Document:

Exhibit 4.4

 

 

HSBC FINANCE CORPORATION,

as Master Servicer,

 

HSBC AUTOMOTIVE TRUST 2005-3,

as Issuer,

 

HSBC AUTO RECEIVABLES CORPORATION,

as Seller,

 

JPMORGAN CHASE BANK, 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 3, 2005

to the

 

INDENTURE

 

Dated as of November 3, 2005

 

MASTER SALE AND SERVICING AGREEMENT

 

Dated as of November 3, 2005

 

and to the

 

AMENDED AND RESTATED TRUST AGREEMENT

 

Dated as of November 3, 2005

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I
  CREATION OF THE NOTES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  DESIGNATION

  	
   

  
	
  SECTION 1.02.

  	
  PLEDGE OF SERIES TRUST
  ESTATE.

  	
   

  
	
  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

  	
  14

  
	
  SECTION 3.06.

  	
  COMPLIANCE WITH WITHHOLDING
  REQUIREMENTS

  	
  15

  
	
  SECTION 3.07.

  	
  SPECIAL COVENANTS AND
  ACKNOWLEDGEMENTS

  	
  15

  
	
  SECTION 3.08.

  	
  INCOME TAX CHARACTERIZATION

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV EVENTS OF
  DEFAULT; REMEDIES

  	
  15

  
	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  EVENTS OF DEFAULT

  	
  15

  
	
  SECTION 4.02.

  	
  RIGHTS UPON EVENT OF DEFAULT

  	
  17

  
	
  SECTION 4.03.

  	
  REMEDIES

  	
  17

  
	
  SECTION 4.04.

  	
  PRIORITIES

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE V PREPAYMENT, REDEMPTION
  AND SUBSTITUTION

  	
  19

  
	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  OPTIONAL “CLEAN-UP”
  REDEMPTION

  	
  19

  
	
  SECTION 5.02.

  	
  OPTIONAL SUBSTITUTION

  	
  19

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI
  MISCELLANEOUS

  	
  20

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  RATIFICATION OF BASIC
  DOCUMENTS

  	
  20

  
	
  SECTION 6.02.

  	
  COUNTERPARTS

  	
  21

  
	
  SECTION 6.03.

  	
  GOVERNING LAW

  	
  21

  
	
  SECTION 6.04.

  	
  AMENDMENTS WITHOUT CONSENT
  OF NOTEHOLDERS

  	
  21

  
	
  SECTION 6.05.

  	
  AMENDMENTS WITH CONSENT OF
  THE NOTEHOLDERS

  	
  22

  
	
  SECTION 6.06.

  	
  AUTHORITY TO REGISTER NOTES
  AND FILE REPORTS

  	
  24

  
	
  SECTION 6.07.

  	
  AUTHORITY TO
  PERFORM DUTIES OF THE ISSUER

  	
  24

  
	
  SECTION 6.08.

  	
  NOTICES

  	
  24

  
	
   

  	
   

  	
   

  
	
  Schedule I

  	
  Eligibility Criteria

  	
  I-1

  
	
  Schedule II

  	
  Schedule of Receivables

  	
  II-1

  
	
  Exhibit A

  	
  Form of Master Servicer’s
  Certificate

  	
  A-1

  
	
  Exhibit B

  	
  Forms of Notes

  	
  B-1

  
				

 

 

This Series Supplement,
dated as of November 3, 2005, is by and among HSBC Finance Corporation, a
Delaware corporation, as Master Servicer (the “Master Servicer”), HSBC
Automotive Trust 2005-3, a Delaware statutory trust, as Issuer (the “Issuer”
or the “Trust”), HSBC Auto Receivables Corporation, a Nevada
corporation, as Seller (the “Seller”), JPMorgan Chase Bank, 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 3, 2005 among
the Issuer, the Indenture Trustee and the Administrator and pursuant to Section 3.2
of the Amended and Restated Trust Agreement (the “Trust
Agreement”) dated as of November 3, 2005 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 2005-3, Series 2005-3 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 $249,500,000 (the “Class A-1 Notes”), Class A-2
Notes in an aggregate initial principal amount of $246,800,000 (the “Class A-2
Notes”), Class A-3 Notes in an aggregate initial principal amount of $273,000,000
(the “Class A-3 Notes”), and Class A-4 Notes in an aggregate
initial principal amount of $135,969,000 (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 2005-3, Series 2005-3 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, investment property, letter-of-credit
rights, letters of credit, money, minerals before extraction 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 or any Affiliate of HAFI that is the seller under a Master
Receivables Purchase Agreement, HSBC Finance, the Seller, the Master 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 or any Affiliate of HAFI that is the
seller under a Master Receivables Purchase Agreement against Dealers pursuant
to Dealer Agreements or Dealer 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; (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
or any Affiliate of HAFI that is the seller under a Master Receivables Purchase
Agreement 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 Master Servicer, the Seller, HAFI or any
Affiliate of HAFI that is the seller under a Master Receivables Purchase
Agreement 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 Master 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 Master 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 $100,000 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 product of
(x) 56% and (y) the Pool Balance as of the close of business on the
last day of the prior Collection Period.

 

“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.

 

“Basic Documents” means
this Series Supplement, the Master 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

 

3

 

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.

 

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

 

“Class A-1 Scheduled
Maturity Date” means November 17, 2006.

 

4

 

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

 

“Class A-2 Scheduled
Maturity Date” means January 20, 2009.

 

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

 

“Class A-3 Scheduled
Maturity Date” means October 18, 2010.

 

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

 

“Class A-4 Scheduled
Maturity Date” means November 19, 2012.

 

“Closing Date” means November 3,
2005.

 

“Collection Account”
means the Eligible Account created pursuant to Section 3.01, which shall
be account no. 10-879227 reference HSBC Auto 2005-3 Collection Account at the Administrator,
ABA No. 021001088.

 

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

 

“Control Agreement” means
the deposit account control agreement dated as of November 3, 2005 among
the Issuer, the Indenture Trustee, HSBC Bank USA, National Association 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 Administration, (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 227 West Monroe Street, 26th Floor, Chicago,
Illinois 60606 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 23, 2005.

 

“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 Master Sale and Servicing Agreement.

 

“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

 

5

 

Period, or if such
day is not a Business Day, the immediately following Business Day, commencing in
December 2005.

 

“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 Master 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 Master 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 November 19, 2012.

 

6

 

“HACI” means HSBC Auto
Credit Inc. (f/k/a Household Automotive Credit Corporation), a Delaware
corporation.  For the avoidance of doubt,
HACI is an Affiliate of HAFI.

 

“HAFI” means HSBC Auto
Finance Inc. (f/k/a Household Automotive Finance Corporation), a Delaware
corporation.

 

“HSBC Finance” means HSBC
Finance Corporation (f/k/a Household Finance Corporation).

 

“Indenture” means the
indenture dated as of November 3, 2005 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.

 

“Master Sale and
Servicing Agreement” means the Master Sale and Servicing Agreement dated as of November 3,
2005, among the Issuer, the Seller, the Master Servicer, the Indenture Trustee
and the Administrator, as such agreement may be amended or supplemented from
time to time.

 

“Master 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 Master Servicer to the Administrator, the
Indenture Trustee and the Owner Trustee pursuant to the Master Sale and
Servicing Agreement.

 

“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:  4.28625%

Class A-2
Notes:  4.70%

Class A-3
Notes:  4.80%

Class A-4
Notes:  4.94%

 

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.

 

7

 

“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.

 

“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 Master
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.

 

8

 

“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. 10-879228, reference HSBC Auto 2005-3 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 be made immediately after the deposit to the Collection
Account effected pursuant to Section 5.1(c) of the Master 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.

 

“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 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, Master 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.

 

“Servicing Fee” means, (i) with
respect to the initial Collection Period, the fee payable to the Master Servicer for servicing rendered
during such Collection Period, which shall be equal to $3,257,598.69, and (ii) with
respect to any other Collection Period, the fee payable to the Master Servicer
for services rendered during such Collection Period, which shall be equal to

 

9

 

one-twelfth of the
Servicing Fee Rate multiplied by the Aggregate Principal Balances of the
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 Master 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 Master 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) $27,432,410.03 (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 26, 2005, between the Seller and
the Owner Trustee, as amended and restated as of November 3, 2005 and as
supplemented by this Series Supplement.

