AMENDED AND RESTATED MORTGAGE LOAN PURCHASE AGREEMENT
EXECUTION
AMENDED
AND RESTATED MORTGAGE LOAN PURCHASE AGREEMENT
This
Amended and Restated Mortgage Loan Purchase Agreement (the “Agreement”), dated
as of December 19, 2006 and retroactively effective to October 1, 2006, is
between HSI Asset Securitization Corporation, a Delaware corporation (the
“Company”), and HSBC Bank USA, National Association, a national banking
association (the “Sponsor” and “Seller”).
WHEREAS,
in connection with the issuance of the Sponsor’s HSI Asset Securitization
Corporation Trust 2006-HE1 Mortgage Pass-Through Certificates, Series 2006-HE1
(the “Certificates”), the Sponsor has made certain representations and
warranties to the Company with respect to the Mortgage Pool underlying the
Certificates pursuant to a Mortgage Loan Purchase Agreement dated as of October
1, 2006 (the “Original Agreement”) between the Company and the
Seller.
WHEREAS,
the Seller and the Company desire to amend and restate the Original Agreement
in
its entirety for the purpose of the Seller providing certain representations
and
warranties with respect to the Group I Mortgage Loans underlying Xxxxxxx Mac’s
investment in Certificates in conformity with Xxxxxxx Mac’s investment
requirements.
NOW,
THEREFORE, the Original Agreement is amended and restated in its entirety to
read as follows:
The
Company and the Seller hereby recite and agree as follows:
1. Defined
Terms.
Terms
used without definition herein shall have the respective meanings assigned
to
them in the Pooling and Servicing Agreement, dated as of October 1, 2006, by
and
among HSI Asset Securitization Corporation, as depositor, Xxxxx Fargo Bank,
N.A., as master servicer, securities administrator and custodian (in such
capacity, the “Custodian”), Xxxxxxx Fixed Income Services Inc., as credit risk
manager, and Deutsche Bank National Trust Company, as trustee (the “Trustee”),
relating to the issuance of the HSI Asset Securitization Corporation Trust
2006-HE1 Mortgage Pass-Through Certificates, Series 2006-HE1 (the “Pooling and
Servicing Agreement”). Unless otherwise defined herein, capitalized terms used
herein shall have the same meanings assigned to them in the Pooling and
Servicing Agreement.
2. Purchase
of Mortgage Loans.
The
Seller hereby sells, transfers, assigns and conveys, and the Company hereby
purchases the mortgage loans (the “Mortgage Loans”) listed on the Mortgage Loan
Schedule in Exhibit
1.
3. Purchase
Price; Purchase and Sale.
The
purchase price (the “Purchase Price”) for the Mortgage Loans shall be
$1,302,565,110.67 inclusive
of
accrued
and unpaid interest on the Mortgage Loans at the weighted average interest
rate
borne by the Mortgage Loans from the date hereof to but not including the
Closing Date, payable by the Company
to
the
Seller on the Closing Date either (i) by appropriate notation of an
inter-company transfer between affiliates of HSBC or (ii) in immediately
available federal funds wired to such bank as may be designated by the
Seller.
Upon
payment of the Purchase Price, the Seller shall be deemed to have transferred,
assigned, set over and otherwise conveyed to the Company all the right, title
and interest of the Seller in and to the Mortgage Loans as of the Cut-Off Date,
including all interest and principal due on the Mortgage Loans after the Cut-Off
Date (including Scheduled Payments due after the Cut-Off Date but received
by
the Seller on or before the Cut-Off Date, but not including payments of
principal and interest due on the Mortgage Loans on or before the Cut-Off Date),
together with all of the Seller’s right, title and interest in and to the
proceeds of any related title, hazard, primary mortgage or other insurance
policies.
