Exhibit
4.4


Execution
Copy




 





HSBC FINANCE
CORPORATION,

as Servicer,


HSBC AUTOMOTIVE TRUST (USA) 2006-3,

as Issuer,


HSBC AUTO RECEIVABLES CORPORATION,

as Seller,


THE BANK OF NEW YORK TRUST COMPANY, N.A.,

as Indenture Trustee,


U.S. BANK TRUST NATIONAL ASSOCIATION,

as Owner Trustee,


HSBC BANK USA, NATIONAL ASSOCIATION,

as Administrator




 





SERIES SUPPLEMENT


Dated as of November 1, 2006


to the


INDENTURE


Dated as of November 1, 2006


to the


SALE AND SERVICING
AGREEMENT


Dated as of
November 1, 2006


and to the


AMENDED AND
RESTATED TRUST AGREEMENT


Dated as of
November 1, 2006




 












 



TABLE OF CONTENTS


	
  

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  I CREATION OF THE NOTES

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  Designation

  	
   

  	
  1

  
	
  SECTION 1.02.

  	
  Pledge of Series Trust Estate

  	
   

  	
  1

  
	
  SECTION 1.03.

  	
  Payments and Computations

  	
   

  	
  3

  
	
  SECTION 1.04.

  	
  Denominations

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  II DEFINITIONS

  	
   

  	
  3

  
	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  Definitions

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III DISTRIBUTIONS AND STATEMENTS TO
  NOTEHOLDERS; SERIES SPECIFIC COVENANTS

  	
   

  	
  10

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  Trust Accounts

  	
   

  	
  10

  
	
  SECTION 3.02.

  	
  Reserve Account

  	
   

  	
  11

  
	
  SECTION 3.03.

  	
  Distributions

  	
   

  	
  11

  
	
  SECTION 3.04.

  	
  Statements to Noteholders

  	
   

  	
  13

  
	
  SECTION 3.05.

  	
  Reporting Requirements

  	
   

  	
  15

  
	
  SECTION 3.06.

  	
  Compliance With Withholding Requirements

  	
   

  	
  16

  
	
  SECTION 3.07.

  	
  Special Covenants and Acknowledgements

  	
   

  	
  16

  
	
  SECTION 3.08.

  	
  Income Tax Characterization

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  IV EVENTS OF DEFAULT; REMEDIES

  	
   

  	
  17

  
	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  Events of Default

  	
   

  	
  17

  
	
  SECTION 4.02.

  	
  Rights Upon Event of Default

  	
   

  	
  18

  
	
  SECTION 4.03.

  	
  Remedies

  	
   

  	
  19

  
	
  SECTION 4.04.

  	
  Priorities

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  V PREPAYMENT, REDEMPTION AND SUBSTITUTION

  	
   

  	
  21

  
	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  Optional “Clean-Up” Redemption

  	
   

  	
  21

  
	
  SECTION 5.02.

  	
  Optional Substitution

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VI MISCELLANEOUS

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  Ratification of Basic Documents

  	
   

  	
  22

  
	
  SECTION 6.02.

  	
  Counterparts

  	
   

  	
  22

  
	
  SECTION 6.03.

  	
  GOVERNING LAW

  	
   

  	
  22

  
	
  SECTION 6.04.

  	
  Amendments Without Consent of Noteholders

  	
   

  	
  22

  
	
  SECTION 6.05.

  	
  Amendments With Consent of the Noteholders

  	
   

  	
  24

  
	
  SECTION 6.06.

  	
  Authority to Register Notes and File Reports

  	
   

  	
  26

  
	
  SECTION 6.07.

  	
  Authority to Perform Duties of the Issuer

  	
   

  	
  26

  
	
  SECTION 6.08.

  	
  Notices

  	
   

  	
  26

  
	
  SECTION 6.09.

  	
  [Reserved]

  	
   

  	
  27

  
	
   

  	
   

  	
   

  
	
  Schedule I

  	
  Eligibility Criteria

  	
   

  	
   

  
	
  Schedule II

  	
  Schedule of Receivables

  	
   

  	
   

  
	
  Exhibit A

  	
  Form of Servicer’s Certificate

  	
   

  	
   

  
	
  Exhibit B

  	
  Forms of Notes

  	
   

  	
   

  
					



 
















This Series Supplement, dated as of November 1, 2006,
is by and among HSBC Finance Corporation, a Delaware corporation, as Servicer
(the “Servicer”), HSBC Automotive Trust (USA) 2006-3, a Delaware
statutory trust, as Issuer (the “Issuer” or the “Trust”), HSBC
Auto Receivables Corporation, a Nevada corporation, as Seller (the “Seller”),
THE BANK OF NEW YORK TRUST COMPANY, N.A., a national banking association,
as trustee for the Noteholders (the “Indenture Trustee”), U.S. Bank
Trust National Association, a national banking association, as owner trustee
for the Certificateholders (the “Owner Trustee”), and HSBC Bank USA,
National Association, a national banking association, as administrator (the “Administrator”).


RECITALS


This Series Supplement is executed and delivered by
the parties hereto pursuant to Section 9.3 of the Indenture (the “Indenture”)
dated as of November 1, 2006 among the Issuer, the Indenture Trustee and the
Administrator and pursuant to Section 3.2 of the Trust Agreement between the
Seller and the Owner Trustee.  In the
event that any term or provision contained herein shall conflict with or be
inconsistent with any term or provision contained in the Indenture or the Trust
Agreement, the terms and provisions of this Series Supplement shall govern.


ARTICLE I

CREATION OF THE NOTES


SECTION 1.01.              Designation.


(a)           There is hereby created a series of Notes,
substantially in the form of Exhibit B hereto, to be issued pursuant to
the Indenture and this Series Supplement to be known as “HSBC Automotive Trust
(USA) 2006-3, Series 2006-3 Notes” (as used herein, the “Notes”).  The Notes shall be issued in four classes
(each, a “Class”):  Class A-1
Notes in an aggregate initial principal amount of $208,700,000 (the “Class
A-1 Notes”), Class A-2 Notes in an aggregate initial principal amount of
$196,300,000 (the “Class A-2 Notes”), Class A-3 Notes in an aggregate
initial principal amount of $283,600,000 (the “Class A-3 Notes”), and
Class A-4 Notes in an aggregate initial principal amount of $150,149,000 (the “Class
A-4 Notes” and, together with the Class A-1 Notes, the Class A-2 Notes and
the Class A-3 Notes, the “Class A Notes”).


(b)           There is hereby created a series of
Certificates to be issued pursuant to the Trust Agreement and this Series
Supplement to be known as the “HSBC Automotive Trust (USA) 2006-3, Series
2006-3 Certificates” (as used herein, the “Certificates”).


SECTION 1.02.              Pledge of Series
Trust Estate.


The Issuer hereby Grants to the Indenture Trustee, for
the benefit of the Secured Parties, all of the Issuer’s right, title and
interest (but none of its obligations) in and to all personal property, whether
now owned or hereafter acquired and whether general intangibles, accounts,
chattel paper, claims and causes of action, deposit accounts, documents, goods,
instruments, money or constituting other personal property of any nature
whatsoever, including, without limitation: 
(a) each and every Receivable listed as a Receivable on the Schedule of
Receivables attached hereto as Schedule II and all monies paid or payable
thereon or in respect









 



thereof after the
applicable Cut-off Date (including amounts due on or before the applicable
Cut-off Date but received by HAFI, HACI, HSBC Finance, the Seller, the Servicer
or the Issuer after the applicable Cut-off Date); (b) all security interests in
the related Financed Vehicles granted by Obligors pursuant to such Receivables
and any other interest of the Issuer in the related Financed Vehicles; (c) all
rights of HAFI against Dealers pursuant to Dealer Agreements or Dealer
Assignments and against Alliance Relationships pursuant to Alliance Agreements
and Alliance Assignments related to such Receivables; (d) any proceeds and the
right to receive proceeds with respect to such Receivables repurchased by a
Dealer pursuant to a Dealer Agreement or by an Alliance Relationship pursuant
to an Alliance Agreement; (e) all rights under any Service Contracts on the
related Financed Vehicles; (f) any proceeds and the right to receive proceeds
with respect to such Receivables from claims under any Insurance Policies
covering the related Financed Vehicles or Obligors; (g) all funds on deposit
from time to time in the Trust Accounts (including all investments and proceeds
thereof); (h) all rights of the Seller in and to the Master Receivables
Purchase Agreements and related Receivables Purchase Agreement Supplements,
including all delivery requirements and representations and warranties and the
cure and repurchase obligations of HAFI, HACI or HSBC Finance, as applicable,
under the Master Receivables Purchase Agreements and such Receivables Purchase
Agreement Supplements; (i) all property (including the right to receive future
Net Liquidation Proceeds) that secures such Receivables and that has been, or
at any time is, acquired by or on behalf of the Issuer pursuant to liquidation
of such Receivables; (j) all items contained in the Receivable Files with
respect to such Receivables and any and all other documents that the Servicer,
the Seller, HAFI or HACI keeps on file in accordance with its customary
procedures relating to such Receivables, the related Financed Vehicles or
Obligors; (k) all rights of the Issuer in and to the Sale and Servicing
Agreement and the Transfer Agreement or Transfer Agreements (including all
rights of the Seller under the Master Receivables Purchase Agreements and
related Receivables Purchase Agreement Supplements assigned to the Issuer
pursuant to the Sale and Servicing Agreement and the related Transfer Agreement
or Transfer Agreements); (l) one share of the Class SV Preferred Stock of the
Seller together with the exclusive right to vote such share; and (m) all
present and future (i) claims, demands, causes and choses in action in respect
of any or all of the foregoing, and (ii) payments on or under, and all proceeds
of every kind and nature whatsoever in respect of, any or all of the foregoing,
including all proceeds of the conversion thereof, whether voluntary or
involuntary, into cash or other liquid property, cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks,
investment property, 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 (collectively,
the “Series Trust Estate”).


The foregoing Grant is made in trust to the Indenture
Trustee for the benefit of the Secured Parties. 
The Indenture Trustee hereby acknowledges such Grant, accepts the trust
under the Indenture and this Series Supplement in accordance with the
provisions of the Indenture and this Series Supplement and agrees to perform
its duties required in the Indenture and in this Series Supplement in
accordance with the provisions hereof and of the Indenture to the best of its
ability to the end that the interests of such parties, recognizing the
priorities of their respective interests, may be adequately and effectively
protected.



 2
 






 



SECTION 1.03.              Payments and
Computations.


All amounts to be paid or deposited by any Person
hereunder shall be paid or deposited in accordance with the terms hereof no
later than 12:00 noon (New York City time) on the day when due in immediately
available funds.  Notwithstanding the
foregoing, any amounts required to be paid by the Indenture Trustee or the
Administrator hereunder shall be paid in accordance with the terms hereof no
later than 3:00 p.m. (New York City time) on the day when due, in immediately
available funds.


SECTION 1.04.              Denominations.


The Notes of each Class shall be issued in
denominations of $25,000 and integral multiples of $1,000 in excess thereof,
except that one Note of each Class may be issued in a denomination other than
an integral multiple of $1,000.


ARTICLE II

DEFINITIONS


SECTION 2.01.              Definitions.


(a)           Whenever used in this Series Supplement and
when used in the Related Documents, the following words and phrases shall have
the following meanings, and the definitions of such terms are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.  Unless otherwise defined in this Series
Supplement, terms defined in the Basic Documents are used herein as therein
defined.  References to sections, unless
otherwise indicated, are to sections of this Series Supplement.  References to any Basic Document, or to any
other agreement, document or other record defined herein, shall mean such Basic
Document or other record as from time to time amended or supplemented.


“Aggregate Note Principal Balance” means, (i) with
respect to all of the Notes, as of any date, the aggregate outstanding
principal amount of all of the Notes on such date and (ii) with respect to any Class
of the Notes, as of any date, the aggregate outstanding principal amount of all
of the Notes of such Class on such date.


“Aggregate Optimal Note Principal Balance” means, with
respect to any Distribution Date, the lesser of (i) 66% of the Pool Balance
as of  the close of business on the last
day of the immediately preceding Collection Period and (ii) the Pool Balance as
of the close of business on the last day of the immediately preceding
Collection Period less $39,607,599.59 (which is 3.4% of the aggregate principal
balance of the auto loans as of the Cut-Off Date), but not less than zero.


“Available Funds” means, with respect to any
Distribution Date and the related Collection Period, the sum of (i) the
Collections for such Collection Period, (ii) investment earnings realized on
the Collection Account and the Reserve Account during such Collection Period,
(iii) all Repurchase Amounts deposited in the Collection Account during such
Collection Period and (iv) all proceeds of any liquidation, in whole or in
part, of the assets of the Trust.



 3
 






 



“Basic Documents” means this Series Supplement, the
Sale and Servicing Agreement, the Certificate of Trust, the Trust Agreement,
the Indenture, the Control Agreement, the Master Receivables Purchase
Agreements, each Transfer Agreement related to the Owner Trust Estate and all
other documents and certificates delivered therewith or pursuant thereto in
connection with the Notes or the Certificates.


“Business Day” means a day other than a Saturday, a
Sunday or other day on which commercial banks located in the states of Illinois
or New York are authorized or obligated by law to be closed.


“Certificate of Trust” shall mean the Certificate of
Trust filed for the Trust.


“Certificateholders” means the holders of the
Certificates.


“Class A Interest Carryover Shortfall” means, with
respect to any Distribution Date and each class of Class A Notes, the sum
of:  (i) the excess of (a) the related
Class A Interest Distributable Amount for the preceding Distribution Date, over
(b) the amount actually paid as interest to the Class A Noteholders on such
preceding Distribution Date (under the Indenture), plus
(ii) interest on such excess, to the extent permitted by law, at a rate per
annum equal to the related Note Rate with respect to the Class A Notes from
such preceding Distribution Date to but excluding the current Distribution
Date.


“Class A Interest Distributable Amount” means, with
respect to any Distribution Date and each class of Class A Notes, an amount
equal to the sum of:  (i) the aggregate
amount of interest accrued on the Class A Notes at the related Note Rate from
and including the preceding Distribution Date (or, in the case of the initial
Distribution Date, from and including the Closing Date) to but excluding the
current Distribution Date plus (ii) the
related Class A Interest Carryover Shortfall for the current Distribution Date.


“Class A Noteholders” means the Holders of the Class A
Notes.


“Class A Additional Principal Distributable Amount”
means, with respect to a Distribution Date, the positive excess, if any, of (i)
the Aggregate Note Principal Balance after giving effect to distribution of the
Class A Minimum Principal Distributable Amount on such Distribution Date
pursuant to Section 3.03(a)(iv) over (ii) the Aggregate Optimal Note Principal
Balance for such Distribution Date.