 

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

 

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 Administrator’s corporate trust department, identified as the “Collection
Account for HSBC Automotive Trust 2005-3, in trust for the Secured Parties.”  The Administrator shall make or permit
withdrawals from the Collection Account only as provided in this Series Supplement.

 

10

 

(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 2005-3, 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 Master 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 Master 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 Master 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 Master Servicer, if HSBC Finance is no longer acting as Master 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
Master Servicer, reasonable transition expenses in an amount not to exceed
$100,000 per servicing transfer) (in each case, to the extent such fees have
not been previously paid by the Master Servicer);

 

(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;

 

11

 

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

 

(viii)                        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 Master 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.

 

(c)                                  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

 

12

 

any monies at any time held in the Reserve Account,
such monies being held in trust for the benefit of the Secured Parties.

 

(d)                                 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 Master Servicer for any Servicing Fees then due and unpaid pursuant to Section 3.03(a)(vii),
and any remainder shall be paid to the holders of the Certificates.

 

(e)                                  In
the event that the Reserve Account is maintained with an institution other than
the Administrator, the Master 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.

 

(f)                                    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.

 

(g)                                 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 Master Servicer shall deliver, and
cause to be delivered via access to its or its Affiliate’s website address, to
the Indenture Trustee and the Administrator (with a copy to the Rating
Agencies) with an instruction for the Administrator to forward to each
Noteholder of record, and to each Certificateholder of record, a statement
setting forth at least the following information as to the Notes to the extent
applicable:

 

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

 

(ii)                                  the
amount of such distribution allocable to interest on or with respect to 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 (i) above;

 

13

 

(iv)                              the
Class A Interest Carryover Shortfall, if any, and the change in such
amount from the preceding statement;

 

(v)                                 the
positive excess, if any, of the Aggregate Note Principal Balance over the Pool
Balance after giving effect to payments allocated to principal reported under (i) above
and the change in such amount from the preceding statement;

 

(vi)                              the
amount of the Servicing Fee paid to the Master Servicer with respect to such
Collection Period; and

 

(vii)                           the Targeted Reserve Account
Balance and the amount on deposit in the Reserve Account at the end of such
Distribution Date.

 

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 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
Master Servicer’s Certificate shall be in the form attached as Exhibit A
hereto.

 

(b)                                 By
January 31 of each calendar year, commencing January 31, 2006, the
Master 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.

 

14

 

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.

 

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

 

15

 

(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

 

(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.

 

16

 

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 Master 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

 

(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;

 

17

 

(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 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 on the date of distribution in the following order
of priority:

 

FIRST:           amounts due and owing and required to be
distributed to the Master Servicer, if HSBC Finance is no longer acting as
Master Servicer, the Administrator, the Owner Trustee and the Indenture
Trustee, respectively, pursuant to priorities (i) and (ii) of Section 3.03(a) and
not previously distributed, in the order of such priorities and without
preference or priority of any kind within such priorities;

 

18

 

SECOND:                                            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;

 

THIRD:       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;

 

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

 

FIFTH:          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.

 

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 Master Servicer and HAFI 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 Master
Servicer (if other than HSBC Finance) under the Related Documents (the “Redemption
Price”).  The Master Servicer or HAFI
shall give the Master 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 Master Servicer or HAFI, 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 Master Servicer or HAFI, 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 Master 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

 

19

 

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 Master Servicer
shall give written notice to each Rating Agency of any such substitution.

 

(b)                                 For
any Collection Period during which the Master Servicer or HAFI substitutes one
or more Eligible Substitute Receivables, the Master Servicer shall determine
the Substitution Adjustment Amount.  The
Master 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 Master Servicer shall amend the Schedule of
Receivables to reflect the removal of any Receivable for which the Master
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 Master
Servicer certifying that the conditions in this Section 5.02(b) have
been satisfied, take any action requested by the Master Servicer or HAFI, as
the case may be, to effect the reconveyance of such Receivable for which the
Master Servicer or HAFI, as the case may be, has made a substitution election
so removed from the Series Trust Estate to the Master Servicer or HAFI, as
the case may be.  The procedures applied
by the Master 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 Master 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 Master Servicer, in each case without
recourse, as shall be necessary to vest in the Master Servicer or HAFI, as
applicable, legal and beneficial ownership of such Receivable for which the
Master 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.

 

20

 

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 may enter into one or more amendments hereto, in
form satisfactory to the Administrator, the Indenture Trustee and 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

 

21

 

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 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.

 

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 Master 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;

 

22

 

(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”;

 

(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.

 

23

 

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
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 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 Master 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 Master 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 Master Servicer.

 

(b)                                 The
Issuer hereby appoints the Master 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 Master Servicer hereby
accepts such appointment.

 

SECTION 6.08.                 Notices.

 

All demands, notices and
communications upon or to the Seller, the Master 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 Master Servicer, if HSBC Finance Corporation is the Master
Servicer, to HSBC Finance Corporation, 2700 Sanders Road, Prospect Heights,
Illinois 60070,  Attention:

 

24

 

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 2005-3, Telecopier # (713) 216-4880 and (f) in the case
of the Administrator, at the Corporate Trust Office of the Administrator,
Attention: Corporate Trust/ABS Group, 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 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.

 

[Reminder of page intentionally
left blank]

 

25

 

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 Master Servicer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ William
  H. Kesler

  	
   

  
	
   

  	
   

  	
  Name:

  	
  William H. Kesler

  
	
   

  	
   

  	
  Title:

  	
  Vice President and
  Assistant Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC AUTOMOTIVE TRUST 2005-3,

  
	
   

  	
  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

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  as Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Keith R. Richardson

  	
   

  
	
   

  	
   

  	
  Name: Keith R. Richardson

  
	
   

  	
   

  	
  Title: Attorney-in-Fact

  
						

 

 

	
   

  	
  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/ Susie Moy

  	
   

  
	
   

  	
   

  	
  Name: Susie Moy

  
	
   

  	
   

  	
  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 HAFI (or any predecessor or Affiliate of HAFI,
as applicable) with the consumer or was originated by a Dealer for the retail
sale of a Financed Vehicle in the ordinary course of such Dealer’s business and
(A) in the case of a receivable originated by HAFI (or any predecessor or
Affiliate of HAFI, as applicable), 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 (or any
predecessor or Affiliate of HAFI, as applicable) from such Dealer under an
existing Dealer Agreement with HAFI (or any predecessor or Affiliate of HAFI,
as applicable), and (C) in the case of a Dealer originated receivable or a
receivable originated by HAFI (or any predecessor or Affiliate of HAFI, as
applicable) such receivable was purchased (x) by HARC pursuant to the
terms of the Master Receivables Purchase Agreements, (y) by the Issuer
pursuant to the Master Sale and Servicing Agreement; and each Receivable was
validly assigned (1) if Dealer originated, by such Dealer to HAFI (or any
predecessor or Affiliate of HAFI, as applicable), (2) by HAFI (or any
predecessor or Affiliate of HAFI, as applicable) to HARC pursuant to the terms
of the Master Receivables Purchase Agreements, (3) by HARC to the Issuer
pursuant to the Master Sale and Servicing Agreement and (4) 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, 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 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

 

I-1

 

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 (or of any predecessor or Affiliate
of HAFI, as applicable) applicable thereto and that has been serviced in
material conformity with procedures applicable to receivables that are serviced
by the Master 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; 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 $40,000, (iv) had
an Annual Percentage Rate of at least 6.50% and not more than 24.95%, (v) was
not more than 30 days contractually delinquent, (vi) no funds have been
advanced by the Issuer, the Master Servicer, HAFI, any predecessor or Affiliate
of HAFI, any Dealer, 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 (or any predecessor or Affiliate of HAFI, as applicable)
will have caused the portions of HAFI’s (or any HAFI predecessor’s or HAFI
Affiliate’s, as applicable) and the Master 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 any predecessor or Affiliate
of HAFI, as applicable) to HARC in accordance with the terms of the Master
Receivables Purchase Agreements and by HARC to the Issuer pursuant to the
Master 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 (or
any predecessor or Affiliate of HAFI, as applicable) to HARC, the Master
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, (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 (or any predecessor or Affiliate of HAFI, as applicable) as first
lienholder 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 (or any predecessor or
Affiliate of HAFI, as applicable) as in effect at the time of purchase is in
the possession of the Master 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 (or any predecessor or Affiliate of HAFI, as applicable) by a
Dealer, (ii) HARC by HAFI (or any predecessor or Affiliate of HAFI, as
applicable) pursuant to the terms of the Master Receivables Purchase
Agreements, (iii) the Issuer by HARC pursuant to the terms of the Master
Sale and Servicing Agreement and (iv) the Indenture Trustee by the Issuer
pursuant to the terms of the Indenture. 
No Dealer has a participation in, or other right to receive, proceeds of
any Receivable.  Neither HAFI (nor any
predecessor or Affiliate of HAFI, 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 or the
related Dealer Agreement or Dealer Assignment or to payments due under such
Receivable;