Concurrently
with the execution and delivery of this Agreement, the Seller hereby assigns
to
the Company all of its rights and interest (but none of its obligations) under
the (i) Servicing Agreements and (ii) Assignment, Assumption and Recognition
Agreements listed on Exhibit
2
hereto
(the “Assignment Agreements”), to the extent relating to the Mortgage Loans. The
Company hereby accepts such assignment, and shall be entitled to exercise all
such rights of the Seller under the Servicing Agreements and the Assignment
Agreements as if the Company had been a party to such agreement.
The
Company hereby acknowledges its acceptance of all right, title and interest
in,
to and under the Mortgage Loans and other property, and its rights under the
Servicing Agreements and the Assignment Agreements, now existing or hereafter
created, conveyed to it pursuant to this Section 3.
The
Company hereby directs the Seller, and the Seller hereby agrees, to deliver
to
the Trustee all documents, instruments and agreements required to be delivered
by the Company to the Trustee under the Pooling and Servicing Agreement and
such
other documents, instruments and agreements as the Company or the Trustee shall
reasonably request.
4. Representations
and Warranties.
The
Seller hereby represents and warrants to the Company with respect to each
Mortgage Loan in either Loan Group as of the date hereof and as of the Closing
Date as follows:
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(a)
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With
respect to each Mortgage Loan, as of the date hereof and as of the
Closing
Date:
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(1)
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The
Seller has good title to the Mortgage Loans and the Mortgage Loans
were
subject to no offsets, defenses or
counterclaims.
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(2)
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The
information set forth in the Mortgage Loan Schedule is complete,
true and
correct as of the Cut-off Date.
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(3)
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The
Mortgaged Property is free of material damage and waste and there
is no
proceeding pending for the total or partial condemnation of the Mortgaged
Property.
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(4)
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From
and after the Cut-off Date, there have been no delinquent taxes,
ground
rents, water charges, sewer rents, assessments, insurance premiums,
leasehold payments or other outstanding charges affecting the related
Mortgaged Property.
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(5)
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From
and after the Cut-off Date, the terms of the Mortgage Note and the
Mortgage have not been impaired, waived, altered or modified in any
respect, except by written instruments, recorded in the applicable
public
recording office if necessary to maintain the lien priority of the
Mortgage, and which have been delivered to the Trustee on behalf
of the
Company; the substance of any such waiver, alteration or modification
has
been approved by the title insurer, to the extent required by the
related
policy, and is reflected on the Mortgage Loan Schedule. No instrument
of
waiver, alteration or modification has been executed, and no borrower
has
been released, in whole or in part, except in connection with an
assumption agreement approved by the title insurer, to the extent
required
by the policy, and which assumption agreement has been delivered
to the
Custodian and the terms of which are reflected in the Mortgage Loan
Schedule.
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(6)
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All
buildings upon the Mortgaged Property are insured by an insurer against
loss by fire, hazards of extended coverage and such other hazards
as are
customary in the area where the Mortgaged Property is located, in
an
amount not less than (i) 100.00% of the replacement cost of all
improvements to the Mortgaged Property, (ii) either (A) the outstanding
principal balance of the Mortgage Loan with respect to each first
lien
Mortgage Loan or (B) with respect to each second lien Mortgage Loan,
the
sum of the outstanding principal balance of the related first lien
Mortgage Loan and the outstanding principal balance of the second
lien
Mortgage Loan, (iii) the amount necessary to avoid the operation of
any co-insurance provisions with respect to the Mortgaged Property,
and
consistent with the amount that would have been required as of the
date of
origination in accordance with the underwriting guidelines or
(iv) the amount necessary to fully compensate for any damage or loss
to the improvements that are a part of such property on a replacement
cost
basis. All such insurance policies contain a standard mortgagee clause
naming the originator, its successors and assigns as mortgagee and
all
premiums thereon have been paid. If the Mortgaged Property is in
an area
identified on a Flood Hazard Map or Flood Insurance Rate Map issued
by the
Federal Emergency Management Agency as having special flood hazards
(and
such flood insurance has been made available) a flood insurance policy
meeting the requirements of the current guidelines of the Federal
Insurance Administration is in effect which policy conforms to the
requirements of Xxxxxx Xxx and Xxxxxxx Mac. The Mortgage obligates
the
borrower thereunder to maintain all such insurance at the borrower’s cost
and expense, and on the borrower’s failure to do so, authorizes the holder
of the Mortgage to maintain such insurance at borrower’s cost and expense
and to seek reimbursement therefor from the
Mortgagor.