“Class A Minimum Principal Distributable Amount”
means, with respect to any Distribution Date, the greatest of (i) the
least of (A) the Optimal Principal Distributable Amount for such
Distribution Date, (B) the excess of the aggregate of the Principal
Balances of the Receivables as of the last day of the second preceding
Collection Period, over the aggregate of the Principal Balances of the
Receivables as of the last day of the immediately preceding Collection Period,
and (C) the Aggregate Note Principal Balance, (ii) on the Scheduled
Maturity Date for any Class of the Notes, the amount necessary to reduce the
Aggregate Note Principal Balance of such Class to zero, and (iii) the
positive excess, if any, of the Aggregate Note Principal Balance prior to
making any distribution on such Distribution Date over the Pool Balance as of
the last day of the preceding Collection Period.



 4
 






 



“Class A-1 Noteholders” means the Holders of the Class
A-1 Notes.


“Class A-1 Scheduled Maturity Date” means November 19,
2007.


“Class A-2 Noteholders” means the Holders of the Class
A-2 Notes.


“Class A-2 Scheduled Maturity Date” means December 17,
2009.


“Class A-3 Noteholders” means the Holders of the Class
A-3 Notes.


“Class A-3 Scheduled Maturity Date” means September
19, 2011.


“Class A-4 Noteholders” means the Holders of the Class
A-4 Notes.


“Class A-4 Scheduled Maturity Date” means September
17, 2013.


“Closing Date” means November 1, 2006.


“Collection Account” means the Eligible Account
created pursuant to Section 3.01, which shall be account no. 10-879781 reference HSBC Auto 2006-3 Collection
Account at the Administrator, ABA No. 021001088.


“Collections” has the meaning assigned to such term in
the Sale and Servicing Agreement.


“Control Agreement” means the deposit account control
agreement dated as of November 1, 2006 among the Issuer, the Indenture Trustee
and the Administrator.


“Controlling Party” means the Indenture Trustee for
the benefit of and acting solely at the direction of the Holders of a majority
of the Outstanding Amount of the Notes.


“Corporate Trust Office” means, (i) with respect to
the Owner Trustee, the office of the Owner Trustee, which at the time of
execution of this Series Supplement is 209 South LaSalle Street, Suite 300,
Chicago, Illinois 60604, Attention: Corporate Trust Services, (ii) with respect
to the Indenture Trustee, the corporate trust office of the Indenture Trustee,
which at the time of execution of this Series Supplement is 2 North LaSalle Street, Suite 1020, Chicago,
Illinois 60602, and (iii) with respect to the Administrator, the
corporate trust office of the Administrator, which at the time of execution of
this Series Supplement is 452 Fifth Avenue, New York, New York 10018.


“Cut-off Date” means, with respect to the Receivables
transferred and assigned to the Issuer on the Closing Date, the close of
business on October 16, 2006.


“Definitive Notes” means the Notes that have been
certificated and fully registered in accordance with Section 2.12 of the
Indenture.


“Determination Date” has the meaning assigned to such
term in the Sale and Servicing Agreement.



 5
 






 



“Distribution Date” means, with respect to each
Collection Period, the seventeenth day of the calendar month next commencing
after the last day of such Collection Period, or if such day is not a Business
Day, the immediately following Business Day, commencing December 18, 2006.


“Eligibility Criteria” means the criteria for
eligibility for Eligible Receivables set forth on Schedule I hereto.


“Eligible Investments” means, with respect to funds in
the Collection Account and Reserve Account, “Eligible Investments” as defined
in the Sale and Servicing Agreement, except that (i) all references in such
definition to “rating satisfactory to the Rating Agency” or words of similar
import shall mean ratings of not less than “A-1+” or “AAA” by Standard &
Poor’s, “P-1” or “Aaa” by Moody’s Investors Service, “F1” or “AAA” by Fitch,
Inc., or the equivalent such ratings by another Rating Agency (whichever is applicable),
and (ii) unless otherwise agreed in writing by the Rating Agencies, all such
investments shall have maturities at the time of the acquisition thereof
occurring no later than the Business Day immediately preceding the Distribution
Date following such date of acquisition.


“Eligible Receivable” means a Receivable that
satisfies the Eligibility Criteria.


“Eligible Substitute Receivable” means a Receivable
substituted by the Servicer or HAFI pursuant to Section 5.02, which on the date
of such substitution must:


(i) have a Principal Balance not substantially greater
or less than the Principal Balance of such elected substituted Receivable;


(ii) have a current Annual Percentage Rate of not less
than the Annual Percentage Rate of such elected substituted Receivable and not
substantially greater than the Annual Percentage Rate of such elected
substituted Receivable;


(iii) have a (A) remaining term to maturity not more
than six months earlier or later than the remaining term to maturity of such
elected substituted Receivable and (B) maturity date not later than the last
day of the Collection Period immediately preceding the month in which the Final
Scheduled Distribution Date occurs;


(iv) satisfy the Eligibility Criteria, to the extent
such criteria do not pertain exclusively to the Receivables transferred on the
Closing Date; and


(v) be the obligation of an Obligor whose credit
profile is substantially similar to that of the Obligor under the elected
substituted Receivable;


provided, however, that notwithstanding
(i) through (v) above, an auto loan may qualify as an Eligible Substitute
Receivable if each of the Rating Agencies confirms such substitution.


“Event of Default” shall have the meaning assigned to
such term in Section 4.01.


“Final Scheduled Distribution Date” means September
17, 2013.



 6
 






 



“HACI” means HSBC Auto Credit Inc., a Delaware
corporation.


“HAFI” means HSBC Auto Finance Inc., a Delaware
corporation.


“HSBC Finance” means HSBC Finance Corporation, a
Delaware corporation.


“Indenture” means the indenture dated as of November
1, 2006 among the Issuer, the Indenture Trustee and the Administrator, as
supplemented by this Series Supplement.


“Initial Reserve Account Deposit” means 1% of the Pool
Balance as of the Cut-off Date.


“Interest Period” means, with respect to any
Distribution Date, the period from and including the prior Distribution Date
(or, in the case of the first Interest Period, from and including the Closing
Date) through (and including) the day preceding such Distribution Date.


“Master Receivables Purchase Agreements” means,
collectively, (i) the Master Receivables Purchase Agreement dated as of
November 18, 2002, between HAFI and the Seller, as such agreement may be
amended or supplemented from time to time, and (ii) the Master Receivables Purchase
Agreement dated as of August 8, 2002, between HACI and the Seller, as such
agreement may be amended or supplemented from time to time.


“Note Rate” means the per annum rate of interest due
with respect to each Class of Notes as set forth below for the respective Class
of Notes:


Class A-1
Notes:  5.36200%


Class A-2
Notes:  5.38%


Class A-3
Notes:  5.28%


Class A-4 Notes:  5.34%


Interest on the Class A-1
Notes will be calculated on the basis of a 360-day year and the actual number
of days elapsed in an applicable Interest Period.  Interest on the Class A-2, Class A-3 and
Class A-4 Notes will be calculated on the basis of a 360-day year consisting of
twelve 30-day months.


“Notes” or “Class A Notes” means, collectively, the
Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4
Notes.


“Optimal Principal Distributable Amount” means, with
respect to any Distribution Date, the excess, if any, of (i) the Aggregate
Note Principal Balance immediately prior to such Distribution Date over
(ii) the Aggregate Optimal Note Principal Balance for such Distribution
Date.


“Original Pool Balance” means the aggregate of the
Principal Balances of the Receivables as of the Cut-off Date.


“Overcollaterization Amount” means, as of any date of
determination, the positive excess, if any, of the Pool Balance over the
Aggregate Note Principal Balance.



 7
 






 



“Owner Trust Estate” has the meaning assigned to such
term in the Trust Agreement.


“Owner Trustee” means U.S. Bank Trust National
Association, not in its individual capacity but solely as trustee under the
Trust Agreement, its successors-in-interest or any successor Owner Trustee
under the Trust Agreement.


“Pledge” means the Grant by the Issuer hereunder to
the Indenture Trustee for the benefit of the Secured Parties in accordance with
Section 1.02 in and to the Series Trust Estate.


“Pool Balance” means, as of any date of determination,
the aggregate of the outstanding Principal Balances of the Receivables, unless
otherwise specified, as of the close of business on the preceding Business Day.


“Principal Balance Shortfall” means, (i) with respect
to a Distribution Date, the positive excess, if any, of the Aggregate Note
Principal Balance (after giving effect to the distribution pursuant to Section
3.03(a)(iv) on such Distribution Date and prior to making any distribution
pursuant to Section 3.03(b) on such Distribution Date) over the Pool Balance as
of the close of business on the last day of the preceding Collection Period and
(ii) with respect to the Scheduled Maturity Date for any Class of the Notes,
the outstanding principal balance of such Class of the Notes (after giving
effect to the distribution pursuant to Section 3.03(a)(iv)).


“Rating Agencies” means Standard & Poor’s, Moody’s
Investors Service and Fitch, Inc.  If any
such organization or a successor does not maintain a rating on the Notes, “Rating
Agency” shall be a nationally recognized statistical rating organization or
other comparable Person designated by the Seller, notice of which designation
shall be given to the Administrator, the Indenture Trustee, the Owner Trustee
and the Servicer.


“Rating Agency Condition” means, with respect to any
action, written confirmation from each Rating Agency rating the Notes that such
action will not result in a reduction or withdrawal of its then current rating
of the Notes.


“Receivables” means each receivable listed on the
Schedule of Receivables, which (a) has not been released from the Series Trust
Estate as provided herein or in the Indenture and (b) is not a Liquidated Receivable.


“Redemption Price” has the meaning specified in
Section 5.01.


“Related Documents” means the Basic Documents and the
Revolving Credit Agreement.


“Reserve Account” means the Reserve Account, which
shall be an Eligible Account created pursuant to Section 3.01 and which shall
be account no. 10-879782,
reference HSBC Auto 2006-3 Reserve Account at the Administrator, ABA No.
021001088.


“Reserve Account Balance” means, with respect to a
Distribution Date, the amount on deposit in the Reserve Account as of the close
of business on the Business Day immediately preceding such Distribution Date; provided,
however, that such determination shall



 8
 






 



be made immediately after
the deposit to the Collection Account effected pursuant to Section 5.1(c) of
the Sale and Servicing Agreement.


“Reserve Account Shortfall Amount” means, with respect
to any Distribution Date, the excess of: 
(x) the Targeted Reserve Account Balance for such Distribution Date over
(y) the Reserve Account Balance for such Distribution Date.


“Revolving Credit Agreement” means the Revolving
Credit Agreement, dated as of March 1, 1998, between HSBC Finance Corporation
and the Seller.


“Sale and Servicing Agreement” means the Sale and
Servicing Agreement dated as of November 1, 2006, among the Issuer, the Seller,
the Servicer, the Indenture Trustee and the Administrator, as such agreement
may be amended or supplemented from time to time.


“Scheduled Maturity Date” means, with respect to the
Class A-1 Notes, the Class A-1 Scheduled Maturity Date, with respect to the
Class A-2 Notes, the Class A-2 Scheduled Maturity Date, with respect to the
Class A-3 Notes, the Class A-3 Scheduled Maturity Date and, with respect to the
Class A-4 Notes, the Class A-4 Scheduled Maturity Date.


“Schedule of Receivables” means, as to any date, the
schedule of all retail installment sales contracts and motor vehicle
installment loans held as part of the Series Trust Estate on such date.  The initial Schedule of Receivables is
attached hereto as Schedule II.  The
Schedule of Receivables will be amended from time to time to reflect the
removal of Receivables and the addition of any Eligible Substitute Receivables
to the Series Trust Estate.


“Secured Parties” means, collectively, the Holders
from time to time of the Notes.


“Securities” means the Notes and the Certificates.


“Series Supplement” means this Series Supplement to
the Indenture, Sale and Servicing Agreement and the Trust Agreement.


“Series Support” means, with respect to the Notes, the
Certificates and the Reserve Account.


“Series Trust Estate” means the property Granted to
the Indenture Trustee pursuant to Section 1.02.


“Servicer’s Certificate” means, with respect to the
Notes and Certificates, a report in substantially the form of Exhibit A
hereto (appropriately completed), furnished by the Servicer to the
Administrator, the Indenture Trustee and the Owner Trustee pursuant to the Sale
and Servicing Agreement.


“Servicing Fee” means,
(i) with respect to the initial Collection Period, the fee payable to the Servicer for servicing rendered during
such Collection Period, which shall be equal to $3,276,363.94, and (ii) with respect to any other
Collection Period, the fee payable to the Servicer for services rendered during
such Collection Period, which shall be equal to one-twelfth of the Servicing
Fee Rate multiplied by the Aggregate Principal Balances of the



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Receivables
determined as of the first day of such Collection Period.  For the avoidance of doubt, the Servicing Fee
does not include any administrative fees, expenses or charges paid by or on
behalf of Obligors during any Collection Period.


“Servicing Fee Rate”
means 2.25% per annum.


“Substitution Adjustment
Amount” means, as to any Receivable for which the Servicer elects to substitute
pursuant to Section 5.02(a) and the date on which a substitution thereof occurs
pursuant to Section 5.02, the sum of:


(i) the excess, if any, of (a) the Principal Balance
of such elected Receivable plus any
amounts charged off by the Servicer with respect to such elected Receivable as
of the end of the related Collection Period preceding the date of substitution
(after the application of any principal payments received on such elected
Receivable on or before the date of the substitution of the applicable Eligible
Substitute Receivable or Receivables) over (b) the aggregate Principal Balance
of the applicable Eligible Substitute Receivable or Receivables, plus


(ii) accrued and
unpaid interest to the end of such Collection Period computed on a daily basis
at the Annual Percentage Rate on the Principal Balance of such elected
Receivable outstanding from time to time.


“Targeted Reserve Account Balance” means, with respect
to any Distribution Date, the lesser of: (i) the greater of (a) 3% of the
outstanding Pool Balance as of the end of the related Collection Period, and
(b) $23,298,588.00 (2% of the Pool Balance as of the Cut-off Date) and (ii) the
Aggregate Note Principal Balance.


“Trust Accounts” means the Collection Account and the
Reserve Account.


“Trust Agreement” means
the Trust Agreement, dated as of October 11, 2006, between the Seller and the
Owner Trustee, as amended and restated as of November 1, 2006 and as
supplemented by this Series Supplement.


“Underwriter” means HSBC
Securities (USA) Inc., as representative of the underwriters named in the
Underwriting Agreement.


“Underwriting Agreement”
means the underwriting agreement, dated as of October 23, 2006 among HSBC
Securities (USA) Inc., HSBC Finance Corporation and HSBC Auto Receivables
Corporation.


ARTICLE III

DISTRIBUTIONS AND STATEMENTS TO

NOTEHOLDERS; SERIES SPECIFIC COVENANTS


SECTION 3.01.              Trust Accounts.


