii) ABOVE,
THE SPONSOR SHALL REQUIRE A WRITTEN OPINION OF COUNSEL (WHICH SHALL NOT BE AT THE EXPENSE OF THE TRUST, THE OWNER TRUSTEE OR THE
INDENTURE TRUSTEE) SATISFACTORY TO THE SPONSOR TO THE EFFECT THAT SUCH TRANSFER WILL NOT VIOLATE THE 1933 ACT.

 

UNLESS COUNSEL SATISFACTORY TO THE SPONSOR
SHALL HAVE RENDERED AN OPINION TO THE EFFECT THAT THE RETAINED NOTES TO BE SOLD, PLEDGED, OR TRANSFERRED WILL BE CHARACTERIZED
AS INDEBTEDNESS FOR U.S. FEDERAL INCOME TAX PURPOSES, NO SALE, PLEDGE, OR TRANSFER OF THIS RETAINED NOTE MAY BE MADE.]

 

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

 

    	 	A-1-1	 

     

    

 

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

 

	REGISTERED	$__________
	No. R-_____	CUSIP NO. _______

HONDA AUTO RECEIVABLES 2020-2 OWNER TRUST

____% ASSET BACKED NOTES, CLASS [A-1][A-2] [A-3] [A-4]

 

Honda Auto Receivables
2020-2 Owner Trust, a statutory trust organized and existing under the laws of the State of Delaware (the “Issuer”),
for value received, hereby promises to pay to [American Honda Finance Corporation][Cede & Co.], or registered assigns,
the principal sum of _____________________ Dollars ($__________), payable to the extent described in the Indenture referred to
on the reverse hereof on each Payment Date; provided, however, that the entire unpaid principal amount of this Note shall be payable
on the earlier of ________________ ___, 20__ (the “Class [A-1] [A-2] [A-3] [A-4] Final Scheduled Payment Date”) and
the Redemption Date, if any, selected pursuant to the Indenture.

 

The Issuer will pay
interest on this Note at the rate per annum shown above on each Payment Date until the principal of this Note is paid or made available
for payment, on the principal amount of this Note outstanding on the preceding Payment Date (after giving effect to all payments
of principal made on the preceding Payment Date), or on the Closing Date in the case of the first Payment Date or if no interest
has yet been paid, subject to certain limitations contained in the Indenture. [Interest on this Class A-[_] Note will accrue for
each Payment Date from and including the immediately preceding Payment Date (or, in the case of the first Payment Date, the Closing
Date), to but excluding such Payment Date]. [Interest on this Class A-[_] Note will accrue for each Payment Date from and including
the [__] day of the prior month (or, in the case of the first Payment Date, the Closing Date) to but excluding the [__] day of
the month of such Payment Date] and will be computed on the basis of [the actual number of days in the Interest Accrual Period
with respect to the Class A-[_] Notes divided by 360] [a 360-day year consisting of twelve 30-day months]. Such principal of and
interest on this Note shall be paid in the manner specified on the reverse hereof.

 

The principal of and
interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender
for payment of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest
due and payable on this Note as provided above and then to the unpaid principal of this Note.

 

    	 	A-1-2	 

     

    

 

Reference is made to
the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.

 

Unless the certificate
of authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall
not be entitled to any benefit under the Indenture, or be valid or obligatory for any purpose.

 

    	 	A-1-3	 

     

    

  

IN WITNESS WHEREOF,
the Issuer has caused this instrument to be signed, manually, in facsimile or scanned, by its Authorized Officer, as of the date
set forth below.