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3
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(7)
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The
Mortgage has not been satisfied, cancelled, subordinated or rescinded,
in
whole or in part, and the Mortgaged Property has not been released
from
the lien of the Mortgage, in whole or in part, nor has any instrument
been
executed that would effect any such satisfaction, cancellation,
subordination, rescission or
release.
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(8)
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The
Mortgage is a valid, existing and enforceable first or second lien
(as
indicated on the Mortgage Loan Schedule) on the Mortgaged Property,
including all improvements on the Mortgaged Property subject only
to
(a) the lien of current real property taxes and assessments not yet
due and payable, (b) covenants, conditions and restrictions, rights
of way, easements and other matters of the public record as of the
date of
recording being acceptable to mortgage lending institutions generally
and
specifically referred to in the lender’s title insurance policy delivered
to the Originator of the Mortgage Loan and which do not materially
and
adversely affect the Appraised Value of the Mortgaged Property,
(c) to the extent the Mortgage Loan is a second lien Mortgage Loan
(as reflected on the Mortgage Loan Schedule), the related first lien
on
the Mortgaged Property and (d) other matters to which like properties
are
commonly subject which do not materially interfere with the benefits
of
the security intended to be provided by the Mortgage or the use,
enjoyment, value or marketability of the related Mortgaged Property.
Any
security agreement, chattel mortgage or equivalent document related
to and
delivered in connection with the Mortgage Loan establishes and creates
a
valid, existing and enforceable first or second lien and first or
second
priority security interest (in each case, as indicated on the Mortgage
Loan Schedule) on the property described therein and the Seller has
full
right to sell and assign the same to the Company.
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(9)
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From
and after the date the Mortgage Loan was purchased by the Seller
from the
related Mortgage Loan Seller (the “Initial Sale Date”), and immediately
prior to the transfer and assignment of each Mortgage Loan by the
Seller
to the Company, the Seller was the sole legal, beneficial and equitable
owner of the Mortgage Note and the Mortgage. The Seller has full
right to
transfer and sell the Mortgage Loan to the Company free and clear
of any
encumbrance, equity, lien, pledge, charge, claim or security
interest.
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(10)
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There
is no default, breach, violation or event of acceleration existing
under
the Mortgage or the Mortgage Note, no event which, with the passage
of
time or with notice and the expiration of any grace or cure period,
would
constitute a default, breach, violation or event of acceleration,
and the
Seller has not waived any default, breach, violation or event of
acceleration. With respect to each second lien Mortgage Loan, (i)
the
first lien Mortgage Loan is in full force and effect, (ii) there
is no
default, breach, violation or event of acceleration existing under
such
first lien Mortgage or the related Mortgage Note, (iii) no event
which,
with the passage of time or with notice and the expiration of any
grace or
cure period, would constitute a default, breach, violation, or event
of
acceleration thereunder, (iv) either (A) the first lien Mortgage
contains
a provision which allows or (B) applicable law requires, the mortgagee
under the second lien Mortgage Loan to receive notice of, and affords
such
mortgagee an opportunity to cure any default by payment in full or
otherwise under the first lien Mortgage, (v) the related first lien
does
not provide for or permit negative amortization under such first
lien
Mortgage Loan and (vi) either no consent for the Mortgage Loan is
required
by the holder of the first lien or such consent has been obtained
and is
contained in the Mortgage File.
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(11)
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From
and after the Cut-off Date, no mechanics’ or similar liens or claims have
been filed for work, labor or material (and no rights are outstanding
that
under law could give rise to such lien) affecting the related Mortgaged
Property which are or may be liens prior to, or equal or coordinate
with,
the lien of the related Mortgage.