(a)           The Administrator, for the benefit of the
Secured Parties, shall establish and maintain an account (the “Collection
Account”) as a segregated trust account in the



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Administrator’s corporate trust department, identified as the “Collection
Account for HSBC Automotive Trust (USA) 2006-3, in trust for the Secured
Parties.”  The Administrator shall make
or permit withdrawals from the Collection Account only as provided in this
Series Supplement.


(b)           The Administrator, for the benefit of the
Secured Parties, shall establish and maintain an account (the “Reserve
Account”) as a segregated trust account in the Administrator’s corporate
trust department, identified as the “Reserve Account for HSBC Automotive Trust
(USA) 2006-3, in trust for the Secured Parties.”  The Administrator shall make or permit
withdrawals from the Reserve Account only as provided in this Series
Supplement.  On the Closing Date, the
Reserve Account will be funded with the Initial Reserve Account Deposit.


(c)           In the event that any Trust Account ceases
to be an Eligible Account, the Administrator, within five Business Days, shall
establish such Trust Account as a new account which is an Eligible
Account.  No withdrawals may be made of
funds in any Trust Account except as provided in this Series Supplement.  Except as specifically provided in this
Series Supplement, funds in the Trust Accounts shall not be commingled with any
other moneys.  All moneys deposited from
time to time in each of the Trust Accounts shall be invested and reinvested by
the Administrator in Eligible Investments selected in writing by the Servicer
(pursuant to standing instructions or otherwise) which, absent any instruction,
shall be investments of the type specified in clause (d) of the definition of
Eligible Investments.  The provisions of
Section 5.1 of the Sale and Servicing Agreement shall apply to the investment
of funds in the Trust Accounts.


SECTION 3.02.              Reserve Account.


On the earlier of (x) the maturity date of the Notes
(whether by acceleration or otherwise), and (y) the Final Scheduled
Distribution Date, the amount on deposit in the Reserve Account shall be
withdrawn from the Reserve Account and distributed in accordance with Section
4.04.


SECTION 3.03.              Distributions.


(a)           On each Distribution Date, the Administrator
shall (based solely on the information contained in the Servicer’s Certificate
delivered with respect to such Distribution Date) distribute the following
amounts from and, to the extent of, Available Funds with respect to the
Collection Period immediately preceding such Distribution Date, in the
following order of priority:


(i)            to the Servicer, if
HSBC Finance is no longer acting as Servicer, the Servicing Fee for the related
Collection Period;


(ii)           to the Administrator,
the Indenture Trustee and the Owner Trustee, any accrued and unpaid fees and
any unreimbursed costs and expenses (including to any successor Servicer,
reasonable transition expenses in an amount not to exceed $100,000 per
servicing transfer), in each case, to the extent such amounts have not been
previously paid by the Servicer or the Seller;



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(iii)          to the Class A
Noteholders in proportion to the interest due on each Class of Notes, the Class
A Interest Distributable Amount;


(iv)          to the Class A
Noteholders, the Class A Minimum Principal Distributable Amount;


(v)           to the Reserve Account,
the Reserve Account Shortfall Amount, if any;


(vi)          to the Class A
Noteholders, the Class A Additional Principal Distributable Amount;


(vii)         to the Administrator, the
Indenture Trustee and the Owner Trustee, any accrued and unpaid indemnity
amounts, in each case, to the extent such amounts have not been previously paid
by the Servicer or the Seller;


(viii)        if HSBC Finance is acting
as the Servicer, the Servicing Fee for the related Collection Period (unless
the Servicer has retained such amount in accordance with Section 4.8 of the
Sale and Servicing Agreement) or if a successor Servicer has been appointed,
reasonable transition expenses in excess of the amounts paid in priority (i)
above; and


(ix)           to the holders of the
Certificates, any remaining Available Funds.


Amounts to be distributed in reduction of the
outstanding principal balance of the Class A Notes pursuant to Section
3.03(a)(iv) or (vi) or Section 3.03(b) shall be distributed in reduction of the
outstanding principal balance of the Class A-1 Notes until the principal
balance of the Class A-1 Notes is reduced to zero; thereafter such amount shall
be distributed in reduction of the outstanding principal balance of the
Class A-2 Notes until the principal balance of the Class A-2 Notes is
reduced to zero; thereafter such amount shall be distributed in reduction of
the outstanding principal balance of the Class A-3 Notes until the
principal balance of the Class A-3 Notes is reduced to zero; and
thereafter such amount shall be distributed in reduction of the outstanding
principal balance of the Class A-4 Notes until the principal balance of
the Class A-4 Notes is reduced to zero.


(b)           If on a Determination
Date, the Servicer’s Certificate delivered with respect to the related
Distribution Date indicates that (i) the amount of Available Funds with respect
to such Distribution Date is not sufficient, when distributed in accordance
with Section 3.03(a), to cause the amounts specified in Section 3.03(a)(i),
(ii) and (iii) with respect to such Distribution Date to be paid in full; or
(ii) if after giving effect to the distribution of Available Funds pursuant to
Section 3.03(a)(iv) on a Distribution Date there exists a Principal Balance
Shortfall, the Administrator shall withdraw from the Reserve Account and
distribute as follows an amount up to the amount which when distributed, first in accordance with Section 3.03(a)(i), (ii) and (iii);
and second, in reduction of the outstanding
principal balance of the Class A Notes, but only to the extent necessary to
eliminate the Principal Balance Shortfall, shall cause the amounts specified in
Section 3.03(a)(i), (ii) and (iii) to be paid in full and such Principal
Balance Shortfall to be eliminated.



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(c)           [Reserved].


(d)           [Reserved].


(e)           Each Certificateholder,
by its acceptance of its Certificate will be deemed to have consented to the
provisions of paragraph (a) above relating to the priority of distributions,
and will be further deemed to have acknowledged that no property rights in any
amount or the proceeds of any such amount shall vest in such Certificateholder
until such amounts have been distributed to such Certificateholder in accordance
with the terms of the Trust Agreement and this Series Supplement; provided,
that the foregoing shall not restrict the right of any
Certificateholder, upon compliance with the provisions hereof, from seeking to
compel the performance of the provisions hereof by the parties hereto.  Each Certificateholder, by acceptance of its
Certificate, further specifically acknowledges that it has no right to or
interest in any monies at any time held in the Reserve Account, such monies
being held in trust for the benefit of the Secured Parties.


(f)            Amounts on deposit in
the Reserve Account on any Distribution Date (after giving effect to all
distributions made on such Distribution Date) in excess of the Targeted Reserve
Account Balance for such Distribution Date shall be released first, to the
Servicer for any Servicing Fees then due and unpaid pursuant to Section
3.03(a)(viii), and any remainder shall be paid to the holders of the
Certificates.


(g)           In the event that the
Reserve Account is maintained with an institution other than the Administrator,
the Servicer shall instruct and cause such institution to transfer the amounts
to be distributed therefrom in accordance with Section 3.03(b) to the
Administrator for distribution pursuant to Section 3.03(a) one Business Day prior
to the related Distribution Date.


(h)           Unless Definitive Notes
are issued pursuant to Section 2.12 of the Indenture, with respect to Notes
registered on the related Record Date in the name of a nominee of the Clearing
Agency, payment will be made by wire transfer to an account designated by such
nominee, without presentation or surrender of the Notes or the making of any
notation thereon.


(i)            If not theretofore
paid in full, all amounts outstanding with respect to the Class A-1 Notes shall
be due and payable on the Class A-1 Scheduled Maturity Date; if not theretofore
paid in full, all amounts outstanding with respect to the Class A-2 Notes shall
be due and payable on the Class A-2 Scheduled Maturity Date; if not theretofore
paid in full, all amounts outstanding with respect to the Class A-3 Notes shall
be due and payable on the Class A-3 Scheduled Maturity Date; and if not
theretofore paid in full, all amounts outstanding with respect to the Class A-4
Notes shall be due and payable on the Class A-4 Scheduled Maturity Date.


SECTION 3.04.              Statements to
Noteholders.


(a)           On or prior to each
Determination Date, the Servicer shall deliver to the Administrator (with an
instruction for the Administrator to forward to each Noteholder of record and
to each Certificateholder of record), and make available (via access to its or
its Affiliate’s website address) to the Rating Agencies, the Indenture Trustee
and any other interested party, a statement setting forth at least the
following information as to the Notes to the extent applicable:



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(i)            the amount of such distribution allocable
to interest on or with respect to each Class of Notes;


(ii)           the amount of such distribution allocable to
principal of each Class of Notes;


(iii)          the aggregate outstanding principal amount of
each Class of the Notes after giving effect to payments allocated to principal
reported under (ii) above;


(iv)          the current Note Rate applicable to each
Class of Notes;


(v)           the Class A Interest Carryover Shortfall, if
any, with respect to each Class of Notes;


(vi)          the Pool Balance at the beginning of the
related Collection Period;


(vii)         the Pool Balance at the end of the related
Collection Period;


(viii)        the amount of Collections for the related
Collection Period;


(ix)           the amount of Collections allocable to
principal payments on the Receivables for the related Collection Period;


(x)            the Net Liquidation Proceeds for such
Collection Period;


(xi)           the principal amount of Receivables which
were repurchased during the related Collection Period;


(xii)          the Substitution Adjustment Amount for the
related Collection Period;


(xiii)         the weighted average coupon of the
Receivables;


(xiv)        the weighted average remaining maturity of the
Receivables;


(xv)         the Collection Account and Reserve Account
investment income for the related Collection Period;


(xvi)        the beginning Reserve Account Balance;


(xvii)       the Targeted Reserve Account Balance;


(xviii)      the Reserve Account Shortfall Amount, if any, for
such Distribution Date;


(xix)         the Reserve Account deposit, if any, for such
Distribution Date;



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(xx)          the release from the Reserve Account pursuant
to Sections 3.03(b) and (f), if any, for such Distribution Date;


(xxi)         the ending Reserve Account Balance;


(xxii)        the Overcollateralization Amount prior to
payments allocated to principal under (ii) above;


(xxiii)       the Overcollateralization Amount after giving
effect to payments allocated to principal under (ii) above;


(xxiv)       the amount of the Servicing Fee paid to the
Servicer with respect to the related Collection Period;


(xxv)        the Principal Balance and percentage of the
Pool Balance of Receivables that are one payment delinquent;


(xxvi)       the Principal Balance and percentage of the Pool
Balance of Receivables that are two payments delinquent;


(xxvii)      the Principal Balance and percentage of the Pool
Balance of Receivables that are three or more payments delinquent;


(xxviii)      the Principal Balance and percentage of the Pool
Balance of Receivables that are two or more payments delinquent;


(xxix)        the Principal Balance and percentage of the
Pool Balance of repossessed vehicles;


(xxx)         the Principal Balance of Receivables that were
extended or modified (and delinquency reset) during the related Collection
Period; and


(xxxi)        the Principal Balance of Receivables that were
extended or modified (and delinquency reset) during the related Collection
Period as a percentage of the Pool Balance at the end of such Collection
Period.


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


(b)           The Administrator may,
but is not obligated to, make available to the parties hereto and to each of
the Noteholders, via the Administrator’s internet website, all information
referred to in this Section 3.04 available each month and, with the consent or
at the direction of the Seller, such other information regarding the Notes
and/or the Receivables as the Administrator may have in its possession, but
only with the use of a password provided by the Administrator.


The Administrator’s internet website, if applicable,
shall be specified by the Administrator from time to time in writing to the
parties hereto and the Noteholders.  In



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connection with providing
access to the Administrator’s internet website, the Administrator may require
registration and the acceptance of a disclaimer.  The Administrator shall not be liable for its
dissemination of information in accordance with this Series Supplement.


SECTION 3.05.              Reporting
Requirements.


(a)           The Servicer’s Certificate
shall be in the form attached as Exhibit A hereto.


(b)           By January 31 of each
calendar year, commencing January 31, 2007, the Servicer on behalf of the
Issuer shall prepare and distribute to the Administrator and the Indenture
Trustee a statement containing such information as is required to be provided
by an issuer of indebtedness under the Code and such other customary
information as is necessary to enable the Noteholders to prepare their tax
returns.


(c)           If an Event of Default
occurs and is continuing and if it is either known by, or written notice of the
existence thereof has been delivered to, a Responsible Officer of the
Administrator or the Indenture Trustee, the Administrator or the Indenture
Trustee, as the case may be, shall mail to each Noteholder notice of the
Default within 30 days after such knowledge or notice occurs.


SECTION 3.06.              Compliance With
Withholding Requirements.


Notwithstanding any other provisions of this Series
Supplement or the Indenture to the contrary, the Administrator and the
Indenture Trustee shall comply with all federal withholding requirements
respecting payments (or advances thereof) to the Noteholders as may be
applicable to instruments constituting indebtedness for federal income tax
purposes.  Any amounts so withheld shall
be treated as having been paid to the applicable Noteholders for all purposes
of the Indenture.  In no event shall the
consent of any Noteholder be required for any such withholding.


SECTION 3.07.              Special Covenants
and Acknowledgements.


With respect to the Notes, the Issuer hereby
represents and warrants, as of the Closing Date:


(i)            Valid Pledge.  It is the intention of the Issuer that the
Pledge herein contemplated hereby constitutes the Grant of a perfected, first
priority security interest in the Series Trust Estate to the Indenture Trustee
for the benefit of the Secured Parties.


(ii)           Governmental Authorization.  Other than the filing of the financing
statements required hereunder, no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by the Issuer of
this Series Supplement, the Indenture, and each Related Document to which it is
a party.



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SECTION 3.08.              Income Tax
Characterization.


For purposes of federal
income, state and local income and franchise and any other income taxes, the
parties to this Series Supplement, and each owner of a beneficial interest in
the Notes by acceptance of such interest, agree to treat the Notes as
indebtedness and hereby instruct the Indenture Trustee to treat the Notes as
indebtedness for federal and state tax reporting purposes.


ARTICLE
IV

EVENTS OF DEFAULT; REMEDIES


SECTION 4.01.              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 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 calendar days; or


(ii)           default in the payment of the outstanding
principal balance of any Class of Notes on the related Scheduled Maturity Date,
which default shall continue for a period of five calendar days; or


(iii)          the Aggregate Note Principal Balance on any
Distribution Date exceeds the Pool Balance as of the last day of the prior
Collection Period after the application of all Available Funds and after making
any distribution pursuant to Section 3.03(b); or


(iv)          default in the observance or performance of
any covenant or agreement of the Issuer made in the Related Documents (other
than a covenant or agreement, a default in the observance or performance of
which is elsewhere in this Section specifically dealt with), or any
representation or warranty of the Issuer made in the Related Documents or in
any certificate or other writing or record delivered pursuant thereto or in
connection therewith proving to have been incorrect in any material respect as
of the time when the same shall have been made and has a material adverse
effect on the Noteholders, and such default shall continue or not be cured, or
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 60 days after there shall have been given, by registered or certified
mail, to the Issuer by the Indenture Trustee or the Administrator or to the
Issuer and the Indenture Trustee by the Holders of at least 25% of the
Outstanding Amount of the Notes, a written notice specifying such default or
incorrect representation or warranty and requiring it to be remedied and
stating that such notice is a “Notice of Default” hereunder; or



 17
 






 



(v)           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 the Series Trust Estate 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 of the Issuer or for any substantial
part of the Series Trust Estate, or ordering the winding-up or liquidation of
the Issuer’s affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or


(vi)          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 or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of
the Issuer or for any substantial part of the Series Trust Estate, 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.