 

(q)                                 which
creates a valid, binding and enforceable first priority security interest in
favor of HAFI (or any predecessor or Affiliate of HAFI, 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 any predecessor or Affiliate of HAFI,
as

 

I-3

 

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 Master Sale and Servicing Agreement, or (ii) that have been
terminated;

 

(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 any predecessor or Affiliate of HAFI, 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)                                 as
to which there has been no default, breach, violation or event permitting acceleration
under the terms of such Receivable (other than payment delinquencies permitted
by clause (g)(iv) above) and no condition exists or event has occurred and
is continuing that with notice, the lapse of time or both would constitute a
default, breach, violation or event permitting acceleration under the terms of
such Receivable, and there has been no waiver of any of the foregoing, and with
respect to which the related Financed Vehicle had not been repossessed;

 

(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 HAFI (or any
predecessor or Affiliate of HAFI, 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

 

I-4

 

insurance, naming HAFI
(or any predecessor or Affiliate of HAFI, 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 180 days of the Closing Date and will show, HAFI (or
any predecessor or Affiliate of HAFI, as applicable) named as the original
secured party under such Receivable and, accordingly, HAFI (or any predecessor
or Affiliate of HAFI, 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 (or any predecessor or Affiliate of HAFI, 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 (or any predecessor or Affiliate of HAFI, 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 by HAFI or any predecessor or Affiliate of HAFI;

 

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

 

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

 

I-5

 

Schedule II

 

Schedule of
Receivables on File in Electronic Form

at Dewey Ballantine LLP

 

II-1

 

Exhibit A

 

Form of
Master Servicer’s Certificate

 

HSBC
Automotive Trust 2005-3

 

Class A-1 Notes:  4.28625%

Class A-2 Notes:  4.70%

Class A-3 Notes:  4.80%

Class A-4 Notes:  4.94%

 

Master Servicer’s Certificate

(Delivered pursuant to Section 4.9 of

the Master Sale and Servicing
Agreement)

 

Collection
Period Beginning

Collection
Period Ending

Previous
Distribution Date

Distribution
Date

Days
in Interest Period

Days
in Collection 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.   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.   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.   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.   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.  CERTIFICATE
CALCULATION

 

Beginning
Certificate Balance

Ending
Certificate Balance

Ending
Certificate Balance 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 Master 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

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

Remaining
funds

 

A-5

 

(G) Amount
released from Reserve Account

Remaining
funds for Servicing Fee

 

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

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

 

Repossessed
Vehicles

% of Principal Receivables

Cumulative
Net Loss Percentage

The
weighted average coupon (WAC) was equal to

The
weighted average remaining maturity (WARM) was equal to

 

A-6

 

Exhibit B

 

Forms of Notes

 

	
  REGISTERED

  	
   

  	
  $249,500,000

  
	
  No. A-1

  	
   

  	
   

  

 

SEE REVERSE FOR CERTAIN DEFINITIONS

 

CUSIP NO. 44328F AJ 8

 

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 2005-3

 

CLASS A-1 4.28625%
NOTE

 

HSBC Automotive Trust 2005-3,
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 TWO HUNDRED FORTY-NINE MILLION FIVE HUNDRED THOUSAND DOLLARS payable on
each Distribution Date in an amount equal to the result obtained by multiplying
(i) a fraction the numerator of which is $249,500,000 and the denominator
of which is $249,500,000 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 November 17,
2006 (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 3, 2005. 
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 3,
  2005

  	
  HSBC AUTOMOTIVE
  TRUST 2005-3

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  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 3,
  2005

  	
  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
4.28625% Notes (herein called the “Class A-1 Notes”), all issued under an
Indenture dated as of November 3, 2005 (such indenture, as supplemented or
amended, is herein called the “Indenture”), among the Issuer, JPMorgan Chase
Bank, 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 19, 2005.  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
be binding upon all future Holders of this Note and of any Note issued upon the
registration of

 

B-5

 

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.

 

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-6

 

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

  	
   

  	
  $246,800,000

  
	
  No. A-2

  	
   

  	
   

  

 

SEE REVERSE FOR CERTAIN DEFINITIONS

 

CUSIP NO. 44328F AK 5

 

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 2005-3

 

CLASS A-2 4.70% NOTE

 

HSBC Automotive Trust 2005-3,
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 TWO HUNDRED FORTY-SIX MILLION EIGHT HUNDRED THOUSAND DOLLARS payable on
each Distribution Date in an amount equal to the result obtained by multiplying
(i) a fraction the numerator of which is $246,800,000 and the denominator
of which is $246,800,000 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 January 20,
2009 (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 3, 2005. 
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 3,
  2005

  	
  HSBC AUTOMOTIVE
  TRUST 2005-3

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  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 3,
  2005

  	
  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
4.70% Notes (herein called the “Class A-2 Notes”), all issued under an
Indenture dated as of November 3, 2005 (such indenture, as supplemented or
amended, is herein called the “Indenture”), among the Issuer, JPMorgan Chase
Bank, 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 19, 2005. 
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-16Exhibit
10.1

 

Execution Copy

 

MASTER RECEIVABLES PURCHASE
AGREEMENT

 

 

between

 

 

HOUSEHOLD AUTOMOTIVE CREDIT
CORPORATION,

as Seller

 

and

 

 

HOUSEHOLD AUTO RECEIVABLES
CORPORATION,

as Purchaser

 

 

dated as of

 

August 8, 2002

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  SECTION 1.1

  	
  General

  	
  1

  
	
  SECTION 1.2

  	
  Specific
  Terms

  	
  1

  
	
  SECTION 1.3

  	
  Other
  Definitional Provisions.

  	
  2

  
	
  SECTION 1.4

  	
  Certain
  References

  	
  2

  
	
  SECTION 1.5

  	
  No
  Recourse

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE II CONVEYANCE OF THE RECEIVABLES AND
  THE OTHER CONVEYED PROPERTY

  	
  3

  
	
   

  	
   

  	
   

  
	
  SECTION 2.1

  	
  Purchase

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE III REPRESENTATIONS AND WARRANTIES

  	
  5

  
	
   

  	
   

  	
   

  
	
  SECTION 3.1

  	
  Representations
  and Warranties of Seller

  	
  5

  
	
  SECTION 3.2

  	
  Representations
  and Warranties of HARC

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV COVENANTS OF SELLER

  	
  8

  
	
   

  	
   

  	
   

  
	
  SECTION 4.1

  	
  Seller’s
  Covenants

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE V REPURCHASES

  	
  9

  
	
   

  	
   

  	
   

  
	
  SECTION 5.1

  	
  Repurchase
  of Receivables Upon Breach of Warranty

  	
  9

  
	
  SECTION 5.2

  	
  Reassignment
  of Repurchased Receivables

  	
  10

  
	
  SECTION 5.3

  	
  Waivers

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI MISCELLANEOUS

  	
  11

  
	
   

  	
   

  	
   

  
	
  SECTION 6.1

  	
  Liability
  of Seller

  	
  11

  
	
  SECTION 6.2

  	
  Amendment

  	
  11

  
	
  SECTION 6.3

  	
  GOVERNING
  LAW

  	
  11

  
	
  SECTION 6.4

  	
  Notices

  	
  11

  
	
  SECTION 6.5

  	
  Severability
  of Provisions

  	
  11

  
	
  SECTION 6.6

  	
  Assignment

  	
  11

  
	
  SECTION 6.7

  	
  Acknowledgment
  and Agreement of Seller

  	
  12

  
	
  SECTION 6.8

  	
  Further
  Assurances

  	
  12

  
	
  SECTION 6.9

  	
  No
  Waiver; Cumulative Remedies

  	
  12

  
	
  SECTION 6.10

  	
  Counterparts

  	
  12

  
	
  SECTION 6.11

  	
  Binding
  Effect; Third-Party Beneficiaries

  	
  12

  
	
  SECTION 6.12

  	
  Merger
  and Integration

  	
  13

  
	
  SECTION 6.13

  	
  Heading

  	
  13

  
	
  SECTION 6.14

  	
  Schedules
  and Exhibits

  	
  13

  
	
  SECTION 6.15

  	
  Survival
  of Representations and Warranties

  	
  13

  
	
  SECTION 6.16

  	
  Nonpetition
  Covenant

  	
  13

  

 

i

 

EXHIBITS

 

	
  EXHIBIT A

  	
   

  	
  Form of
  Receivables Purchase Agreement Supplement

  	
  A-1

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE A

  	
   

  	
  Schedule of
  Related Master Sale and Servicing Agreements

  	
   

  

 

ii

 

THIS MASTER RECEIVABLES
PURCHASE AGREEMENT, dated as of August 8, 2002, executed between Household
Auto Receivables Corporation, a Nevada corporation, as purchaser (“HARC”)
and Household Automotive Credit Corporation, a Delaware corporation, as seller
(“Seller”).