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(12)
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Since
Initial Sale Date of the Mortgage Loan, the Mortgaged Property has
not
been subject to any bankruptcy proceeding or foreclosure proceeding
and
the Mortgagor has not filed for protection under applicable bankruptcy
laws. There is no homestead or other exemption available to the Mortgagor
which would interfere with the right to sell the Mortgaged Property
at a
trustee’s sale or the right to foreclose the Mortgage. The Mortgagor has
not notified the Seller and the Seller has no knowledge of any relief
requested by the borrower under the Servicemembers Civil Relief
Act.
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(13)
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To
the Seller’s knowledge, the Mortgaged Property is in material compliance
with all applicable environmental laws pertaining to environmental
hazards
including, without limitation, asbestos, and neither the Seller nor,
to
the Seller’s knowledge, the related Mortgagor, has received any notice of
any violation or potential violation of such
law.
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(14)
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There
is no Mortgage Loan that was originated on or after October 1, 2002
and
before March 7, 2003, which is secured by property located in the
state of
Georgia. There is no Mortgage Loan that was originated on or after
March
7, 2003, which is a “high cost home loan” as defined under the Georgia
Fair Lending Act.
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(15)
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No
Mortgage Loan is (a) subject to the provisions of the Homeownership
and
Equity Protection Act of 1994 as amended (“HOEPA”), (b) a “high cost”
mortgage loan, “covered” mortgage loan, “high risk home” mortgage loan or
“predatory” mortgage loan or any other comparable term, no matter how
defined under any federal, state or local law, or (c) subject to
any
comparable federal, state or local statutes or regulations, or any
other
statute or regulation providing for heightened regulatory scrutiny
or
assignee liability to holders of such mortgage loans, or (d) a High
Cost
Loan or Covered Loan, as applicable (as such terms are defined in
the then
current Standard & Poor’s LEVELS®
Glossary).
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(16)
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Each
Mortgage Loan at the time it was made complied in all material respects
with applicable local, state and federal laws, including, but not
limited
to, all applicable predatory and abusive lending
laws.
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(17)
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The
information set forth in the Mortgage Loan Schedule with respect
to
Prepayment Charges is complete, true and correct in all material
respects
and, subject to applicable federal and state law, each Prepayment
Charge
is permissible, enforceable and collectible.
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(18)
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No
Mortgage Loan is (i) a “High-Cost Home Loan” as defined in the New Jersey
Home Ownership Act effective November 27, 2003, (ii) a “High-Cost Home
Loan” as defined in the New Mexico Home Loan Protection Act effective
January 1, 2004, (iii) a “High-Cost Home Mortgage Loan” as defined in the
Massachusetts Predatory Home Loan Practices Act effective November
7, 2004
or (iv) a “High Cost Home Loan” as defined in the Indiana Home Loan
Practices Act effective January 1,
2005.
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(19)
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All
parties which have had any interest in the Mortgage Loan, whether
as
mortgagee, assignee, pledgee or otherwise, are (or, during the period
in
which they held and disposed of such interest, were) in compliance
with
any and all applicable “doing business” and licensing requirements of the
laws of the state wherein the Mortgaged Property is located or were
not
required to be licensed in such
state.