 

	Date:	HONDA AUTO RECEIVABLES 2020-2 OWNER

TRUST,
	 
	By:	THE BANK OF NEW YORK MELLON, not in its individual capacity but solely as Owner Trustee on behalf of the Trust,
	By:	
	 	Authorized Signatory

 

    	 	A-1-4	 

     

    

 

INDENTURE TRUSTEE’S CERTIFICATE OF
AUTHENTICATION

 

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

 

 

	Date:	CITIBANK, N.A., not in its individual capacity but solely as Indenture Trustee,
	By:	 
	Authorized Signatory

 

    	 	A-1-5	 

     

    

 

This Note is one of
a duly authorized issue of Notes of the Issuer, designated as its ___% Asset Backed Notes, Class [A-1] [A-2] [A-3] [A-4] (the “Class
[A-1] [A-2] [A-3] [A-4] Notes”), all issued under the Indenture, to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee
and the Noteholders. The Notes are subject to all terms of the Indenture. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Sale and Servicing Agreement.

 

The Class A-1 Notes,
the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes (collectively, the “Notes”) are and will be equally
and ratably secured by the collateral pledged as security therefore, except as provided in the Indenture or the Sale and Servicing
Agreement.

 

Principal payable on
the Notes will be paid on each Payment Date in the amount specified in the Indenture and in the Sale and Servicing Agreement. As
described above, the entire unpaid principal amount of this Note will be payable on the earlier of the Class [A-1] [A-2] [A-3]
[A-4] Final Scheduled Payment Date and the Redemption Date, if any, selected pursuant to the Indenture. Notwithstanding the foregoing,
under certain circumstances, the entire unpaid principal amount of the Class [A-1] [A-2] [A-3] [A-4] Notes shall be due and payable
following the occurrence and continuance of an Event of Default, as described in the Indenture. All principal payments on the Class
[A-1] [A-2] [A-3] [A-4] Notes shall be made pro rata to the Class [A-1] [A-2] [A-3] [A-4] Noteholders entitled thereto.

 

Payments of principal
and interest on this Note due and payable on each Payment Date or Redemption Date shall be made by check mailed to the Person whose
name appears as the registered Noteholder of this Note (or one or more Predecessor Notes) on the Note Register as of the close
of business on the related Record Date[, except that with respect to Notes registered on the Record Date in the name of the nominee
of the Depository (initially, such nominee to be Cede & Co.), payments will be made by wire transfer in immediately available
funds to the account designated by such nominee]. Such checks shall be mailed to the Person entitled thereto at the address of
such Person as it appears on the Note Register as of the applicable Record Date without requiring that this Note be submitted for
notation of payment. Any reduction in the principal amount of this Note (or any one or more Predecessor Notes) affected by any
payments made on any Payment Date or Redemption Date shall be binding upon all future Noteholders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds
are expected to be available, as provided in the Indenture or the Sale and Servicing Agreement, for payment in full of the remaining
unpaid principal amount of this Note on a Payment Date or Redemption Date, then the Indenture Trustee, in the name of and on behalf
of the Issuer, will notify the Person who was the registered Noteholder hereof as of the Record Date preceding such Payment Date
or Redemption Date by notice mailed within five (5) Business Days of such Payment Date or Redemption Date and the amount then due
and payable shall be payable only upon presentation and surrender of this Note at the Corporate Trust Office of the Indenture Trustee.

 

    	 	A-1-6	 

     

    

 

As provided in the
Indenture and subject to the limitations set forth therein and on the face hereof, the transfer of this Note may be registered
on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer
pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture
Trustee duly executed by, the Noteholder hereof or such Noteholder’s attorney duly authorized in writing, with such signature
guaranteed by an “eligible guarantor institution” meeting the requirements of the Note Registrar, which requirements
include membership or participation in the Securities Transfer Agent’s Medallion Program (“STAMP”) or such other
 “signature guarantee program” as may be determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended, and thereupon one or more new Notes of authorized denominations
and in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be
charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange.

 

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

 

Each Noteholder or
Note Owner, by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees by accepting
the benefits of the Indenture that such Noteholder or Note Owner will not at any time institute against the Depositor or the Issuer,
or join in any institution against the Depositor or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under any U.S. federal or state bankruptcy or similar law in connection with any obligations relating to the Notes,
the Indenture or the other Basic Documents.