 

W I T N E S S E T H :

 

WHEREAS, HARC has agreed
to purchase from time to time from Seller, and Seller, pursuant to this
Agreement, has agreed to transfer from time to time to HARC the Receivables and
the Other Conveyed Property.

 

WHEREAS, HARC intends
from time to time to transfer Receivables and Other Conveyed Property to
different Delaware business trusts, each of which will issue notes and
certificates secured by the Receivables and Other Conveyed Property.

 

NOW, THEREFORE, in
consideration of the premises and the mutual agreements hereinafter contained,
and for other good and valuable consideration, the receipt of which is
acknowledged, HARC and Seller, intending to be legally bound, hereby agree as
follows:

 

ARTICLE I

 

DEFINITIONS

 

SECTION 1.1         General.  Capitalized terms used herein without
definition shall have the respective meanings assigned to such terms in the
related Master Sale and Servicing Agreement.

 

SECTION 1.2         Specific Terms.  Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:

 

“Agreement” means
this Master Receivables Purchase Agreement and all amendments hereof and
supplements hereto.

 

“Conveyance” shall
have the meaning specified in Section 2.1.

 

“Conveyance Papers”
shall have the meaning specified in Section 3.1.

 

“Cutoff Date”
shall have the meaning assigned to such term in the applicable
Series Supplement or Receivables Purchase Agreement Supplement.

 

“Master Sale and
Servicing Agreement” means each agreement so entitled set forth on
Schedule A among HARC, Household Finance Corporation, as Master Servicer,
the indenture trustee named therein and the issuer named therein, each as
supplemented by a related series supplement among HARC, Household Finance

 

1

 

Corporation, as
Master Servicer, the indenture trustee named therein, the issuer named therein
and the owner trustee and Delaware trustee (if necessary) named therein,
pursuant to which Receivables are conveyed by HARC to such issuer.

 

“Other Conveyed
Property” means all money, instruments, rights and other property that are
subject or intended to be subject to the lien and security interest of the
related Indenture (including all property and interests granted to the related
Indenture Trustee), including all proceeds thereof, other than the Receivables.

 

“Purchase Date”
means, with respect to Receivables, any date, on which Receivables are to be
purchased by HARC pursuant to this Agreement and a Receivables Purchase
Agreement Supplement is executed and delivered by Seller and HARC.

 

“Receivables”
means the Receivables listed on the Schedules of Receivables attached to a
Receivables Purchase Agreement Supplement as Schedule A.

 

“Receivables Purchase
Agreement Supplement” means an agreement between HARC and Seller in
connection with a Series, substantially in the form of Exhibit A hereto.

 

“Repurchase Event”
means a determination pursuant to Section 3.2 of the related Master Sale
and Servicing Agreement that HARC is required to repurchase a Receivable.

 

“Schedule of
Receivables” means a schedule of Receivables sold and transferred
pursuant to this Agreement and a related Receivables Purchase Agreement
Supplement, which is attached as Schedule A to such related Receivables
Purchase Agreement Supplement.

 

SECTION 1.3         Other Definitional Provisions.

 

(a)                                  All
terms defined in this Agreement shall have the defined meanings when used in
any certificate, other documents, or Conveyance Paper made or delivered
pursuant hereto unless otherwise defined herein.

 

(b)                                 The
words “hereof”, “herein” and “hereunder” and words of similar import when used
in this Agreement or any Conveyance Paper shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; and Section,
Subsection, Schedule and Exhibit references contained in this
Agreement are references to Sections, Subsections, Schedules and Exhibits in or
to this Agreement unless otherwise specified.

 

(c)                                  All
determinations of the principal or finance charge balance of any Receivable,
and of any collections thereof, shall be made in accordance with the related
Master Sale and Servicing Agreement.

 

SECTION 1.4         Certain References.  All references to the Principal Balance of a
Receivable as of any date of determination shall refer to the close of

 

2

 

business on such day, or
as of the first day of a Collection Period shall refer to the opening of
business on such day.  All references to
the last day of a Collection Period shall refer to the close of business on
such day.

 

SECTION 1.5         No Recourse.  Without limiting the obligations of Seller
hereunder, no recourse may be taken, directly or indirectly, under this
Agreement or any certificate or other writing delivered in connection herewith
or therewith, against any stockholder, officer or director, as such, of Seller,
or of any predecessor or successor of Seller.

 

ARTICLE II

 

CONVEYANCE OF THE RECEIVABLES

AND THE OTHER CONVEYED PROPERTY

 

SECTION 2.1         Purchase.

 

(a)                                  By
execution of this Agreement and subject to the terms and conditions of this
Agreement, on a Purchase Date with respect to a Receivables Purchase Agreement
Supplement, Seller shall sell, transfer, assign, and otherwise convey to HARC
(each, a “Conveyance”) without recourse (but without limitation of its
obligations in this Agreement), and HARC shall purchase, all right, title and
interest of Seller in and to:

 

(i)                                     each
and every Receivable listed from time to time on Schedule A to such
related Receivables Purchase Agreement Supplement and all monies paid or
payable thereon or in respect thereof on or after the related Cutoff Date
(including amounts due on or before the related Cutoff Date but received by
Seller after such date);

 

(ii)                                  the
security interests in the related Financed Vehicles granted by Obligors
pursuant to such Receivables and any other interest of Seller in such Financed
Vehicles;

 

(iii)                               all rights of Seller
against Dealers pursuant to Dealer Agreements or Dealer Assignments related to
such Receivables;

 

(iv)                              any
proceeds and the right to receive proceeds with respect to such Receivables
repurchased by a Dealer pursuant to a Dealer Agreement;

 

(v)                                 all
rights of Seller under any Service Contracts on the related Financed Vehicles;

 

(vi)                              any
proceeds and the right to receive proceeds with respect to the related
Receivables from claims on any physical damage, loss, credit life or disability
insurance policies, if any, covering Financed Vehicles or Obligors, including
rebates of insurance premiums relating to

 

3

 

the Receivables and any proceeds from the liquidation of such
Receivables;

 

(vii)                           all items contained in the
Receivables Files with respect to such Receivables and any and all other
documents that Seller or Master Servicer keeps on file in accordance with its
customary procedures relating to the related Receivables, or the related
Financed Vehicles or Obligor;

 

(viii)                        all property (including the
right to receive future Net Liquidation Proceeds) that secures each related
Receivable and that has been acquired by or on behalf of HARC pursuant to the
liquidation of such Receivable; and

 

(ix)                                all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing and all 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, voluntary or involuntary, into cash
or other liquid property, all cash proceeds, accounts, accounts receivable,
notes, drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, condemnation awards, rights to payment of any and every kind and
other forms of obligations and receivables, instruments and other property which
at any time constitute all or part of or are included in the proceeds of any of
the foregoing.

 

(b)                                 Simultaneously
with each Conveyance, HARC will pay or cause to be paid to or upon the order of
Seller an amount equal to 100% of the Principal Balance of the related
Receivables on the books and records of Seller, plus the present value of
anticipated excess spread on such Receivables, discounted to take into account
any uncertainty as to future performance matching historical performance,
servicing fees, delinquencies, pay down rates, yield and such other factors as
may be mutually agreed upon between Seller and HARC, by wire transfer of
immediately available funds.