SECTION 4.02.              Rights Upon Event
of Default.


(a)           If an Event of Default
shall have occurred and be continuing, the Indenture Trustee may, or if so
requested in writing by Holders holding Notes representing at least 66 2/3% of
the Outstanding Amount of the Notes shall, declare by written notice to the
Issuer that the Notes have become due and payable, whereupon they shall become,
immediately due and payable at 100% of the outstanding principal balance of the
Notes and accrued interest thereon (together with interest accrued at the
relevant Note Rate on such overdue interest).


(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,
the Controlling Party, by written notice to the Issuer and the Servicer, may
rescind and annul such declaration and its consequences if:


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


(A)          all payments of principal 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



 18
 






 



(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 5.9 of the
Indenture.


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


SECTION 4.03.              Remedies.


If an Event of Default shall have occurred and be
continuing, the Indenture Trustee, subject to Section 11.17 of the Indenture,
may exercise any of the remedies specified in Article V of the Indenture and,
in addition, may do one or more of the following:


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


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


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


(iv)          sell the Series Trust Estate or any portion
thereof or rights or interest therein, at one or more public or private sales
called and conducted in any manner permitted by law; provided, however,
that the Indenture Trustee may not sell or otherwise liquidate the Series Trust
Estate following an Event of Default unless:


(x)            the proceeds of such
sale or liquidation distributable to the Noteholders are sufficient to
discharge in full all amounts then due and unpaid upon such Notes for principal
and interest, or


(y)           the Indenture Trustee
determines that the Series Trust Estate will not continue to provide sufficient
funds for the payment of principal of and interest on the Notes as they would
have become due if the Notes had not been declared due and payable, and the
Indenture Trustee obtains the consent of the Holders of 66 2/3% of the
Outstanding Amount of the Notes, or


(z)            if the provisions of
neither subparagraph (x) nor subparagraph (y) are satisfied, if the Indenture
Trustee obtains the consent of the Holders of 100% of the Outstanding Amount of
the Notes.


In determining such sufficiency or insufficiency with
respect to clause (y), the Indenture Trustee may, but need not, obtain and rely
upon an opinion of an independent investment banking or



 19
 






 



accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency of the Series Trust
Estate for such purpose.  Any reasonable
costs and expenses incurred by the Indenture Trustee in obtaining such opinion
shall be costs and expenses of the Indenture Trustee pursuant to Section
3.03(a)(ii) of this Series Supplement.


SECTION 4.04.              Priorities.


(a)           On and after the
maturity date of the Notes (by acceleration or otherwise), including, without
limitation, on and after the Final Scheduled Distribution Date, all Available
Funds, all amounts on deposit in the Reserve Account withdrawn in accordance
with Section 3.02 and any proceeds of the liquidation of all or any portion of
the Series Trust Estate pursuant to Section 4.03(iv) (which proceeds the
Indenture Trustee shall remit to the Administrator), shall be applied by the
Administrator, based upon information most recently provided to it by the
Servicer, on the date of distribution in the following order of priority:


FIRST:                to the Servicer, if HSBC Finance is no
longer acting as Servicer, the Servicing Fee for the related Collection Period;


SECOND:           to the Administrator, the Indenture Trustee
and the Owner Trustee, any accrued and unpaid fees and any unreimbursed costs
and expenses (including to any successor Servicer, reasonable transition
expenses in an amount not to exceed $100,000 per servicing transfer), in each
case, to the extent such amounts have not been previously paid by the Servicer
or the Seller;


THIRD:              to Class A Noteholders for amounts due
and unpaid on the Class A Notes for interest, pro  rata, in
accordance with the amounts due and payable on the Class A Notes on the date of
distribution for interest without preference or priority of any kind;


FOURTH:          to the Class A Noteholders for amounts due
and unpaid on the Class A Notes for principal, pro  rata, in
accordance with the respective aggregate outstanding principal balance of each
Class of Class A Notes without preference or priority of any kind;


FIFTH:               to the Administrator, the Indenture
Trustee and the Owner Trustee, any accrued and unpaid indemnity amounts, in
each case, to the extent such fees have not been previously paid by the
Servicer or the Seller;


SIXTH:               to the Servicer, if HSBC Finance is
acting as Servicer, for any Servicing Fees then due and unpaid; and


SEVENTH:         to the Certificateholders, any remaining
Available Funds.


(b)           The Administrator may
fix a record date and distribution date for any payment to Noteholders pursuant
to this Section 4.04.  At least 15 days
before such record date, the Administrator shall mail to the Noteholders a
notice that states the record date, the distribution date and the amount to be
paid.



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ARTICLE
V

PREPAYMENT, REDEMPTION AND SUBSTITUTION


SECTION 5.01.              Optional “Clean-Up”
Redemption.


On any Distribution Date occurring on or after the
date upon which the Pool Balance shall have been reduced to an amount which is
less than or equal to 10% of the Original Pool Balance, the Servicer, HAFI and
HACI shall each have the option to purchase the outstanding Receivables at a
price equal to the aggregate Repurchase Amount for such Receivables; provided,
however, such aggregate Repurchase Amount shall not be less than the
then Aggregate Note Principal Balance, plus all accrued and unpaid interest
thereon and all fees and other amounts owing to the Administrator, the
Indenture Trustee, the Owner Trustee and the Servicer (if other than HSBC
Finance) under the Related Documents (the “Redemption Price”).  The Servicer, HAFI or HACI shall give the
Servicer (if other than HSBC Finance), the Administrator, the Indenture Trustee
and the Owner Trustee at least 10 days irrevocable prior written notice of the
date on which the Servicer, HAFI or HACI, as applicable, intends to exercise
such option to purchase.  Not later than
12:00 P.M., New York City time, on the day prior to such Distribution Date, the
Servicer, HAFI or HACI, as applicable, shall deposit such amount in the
Collection Account in immediately available funds for distribution pursuant to
Section 3.03.  Such purchase option is
subject to payment in full of the aggregate Repurchase Amount described herein.


SECTION 5.02.              Optional
Substitution.


(a)           At any time the
Servicer and HAFI shall each have the right, in their respective sole
discretion, but not the obligation, to elect (by written notice sent to the
Indenture Trustee and the Owner Trustee) to substitute in the place of any
Receivable an Eligible Substitute Receivable or Receivables; provided that the
aggregate Principal Balance of all Eligible Substitute Receivables substituted
pursuant to this Section shall not exceed 2% of the Pool Balance as of the
initial Cut-off Date; provided further that prior to any such substitution the
Servicer shall give written notice to each Rating Agency of any such
substitution.


(b)           For any Collection
Period during which the Servicer or HAFI substitutes one or more Eligible
Substitute Receivables, the Servicer shall determine the Substitution
Adjustment Amount.  The Servicer or HAFI,
as applicable, shall deposit the Substitution Adjustment Amount in the
Collection Account no later than the Business Day immediately preceding the
Distribution Date in the month following the end of the Collection Period in
which such substitution occurs.  The
Servicer shall amend the Schedule of Receivables to reflect the removal of any
Receivable for which the Servicer or HAFI has made a substitution election
pursuant to Section 5.02(a) from the terms of this Agreement and the
substitution of the Eligible Substitute Receivable or Receivables.  Upon such substitution, the Eligible
Substitute Receivable or Receivables shall be subject to the terms of this Agreement
in all respects, and the Seller shall be deemed to have represented that each
such Eligible Substitute Receivable or Receivables, as of the date of
substitution, satisfies the Eligibility Criteria, to the extent such criteria
do not pertain exclusively to the Receivables transferred on the Closing
Date.  The Indenture Trustee and the
Owner Trustee shall, upon receipt by each of the Indenture Trustee and the
Owner Trustee of an officer’s certificate from an officer of the Servicer
certifying that the conditions in



 21
 






 



this Section 5.02(b) have been satisfied,
take any action requested by the Servicer or HAFI, as the case may be, to
effect the reconveyance of such Receivable for which the Servicer or HAFI, as
the case may be, has made a substitution election so removed from the Series
Trust Estate to the Servicer or HAFI, as the case may be.  The procedures applied by the Servicer or
HAFI in selecting each Eligible Substitute Receivable shall not be adverse to
the interests of the Noteholders and shall be comparable to the selection
procedures applicable to the Receivables originally conveyed hereunder.


(c)           In the case of a
substitution pursuant to this Section, upon receipt by the Indenture Trustee of
(i) a Servicer’s Certificate to the effect that the Substitution Adjustment
Amount, if any, has been so deposited in the Collection Account and (ii) an
Officer’s Certificate reciting the transfer and assignment of the Eligible
Substitute Receivable(s) to the Indenture Trustee, the Indenture Trustee shall
execute and deliver such instrument of transfer or assignment presented to it
by the Servicer, in each case without recourse, as shall be necessary to vest
in the Servicer or HAFI, as applicable, legal and beneficial ownership of such
Receivable for which the Servicer has made a substitution election (including
any property acquired in respect thereof or proceeds of any insurance policy
with respect thereto).


ARTICLE
VI

MISCELLANEOUS


SECTION 6.01.              Ratification of
Basic Documents.


Each of the Basic Documents (to the extent
appropriate, as supplemented by this Series Supplement) is in all respects
ratified and confirmed and each of the Basic Documents, as so supplemented by
this Series Supplement shall be read, taken and construed as one and the same
instrument.


SECTION 6.02.              Counterparts.


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


SECTION 6.03.              GOVERNING LAW.


THIS SERIES SUPPLEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS PROVISIONS WHICH WOULD REQUIRE THE
APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.


SECTION 6.04.              Amendments
Without Consent of Noteholders.


(a)           Without the consent of
the Noteholders and with prior written notice to the Rating Agencies, as
evidenced in writing to the Administrator, the Indenture Trustee and the
Issuer, when authorized by an Issuer Order, at any time and from time to time,
the parties hereto



 22
 






 



may enter into one or more amendments hereto,
in form satisfactory to the Administrator, the Indenture Trustee, the Owner
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 the Indenture as supplemented
by this Series Supplement, or better to assure, convey and confirm unto the
Indenture Trustee, if any, any property subject or required to be subjected to
the lien of the Indenture as supplemented by this Series Supplement, or subject
to the lien of the Indenture as supplemented by this Series Supplement
additional property;


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


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


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


(v)           to cure any ambiguity, to correct or supplement
any provision herein which may be inconsistent with any other provision herein
or to make any other provisions with respect to matters or questions arising
under the Indenture, the Trust Agreement or in this Series Supplement; 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 and under the Indenture by a successor indenture
trustee with respect to the Notes and to add to or change any of the provisions
of the Indenture or of this Series Supplement as shall be necessary to
facilitate the administration of the trusts hereunder by more than one
indenture trustee, pursuant to the requirements of Article V of the Indenture;
or


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


Each of the Administrator, the Indenture Trustee and
the Owner Trustee is hereby authorized to join in the execution of any
amendment and to make any further appropriate agreements and stipulations that
may be therein contained.


(b)           Except as otherwise
provided herein, the Issuer, the Indenture Trustee and the Administrator, when
authorized by an Issuer Order, may, also without the consent of any of the
Noteholders and with prior written notice to the Rating Agencies by the Issuer,
as evidenced in writing to the Indenture Trustee and the Administrator, enter
into an amendment hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the



 23
 






 



provisions of, the Indenture or of this
Series Supplement of modifying in any manner the rights of the Noteholders
under the Indenture or under this Series Supplement; 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; provided, further,
that with respect to tax matters, such action shall not, if evidenced by an
Opinion of Counsel to such effect, be deemed to adversely affect in any
material respect the interests of any Noteholder if, for federal income tax
purposes, the action does not cause the issuing entity to be treated as an
association or publicly traded partnership taxable as a corporation, or the
Notes that were characterized as debt at the time of issuance to fail to
qualify as debt.


SECTION 6.05.              Amendments With
Consent of the Noteholders.


Except as otherwise provided herein, the Issuer, the
Indenture Trustee and the Administrator, when authorized by an Issuer Order
provided by the Servicer, also may, with prior written notice to the Rating
Agencies and with the consent of the Holders of not less than a majority of the
Outstanding Amount of each Class of affected Notes, by Act of such Holders
delivered to the Issuer, the Indenture Trustee and the Administrator, enter
into an amendment hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, this Series
Supplement or of modifying in any manner the rights of the Noteholders under
the Indenture or under this Series Supplement; provided, however,
that no such amendment shall, without the consent of the Holder 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, change the provision of the
Indenture relating to the application of collections on, or the proceeds of the
sale of, all or any portion of any Series 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;


(ii)           impair the right to institute suit for the
enforcement of the provisions of the Indenture requiring the application of
funds available therefor, as provided in Article V of the Indenture, to the
payment of any such amount due on the Notes on or after the respective due
dates thereof;


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


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



 24
 






 



(v)           reduce the percentage of the Outstanding
Amount of the Notes required to direct the Indenture Trustee to direct the
Issuer to sell or liquidate the Series Trust Estate pursuant to the Indenture;


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


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


(viii)        permit the creation of any lien ranking prior
to or on a parity with the lien of the Indenture with respect to any part of
the Series Trust Estate or, except as otherwise permitted or contemplated
herein or the Related Documents, terminate the lien of the Indenture on any
property at any time subject hereto or deprive the Holder of any Note of the
security provided by the lien of the Indenture.


It shall not be necessary for any Act of Noteholders
under this Section to approve the particular form of an amendment to this
Series Supplement, but it shall be sufficient if such Act shall approve the
substance thereof.


Promptly after the execution by the Issuer, the
Indenture Trustee and the Administrator of an amendment to this Series
Supplement, the Administrator shall, upon written instruction from the Issuer
or the Indenture Trustee, mail to the Noteholders a notice setting forth in
general terms the substance hereof.  Any
failure of the Administrator to mail such notice, or any defect therein, shall
not, however, in any way impair or affect the validity of any amendment to this
Series Supplement.


Prior to the execution of any amendment to this Series
Supplement, the Indenture Trustee, the Administrator and the Owner Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
the execution of such amendment is authorized and permitted by this Series
Supplement.  The Indenture Trustee, the
Administrator and the Owner Trustee may, but shall not be obligated to, enter
into any such amendment which affects the Indenture Trustee’s, the
Administrator’s or the Owner Trustee’s, as the case may be, own rights, duties
or immunities under this Series Supplement.