 

By acquiring this Note
(or interest herein), each purchaser and transferee (and if the purchaser or transferee is a Plan, its fiduciary) is deemed to
represent and warrant that either (i) it is not acquiring the Note (or interest therein) with the assets of a Benefit Plan Investor
or a Plan that is subject to Similar Law; or (ii) the acquisition and holding of the Note (or interest therein) will not give rise
to, in the case of a Benefit Plan Investor, a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the
Code or, in the case of a Plan that is subject to Similar Law, a violation of Similar Law.

 

The Issuer has entered
into the Indenture and this Note is issued with the intention that, for U.S. federal income, state and local income and franchise
tax purposes, the Notes will qualify as indebtedness secured by the Owner Trust Estate. Each Noteholder (other than a Noteholder
of a Retained Note), by acceptance of a Note (and each Note Owner by acceptance of a beneficial interest in a Note), agrees to
treat the Notes for U.S. federal income, state and local income and franchise tax purposes as indebtedness.

 

    	 	A-1-7	 

     

    

 

Prior to the due presentment
for registration of transfer of this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee
may treat the Person in whose name this Note (as of the day of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Issuer, the
Indenture Trustee or any such agent shall be affected by notice to the contrary.

 

The Indenture permits,
with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer
and the rights of the Noteholders under the Indenture at any time by the Issuer with the consent of the Noteholders of Notes representing
a majority of the Outstanding Amount of all Notes at the time Outstanding. The Indenture also contains provisions permitting the
Noteholders of Notes representing specified percentages of the Outstanding Amount of the Notes, on behalf of the Noteholders of
all the Notes, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture
and their consequences. Any such consent or waiver by the Noteholder of this Note (or any one or more Predecessor Notes) shall
be conclusive and binding upon such Noteholder and upon all future Noteholders of this Note and of any Note issued upon the registration
of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this
Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture
without the consent of Noteholders of the Notes issued thereunder.

 

The Notes are issuable
only in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth.

 

This Note shall be
construed in accordance with the laws of the State of New York, without reference to its conflict of law provisions, and the obligations,
rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws.

 

    	 	A-1-8	 

     

    

 

ASSIGNMENT

 

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

 

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

	 
	
        (name and
        address of assignee)

         
	 
	the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints

	 
	
        attorney, to transfer said Note
        on the books kept for registration thereof, with full power of substitution in the premises.

         
	 
	Dated:	 	 	 	1
	 	 	Signature Guaranteed:	*	 
	 	 	 	 	 	 	 	 	 

 

 

1       NOTICE:
The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within
Note in every particular, without alteration, enlargement or any change whatever. Such signature must be guaranteed by an “eligible
guarantor institution” meeting the requirements of the Note Registrar, which requirements include membership or participation
in STAMP or such other “signature guarantee program” as may be determined by the Note Registrar in addition to, or
in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

    	 	A-1-9	 

     

    

 

EXHIBIT B

 

FORM OF TRANSFEROR CERTIFICATE FOR RETAINED
NOTES

  

[DATE]

 

 

Citibank, N.A.

388 Greenwich Street

New York, New York 10013

Attention: HAROT 2020-2

 

American Honda Finance Corporation

20800 Madrona Avenue,

Torrance, California 90503

 

	 	Re:	Honda Auto Receivables 2020-2 Owner Trust, Class [__] Notes (Retained Notes)

 

Ladies and Gentlemen:

 

In connection with our
disposition of such of the Class [__] Notes that are Retained Notes (the “Retained Notes”) we certify that (a) we
understand that the Retained Notes have not been registered under the Securities Act of 1933, as amended (the “Act”),
but were retained by the Sponsor, and are being transferred by us in a transaction that is exempt from the registration requirements
of the Act and (b) we have not offered or sold any Retained Notes to, or solicited offers to buy any Retained Notes from,
any person, or otherwise approached or negotiated with any person with respect thereto, in a manner that would be deemed, or taken
any other action which would result in, a violation of Section 5 of the Act.