 

(c)                                  In
connection with each Conveyance, Seller further agrees that it will, at its own
expense, on or prior to the related Purchase Date (i) indicate in its
computer files or microfiche lists that the related Receivables have been
conveyed to HARC in accordance with this Agreement and the related Receivables
Purchase Agreement Supplement, and have been conveyed by HARC to the related
Indenture Trustee pursuant to the related Master Sale and Servicing Agreement
for the benefit of the related Secured Parties by including in such computer
files and microfiche lists the code identifying each such Receivable and
(ii) deliver to HARC (or to the related Indenture Trustee if HARC so
directs) a computer file or microfiche list containing a true and complete list
of all such Receivables specifying for each such Receivable, as of the Cutoff
Date (A) its account number and (B) the outstanding balance of such
Receivable.  Such computer files or
microfiche lists shall be delivered to HARC (or to the related Indenture
Trustee if so directed by HARC) and marked as proprietary and
confidential.  Seller further agrees not

 

4

 

to alter the code referenced in clause (i) of
this paragraph with respect to any Receivable during the term of this
Agreement.

 

(d)                                 The
parties hereto intend that each Conveyance shall constitute a sale of the
Seller’s right, title and interest in and to the related Receivables and Other
Conveyed Property, conveying good title free and clear of any liens, claims,
encumbrances or rights of others from Seller to HARC and that the such
Receivables and Other Conveyed Property subject to such Conveyance shall not be
part of Seller’s estate in the event of the insolvency of Seller or a
conservatorship, receivership or similar event with respect to Seller.  It is the intention of the parties hereto
that the arrangements with respect to each Conveyance of Receivables and Other
Conveyed Property shall constitute a purchase and sale of such Receivables and
Other Conveyed Property and not a loan. 
In the event, however, that a court of competent jurisdiction were to
hold that the transactions evidenced hereby constitute a loan and not a
purchase and sale, it is the intention of the parties hereto that this
Agreement shall constitute a security agreement under applicable law, and that
Seller shall be deemed to have granted to HARC a first priority perfected
security interest in all of such Seller’s right, title and interest in and to
the Receivables and Other Conveyed Property.

 

ARTICLE III

 

REPRESENTATIONS
AND WARRANTIES

 

SECTION 3.1         Representations and Warranties of
Seller.  Seller makes the
representations and warranties set forth in Section 3.1(b) through
(h) as of each Purchase Date on which HARC relies in purchasing the
Receivables and the Other Conveyed Property subject to the related Conveyance
and in transferring the Receivables and the Other Conveyed Property to the
Issuer under the related Master Sale and Servicing Agreement.  The representations set forth in
Section 3.1(a), on which HARC relies in purchasing the Receivables and the
Other Conveyed Property subject to the related Conveyance and in transferring
the Receivables and the Other Conveyed Property to the Issuer under the related
Master Sale and Servicing Agreement, are made with respect to Receivables and
Other Conveyed Property conveyed hereunder, as of the execution and delivery of
the related Receivables Purchase Agreement Supplement, but shall, together with
the representations and warranties set forth in
Section 3.1(b) through (h), survive the sale, transfer and assignment
of the Receivables and the Other Conveyed Property hereunder, and the sale,
transfer and assignment thereof by HARC to the Issuer under each Master Sale
and Servicing Agreement.  Seller and HARC
agree that HARC will assign to Issuer all HARC’s rights under this Agreement and
each Receivables Purchase Agreement Supplement and that the Indenture Trustee
will thereafter be entitled to enforce this Agreement and each Receivables
Purchase Agreement Supplement against Seller in the Indenture Trustee’s own
name on behalf of the Securityholders.

 

(a)                                  Eligibility
Criteria.  Each of the Receivables
which is to be pledged as collateral for a Series of Notes will satisfy
the applicable Eligibility Criteria set forth in, or to be set forth in,
Schedule I to the Series Supplement establishing such Series.

 

5

 

(b)                                 Organization
and Good Standing.  Seller is a
corporation duly organized and validly existing in good standing under the laws
of the state of Delaware and has, in all material respects, full power and
authority to own its properties and conduct its business as such properties are
presently owned and such business is presently conducted, and to execute,
deliver and perform its obligations under this Agreement.

 

(c)                                  Due
Obligation.  Seller is duly qualified
to do business and is in good standing as a foreign corporation (or is exempt
from such requirements) and has obtained all necessary licenses and approvals,
in each jurisdiction in which failure to so qualify or to obtain such licenses and
approvals would (i) render any Receivable unenforceable by Seller, HARC or
any Trust and (ii) have a material adverse effect on any Secured Parties.

 

(d)                                 Due
Authorization.  The execution,
delivery and performance of this Agreement and any other document or instrument
delivered pursuant hereto (such other documents and instruments, including, but
not limited to, the Receivables Purchase Agreement Supplement collectively, the
“Conveyance Papers”) and the consummation of the transactions provided
for in this Agreement or any other Conveyance Papers have been duly authorized
by all necessary corporate action on the part of Seller and constitute or will
constitute the legal, valid and binding obligation of Seller, enforceable in
accordance with their terms.

 

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

 

(f)                                    No
Violation.  The execution, delivery
and performance of this Agreement and the Conveyance Papers and the fulfillment
of the terms contemplated herein and therein applicable to Seller will not
conflict with or violate any requirements of law applicable to Seller.

 

(g)                                 No
Proceedings.  There are no
proceedings or investigations pending or, to the best knowledge of Seller,
threatened against Seller, before any court, regulatory body, administrative
agency or other tribunal or governmental instrumentality (i) asserting the
invalidity of this Agreement or the Conveyance Papers, (ii) seeking to
prevent the consummation of any of the transactions contemplated by this
Agreement or the Conveyance Papers, (iii) seeking any determination or
ruling that, in the reasonable judgment of Seller, would materially and
adversely affect the performance by Seller of its obligations under this Agreement
or the Conveyance Papers, (iv) seeking any determination or ruling that
would materially and adversely affect the validity or enforceability of this
Agreement or the Conveyance Papers or (v) seeking to affect adversely the
income tax attributes of any Trust under United States Federal, Nevada or
California income tax systems.

 

6

 

(h)                                 All
Consents.  All authorizations,
consents, orders, approvals, registrations or declarations with, or of, any
Governmental Authority required to be obtained, effected or given by Seller in
connection with the execution and delivery by Seller of this Agreement or the
Conveyance Papers and the performance of the transactions contemplated by this
Agreement or the Conveyance Papers by Seller have been duly obtained, effected
or given and are in full force and effect.

 

SECTION 3.2         Representations and Warranties of
HARC.  HARC makes the representations
and warranties set forth in Section 3.2 (a) through (f) as of
each Purchase Date, on which Seller relies in selling, assigning, transferring
and conveying the Receivables and the Other Conveyed Property subject to the
related conveyance to HARC hereunder. 
The representations are made with respect to Receivables and Other
Conveyed Property conveyed hereunder, as of the execution and delivery of the
related Receivables Purchase Agreement Supplement, but shall survive the sale,
transfer and assignment of the Receivables and the Other Conveyed Property
hereunder and the sale, transfer and assignment thereof by HARC to the related
Issuer under each Master Sale and Servicing Agreement.

 

(a)                                  Organization
and Good Standing.  HARC is a
corporation duly organized and validly existing under the laws of the State of
Nevada and has, in all material respects, full power and authority to own its
properties and conduct its business as such properties are presently owned and
such business is presently conducted and to execute, deliver and perform its
obligations under this Agreement and the Conveyance Papers.

 

(b)                                 Due
Authorization.  The execution and
delivery of this Agreement and the Conveyance Papers and the consummation of
the transactions provided for in this Agreement and the Conveyance Papers have
been duly authorized by HARC by all necessary corporate action on the part of
HARC.

 

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

 

(d)                                 No
Violation.  The execution, delivery
and performance of this Agreement and the Conveyance Papers by HARC and the
fulfillment of the terms contemplated herein and therein applicable to HARC
will not conflict with or violate any requirements of law applicable to HARC.

 

(e)                                  No
Proceeding.  There are no proceedings
or investigations pending or, to the best knowledge of HARC, threatened against
HARC, before any court, regulatory body, administrative agency, or other
tribunal or governmental instrumentality (i) asserting the invalidity of
this Agreement or the Conveyance Papers, (ii) seeking to

 

7

 

prevent the consummation of any of the transactions
contemplated by this Agreement or the Conveyance Papers, (iii) seeking any
determination or ruling that, in the reasonable judgment of HARC, would
materially and adversely affect the performance by HARC of its obligations under
this Agreement or the Conveyance Papers or (iv) seeking any determination
or ruling that would materially and adversely affect the validity or
enforceability of this Agreement or the Conveyance Papers.