By its acceptance of its interest in the Notes, each
owner of a beneficial interest in a Note shall be deemed to have agreed that
prior to the date which is one year and one day after the termination of the
Indenture, such Person shall not acquiesce, petition or otherwise invoke or
cause the Issuer or the Seller to invoke the process of any governmental
authority for the purpose of commencing or sustaining a case against the Seller
or Issuer under any federal or state



 25
 






 



bankruptcy, insolvency or
similar law or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of or for the Issuer or the Seller or
any substantial part of its property or ordering the winding-up or liquidation
of the affairs of the Issuer or the Seller.


SECTION 6.06.              Authority to
Register Notes and File Reports.


The Issuer hereby authorizes the Seller (and, at the
Seller’s direction, the Servicer) to prepare and execute on behalf of the
Issuer, filings with the Securities and Exchange Commission and any applicable
state agencies of documents required to register or qualify the Notes for
public distribution and to file, on a periodic basis or as otherwise may be
required, such documents or records as may be required by rules and regulations
prescribed by such authorities.


SECTION 6.07.              Authority to
Perform Duties of the Issuer.


(a)           The Issuer hereby
designates the Servicer its agent and attorney-in-fact to execute or otherwise
authenticate any financing statement, continuation statement or other
instrument or record required by the Indenture Trustee pursuant to
Section 3.5 of the Indenture; provided that such designation shall
not be deemed to create a duty in the Indenture Trustee to monitor the
compliance of the Servicer with respect to its duties under Section 3.5 of
the Indenture or the adequacy of any financing statement, continuation
statement or other instrument or record prepared by the Servicer.


(b)           The Issuer hereby
appoints the Servicer to assist the Issuer in performing its duties under the
Related Documents, including, but not limited to, Sections 2.13 and 3.9 of
the Indenture, and the Servicer hereby accepts such appointment.


SECTION 6.08.              Notices.


All demands, notices and communications upon or to the
Seller, the Servicer, the Owner Trustee, the Indenture Trustee or the
Administrator shall be in writing, personally delivered, or mailed by certified
mail, or sent by confirmed telecopier transmission and shall be deemed to have
been duly given upon receipt (a) in the case of the Seller, to HSBC Auto
Receivables Corporation, 1111 Town Center Drive, Las Vegas, Nevada 89144, with a
copy to HSBC Finance Corporation, 2700 Sanders Road, Prospect Heights,
Illinois, 60070, Attention:  Treasurer,
Telecopier # (847) 205-7538, (b) in the case of the Servicer, if HSBC Finance
Corporation is the Servicer, to HSBC Finance Corporation, 2700 Sanders Road,
Prospect Heights, Illinois 60070, 
Attention: Treasurer, Telecopier # (847) 205-7538, (c) in the case of
the Issuer, at the Corporate Trust Office of the Owner Trustee, Telecopier #
(312) 325-8905, (d) in the case of the Owner Trustee, at its Corporate Trust
Office, Telecopier # (312) 325-8905, (e) in the case of the Indenture Trustee,
at the Corporate Trust Office of the Indenture Trustee, Attention: Corporate
Trust Office-HSBC Automotive Trust (USA) 2006-3, Telecopier # 312-827-8562, (f)
in the case of the Administrator, at the Corporate Trust Office of the
Administrator, Attention: CTLA - Structured Finance, Telecopier # (212)
525-1300.  Any notice required or
permitted to be mailed to a Noteholder or Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in
the Certificate Register or Note



 26
 






 



Register, as
applicable.  Any notice so mailed within
the time prescribed in the Agreement shall be conclusively presumed to have
been duly given, whether or not the Certificateholder or Noteholder shall
receive such notice.


SECTION 6.09.              [Reserved].


[Reminder of page intentionally left blank]



 27














 


IN WITNESS WHEREOF, the parties hereto have caused
this Series Supplement to be fully executed by their respective officers as of
the day and year first above written.


	
  

  	
  HSBC FINANCE CORPORATION,

  
	
   

  	
    as Servicer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William H.
  Kesler

  	
   

  
	
   

  	
   

  	
  Name: William H.
  Kesler

  
	
   

  	
   

  	
  Title: Senior
  Vice President - Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC AUTOMOTIVE
  TRUST (USA) 2006-3,

  
	
   

  	
    as Issuer

  
	
   

  	
    by U.S. Bank Trust National Association,
  not in its

  
	
   

  	
    individual capacity but solely as Owner
  Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Patricia M.
  Child

  	
   

  
	
   

  	
   

  	
  Name: Patricia
  M. Child

  
	
   

  	
   

  	
  Title: Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC AUTO
  RECEIVABLES CORPORATION,

  
	
   

  	
    as Seller

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven H.
  Smith

  	
   

  
	
   

  	
   

  	
  Name: Steven H.
  Smith

  
	
   

  	
   

  	
  Title: Vice
  President and Assistant Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE BANK OF
  NEW YORK TRUST

  COMPANY, N.A.,

  
	
   

  	
    as Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Cindi Garcia
  as Trustee

  	
   

  
	
   

  	
   

  	
  Name: Cindi
  Garcia

  
	
   

  	
   

  	
  Title: Trust
  Officer

  










 



 


	
  

  	
  U.S. BANK TRUST
  NATIONAL ASSOCIATION,

  
	
   

  	
    not in its individual capacity but solely
  as Owner

  
	
   

  	
    Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Patricia M.
  Child

  	
   

  
	
   

  	
   

  	
  Name: Patricia
  M. Child

  
	
   

  	
   

  	
  Title: Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC BANK USA,
  NATIONAL ASSOCIATION,

  
	
   

  	
    as Administrator

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Fernando
  Acebedo

  	
   

  
	
   

  	
   

  	
  Name: Fernando
  Acebedo

  
	
   

  	
   

  	
  Title: Vice
  President

  



 


[Signature Page for Series Supplement]















 


Schedule I


Eligibility Criteria


“Eligible Receivable” means a Receivable with
respect to which each of the following is true as of the Closing Date:


(a)           that
(i) was originated directly by HACI or HAFI with the consumer, was originated
by a Dealer for the retail sale of a Financed Vehicle in the ordinary course of
such Dealer’s business, or was originated by an Alliance Relationship and sold
to HACI or HAFI and (A) in the case of a receivable originated by HACI or
HAFI, such entity had all necessary licenses and permits to originate
receivables in the state where such entity was located, and (B) in the case of
a Dealer originated receivable, such Dealer had all necessary licenses and
permits to originate receivables in the state where such Dealer was located,
and such receivable was purchased by HAFI from such Dealer under an existing
Dealer Agreement or Dealer Assignment with HAFI, and (C) in the case of a
receivable originated by an Alliance Relationship, such Alliance Relationship
had all necessary licenses and permits to originate receivables in the state
where such Alliance Relationship was located, and such receivable was purchased
by HACI or HAFI from such Alliance Relationship under an existing Alliance
Agreement and Alliance Assignment with HACI or HAFI, as applicable, and (D) in
the case of a Dealer originated receivable or a receivable originated by HACI,
HAFI or an Alliance Relationship, such receivable was purchased (x) by
HARC pursuant to the terms of the Master Receivables Purchase Agreements and
(y) by the Issuer pursuant to the Sale and Servicing Agreement; and each
Receivable was validly assigned (1) if Dealer originated, by such Dealer
to HAFI, (2) if originated by an Alliance Relationship, by such Alliance
Relationship to HAFI or HACI, as applicable, (3) by HAFI or HACI, as
applicable, to HARC pursuant to the terms of the Master Receivables Purchase
Agreements, (4) by HARC to the Issuer
pursuant to the Sale and Servicing Agreement and (5) by the Issuer to the
Indenture Trustee pursuant to the Indenture, (ii) was fully and properly
executed by the parties thereto, (iii) contains customary and enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for realization against the collateral security, and (iv) is fully
amortizing and provides for level monthly payments (provided that the
payment in the first Collection Period and the final Collection Period of the
term of the Receivable may be minimally different from the level payment)
which, if made when due, shall fully amortize the Amount Financed over the
original term;


(b)           that
was originated without any fraud or material misrepresentation on the part of a
Dealer, an Alliance Relationship, the Obligor, HAFI or HACI, as applicable;


(c)           with
respect to which all requirements of applicable federal, state and local laws,
and regulations thereunder (including, without limitation, usury laws, the
federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices
Act, the Federal Trade Commission Act, the Magnuson-Moss Warranty Act, the
Federal Reserve Board’s Regulations “B” and “Z”, the Servicemembers Civil
Relief Act, as amended, and state adaptations of the National Consumer Act and
of the Uniform Consumer Credit Code and other consumer credit laws and equal
credit opportunity and disclosure laws) in respect of all of the Receivables,
each and every sale of Financed Vehicles and the sale of any physical damage,
loss, credit life and credit accident and



 I-1
 






 



health insurance and any
extended service contracts, have been complied with in all material respects,
and each Receivable and the sale of the Financed Vehicle evidenced by each
Receivable and the sale of any physical damage, loss, credit life and credit
accident and health insurance and any extended service contracts complied at
the time it was originated or made and now complies in all material respects
with all applicable legal requirements;


(d)           that
was originated in, and the related Obligor is a resident of, the United States
of America and, at the time of origination materially conformed to all
underwriting and funding guidelines of HAFI applicable thereto and that has
been serviced in material conformity with procedures applicable to receivables
that are serviced by the Servicer for its own account;


(e)           which
represents the genuine, legal, valid and binding payment obligation of the
Obligor thereon, enforceable by the holder thereof in accordance with its
terms, except (A) as enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the enforcement of creditors’ rights
generally and by equitable limitations on the availability of specific
remedies, regardless of whether such enforceability is considered in a
proceeding in equity or at law and (B) as such Receivable may be modified by
the application of the Servicemembers Civil Relief Act, as amended, or similar
state regulation; and all parties thereto had full legal capacity to execute
and deliver such Receivable and all other documents related thereto and to
grant the security interest purported to be granted thereby;


(f)            which
is not due from the United States of America or any state or from any agency,
department, subdivision or instrumentality thereof;


(g)           which,
as of the Cut-off Date, (i) had an original term of not more than 72 months,
(ii) has a remaining term of not more than 72 months, (iii) had a remaining
Amount Financed of at least $3,000 and not more than $50,000, (iv) had an
Annual Percentage Rate of at least 6.50% and not more than 27.00%, (v) was not
more than 30 days contractually delinquent, (vi) no funds have been advanced by
the Issuer, the Servicer, HAFI, HACI, any Dealer, any Alliance Relationship or
anyone acting on behalf of any of them in order to cause such Receivable to
qualify under subclause (iv) of this clause (g) and (vii) had no
provision thereof waived, altered or modified in any respect since its
origination;


(h)           with
respect to which the information pertaining to such Receivable set forth in
each Schedule of Receivables is true and correct in all material respects;


(i)            with
respect to which HAFI will have caused the portions of HAFI’s  and the Servicer’s servicing records relating
to such Receivable to be clearly and unambiguously marked to show that such
Receivable has been transferred by HAFI or HACI to HARC in accordance with the
terms of the Master Receivables Purchase Agreements and by HARC to the Issuer
pursuant to the Sale and Servicing Agreement, and by the Issuer to the
Indenture Trustee pursuant to the Indenture;


(j)            with
respect to which the computer tape or listing to be made available by HAFI to
HARC, the Servicer or the Indenture Trustee is complete and accurate and
includes a description of the same Receivables that are, or will be, described
in the related Schedule of Receivables;



 I-2
 






 



(k)           which
constitutes tangible chattel paper within the meaning of the UCC;


(l)            of
which there is only one original executed copy;


(m)          with
respect to which there exists a Receivable File and such Receivable File
contains, without limitation, (a) a fully executed original of the Contract or
an electronic copy thereof, (b) a certificate of insurance, application form
for insurance signed by the Obligor, or a signed representation letter from the
relevant Obligor named pursuant to which the Obligor has agreed to obtain
physical damage insurance for the related Financed Vehicle, (c) the original
Lien Certificate or application therefor, or a physical or electronic copy
thereof, showing HAFI, HACI or an Alliance Relationship assigning its interest
in the Lien Certificate, as applicable, as first lienholder (which, for
Financed Vehicles registered in states that issue confirmation of the
lienholder’s interest electronically, the “Lien Certificate” may consist of
notification of an electronic recordation, by either a third party service
provider or the relevant Registrar of Titles of the applicable state, which
indicates that the lien of the secured party on the Financed Vehicle is
recorded on the original certificate of title on the electronic lien and title
system of the applicable state) and (d) an original credit application, or a
physical or electronic copy thereof, signed by the Obligor; and (x) each of the
documents relating thereto which is required to be signed by the Obligor has
been signed by the Obligor in the appropriate spaces and (y) all blanks on
any form relating thereto to be completed have been properly filled in and each
form has otherwise been correctly prepared; and, notwithstanding the above,
with respect to which, a copy of the complete Receivable File for such
Receivable, which fulfills the documentation requirements of HAFI as in effect
at the time of purchase is in the possession of the Servicer or Subservicer;


(n)           which
has not been satisfied, subordinated or rescinded, and the Financed Vehicle
securing such Receivable has not been released from the lien of such Receivable
in whole or in part;


(o)           which
was not originated in, and is not subject to the laws of, any jurisdiction the
laws of which would make unlawful, void or voidable the sale, transfer and
assignment of such Receivable and with respect to which there is no agreement
with any account debtor that prohibits, restricts or conditions the assignment
of any portion of such Receivable;


(p)           which
has not been sold, transferred, assigned or pledged to any Person other than to
(i) HAFI by a Dealer, (ii) HACI or HAFI, as applicable, by an
Alliance Relationship, (iii) HARC by HAFI or HACI, as applicable, pursuant to
the terms of the Master Receivables Purchase Agreements, (iv) the Issuer
by HARC pursuant to the terms of the Sale and Servicing Agreement, (v) the
Indenture Trustee by the Issuer pursuant to the terms of the Indenture, (vi) the
Household Automotive Warehouse Trust by HARC pursuant to the terms of the
master sale and servicing agreement, dated as of December 18, 2001 as amended
and restated from time to time, among HSBC Finance Corporation, HARC, Household
Automotive Warehouse Trust and Wells Fargo Bank, National Association, (vii)
Wells Fargo Bank, National Association by Household Automotive Warehouse Trust
pursuant to the terms of the indenture, dated as of December 18, 2001 as
amended and restated from time to time, among Household Automotive Warehouse
Trust, HSBC Finance Corporation and Wells Fargo Bank, National Association and
(viii) HARC, in connection with a prior securitization of such Receivable



 I-3
 






 



pursuant to a sale and
servicing agreement in which HARC was a seller, or the related indenture, each
as supplemented by a series supplement. No Dealer nor Alliance Relationship has
a participation in, or other right to receive, proceeds of any Receivable.  Neither HAFI nor HACI, as applicable, HARC nor
the Issuer has taken any action to convey any right to any Person that would
result in such Person having a right to payments received under the related
Insurance Policy, the related Dealer Agreement or Dealer Assignment, or the
related Alliance Agreement and Alliance Assignment, as applicable, or to
payments due under such Receivable;