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(20)
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The
Mortgage Loan is covered by an American Land Title Association (“ALTA”)
lender’s title insurance policy (which, in the case of an Adjustable Rate
Mortgage Loan has an adjustable rate mortgage endorsement in the
form of
ALTA 6.0 or 6.1), or with respect to any Mortgage Loan for which
the
related Mortgaged Property is located in California, a CLTA lender’s title
insurance policy, pursuant to the underwriting guidelines and qualified
to
do business in the jurisdiction where the Mortgaged Property is located,
insuring (subject to the exceptions contained in (8)(a) through (d)
above)
the Originator, its successors and assigns as to the first or second
(as
indicated on the related Mortgage Loan Schedule) priority lien of
the
Mortgage in the original principal amount of the Mortgage Loan and,
with
respect to any Adjustable Rate Mortgage Loan, against any loss by
reason
of the invalidity or unenforceability of the lien resulting from
the
provisions of the Mortgage providing for adjustment in the mortgage
interest rate and monthly payment. Additionally, such lender's title
insurance policy affirmatively insures ingress and egress to and
from the
Mortgaged Property, and against encroachments by or upon the Mortgaged
Property or any interest therein. The Originator (or its predecessor
in
interest) is the sole insured of such lender’s title insurance policy, and
such lender’s title insurance policy is in full force and effect and will
be in full force and effect upon the consummation of the transactions
contemplated by this Agreement. No claims have been made under such
lender’s title insurance policy, and no prior holder of the related
Mortgage, including the Originator, has done, by act or omission,
anything
which would impair the coverage of such lender’s title insurance
policy.
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(21)
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The
Mortgaged Property is lawfully occupied under applicable
law.
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(22)
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The
Seller has no knowledge of any circumstances or condition with respect
to
the Mortgage, the Mortgaged Property, the Mortgagor or the Mortgagor’s
credit standing that can reasonably be expected to cause the Mortgage
Loan
to become delinquent.
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(b)
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In
addition to the representations and warranties in Paragraph 4(a)
above,
with respect to the Group I Mortgage Loans, as of the date hereof
and as
of the Closing Date:
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(1)
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The
outstanding Principal Balance of each Group I Mortgage Loan does
not
exceed the applicable maximum original loan amount limitations with
respect to first lien or subordinate lien one-to-four family residential
mortgage loans, as applicable, as set forth in the Xxxxxxx Mac Selling
Guide;
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(2)
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With
respect to any Group I Mortgage Loan that is a subordinate lien mortgage
loan, (i) such lien is on a one- to four-family residence that is
the
principal residence of the borrower; (ii) the original principal
balance
does not exceed the applicable limitations with respect to subordinate
lien mortgage loans as set forth in the Xxxxxxx Mac Selling Guide;
and
(iii) the original principal balance of the first lien mortgage loan
plus
the original principal balance of any subordinate lien mortgage loans
relating to the same mortgaged property do not exceed the applicable
limitations with respect to first lien mortgage loans for that property
type as set forth in the Xxxxxxx Mac Selling
Guide;
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(3)
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There
is no Group I Mortgage Loan that was originated on or after March
7, 2003
which is a “high cost home loan” as defined under the Georgia Fair Lending
Act;
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(4)
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No
borrower obtained a prepaid single-premium credit life, credit disability,
credit unemployment or credit property insurance policy in connection
with
the origination of any Group I Mortgage Loan; no proceeds from any
Group I
Mortgage Loan were used to purchase single premium credit insurance
policies or debt cancellation agreements as part of the origination
of, or
as a condition to closing, such Group I Mortgage Loan;
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(5)
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The
applicable Servicer for each Group I Mortgage Loan has fully furnished
in
the past (and the Seller shall cause the applicable Servicer to furnish
in
the future), in accordance with the Fair Credit Reporting Act and
its
implementing regulations, accurate and complete information (i.e.,
favorable and unfavorable) on its borrower credit files to Equifax,
Experian and Trans Union Credit Information Company, on a monthly
basis;
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(6)
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With