 

(f)                                    All
Consents.  All authorizations,
consents, orders or approvals of or registrations or declarations with any
Governmental Authority required to be obtained, effected or given by HARC in
connection with the execution and delivery by HARC of this Agreement and the
Conveyance Papers and the performance of the transactions contemplated by this
Agreement and the Conveyance Papers or the fulfillment of the terms of this
Agreement and the Conveyance Papers by HARC have been duly obtained.

 

In the event of any
breach of a representation and warranty made by HARC hereunder, Seller
covenants and agrees that it will not take any action to pursue any remedy that
it may have hereunder, in law, in equity or otherwise, until a year and a day
have passed since the date on which all Notes and Certificates issued by any Trust
have been paid in full.  Seller and HARC
agree that damages will not be an adequate remedy for such breach and that this
covenant may be specifically enforced by HARC, the related Issuer or by the
related Indenture Trustee on behalf of the related Secured Parties and the
related Owner Trustee on behalf of the related Certificateholders.  Seller agrees that with respect to its
obligations in connection with a Repurchase Event it will exercise no rights of
offset with respect to any claims it may have against HARC.

 

ARTICLE IV

 

COVENANTS OF
SELLER

 

SECTION 4.1         Seller’s Covenants.  Seller hereby covenants and agrees with HARC
as follows:

 

(a)                                  Receivables
Not To Be Evidenced by Promissory Notes. 
Seller will take no action to cause any Receivable to be evidenced by
any instrument (as defined in the UCC).

 

(b)                                 Security
Interests.  Except for the
conveyances hereunder or as otherwise provide herein, Seller will not sell,
pledge, assign or transfer to any other Person, or take any other action
inconsistent with HARC’s ownership of the Receivables and Other Conveyed
Property or grant, create, incur, assume or suffer to exist any Lien on any
Receivable or any Other Conveyed Property, whether now existing or hereafter
created, or any interest therein, and Seller shall not claim any ownership
interest in the Receivables or any Other Conveyed Property and shall defend the
right, title and interest of HARC in and to the Receivables and Other Conveyed
Property, whether now existing or hereafter created, against all claims of
third parties claiming through or under Seller.

 

8

 

(c)                                  Security’s
Interest.  Except for the conveyances
hereunder and in connection with any transaction permitted pursuant to
Section 6.6, Seller hereby agrees not to transfer, assign, exchange or
otherwise convey or pledge, hypothecate or otherwise grant a security interest
in the Receivables or any Other Conveyed Property and any such attempted
transfer, assignment, exchange, conveyance, pledge, hypothecation or grant
shall be void.

 

(d)                                 Delivery
of Collections or Recoveries.  In the
event that Seller receives collections or recoveries with respect to the
Receivables, Seller agrees to pay to HARC (or to the Master Servicer if HARC so
directs) all such collections and recoveries to the extent such amounts are
payable to HARC as soon as practicable after receipt thereof.

 

(e)                                  Notice
of Liens.  Seller shall notify HARC
promptly after becoming aware of any Lien on any Receivable or any Other
Conveyed Property other than the conveyances hereunder.

 

(f)                                    Documentation
of Transfer.  Seller shall undertake
to file the documents which would be necessary to perfect and maintain the
transfer of the security interest in and to the Receivables and Other Conveyed
Property.

 

(g)                                 Approval
of Office Records.  Seller shall
cause this Agreement to be duly approved by Seller’s Board of Directors, and
Seller shall maintain this Agreement as a part of the official records of
Seller for the term of this Agreement.

 

(h)                                 Maintenance
of Security Interests in Vehicles. 
In the event that the assignment of a Receivable to HARC or any assignee
thereof is insufficient, without a notation on the related Financed Vehicle’s
certificate of title, or without fulfilling any additional administrative
requirements under the laws of the state in which the Financed Vehicle is
located, to perfect a security interest in the related Financed Vehicle in
favor of HARC or any assignee thereof, Seller hereby agrees that the
designation of Seller or any Affiliate of Seller as the secured party on the
certificate of title is in its capacity as agent of HARC or the agent of any
assignee of HARC for such limited purpose.

 

ARTICLE V

 

REPURCHASES

 

SECTION 5.1         Repurchase of Receivables Upon
Breach of Warranty.  Upon the
occurrence of a Repurchase Event, Seller shall, unless the breach which is the
subject of such Repurchase Event shall have been cured in all material
respects, repurchase the Receivable relating thereto from the related Issuer
under the related Master Sale and Servicing Agreement by the last day of the
first full calendar month following the discovery of such breach by Seller or
receipt by Seller of notice of such breach from any of the Master Servicer,
HARC, a Trust Officer of the related Indenture Trustee or the related Owner
Trustee and, simultaneously with the repurchase of the Receivable, Seller shall
deposit the Repurchase Amount in full, without deduction or offset, in the
Collection Account, pursuant to Section 3.2 of the related Master Sale and

 

9

 

Servicing Agreement.  It is understood and agreed that, except as
set forth in Section 6.1 hereof, the obligation of Seller to repurchase
any Receivable, as to which a breach occurred and is continuing, shall, if such
obligation is fulfilled, constitute the sole remedy against Seller for such
breach available to HARC, the related Issuer, the related Secured Parties, the
related Certificateholders, the related Indenture Trustee on behalf of the
related Noteholders or the related Owner Trustee on behalf of the related
Certificateholders.  The provisions of
this Section 5.1 are intended to grant the related Indenture Trustee or
the related Issuer a direct right against Seller to demand performance
hereunder, and in connection therewith, Seller waives any requirement of prior
demand against HARC with respect to such repurchase obligation.  Any such repurchase shall take place in the
manner specified in Section 3.2 of the related Master Sale and Servicing
Agreement.  Notwithstanding any other
provision of this Agreement or the related Master Sale and Servicing Agreement
to the contrary, the obligation of Seller under this Section shall not
terminate upon a termination of Household Finance Corporation as Master Servicer
under the related Master Sale and Servicing Agreement and shall be performed in
accordance with the terms hereof notwithstanding the failure of the Master
Servicer or HARC to perform any of their respective obligations with respect to
such Receivable under the related Master Sale and Servicing Agreement.

 

SECTION 5.2         Reassignment of Repurchased
Receivables.  Upon deposit in the
Collection Account of the Repurchase Amount of any Receivable repurchased by
Seller under Section 5.1 hereof, HARC and the related Issuer shall take
such steps as may be reasonably requested by Seller in order to assign to
Seller all of HARC’s and the related Issuer’s right, title and interest in and
to such Receivable and all security and documents and all Other Conveyed Property
conveyed to HARC and the related Issuer directly relating thereto, without
recourse, representation or warranty, except as to the absence of liens,
charges or encumbrances created by or arising as a result of actions of HARC or
the related Issuer.  Such assignment
shall be a sale and assignment outright, and not for security.  If, following the reassignment of a
Repurchased Receivable, in any enforcement suit or legal proceeding, it is held
that Seller may not enforce any such Receivable on the ground that it shall not
be a real party in interest or a holder entitled to enforce the Receivable,
HARC and the related Issuer shall, at the expense of Seller, take such steps as
Seller deems reasonably necessary to enforce the Receivable, including bringing
suit in HARC’s or in the related Issuer’s name.

 

SECTION 5.3         Waivers.  No failure or delay on the part of HARC, or
the related Issuer as assignee of HARC, in exercising any power, right or
remedy under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power, right or remedy preclude any
other or future exercise thereof or the exercise of any other power, right or
remedy.

 

10

 

ARTICLE VI

 

MISCELLANEOUS

 

SECTION 6.1         Liability of Seller.  Seller shall be liable in accordance herewith
only to the extent of the obligations in this Agreement specifically undertaken
by Seller and the representations and warranties of Seller.

 

SECTION 6.2         Amendment.  This Agreement and any Conveyance Papers and
the rights and obligations of the parties hereunder may not be changed orally,
but only by an instrument in writing signed by HARC and Seller in accordance
with this Section 6.2.  This Agreement
and any Conveyance Papers may be amended from time to time by HARC and Seller
only with the prior written consent of all of the Secured Parties.

 

SECTION 6.3         GOVERNING LAW.  THIS AGREEMENT AND THE CONVEYANCE PAPERS
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.