(q)           which
creates a valid, binding and enforceable first priority security interest in
favor of HAFI or HACI, as applicable, in the Financed Vehicle;


(r)            which
is secured by an enforceable and perfected first priority security interest in
the Financed Vehicle in favor of HAFI or HACI, as applicable, as secured party,
which security interest is prior to all other Liens upon and security interests
in such Financed Vehicle which now exist or may hereafter arise or be created
(except, as to priority, for any Lien for taxes, labor or materials affecting a
Financed Vehicle); and, with respect to which there are no Liens or claims for
taxes, work, labor or materials affecting the related Financed Vehicle which
are or may be Liens prior or equal to the lien of such Receivable;


(s)           as
to which the Seller has not authorized the filing of, and is not aware of any
financing statements against the Seller that include a description of the
collateral covering such Receivable, other than any financing statements (i)
relating to the sale of such Receivable by HARC to the Issuer pursuant to the
terms of the Sale and Servicing Agreement, (ii) that have been terminated, or
(iii) that have been amended to release such Receivable;


(t)            as
to which all filings (including, without limitation, UCC filings) required to
be made by any Person and actions required to be taken or performed by any
Person in any jurisdiction to give the Indenture Trustee a first priority
perfected lien on, or ownership interest in, the Receivables and the proceeds
thereof have been made, taken or performed;


(u)           as
to which, immediately prior to the transfer and assignment of such Receivable
by the Seller pursuant to the Sale and Servicing Agreement, the Seller has good
and marketable title thereto, free and clear of any and all liens, claims or
encumbrances of any person;


(v)           as
to which HAFI or HACI, as applicable, HARC or the Issuer has not done anything
to convey any right to any Person that would result in such Person having a
right to payments due under such Receivable or otherwise to impair the rights
of the Indenture Trustee, the Noteholders or the Certificateholders in such
Receivable or the proceeds thereof;


(w)          which
is not assumable by another Person in a manner which would release the Obligor
thereof from such Obligor’s obligations with respect to such Receivable;


(x)            which
is not subject to any right of rescission, setoff, counterclaim or defense and
no such right has been asserted or threatened with respect thereto;


(y)           except
for payment delinquencies continuing for a period of not more than 30 days as
of the applicable Cut-Off Date, the Seller has no knowledge that a default,
breach,



 I-4
 






 



violation or event
permitting acceleration under the terms of the Receivable existed as of
the applicable Cut-Off Date or that any continuing condition that with notice
or lapse of time, or both, would constitute a default, breach, violation or
event permitting acceleration under the terms of the Receivable had arisen as
of the applicable Cut-Off Date and the Seller has not waived any of the
foregoing;


(z)            at
the time of the origination of which, the related Financed Vehicle was covered
by a comprehensive and collision insurance policy (i) in an amount at
least equal to the lesser of (a) its maximum insurable value and
(b) the principal amount due from the Obligor thereunder, (ii) naming
the Servicer, HAFI or HACI, as applicable, and its successors and assigns as
loss payee and (iii) insuring against loss and damage due to fire, theft,
transportation, collision and other risks generally covered by comprehensive
and collision coverage and with respect to which the Obligor is required to
maintain physical loss and damage insurance, naming the Servicer, HAFI or HACI,
as applicable, and its successors and assigns as additional insured parties,
and such Receivable permits the holder thereof to obtain physical loss and
damage insurance at the expense of the Obligor if the Obligor fails to do so;


(aa)         with
respect to which the following is true:


The Lien Certificate for the related Financed Vehicle
shows, or if a new or replacement Lien Certificate is being applied for with
respect to such Financed Vehicle the Lien Certificate will be received within
270 days of the Closing Date and will show, HAFI, HACI or an Alliance
Relationship assigning its interest in the Lien Certificate, as applicable,
named as the original secured party under such Receivable and, accordingly,
HAFI, HACI or such Alliance Relationship, as applicable, will be the holder of
a first priority security interest in such Financed Vehicle.  With respect to each Receivable for which the
Lien Certificate has not yet been returned from the Registrar of Titles, HAFI
has either applied for or received written evidence from the related Dealer or
the Obligor that such Lien Certificate showing HAFI, HACI or an Alliance
Relationship assigning its interest in the Lien Certificate, as applicable, as
first lienholder has been applied for. 
If the Receivable was originated in a state in which a filing or
recording is required of the secured party to perfect a security interest in
motor vehicles, such filings or recordings have been duly made to show HAFI,
HACI or an Alliance Relationship assigning its interest in the Lien
Certificate, as applicable, named as the original secured party under the
related Receivable;


(bb)         with
respect to which the related Contract contains no mark or notation indicating
that such Contract has been sold or pledged by the Seller to any person other
than the Issuer;


(cc)         as
to which no selection procedures adverse to the Noteholders or the
Certificateholder have been utilized in selecting such Receivable from all
other similar Receivables purchased or originated by HAFI or originated by
HACI;


(dd)         as
to which, as of the Cut-off Date, no Obligor had been identified on the records
of HAFI as being the subject of a current bankruptcy proceeding; and



 I-5
 






 



(ee)         as
to which all funds have been fully advanced
to or on behalf of the related Obligor in accordance with its terms.



 I-6














 


Schedule II


Schedule of Receivables on File in Electronic Form

at Dewey Ballantine LLP



 II-1














 


Exhibit A


Form of Servicer’s Certificate


HSBC Automotive Trust (USA)  2006-3


Class A-1
Notes:  5.36200%


Class A-2
Notes:  5.38%


Class A-3
Notes:  5.28%


Class A-4
Notes:  5.34%


Servicer’s Certificate


(Delivered pursuant to Section 4.9 of


the Sale and Servicing Agreement)


Collection Period Beginning


Collection Period Ending


Previous Distribution Date


Distribution Date


Days in Interest Period


Months
Since Closing


I.  COLLECTION PERIOD
POOL BALANCE CALCULATION:


Beginning of Collection Period Pool Balance


Principal Receivables Added


Monthly Principal Amounts:


 
Principal Payments Received for the Collection Period


 
Liquidated Receivables for the Collection Period


 
Principal Amount of Repurchased Receivables for the Collection Period


End of Collection Period Pool Balance


End
of Collection Period Pool Factor


II.  COLLECTION PERIOD
NOTEHOLDER CALCULATIONS:


(a) Class
A-1


A.  
Information regarding distributions


  
1.   Total distribution per $1,000


  
2.   Principal distribution per
$1,000


  
3.   Interest distribution per
$1,000


B. 
Calculation of Class A-1 interest due


  
1.   Class A-1 related Note Rate


  
2.   Class A-1 note balance -
beginning of period


  
3.   Interest accrual convention


  
4.   Days in Interest Period


  
5.   Class A-1 interest due -
current period



 A-1
 






 



  
6.   Class A Interest Carryover
Shortfall with respect to Class A-1


  
7.   Class A-1 interest paid


   8.  
Class A-1 unpaid interest with respect to the Distribution Date


C. 
Calculation of Class A-1 principal balance


  
1.  Class A-1 note balance -
beginning of period


  
2.  Class A-1 minimum principal
distributable amount - due


  
3.  Class A-1 additional principal
distributable amount - due


  
4.  Class A-1 minimum principal
distributable amount - paid


  
5.  Class A-1 additional principal
distributable amount - paid


  
6.  Class A-1 note balance - end
of period


  
7.  Class A-1 notes as a
percentage of the total Notes outstanding on the Distribution Date


   8. 
Class A-1 notes as a percentage of the Pool Balance on the Distribution
Date


(b) Class
A-2


A.  
Information Regarding Distributions


  
1.   Total distribution per $1,000


  
2.   Principal distribution per
$1,000


   3.  
Interest distribution per $1,000


B. 
Calculation of Class A-2 interest due


  
1.   Class A-2 related Note Rate


  
2.   Class A-2 note balance -
beginning of period


  
3.   Interest accrual convention


  
4.   Days in Interest Period


  
5.   Class A-2 interest due -
current period


  
6.   Class A Interest Carryover
Shortfall with respect to Class A-2


  
7.   Class A-2 interest paid


   8.  
Class A-2 unpaid interest with respect to the Distribution Date


C. 
Calculation of Class A-2 principal balance


  
1.  Class A-2 note balance -
beginning of period


  
2.  Class A-2 minimum principal
distributable amount - due


  
3.  Class A-2 additional principal
distributable amount - due


  
4.  Class A-2 minimum principal
distributable amount - paid


  
5.  Class A-2 additional principal
distributable amount - paid


  
6.  Class A-2 note balance - end
of period


  
7.  Class A-2 notes as a percentage
of the total Notes outstanding on the Distribution Date


  
8.  Class A-2 notes as a
percentage of the Pool Balance on the Distribution Date


   9. 
Class A-1 and A-2 notes as a percentage of the Pool Balance on the
Distribution Date


(c) Class
A-3


A.   Information Regarding Distributions


  
1.   Total distribution per $1,000


  
2.   Principal distribution per
$1,000


   3.  
Interest distribution per $1,000



 A-2
 






 



B. 
Calculation of Class A-3 interest Due


  
1.   Class A-3 related Note Rate


  
2.   Class A-3 note balance -
beginning of period


  
3.   Interest accrual convention


  
4.   Days in Interest Period


  
5.   Class A-3 interest due -
current period


  
6.   Class A Interest Carryover
Shortfall with respect to Class A-3


  
7.   Class A-3 interest paid


   8.  
Class A-3 unpaid interest with respect to the Distribution Date


C. 
Calculation of Class A-3 principal balance


  
1.  Class A-3 note balance -
beginning of period


  
2.  Class A-3 minimum principal
distributable amount - due


  
3.  Class A-3 additional principal
distributable amount - due


  
4.  Class A-3 minimum principal
distributable amount - paid


  
5.  Class A-3 additional principal
distributable amount - paid


  
6.  Class A-3 note balance - end
of period


  
7.  Class A-3 notes as a
percentage of the total Notes outstanding on the Distribution Date


  
8.  Class A-3 notes as a
percentage of the Pool Balance on the Distribution Date


   9. 
Class A-1, A-2 and A-3 notes as a percentage of the Pool Balance on the
Distribution Date


(d) Class
A-4


A.   Information
Regarding Distributions


  
1.   Total distribution per $1,000


  
2.   Principal distribution per
$1,000


   3.  
Interest distribution per $1,000


B. 
Calculation of Class A-4 Interest Due


  
1.   Class A-4 related Note Rate


  
2.   Class A-4 principal balance -
beginning of period


  
3.   Interest accrual convention


  
4.   Days in Interest Period


  
5.   Class A-4 interest due -
current period


  
6.   Class A Interest Carryover
Shortfall with respect to Class A-4


  
7.   Class A-4 interest paid


   8.  
Class A-4 unpaid interest with respect to the Distribution Date


C. 
Calculation of Class A-4 principal balance


  
1.  Class A-4 note balance -
beginning of period


  
2.  Class A-4 minimum principal
distributable amount - due


  
3.  Class A-4 additional principal
distributable amount - due


  
4.  Class A-4 minimum principal
distributable amount - paid


  
5.  Class A-4 additional principal
distributable amount - paid


  
6.  Class A-4 note balance - end
of period


  
7.  Class A-4 notes as a
percentage of the total Notes outstanding on the Distribution Date



 A-3
 






 



  
8.  Class A-4 Notes as a
percentage of the Pool Balance on the Distribution Date


   9. 
Class A-1, A-2, A-3 and A-4 notes as a percentage of the Pool Balance on
the Distribution Date


III.  PRINCIPAL DISTRIBUTABLE AMOUNT CALCULATION


 Aggregate
Optimal Note Principal Balance for the Distribution Date:


   Pool
Balance as of the end of the Collection Period


  
Factor


Aggregate Optimal Note Principal Balance for
the Distribution Date


Optimal
Principal Distributable Amount for the Distribution Date:


   The
excess, if any, of


    
(x) Aggregate Note Principal Balance over


    
(y) Aggregate Optimal Note Principal Balance for such Distribution Date


Optimal Principal Distributable Amount


Class A
Minimum Principal Distributable Amount:


  
Greater of (a), (b), or (c):


   (a)
The lesser of:


       
(i) Optimal Principal Distributable Amount


       
(ii) BOM Principal Balance less EOM Principal Balance


       
(iii) Aggregate Note Principal Balance


   (b)
The amount necessary on a Note’s Scheduled Maturity Date to bring the Note’s


        
Aggregate Note Principal Balance to zero


   (c)
The excess of the Aggregate Note Principal Balance over the


        
Pool Balance


Class A Minimum Principal Distributable
Amount


Class A
Additional Principal Distributable Amount


  
Excess of:


    
(i) Aggregate Note Principal Balance


         
Less:  Class A Minimum Principal
Distributable Amount paid over


    
(ii) Aggregate Optimal Note Principal Balance


Class
A Additional Principal Distributable Amount


IV.   RESERVE ACCOUNT RECONCILIATION


Beginning Reserve Account Balance


Targeted Reserve Account Balance


Reserve Account Shortfall


Reserve Account Deposit


Reserve Account Release


Ending Reserve Account Balance


Ending
Reserve Account Balance as a percentage of the Ending Pool Balance


V.  OVERCOLLATERALIZATION CALCULATION


Overcollateralization
Amount prior to payments allocated to principal


 Overcollateralization Amount after giving
effect to payments allocated to principal


Ending
Overcollateralization Amount as a percentage of the Ending Pool Balance



 A-4
 






 



VI.  RECONCILIATION OF COLLECTION ACCOUNT


 (A) Available Funds (Sect. 2.01(a))


i. Collected Funds


  
(a)  Collections On Receivables


  
(b)  Net Liquidation Proceeds


  
(c)  Substitution Adjustment
Amounts


Total Collected Funds


ii. Collection and Reserve Account investment
income


iii. Repurchase Amounts deposited in the
Collection Account


iv. Proceeds of any liquidation of the Trust


Available
Funds for distribution


Distributions (Sect. 3.03)


(A)
Available Funds


(B) Servicing Fee


i.
Servicing Fee (If HSBC Finance no longer the Servicer)


(C) Unpaid Administrator, and Indenture and
Owner Trustee fees


Remaining
available funds for interest distribution


(D) Class A Interest Distributable Amount paid


i. Class A-1 interest paid


ii. Class A-2 interest paid


iii. Class A-3 interest paid


iv. Class A-4 interest paid


Total Class A Interest Distributable Amount
paid


Remaining
Available Funds for principal distribution


(E) Class A Minimum Principal Distributable
Amount paid


i. Class A-1 minimum principal paid


ii. Class A-2 minimum principal paid


iii. Class A-3 minimum principal paid


iv. Class A-4 minimum principal paid


Class A Minimum Principal Distributable
Amount paid


Remaining
funds


(F) Reserve Account Shortfall Amount -
deposited


Remaining
funds


(G) Class A Additional Principal
Distributable Amount


i. Class A-1 additional principal
distributable amount


ii. Class A-2 additional principal
distributable amount


iii. Class A-3 additional principal
distributable amount


iv. Class A-4 additional principal
distributable amount


Class A Additional Principal Distributable
Amount - paid



 A-5
 






 



Remaining
funds


(H) Amount released from Reserve Account


Remaining
funds


(I) Unpaid Administrator, and Indenture and
Owner Trustee indemnity expenses


Remaining
funds


(J)
Servicing Fee (If HSBC Finance Is Servicer)


(K)
Remaining Available Funds for distribution to Certificateholders


VII.  OTHER STATISTICS


Delinquency


A. One payment delinquent  - $


   % of
Principal Receivables


B. Two payments delinquent - $


   % of
Principal Receivables


C. Three or more payments delinquent - $


   % of
Principal Receivables


D. Two or more payments delinquent - $


   % of Principal Receivables


E. Principal
Balance of Receivables that were extended or modified (and delinquency reset)
during the related Collection Period - $


F. Principal
Balance of Receivables that were extended or modified (and delinquency reset)
during the related Collection Period as a percent of the Pool Balance at the
end of such Collection Period -    %


G. Repossessed Vehicles


   % of
Principal Receivables


H. Cumulative Net Loss Percentage


I. The weighted average coupon (WAC) was
equal to


J.
The weighted average remaining maturity (WARM) was equal to



 A-6














 


Exhibit B


Forms of Notes


	
  REGISTERED

  	
   

  	
  $[              ]

  
	
  No. A-1

  	
   

  	
   

  



 


SEE REVERSE FOR CERTAIN DEFINITIONS


CUSIP NO. [                ]


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.