 

	 	Very truly yours,
	 	 	 
	 	[NAME OF TRANSFEROR]
	 	 	 
	 	By:	 
	 	 	Authorized Officer

 

    	 	B-1	 

     

    

 

EXHIBIT C

 

 

FORM OF INVESTMENT LETTER FOR RETAINED NOTES

 

Citibank, N.A.

388 Greenwich Street

New York, New York 10013

Attention: HAROT 2020-2

American Honda Finance Corporation

20800 Madrona Avenue,

Torrance, California 90503

Ladies and Gentlemen:

 

In connection with our proposed purchase
of such of the Class [__] Notes that are Retained Notes (the “Retained Notes”) of Honda Auto Receivables 2020-2
Owner Trust (the “Issuing Entity”), we confirm that:

 

1.       We
understand that such Retained Notes have not been registered under the Securities Act of 1933, as amended (the “1933 Act”)
but were retained by American Honda Finance Corporation (the “Sponsor”), and may not be sold except as permitted
in the following sentence. We understand and agree, on our own behalf and on behalf of any accounts for which we are acting as
hereinafter stated, (x) that such Retained Notes are being offered only in a transaction not involving any public offering
within the meaning of the 1933 Act and (y) that such Retained Notes may be resold, pledged or transferred only (i) to
the Sponsor or an Affiliate, (ii) to an “accredited investor” as defined in Rule 501(a)(1),(2),(3) or (7) of
Regulation D under the 1933 Act (an “Accredited Investor”) acting for its own account (and not for the account of others)
or as a fiduciary or agent for others (which others also are Accredited Investors unless the holder is a bank acting in its fiduciary
capacity) that executes a certificate substantially in the form hereof, (iii) so long as such Retained Note is eligible for
resale pursuant to Rule 144A under the 1933 Act (“Rule 144A”), to a person whom we reasonably believe after due inquiry
is a “qualified institutional buyer” as defined in Rule 144A, acting for its own account (and not for the account of
others) or as a fiduciary or agent for others (which others also are “qualified institutional buyers”) to whom notice
is given that the resale, pledge or transfer is being made in reliance on Rule 144A or (iv) in a sale, pledge or other transfer
made in a transaction otherwise exempt from the registration requirements of the 1933 Act, in which case the Sponsor shall require
that both the prospective transferor and the prospective transferee certify to the Indenture Trustee and the Sponsor in writing
the facts surrounding such transfer, which certification shall be in form and substance satisfactory to the Issuer and the Sponsor.
Except in the case of a transfer described in clauses (i) or (iii) above, the Sponsor shall require that a written opinion
of counsel (which will not be at the expense of the Sponsor, any Affiliate of the Sponsor, the Owner Trustee or the Indenture Trustee),
reasonably satisfactory to the Issuer and the Sponsor, be delivered to the Issuer, the Owner Trustee, the Indenture Trustee and
the Sponsor to the effect that such transfer will not violate the 1933 Act, and will be effected in accordance with any applicable
securities laws of each state of the United States. We will notify any purchaser of the Retained Notes from us of the above resale
restrictions, if then applicable. We further understand that in connection with any transfer of the Retained Notes by us that the
Issuer and the Sponsor may request, and if so requested we will furnish, such certificates and other information as they may reasonably
require to confirm that any such transfer complies with the foregoing restrictions.

 

    	 	C-1	 

     

    

 

2.       [CHECK
ONE]

 

(a)       We
are an Accredited Investor acting for our own account (and not for the account of others) or as a fiduciary or agent for others
(which others also are Accredited Investors unless we are a bank acting in its fiduciary capacity). We have such knowledge and
experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Retained
Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or their investment for an
indefinite period of time. We are acquiring the Retained Notes or investment and not with a view to, or for offer and sale in connection
with, a public distribution.

 

(b)       We
are a “qualified institutional buyer” as defined under Rule 144A under the 1933 Act and are acquiring the Retained
Notes for our own account (and not for the account of others) or as a fiduciary or agent for others (which others also are “qualified
institutional buyers”). We are familiar with Rule 144A under the 1933 Act and are aware that the seller of the Retained Notes
and other parties intend to rely on the statements made herein and the exemption from the registration requirements of the 1933
Act provided by Rule 144A.