 

SECTION 6.4         Notices.  All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, return receipt requested,
to (a) in the case of Seller, 5855 Copley Drive, San Diego, CA 92111,
Attention:  Chief Operating Officer, with
a copy to 2700 Sanders Road, Prospect Heights, Illinois 60070  Attention: 
Director—Asset Securitization, (b) in the case of HARC, 1111 Town
Center Drive, Las Vegas, Nevada 89134 Attention:  Compliance Officer, with a copy to 2700
Sanders Road, Prospect Heights, Illinois 60070, 
Attention:  Treasurer; or, as to
each party, at such other address as shall be designated by such party in a
written notice to each other party.

 

SECTION 6.5         Severability of Provisions.  If any one or more of the covenants,
agreements, provisions, or terms of this Agreement or Conveyance Paper shall
for any reason whatsoever be held invalid, then such covenants, agreements,
provisions, or terms shall be deemed severable from the remaining covenants,
agreements, provisions, and terms of this Agreement or any Conveyance Paper and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of any Conveyance Paper.

 

SECTION 6.6         Assignment.  Notwithstanding anything to the contrary
contained herein, other than HARC’s assignment of its rights, title, and
interests in, to, and under this Agreement to the Issuer specified in a Master
Sale and Servicing Agreement (which Issuer shall assign such rights, title and
interest in and to this Agreement to the related Indenture Trustee for the
benefit of the related Secured Parties), as contemplated by the Master Sale and
Servicing Agreement and Section 6.7 hereof, the Receivables, the Other
Conveyed Property, this Agreement and all other Conveyance

 

11

 

Papers may not be
assigned by the parties hereto; provided, however, that Seller
shall have the right to assign its rights, title and interests, in to and under
this Agreement to (i) any successor by merger or consolidation, or any Person
which acquires by conveyance, transfer or sale the properties and assets of
Seller or (ii) any Affiliate owned directly or indirectly by Household
International, Inc.  The right
granted in the foregoing proviso is subject to the further condition that any
such successor or other Person shall expressly assume by written agreement, in
form and substance satisfactory to HARC, the obligations of Seller hereunder
and under the Conveyance Papers.

 

SECTION 6.7         Acknowledgment and Agreement of
Seller.  By execution below, Seller
expressly acknowledges and agrees that all of HARC’s right, title, and interest
in, to, and under this Agreement, including, without limitation, all of HARC’s
right title, and interest in and to the Receivables purchased pursuant to this
Agreement, shall be assigned by HARC to an Issuer specified in a Master Sale
and Servicing Agreement and by such Issuer to the related Indenture Trustee for
the benefit of the related Secured Parties, and Seller consents to such
assignment.  Additionally, Seller agrees
for the benefit of such Indenture Trustee that any amounts payable by Seller to
HARC hereunder which are to be paid by HARC to such Indenture Trustee for the
benefit of the related Secured Parties shall be paid by Seller, on behalf of
HARC, directly to such Indenture Trustee. 
Any payment required to be made on or before a specified date in
same-day funds may be made on the prior business day in next-day funds.

 

SECTION 6.8         Further Assurances.  HARC and Seller agree to do and perform, from
time to time, any and all acts to authenticate any and further records, to
execute any and further instruments, in each case required or reasonably
requested by the other party more fully to effect the purposes of this
Agreement and the Conveyance Papers, including, without limitation, the
execution of any financing statements or continuation statements or equivalent
documents relating to the Receivables for filing under the provisions of the
UCC or other law of any applicable jurisdiction.

 

SECTION 6.9         No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of HARC or Seller, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.  The rights,
remedies, powers and privileges herein provided are cumulative and not
exhaustive of any rights, remedies, powers and privileges provided by law.

 

SECTION 6.10       Counterparts.  This Agreement and all Conveyance Papers may
be executed in two or more counterparts (and by different parties on separate
counterparts), each of which shall be an original, but all of which together
shall constitute one and the same instrument.

 

SECTION 6.11       Binding Effect; Third-Party
Beneficiaries.  This Agreement and
the Conveyance Papers will inure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.  Each of the Indenture Trustee and Issuer with
respect to a Master Sale and Servicing Agreement and

 

12

 

the related Owner Trustee
shall be considered a third-party beneficiary of this Agreement.

 

SECTION 6.12       Merger and Integration.  Except as specifically stated otherwise
herein, this Agreement and the Conveyance Papers set forth the entire
understanding of the parties relating to the subject matter hereof,  and all prior understandings, written or
oral, are superseded by this Agreement and the Conveyance Papers.  This Agreement and the Conveyance Papers may
not be modified, amended, waived or supplemented except as provided herein.

 

SECTION 6.13       Heading.  The headings are for purposes of reference
only and shall not otherwise affect the meaning or interpretation of any
provision hereof.

 

SECTION 6.14       Schedules and Exhibits.  The schedules and exhibits attached hereto
and referred to herein shall constitute a part of this Agreement and are
incorporated into this Agreement for all purposes.

 

SECTION 6.15       Survival of Representations and
Warranties.  All representations,
warranties and agreements contained in this Agreement or contained in any
Conveyance Paper, shall remain operative and in full force and effect and shall
survive conveyance of the Receivables by HARC to the Issuer pursuant to the
Master Sale and Servicing Agreement and the pledge thereof by the Issuer to the
Indenture Trustee pursuant to the related Indenture and the related
Series Supplement.

 

SECTION 6.16       Nonpetition Covenant.  Until the date which is one year and one day
after payment in full of all the Notes of all Series, neither HARC nor Seller
shall petition or otherwise invoke the process of any court or government
authority for the purpose of commencing or sustaining a case against Seller or
any Issuer under any federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of Seller or any Issuer or any substantial part of
their respective properties, or ordering the winding up or liquidation of the
affairs of Seller or any Issuer.  This
provision shall survive the termination of this Agreement.

 

[Signature Page Follows]

 

13

 

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

 

	
   

  	
  HOUSEHOLD AUTOMOTIVE CREDIT

  CORPORATION

  
	
   

  	
  as Seller

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy R. Condon

  	
   

  
	
   

  	
   

  	
  Name: Timothy R. Condon

  
	
   

  	
   

  	
  Title: Executive Vice President and Chief
  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HOUSEHOLD AUTO RECEIVABLES

  CORPORATION,

  
	
   

  	
  as Purchaser

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ S. H. Smith

  	
   

  
	
   

  	
   

  	
  Name: S. H. Smith

  
	
   

  	
   

  	
  Title: Vice President and Assistant
  Treasurer

  

 

14

 

EXHIBIT A

 

FORM OF RECEIVABLES PURCHASE AGREEMENT
SUPPLEMENT

 

Transfer
No.      of Receivables, dated as of
                           ,
pursuant to a Master Receivables Purchase Agreement (the “Purchase Agreement”)
dated as of August 8, 2002, between Household Automotive Credit
Corporation, a Delaware corporation (“Seller”) and Household Auto
Receivables Corporation, a Nevada corporation (“HARC”).

 

W I T N E S S E T H :

 

WHEREAS pursuant to the
Purchase Agreement, Seller wishes to convey Receivables and Other Conveyed
Property to HARC; and

 

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

 

NOW, THEREFORE, Seller
and HARC hereby agree as follows:

 

1.                                       Defined Terms.  Capitalized terms used herein shall have the
meanings ascribed to them in the Purchase Agreement unless otherwise defined
herein.

 

“Cutoff Date”
shall mean with respect to the Receivables conveyed hereby, the close of
business on
                          ,
200  .

 

“Master Sale and
Servicing Agreement” means the agreement dated as of
                   ,
           among HARC,
Household Finance Corporation, as Master Servicer,
                              ,
as indenture trustee and
                              ,
as issuer.

 

“Purchase Date”
shall mean with respect to the Receivables conveyed hereby,
                              ,
200   .

 

“Purchase Price”
shall mean 100% of the Principal Balance of the Receivables on the books and
records of Seller, plus the present value of anticipated excess spread on such
Receivables, discounted to take into account any uncertainty as to future
performance matching historical performance, servicing fees, delinquencies,
paydown rates, yield and such other factors as may be mutually agreed upon by
Seller and HARC.

 

“Transfer Date”
means, with respect to Receivables, the date on which Receivables and Other
Conveyed Property are to be transferred to the Trust pursuant to the Master
Sale and Servicing Agreement.

 

A-1

 

2.                                       Schedule of
Receivables.  Annexed as
Schedule A hereto is a computer file which reflects the Receivables that
constitute the Receivables to be conveyed pursuant to this Agreement on the
Purchase Date.