respect to any Group I Mortgage Loan that contains a provision permitting
imposition of a Prepayment Charge upon a prepayment prior to maturity,
to
the best of the Seller’s knowledge: (i) the Group I Mortgage Loan provides
some benefit to the borrower (e.g., a rate or fee reduction) in exchange
for accepting such Prepayment Charge; (ii) the Group I Mortgage Loan’s
originator had a written policy of offering the borrower, or requiring
third-party brokers to offer the borrower, the option of obtaining
a
mortgage loan that did not require payment of such Prepayment Charge;
(iii) the Prepayment Charge was adequately disclosed to the borrower
in
the loan documents pursuant to applicable state and federal law;
(iv) no
subprime loan originated on or after October 1, 2002, will provide
for a
Prepayment Charge for a term in excess of three years and any subprime
loan or non-subprime loan originated prior to such date will not
provide
for a Prepayment Charge for a term in excess of five years; in each
case
unless such loan was modified to reduce the prepayment period to
no more
than three years from the date of the note in the case of a subprime
loan
and no more than five years from the date of the note in the case
of a
non-subprime loan and the borrower was notified in writing of such
reduction in prepayment period; and (v) such Prepayment Charge shall
not be imposed in any instance where the Group I Mortgage Loan is
accelerated or paid off in connection with the workout of a delinquent
mortgage or due to the borrower’s default, notwithstanding that the terms
of the Group I Mortgage Loan or state or federal law might permit
the
imposition of such Prepayment
Charge;
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(7)
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With
respect to any Group I Mortgage Loan originated on or after August
1,
2004, neither the related mortgage nor the related mortgage note
requires
the borrower to submit to arbitration to resolve any dispute arising
out
of or relating in any way to the mortgage loan
transaction;
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(8)
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With
respect to any Group I Mortgage Loan secured by manufactured housing,
(i)
each contract is secured by a “single family residence” within the meaning
of Section 25(e)(10) of the Code and (ii) the manufactured housing
is the
principal residence of the borrower. The fair market value of the
manufactured home securing each contract was at least 80% of the
adjusted
issue price of the contract at either (i) the time the contract was
originated (determined pursuant to the REMIC provisions of the Code)
or
(ii) the time the contract was transferred to the Seller. Each such
contract is a “qualified mortgage” under Section 860G(a)(3) of the
Code;
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(9)
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To
the best of the Seller’s knowledge, no borrower was encouraged or required
to select a Group I Mortgage Loan product offered by the originator
which
is a higher cost product designed for less creditworthy borrowers,
unless
at the time of origination, such borrower did not qualify, taking
into
account such facts as, without limitation, the related Group I Mortgage
Loan’s requirements and the borrower’s credit history, income, assets and
liabilities, for a lower cost credit product then offered by the
mortgage
loan’s originator or any affiliate of the originator. If, at the time
of
loan application, the borrower may have qualified for a lower cost
credit
product then offered by any mortgage lending affiliate of the originator,
the originator referred the borrower’s application to such affiliate for
underwriting consideration;
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(10)
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To
the best of the Seller’s knowledge, the methodology used in underwriting
the extension of credit for each Group I Mortgage Loan did not rely
on the
borrower’s equity in the collateral as the principal determining factor in
approving the extension of credit, but rather related such facts
as,
without limitation, the borrower’s credit history, income, assets or
liabilities, to the proposed mortgage payment. Such underwriting
methodology confirmed that at the time of origination
(application/approval), the borrower had a reasonable ability to
make
timely payments on the related Group I Mortgage
Loan;
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(11)
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No
borrower under a Group I Mortgage Loan was charged “points and fees” in an
amount greater than (a) $1,000 or (b) 5% of the principal amount
of such
Group I Mortgage Loan, such limitation calculated in accordance with
Xxxxxxx Mac’s anti-predatory lending requirements as set forth in the
Xxxxxxx Mac Selling Guide; and
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(12)
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No
Group I Mortgage Loan was originated more than twelve months prior
to the
Closing Date.
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(13)
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No
Group I Mortgage Loan has an annual percentage rate (APR) or total
points
and fees that exceed the thresholds set by HOEPA and its implementing
regulations, including 12 CFR §226.32(a)(1)(i) and
(ii).