 

3.       Either
(a) we are not a Plan (as defined below) that is subject to (i) Title I of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”), or Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”)
(each of the foregoing, a “Benefit Plan Investor”), or (ii) a law that is similar to the fiduciary or prohibited
transaction provisions of Title I of ERISA or Section 4975 of the Code (“Similar Law”) or (b) we and our fiduciary
represent and warrant that the acquisition and holding of this Note (or any interest herein) will not give rise to, in the case
of a Benefit Plan Investor, a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in the
case of a Plan that is subject to Similar Law, a violation of Similar Law. For purposes of the foregoing, the term “Plan”
means an “employee benefit plan” as defined in Section 3(3) of ERISA whether or not subject to Title I of ERISA, a
 “plan” as defined in Section 4975 of the Code, or an entity deemed to hold the plan assets of any of the foregoing.

 

4.       We
understand that the Indenture Trustee, the Sponsor and others will rely upon the truth and accuracy of the foregoing acknowledgments,
representations and agreements, and we agree that if any of the acknowledgments, representations and warranties deemed to have
been made by us by our purchase of the Retained Notes, for our own account or for one or more accounts as to each of which we exercise
sole investment discretion, are no longer accurate, we shall promptly notify the Sponsor.

 

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

 

    	 	C-2	 

     

    

 

	 	Very truly yours,
	 	 
	 	[NAME OF PURCHASER]
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	Date:	 

 

    	 	C-3	 

     

    

 

EXHIBIT D

 

Servicing Criteria To Be Addressed In Assessment
Of Compliance

 

The assessment of compliance to be delivered
by the Indenture Trustee, shall address, at a minimum, the criteria identified below as “Applicable Servicing Criteria”:

 

	Reference	Criteria	 
	 	
         

        Cash Collection and Administration

         

         
	 
	1122(d)(2)(ii)	Disbursements made via wire transfer on behalf of an obligor or to an investor are made only by authorized personnel.	X
	 	
         

        Investor Remittances and Reporting

         

         
	 
	1122(d)(3)(ii)	Amounts due to investors are allocated and remitted in accordance with timeframes, distribution priority and other terms set forth in the transaction agreements.*	X
	1122(d)(3)(iii)	Disbursements made to an investor are posted within two business days to the Servicer’s investor records, or such other number of days specified in the transaction agreements.	X
	1122(d)(3)(iv)	Amounts remitted to investors per the investor reports agree with cancelled checks, or other form of payment, or custodial bank statements.	X

  

* With respect to remittances.

 

    	 	D-1	 

     

    

 

EXHIBIT E 

 

Form of Monthly Rule 15Ga-1 Asset Repurchase
Activity Report

Reporting Period: ____________

Name of Issuing Entity: HAROT 2020-2

Trustee: Citibank, N.A.

[_] Check here if the Trustee has no activity to report during Reporting Period indicated above

 

	Name of

Issuing Entity	Check if Registered	Name of Originator	Total Assets in 

ABS by Originator	Assets That Were Subject of

Demand	Assets That Were Repurchased or Replaced	Assets Pending Repurchase or

Replacement 

(within cure period)	Demand in Dispute	Demand Withdrawn	Demand Rejected
	(a)	(b)	(c)	(#)

(d)	($)

(e)	(% of principal balance)

(f)	(#)

(g)	($)

(h)	(% of principal balance)

(i)	(#)

(j)	($)

(k)	(% of principal balance)

(l)	(#)

(m)	($)

(n)	(% of principal balance)

(o)	(#)

(p)	($)

(q)	(% of principal balance)

(r)	(#)

(s)	($)

(t)	(% of principal balance)

(u)	(#)

(v)	($)

(w)	(% of principal balance)

(x)
	Asset 

Class X	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Issuing Entity A CIK #	X	Originator 1	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Originator 2	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 
	Asset 

Class Y	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Issuing 

Entity B	 	Originator 3	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 

 

    	 	E-1

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