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.


HSBC AUTOMOTIVE TRUST
(USA) 2006-3


CLASS A-1 [           ]%
NOTE


HSBC Automotive Trust (USA) 2006-3, a statutory trust
organized and existing under the laws of the State of Delaware (herein referred
to as the “Issuer”), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of [                                                                           ]
DOLLARS payable on each Distribution Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $[               ]
and the denominator of which is $[               ]
by (ii) the aggregate amount, if any, payable from Available Funds in
respect of principal on the Class A-1 Notes pursuant to the Indenture; provided,
however, that the entire unpaid principal amount of this Note shall be
due and payable on [                  ]
(the “Class A-1 Scheduled Maturity Date”). 
The Issuer will pay interest on this Note at the rate per annum shown
above on each Distribution Date until the principal of this Note is paid or
made available for payment.  Interest on
this Note will accrue for each Distribution Date from the most recent
Distribution Date on which interest has been paid to but excluding such
Distribution Date or, if no interest has yet been paid, from November [   ],
2006.  Interest will be computed on the
basis of a 360-day year and the actual number of days elapsed in an
applicable Interest Period.  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



 B-1
 






 



interest due and payable
on this Note as provided above and then to the unpaid principal of this Note.


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


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



 B-2
 






 



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


	
  Date: November [   ], 2006

  	
   

  	
  HSBC AUTOMOTIVE TRUST (USA) 2006-3

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  U.S. BANK TRUST NATIONAL

  
	
   

  	
  ASSOCIATION, not in its individual capacity but

  
	
   

  	
  solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					




 B-3
 






 



ADMINISTRATOR’S
CERTIFICATE OF AUTHENTICATION


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


	
  Date: November [   ], 2006

  	
  HSBC BANK USA, NATIONAL ASSOCIATION,

  
	
   

  	
  not in its individual capacity but solely as

  
	
   

  	
  Administrator

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  
					




 B-4
 






 



[REVERSE OF NOTE]


This Note is one of a duly authorized issue of Notes
of the Issuer, designated as its Class A-1 [         ]%
Notes (herein called the “Class A-1 Notes”), all issued under an Indenture
dated as of November [   ], 2006 (such indenture, as
supplemented or amended, is herein called the “Indenture”), among the Issuer,
The Bank of New York Trust Company, N.A., as indenture trustee (the “Indenture
Trustee”, which term includes any successor Indenture Trustee under the Indenture)
and HSBC Bank USA, National Association, as administrator (the “Administrator”,
which term includes any successor Administrator 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, the Administrator and the Holders of the Notes.  The Notes are subject to all terms of the
Indenture.  All terms used in this Note
that are defined in the Indenture, as supplemented or amended, shall have the
meanings assigned to them in or pursuant to the Indenture, as so supplemented
or amended.


The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes (together, the “Notes”) are and will be
equally and ratably secured by the collateral pledged as security therefor as
provided in the Indenture.


Principal of the Class A-1 Notes will be payable on
each Distribution Date in an amount described on the face hereof. “Distribution
Date” means the seventeenth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing on December 18,
2006.  The term “Distribution Date” shall
be deemed to include the Class A-1 Scheduled Maturity Date.


As described above, the entire unpaid principal amount
of this Note shall be due and payable on the Class A-1 Scheduled Maturity
Date.  This Note is also subject to
redemption when the Pool Balance is reduced to an amount that is less than or
equal to 10% of the original Pool Balance. Notwithstanding the foregoing, the
entire unpaid principal amount of the Notes shall be due and payable on any
date on or after which an Event of Default shall have occurred and be
continuing if the Indenture Trustee in its discretion or if requested by
Holders of the Notes representing at least 66 2/3% of the Outstanding Amount of
the Notes have declared the Notes to be immediately due and payable in the
manner provided in the Indenture.  All
principal payments on the Class A-1 Notes shall be made pro rata to the Class
A-1 Noteholders entitled thereto.


Payments of interest on this Note due and payable on
each Distribution Date, together with the installment of principal, if any, to
the extent not in full payment of this Note, shall be made by check mailed to
the Person whose name appears as the Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on each
Record Date, except that 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.), 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) effected by any payments made on any Distribution Date shall



 B-5
 






 



be binding upon all
future Holders 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, for payment in full of the then
remaining unpaid principal amount of this Note on a Distribution Date, then the
Administrator, in the name of and on behalf of the Issuer, will notify the
Person who was the Holder hereof as of the Record Date preceding such
Distribution Date by notice mailed prior to such Distribution Date and the
amount then due and payable shall be payable only upon presentation and
surrender of this Note at the Administrator’s principal Corporate Trust Office
or at the office of the Administrator’s agent appointed for such purposes
located in New York, New York.


The Issuer shall pay interest on overdue installments
of interest at the Class A-1 Note Rate to the extent lawful.


As provided in the Indenture and subject to certain
limitations set forth therein, 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, (i)
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
his 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 Securities Transfer Agents
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, and (ii) accompanied by such
other documents as the Indenture Trustee may require, 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, the Administrator or the
Indenture Trustee on the Notes or under the Indenture or any certificate or
other writing delivered in connection therewith, against (i) the Seller,
the Servicer, the Indenture Trustee, the Administrator 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 Seller, the Servicer, the Indenture Trustee, the Administrator or the
Owner Trustee in its individual capacity, any holder of a beneficial interest
in the Issuer, the Seller, the Servicer, the Owner Trustee, the Administrator
or the Indenture Trustee or of any successor or assign of the Seller, the
Servicer, the Indenture Trustee, the Administrator 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.



 B-6
 






 



Prior to the due presentment for registration of
transfer of this Note, the Issuer, the Indenture Trustee and the Administrator
and any agent of the Issuer, the Indenture Trustee or the Administrator 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, the Administrator nor 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 Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Noteholders
representing a majority of the Outstanding Amount of all Notes at the time Outstanding.


The term “Issuer” as used in this Note includes any
successor to the Issuer under the Indenture.


The Issuer is permitted by the Indenture, under
certain circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Noteholders under the Indenture.


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


This Note and the 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 and thereunder shall be determined in accordance with such
laws.


No reference herein to the Indenture and no provision
of this Note or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Note at the times, place, and rate, and in the coin or
currency herein prescribed.


Anything herein to the contrary notwithstanding,
except as expressly provided in the Indenture or the Basic Documents, neither
U.S. Bank Trust National Association in its individual capacity, any owner of a
beneficial interest in the Issuer, nor any of their respective partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for,
the payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in
this Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Owner Trustee for the
sole purposes of binding the interests of the Owner Trustee in the assets of
the Issuer.  The Holder of this Note by
the acceptance hereof agrees that except as expressly provided in the Indenture
or the Basic Documents, in the case of an Event of Default under the Indenture,
the Holder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.



 B-7














 


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) NOTE: The signature
to this assignment must correspond with the name of the registered owner as it
appears on the face of the within Note in every particular, without alteration,
enlargement or any change whatsoever.



 B-8
 






 



 


	
  REGISTERED

  	
   

  	
  $[              ]

  
	
  No. A-2

  	
   

  	
   

  



 


SEE REVERSE FOR CERTAIN DEFINITIONS


CUSIP NO. [                  ]


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.


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.


HSBC AUTOMOTIVE TRUST
(USA) 2006-3


CLASS A-2 [      ]%
NOTE


HSBC Automotive Trust (USA) 2006-3, a statutory trust
organized and existing under the laws of the State of Delaware (herein referred
to as the “Issuer”), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of [                                                                                          ]
DOLLARS payable on each Distribution Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $[            ]
and the denominator of which is $[            ]
by (ii) the aggregate amount, if any, payable from Available Funds in
respect of principal on the Class A-2 Notes pursuant to the Indenture; provided,
however, that the entire unpaid principal amount of this Note shall be
due and payable on [               ]
(the “Class A-2 Scheduled Maturity Date”). 
The Issuer will pay interest on this Note at the rate per annum shown
above on each Distribution Date until the principal of this Note is paid or
made available for payment.  Interest on
this Note will accrue for each Distribution Date from the most recent
Distribution Date on which interest has been paid to but excluding such
Distribution Date or, if no interest has yet been paid, from November [   ],
2006.  Interest will be computed on the
basis of a 360-day year consisting of twelve 30-day months.


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.



 B-9
 






 



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 Administrator whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof, or be valid or obligatory for any purpose.



 B-10
 






 



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


	
  Date: November [   ], 2006

  	
  HSBC AUTOMOTIVE TRUST (USA) 2006-3

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  U.S. BANK TRUST NATIONAL

  
	
   

  	
  ASSOCIATION, not in its individual capacity but

  
	
   

  	
  solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					




 B-11
 






 



ADMINISTRATOR’S
CERTIFICATE OF AUTHENTICATION


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


	
  Date: November [   ], 2006

  	
  HSBC BANK USA, NATIONAL ASSOCIATION,

  
	
   

  	
  not in its individual capacity but solely as

  
	
   

  	
  Administrator

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  
					




 B-12
 






 



[REVERSE OF NOTE]


This Note is one of a duly authorized issue of Notes
of the Issuer, designated as its Class A-2 [   ]% Notes (herein
called the “Class A-2 Notes”), all issued under an Indenture dated as of
November [   ], 2006 (such indenture, as supplemented or
amended, is herein called the “Indenture”), among the Issuer, The Bank of New
York Trust Company, N.A., as indenture trustee (the “Indenture Trustee”, which
term includes any successor Indenture Trustee under the Indenture) and HSBC
Bank USA, National Association, as administrator (the “Administrator”, which
term includes any successor Administrator 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, the Administrator and the Holders of the Notes.  The Notes are subject to all terms of the
Indenture.  All terms used in this Note
that are defined in the Indenture, as supplemented or amended, shall have the
meanings assigned to them in or pursuant to the Indenture, as so supplemented
or amended.


The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes (together, the “Notes”) are and will be
equally and ratably secured by the collateral pledged as security therefor as
provided in the Indenture.


Principal of the Class A-2 Notes will be payable on
each Distribution Date in an amount described on the face hereof. “Distribution
Date” means the seventeenth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing on December 18,
2006.  The term “Distribution Date” shall
be deemed to include the Class A-2 Scheduled Maturity Date.


As described above, the entire unpaid principal amount
of this Note shall be due and payable on the Class A-2 Scheduled Maturity
Date.  This Note is also subject to
redemption when the Pool Balance is reduced to an amount that is less than or
equal to 10% of the original Pool Balance. Notwithstanding the foregoing, the
entire unpaid principal amount of the Notes shall be due and payable on any
date on or after which an Event of Default shall have occurred and be
continuing if the Indenture Trustee in its discretion or if requested by
Holders of the Notes representing at least 66 2/3% of the Outstanding Amount of
the Notes have declared the Notes to be immediately due and payable in the
manner provided in the Indenture.  All
principal payments on the Class A-2 Notes shall be made pro rata to the Class
A-2 Noteholders entitled thereto.


Payments of interest on this Note due and payable on
each Distribution Date, together with the installment of principal, if any, to
the extent not in full payment of this Note, shall be made by check mailed to
the Person whose name appears as the Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on each
Record Date, except that 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.), 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) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of



 B-13
 






 



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, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Administrator,
in the name of and on behalf of the Issuer, will notify the Person who was the
Holder hereof as of the Record Date preceding such Distribution Date by notice
mailed prior to such Distribution Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Administrator’s principal Corporate Trust Office or at the office of the
Administrator’s agent appointed for such purposes located in New York, New
York.


The Issuer shall pay interest on overdue installments
of interest at the Class A-2 Note Rate to the extent lawful.


As provided in the Indenture and subject to certain
limitations set forth therein, 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, (i)
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or his
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 Securities Transfer Agents
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, and (ii) accompanied by such
other documents as the Indenture Trustee may require, 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, the Administrator or the
Indenture Trustee on the Notes or under the Indenture or any certificate or
other writing delivered in connection therewith, against (i) the Seller,
the Servicer, the Indenture Trustee, the Administrator 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 Seller, the Servicer, the Indenture Trustee, the Administrator or the
Owner Trustee in its individual capacity, any holder of a beneficial interest
in the Issuer, the Seller, the Servicer, the Owner Trustee, the Administrator
or the Indenture Trustee or of any successor or assign of the Seller, the
Servicer, the Indenture Trustee, the Administrator 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.


Prior to the due presentment for registration of
transfer of this Note, the Issuer, the Indenture Trustee and the Administrator
and any agent of the Issuer, the Indenture Trustee or the



 B-14
 






 



Administrator 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, the Administrator nor 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 Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Noteholders representing
a majority of the Outstanding Amount of all Notes at the time Outstanding.


The term “Issuer” as used in this Note includes any
successor to the Issuer under the Indenture.


The Issuer is permitted by the Indenture, under
certain circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Noteholders under the Indenture.


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


This Note and the 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 and thereunder shall be determined in accordance with such
laws.


No reference herein to the Indenture and no provision
of this Note or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Note at the times, place, and rate, and in the coin or
currency herein prescribed.