 

3.                                       Conveyance of
Receivables.  In consideration of
HARC’s delivery to or upon the order of Seller of the Purchase Price, Seller
does hereby sell, transfer, assign, set over and otherwise convey to HARC,
without recourse (except as expressly provided in the Purchase Agreement), all
right, title and interest of Seller in and to:

 

(i)                                     each
and every Receivable listed on Schedule A hereto and all monies paid or
payable thereon or in respect thereof on or after the Cutoff Date (including
amounts due on or before the Cutoff Date but received by Seller after such
date);

 

(ii)                                  the
security interests in the related Financed Vehicles granted by Obligors
pursuant to such Receivables and any other interest of Seller in such Financed
Vehicles;

 

(iii)                               all rights of Seller
against Dealers pursuant to Dealer Agreements or Dealer Assignments related to
such Receivables;

 

(iv)                              any
proceeds and the right to receive proceeds with respect to such Receivables
repurchased by a Dealer pursuant to a Dealer Agreement;

 

(v)                                 all
rights of Seller under any Service Contracts on the related Financed Vehicles;

 

(vi)                              any
proceeds and the right to receive proceeds with respect to the related
Receivables from claims on any physical damage, loss, credit life or disability
insurance policies, if any, covering Financed Vehicles or Obligors, including
rebates of insurance premiums relating to the Receivables and any proceeds from
the liquidation of such Receivables;

 

(vii)                           all items contained in the
Receivables Files with respect to such Receivables and any and all other
documents that Seller or the Master Servicer keeps on file in accordance with
its customary procedures relating to the related Receivables, or the related
Financed Vehicles or Obligor;

 

(viii)                        all property (including the
right to receive future Net Liquidation Proceeds) that secures each related
Receivable and that has been acquired by or on behalf of HARC pursuant to
liquidation of such Receivable;

 

(ix)                                all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing and all 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, voluntary or involuntary, into cash
or other liquid property, all cash proceeds, accounts, accounts receivable,
notes, drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, condemnation awards, rights to payment of any and every kind and

 

A-2

 

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.

 

4.                                       Representations
and Warranties of Seller.  As of the
Purchase Date, Seller hereby makes the representations and warranties to HARC
that are set forth in Section 3.1 of the Purchase Agreement with respect
to the Conveyance effected hereby to the same extent as if set forth in full
herein.

 

5.                                       Representations
and Warranties of HARC.  As of the
Purchase Date, HARC hereby makes the representations and warranties to Seller
that are set forth in Section 3.2 of the Purchase Agreement with respect
to the Conveyance effected hereby to the same extent as if set forth in full
herein.  In the event of any breach of a
representation and warranty made by HARC hereunder, Seller covenants and agrees
that it will not take any action to pursue any remedy that it may have hereunder,
in law, in equity or otherwise, until a year and a day have passed since the
date on which all Notes and Certificates issued by the Trust have been paid in
full.  Seller and HARC agree that damages
will not be an adequate remedy for such breach and that this covenant may be
specifically enforced by HARC, the related Issuer or by the related Indenture
Trustee on behalf of the related Secured Parties and the related Owner Trustee
on behalf of the related Certificateholders.

 

6.                                       Conditions
Precedent.  The obligation of HARC to
acquire the Receivables hereunder is subject to the satisfaction, on or prior
to the Purchase Date, of the following conditions precedent:

 

(a)           Representations and Warranties.  Each of the representations and warranties
made by Seller in Section 4 of this Agreement and in Section 3.1 of
the Master Receivables Purchase Agreement shall be true and correct as of the
date of this Agreement and as of the Purchase Date.

 

(b)           Additional Information.  Seller shall have delivered to HARC such
information as was reasonably requested by HARC to satisfy itself as to
(i) the accuracy of the representations and warranties set forth in
Section 4 of this Agreement and in Section 3.1 of the Purchase
Agreement and (ii) the satisfaction of the conditions set forth in this
Section.

 

7.                                       Ratification
of Agreement.  As supplemented by
this Agreement, the Purchase Agreement is in all respects ratified and
confirmed and the Purchase Agreement as so supplemented by this Agreement shall
be read, taken and construed as one and the same instrument.

 

8.                                       Counterparts.  This Agreement may be executed in two or more
counterparts (and by different parties in separate counterparts), each of which
shall be an original but all of which together shall constitute one and the
same instrument.

 

A-3

 

9.                                       Conveyance of
the Receivables and the Other Conveyed Property to the Issuer.  Seller acknowledges that HARC intends,
pursuant to the related Master Sale and Servicing Agreement, to convey the
Receivables and the Other Conveyed Property, together with its rights under
this Agreement, to the related Issuer on the Transfer Date.  The Seller acknowledges and consents to such
conveyance and pledge and waives any further notice thereof and covenants and
agrees that the representations and warranties of the Seller contained in this
Agreement and the rights of HARC hereunder are intended to benefit the related
Issuer, the related Owner Trustee, the related Indenture Trustee, the related
Secured Parties and the related Certificateholders.  In furtherance of the foregoing, the Seller
covenants and agrees to perform its duties and obligations hereunder, in
accordance with the terms hereof for the benefit of the related Issuer, the
related Owner Trustee, the related Indenture Trustee and the related Secured
Parties and that, notwithstanding anything to the contrary in this Agreement,
the Seller shall be directly liable to the related Issuer, the related Owner
Trustee, the related Indenture Trustee and the related Secured Parties
(notwithstanding any failure by the Master Servicer or HARC to perform their
respective duties and obligations hereunder or under any Basic Document) and
that the related Indenture Trustee may enforce the duties and obligations of
Seller under this Agreement against Seller for the benefit of the related
Secured Parties and the related Owner Trustee.

 

10.                                 GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

A-4

 

IN WITNESS WHEREOF,
Seller and HARC have caused this Purchase Agreement to be duly executed and
delivered by their respective duly authorized officers as of day and the year
first above written.

 

 

	
   

  	
  HOUSEHOLD AUTOMOTIVE CREDIT

  
	
   

  	
  CORPORATION,

  
	
   

  	
  as Seller

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HOUSEHOLD AUTO RECEIVABLES

  CORPORATION,

  
	
   

  	
  as Purchaser

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

A-5

 

SCHEDULE A

 

SCHEDULE OF RELATED MASTER
SALE AND SERVICING AGREEMENTS

 

(1) Master Sale and Servicing Agreement dated as of August 8,
2002, among Household Finance Corporation, as Master Servicer, Household
Automotive Trust 2002-2, as Issuer, Household Auto Receivables Corporation, as
Seller and JPMorgan Chase Bank, as Indenture Trustee.

 

(2) Master Sale and Servicing Agreement dated as of May 29,
2003, among Household Finance Corporation, as Master Servicer, Household
Automotive Trust 2003-1, as Issuer, Household Auto Receivables Corporation, as
Seller and U.S. Bank National Association, as Indenture Trustee.

 

(3) Master Sale and
Servicing Agreement, dated as of November 26, 2003, among Household
Finance Corporation, as Master Servicer, Household Automotive Trust 2003-2, as
Issuer, Household Auto Receivables Corporation, as Seller and Wells Fargo Bank
Minnesota, National Association, as Indenture Trustee.

 

(4) Master Sale and
Servicing Agreement, dated as of June 22, 2005, among HSBC Finance
Corporation (formerly Household Finance Corporation), as Master Servicer, HSBC
Automotive Trust 2005-1, as Issuer, HSBC Auto Receivables Corporation (formerly
Household Auto Receivables Corporation), as Seller, Wells Fargo Bank, National
Association, as Indenture Trustee and HSBC Bank USA, National Association, as
Administrator.

 

(5) Master Sale and
Servicing Agreement, dated as of July 27, 2005, among HSBC Finance
Corporation, as Master Servicer, HSBC Automotive Trust 2005-2, as Issuer, HSBC
Auto Receivables Corporation, as Seller, U.S. Bank National Association, as
Indenture Trustee and HSBC Bank USA, National Association, as Administrator.

 

(6) Master Sale and
Servicing Agreement, dated as of November 3, 2005, among HSBC Finance
Corporation, as Master Servicer, HSBC Automotive Trust 2005-3, as Issuer, HSBC
Auto Receivables Corporation, as Seller, JPMorgan Chase Bank, N.A., as Indenture
Trustee and HSBC Bank USA, National Association, as Administrator.

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