Anything herein to the contrary notwithstanding,
except as expressly provided in the Indenture or the Basic Documents, neither
U.S. Bank Trust National Association in its individual capacity, any owner of a
beneficial interest in the Issuer, nor any of their respective partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for,
the payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in
this Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Owner Trustee for the
sole purposes of binding the interests of the Owner Trustee in the assets of
the Issuer.  The Holder of this Note by
the acceptance hereof agrees that except as expressly provided in the Indenture
or the Basic Documents, in the case of an Event of Default under the Indenture,
the Holder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.



 B-15














 


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) NOTE: The signature
to this assignment must correspond with the name of the registered owner as it
appears on the face of the within Note in every particular, without alteration,
enlargement or any change whatsoever.



 B-16
 






 



 


	
  REGISTERED

  	
   

  	
  $[              ]

  
	
  No. A-3

  	
   

  	
   

  



 


SEE REVERSE FOR CERTAIN DEFINITIONS


CUSIP NO. [               ]


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.


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.


HSBC AUTOMOTIVE TRUST
(USA) 2006-3


CLASS A-3 [      ]%
NOTE


HSBC Automotive Trust (USA) 2006-3, a statutory trust
organized and existing under the laws of the State of Delaware (herein referred
to as the “Issuer”), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of [                                                                                          ]
DOLLARS payable on each Distribution Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $[            ]
and the denominator of which is $[            ]
by (ii) the aggregate amount, if any, payable from Available Funds in
respect of principal on the Class A-3 Notes pursuant to the Indenture; provided,
however, that the entire unpaid principal amount of this Note shall be
due and payable on [               ]
(the “Class A-3 Scheduled Maturity Date”). 
The Issuer will pay interest on this Note at the rate per annum shown
above on each Distribution Date until the principal of this Note is paid or
made available for payment.  Interest on
this Note will accrue for each Distribution Date from the most recent
Distribution Date on which interest has been paid to but excluding such
Distribution Date or, if no interest has yet been paid, from November [   ],
2006.  Interest will be computed on the
basis of a 360-day year consisting of twelve 30-day months.


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.



 B-17
 






 



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 Administrator whose name appears below by manual
signature, this Note shall not be entitled to any benefit under the Indenture
referred to on the reverse hereof, or be valid or obligatory for any purpose.



 B-18
 






 



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


	
  Date: November [   ], 2006

  	
  HSBC AUTOMOTIVE TRUST (USA) 2006-3

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  U.S. BANK TRUST NATIONAL

  
	
   

  	
  ASSOCIATION, not in its individual capacity but

  
	
   

  	
  solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					




 B-19
 






 



ADMINISTRATOR’S
CERTIFICATE OF AUTHENTICATION


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


	
  Date: November [   ], 2006

  	
  HSBC BANK USA, NATIONAL ASSOCIATION,

  
	
   

  	
  not in its individual capacity but solely as

  
	
   

  	
  Administrator

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  
					




 B-20
 






 



[REVERSE OF NOTE]


This Note is one of a duly authorized issue of Notes
of the Issuer, designated as its Class A-3 [   ]% Notes (herein
called the “Class A-3 Notes”), all issued under an Indenture dated as of
November [   ], 2006 (such indenture, as supplemented or
amended, is herein called the “Indenture”), among the Issuer, The Bank of New
York Trust Company, N.A., as indenture trustee (the “Indenture Trustee”, which
term includes any successor Indenture Trustee under the Indenture) and HSBC
Bank USA, National Association, as administrator (the “Administrator”, which
term includes any successor Administrator 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, the Administrator and the Holders of the Notes.  The Notes are subject to all terms of the
Indenture.  All terms used in this Note
that are defined in the Indenture, as supplemented or amended, shall have the
meanings assigned to them in or pursuant to the Indenture, as so supplemented
or amended.


The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes (together, the “Notes”) are and will be
equally and ratably secured by the collateral pledged as security therefor as
provided in the Indenture.


Principal of the Class A-3 Notes will be payable on
each Distribution Date in an amount described on the face hereof. “Distribution
Date” means the seventeenth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing on December 18,
2006.  The term “Distribution Date” shall
be deemed to include the Class A-3 Scheduled Maturity Date.


As described above, the entire unpaid principal amount
of this Note shall be due and payable on the Class A-3 Scheduled Maturity
Date.  This Note is also subject to
redemption when the Pool Balance is reduced to an amount that is less than or
equal to 10% of the original Pool Balance. Notwithstanding the foregoing, the
entire unpaid principal amount of the Notes shall be due and payable on any
date on or after which an Event of Default shall have occurred and be
continuing if the Indenture Trustee in its discretion or if requested by
Holders of the Notes representing at least 66 2/3% of the Outstanding Amount of
the Notes have declared the Notes to be immediately due and payable in the
manner provided in the Indenture.  All
principal payments on the Class A-3 Notes shall be made pro rata to the Class
A-3 Noteholders entitled thereto.


Payments of interest on this Note due and payable on
each Distribution Date, together with the installment of principal, if any, to
the extent not in full payment of this Note, shall be made by check mailed to
the Person whose name appears as the Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on each
Record Date, except that 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.), 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) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of



 B-21
 






 



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, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Administrator,
in the name of and on behalf of the Issuer, will notify the Person who was the
Holder hereof as of the Record Date preceding such Distribution Date by notice
mailed prior to such Distribution Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Administrator’s principal Corporate Trust Office or at the office of the
Administrator’s agent appointed for such purposes located in New York, New
York.


The Issuer shall pay interest on overdue installments
of interest at the Class A-3 Note Rate to the extent lawful.


As provided in the Indenture and subject to certain
limitations set forth therein, 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, (i)
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
his 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 Securities Transfer Agents
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, and (ii) accompanied by such
other documents as the Indenture Trustee may require, 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, the Administrator or the
Indenture Trustee on the Notes or under the Indenture or any certificate or
other writing delivered in connection therewith, against (i) the Seller,
the Servicer, the Indenture Trustee, the Administrator 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 Seller, the Servicer, the Indenture Trustee, the Administrator or the
Owner Trustee in its individual capacity, any holder of a beneficial interest
in the Issuer, the Seller, the Servicer, the Owner Trustee, the Administrator
or the Indenture Trustee or of any successor or assign of the Seller, the
Servicer, the Indenture Trustee, the Administrator 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.


Prior to the due presentment for registration of
transfer of this Note, the Issuer, the Indenture Trustee and the Administrator
and any agent of the Issuer, the Indenture Trustee or the



 B-22
 






 



Administrator 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, the Administrator nor 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 Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Noteholders representing
a majority of the Outstanding Amount of all Notes at the time Outstanding.


The term “Issuer” as used in this Note includes any
successor to the Issuer under the Indenture.


The Issuer is permitted by the Indenture, under
certain circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Noteholders under the Indenture.


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


This Note and the 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 and thereunder shall be determined in accordance with such
laws.


No reference herein to the Indenture and no provision
of this Note or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Note at the times, place, and rate, and in the coin or
currency herein prescribed.


Anything herein to the contrary notwithstanding,
except as expressly provided in the Indenture or the Basic Documents, neither
U.S. Bank Trust National Association in its individual capacity, any owner of a
beneficial interest in the Issuer, nor any of their respective partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for, the
payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in
this Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Owner Trustee for the
sole purposes of binding the interests of the Owner Trustee in the assets of
the Issuer.  The Holder of this Note by
the acceptance hereof agrees that except as expressly provided in the Indenture
or the Basic Documents, in the case of an Event of Default under the Indenture,
the Holder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.



 B-23














 


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) NOTE: The signature
to this assignment must correspond with the name of the registered owner as it
appears on the face of the within Note in every particular, without alteration,
enlargement or any change whatsoever.



 B-24
 






 



 


	
  REGISTERED

  	
   

  	
  $[              ]

  
	
  No. A-4

  	
   

  	
   

  



 


SEE REVERSE FOR CERTAIN DEFINITIONS


CUSIP NO. [               ]


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.


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.


HSBC AUTOMOTIVE TRUST
(USA) 2006-3


CLASS A-4 [      ]%
NOTE


HSBC Automotive Trust (USA) 2006-3, a statutory trust
organized and existing under the laws of the State of Delaware (herein referred
to as the “Issuer”), for value received, hereby promises to pay to CEDE &
CO., or registered assigns, the principal sum of [                                                                                          ]
DOLLARS payable on each Distribution Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $[            ]
and the denominator of which is $[            ]
by (ii) the aggregate amount, if any, payable from Available Funds in
respect of principal on the Class A-4 Notes pursuant to the Indenture; provided,
however, that the entire unpaid principal amount of this Note shall be
due and payable on [               ]
(the “Class A-4 Scheduled Maturity Date”). 
The Issuer will pay interest on this Note at the rate per annum shown
above on each Distribution Date until the principal of this Note is paid or
made available for payment.  Interest on
this Note will accrue for each Distribution Date from the most recent
Distribution Date on which interest has been paid to but excluding such
Distribution Date or, if no interest has yet been paid, from November [   ],
2006.  Interest will be computed on the
basis of a 360-day year consisting of twelve 30-day months.


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.



 B-25
 






 



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 Administrator whose name appears below by manual
signature, this Note shall not be entitled to any benefit under the Indenture
referred to on the reverse hereof, or be valid or obligatory for any purpose.



 B-26
 






 



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


	
  Date: November [   ], 2006

  	
  HSBC AUTOMOTIVE TRUST (USA) 2006-3

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  U.S. BANK TRUST NATIONAL

  
	
   

  	
  ASSOCIATION, not in its individual capacity but

  
	
   

  	
  solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					




 B-27
 






 



ADMINISTRATOR’S
CERTIFICATE OF AUTHENTICATION


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


	
  Date: November [   ], 2006

  	
  HSBC BANK USA, NATIONAL ASSOCIATION,

  
	
   

  	
  not in its individual capacity but solely as

  
	
   

  	
  Administrator

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  
					




 B-28
 






 



[REVERSE OF NOTE]


This Note is one of a duly authorized issue of Notes
of the Issuer, designated as its Class A-4 [   ]% Notes (herein
called the “Class A-4 Notes”), all issued under an Indenture dated as of
November [   ], 2006 (such indenture, as supplemented or
amended, is herein called the “Indenture”), among the Issuer, The Bank of New
York Trust Company, N.A., as indenture trustee (the “Indenture Trustee”, which
term includes any successor Indenture Trustee under the Indenture) and HSBC
Bank USA, National Association, as administrator (the “Administrator”, which
term includes any successor Administrator 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, the Administrator and the Holders of the Notes.  The Notes are subject to all terms of the
Indenture.  All terms used in this Note
that are defined in the Indenture, as supplemented or amended, shall have the
meanings assigned to them in or pursuant to the Indenture, as so supplemented
or amended.


The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes and the Class A-4 Notes (together, the “Notes”) are and will be
equally and ratably secured by the collateral pledged as security therefor as
provided in the Indenture.


Principal of the Class A-4 Notes will be payable on
each Distribution Date in an amount described on the face hereof. “Distribution
Date” means the seventeenth day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing on December 18,
2006.  The term “Distribution Date” shall
be deemed to include the Class A-4 Scheduled Maturity Date.


As described above, the entire unpaid principal amount
of this Note shall be due and payable on the Class A-4 Scheduled Maturity
Date.  This Note is also subject to
redemption when the Pool Balance is reduced to an amount that is less than or
equal to 10% of the original Pool Balance. Notwithstanding the foregoing, the
entire unpaid principal amount of the Notes shall be due and payable on any
date on or after which an Event of Default shall have occurred and be
continuing if the Indenture Trustee in its discretion or if requested by
Holders of the Notes representing at least 66 2/3% of the Outstanding Amount of
the Notes have declared the Notes to be immediately due and payable in the
manner provided in the Indenture.  All
principal payments on the Class A-4 Notes shall be made pro rata to the Class
A-4 Noteholders entitled thereto.


Payments of interest on this Note due and payable on
each Distribution Date, together with the installment of principal, if any, to
the extent not in full payment of this Note, shall be made by check mailed to
the Person whose name appears as the Holder of this Note (or one or more
Predecessor Notes) on the Note Register as of the close of business on each
Record Date, except that 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.), 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) effected by any payments made on any Distribution Date shall be binding
upon all future Holders of this Note and of any Note issued upon the
registration of



 B-29
 






 



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, for payment in full of the then remaining unpaid
principal amount of this Note on a Distribution Date, then the Administrator,
in the name of and on behalf of the Issuer, will notify the Person who was the
Holder hereof as of the Record Date preceding such Distribution Date by notice
mailed prior to such Distribution Date and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Administrator’s principal Corporate Trust Office or at the office of the
Administrator’s agent appointed for such purposes located in New York, New
York.


The Issuer shall pay interest on overdue installments
of interest at the Class A-4 Note Rate to the extent lawful.


As provided in the Indenture and subject to certain
limitations set forth therein, 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, (i)
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder hereof or
his 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 Securities Transfer Agents
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, and (ii) accompanied by such
other documents as the Indenture Trustee may require, 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, the Administrator or the
Indenture Trustee on the Notes or under the Indenture or any certificate or
other writing delivered in connection therewith, against (i) the Seller,
the Servicer, the Indenture Trustee, the Administrator 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 Seller, the Servicer, the Indenture Trustee, the Administrator or the
Owner Trustee in its individual capacity, any holder of a beneficial interest
in the Issuer, the Seller, the Servicer, the Owner Trustee, the Administrator
or the Indenture Trustee or of any successor or assign of the Seller, the
Servicer, the Indenture Trustee, the Administrator 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.


Prior to the due presentment for registration of
transfer of this Note, the Issuer, the Indenture Trustee and the Administrator
and any agent of the Issuer, the Indenture Trustee or the



 B-30
 






 



Administrator 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, the Administrator nor 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 Holders of the Notes under the
Indenture at any time by the Issuer with the consent of the Noteholders representing
a majority of the Outstanding Amount of all Notes at the time Outstanding.


The term “Issuer” as used in this Note includes any
successor to the Issuer under the Indenture.


The Issuer is permitted by the Indenture, under
certain circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Noteholders under the Indenture.


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


This Note and the 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 and thereunder shall be determined in accordance with such
laws.


No reference herein to the Indenture and no provision
of this Note or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Note at the times, place, and rate, and in the coin or
currency herein prescribed.


Anything herein to the contrary notwithstanding,
except as expressly provided in the Indenture or the Basic Documents, neither
U.S. Bank Trust National Association in its individual capacity, any owner of a
beneficial interest in the Issuer, nor any of their respective partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for, the
payment of principal of or interest on, or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in
this Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Owner Trustee for the
sole purposes of binding the interests of the Owner Trustee in the assets of
the Issuer.  The Holder of this Note by
the acceptance hereof agrees that except as expressly provided in the Indenture
or the Basic Documents, in the case of an Event of Default under the Indenture,
the Holder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.



 B-31
 






 



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) NOTE: The signature to this assignment must
correspond with the name of the registered owner as it appears on the face of
the within Note in every particular, without alteration, enlargement or any
change whatsoever.



 B-32