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(14)
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The
Seller operates an on-going program to make periodic purchases of
mortgage
loans from originators or other sellers and/or to issue and/or purchase
securities or bonds supported by mortgages with a portion of the
proceeds
generated by such program being used to purchase or originate mortgages
made to borrowers who are low-income. The Seller agrees that for
a period
of two years following the date of this Agreement, Xxxxxxx Mac may
contact
the Seller to confirm that it continues to operate or actively participate
in such programs, in order to obtain other nonproprietary information
about the Seller’s activities that may assist Xxxxxxx Mac in completing
its regulatory reporting requirements. The Seller will make reasonable
efforts to provide such information to Xxxxxxx
Mac.
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It
is
understood and agreed that the representations and warranties of the Seller
set
forth in this Section 4 shall survive the Closing Date. Upon the discovery
by
either the Seller or the Company of a breach of any of the foregoing
representations and warranties (excluding a breach with respect to the
representation made in subparagraph (a)(17) of Section 4 above) that adversely
and materially affects the value of the related Mortgage Loan and that does
not
also constitute a breach of a representation or warranty of the applicable
Mortgage Loan Seller under the applicable Transfer Agreement, the party
discovering the breach shall give prompt written notice to the other. Within
30
days of the earlier of either discovery by or notice to the Seller of any breach
of any of the foregoing representations or warranties that materially and
adversely affects the value of any Mortgage Loan, the Seller shall use its
best
efforts to cure such breach in all material respects and, if such defect or
breach cannot be remedied, the Seller shall, at the Company’s option as
specified in writing and provided to the Seller, (i) if such 30 day period
expires prior to the second anniversary of the Closing Date, remove such
Mortgage Loan from the Trust Fund and substitute in its place a Substitute
Mortgage Loan; or (ii) repurchase such Mortgage Loan at the Repurchase Price.
Notwithstanding the foregoing, with respect to any of the foregoing
representations and warranties made in clauses (14), (15) and (16) of
subparagraph (a) of this Section 4 and in subparagraphs (b) of this Section
4
with respect to the Group I Mortgage Loans, a breach of any such representation
or warranty shall be deemed to materially and adversely affect the value of
the
affected Mortgage Loan and the interests of Certificateholders therein, thus
requiring the Seller to repurchase or substitute such Mortgage Loan irrespective
of the Seller’s knowledge of the breach or violation of the representation or
warranty.
10
Notwithstanding
the preceding paragraph, in connection with the Seller’s representations and
warranties made in subparagraph (a)(17) of Section 4 and within 90 days of
the
earlier of discovery by the Seller or receipt of notice from the applicable
Servicer of a breach of such representation and warranty by the Seller, which
breach materially and adversely affects the interests of the Class P
Certificateholders in any Prepayment Charge, the Seller shall, if (i) such
representation and warranty is breached and a Principal Prepayment has occurred
or (ii) if a change in law subsequent to the Closing Date limits the
enforceability of the Prepayment Charge, pay, at the time of such Principal
Prepayment or change in law, the amount of the scheduled Prepayment Charge,
for
the benefit of the holders of the Class P Certificates, by depositing such
amount into the Distribution Account no later than the Remittance Date
immediately following the Prepayment Period in which such Principal Prepayment
on the related Mortgage Loan or such change in law has occurred.
5. Repurchase
and Substitution of Mortgage Loans.
In the
event a Mortgage Loan Seller fails to perform its repurchase or substitution
obligations under its related Transfer Agreement resulting from the insolvency
or financial inability of such Mortgage Loan Seller to do so, the Seller may,
in
its sole discretion, opt to undertake such repurchase or
substitution.
6. Underwriting.
The
Seller hereby agrees to furnish any and all information, documents,
certificates, letters or opinions with respect to the Mortgage Loans, reasonably
requested by the Company in order to perform any of its obligations or satisfy
any of the conditions on its part to be performed or satisfied pursuant to
the
underwriting agreement dated November 3, 2006, among the Company, the Seller,
HSBC Securities (USA) Inc., Xxxxxxxx & Company, Inc. and Countrywide
Securities Corporation or the Purchase Agreement at or prior to the Closing
Date.
7. Notices.
All
demands, notices and communications hereunder shall be in writing, shall be
effective only upon receipt and shall, if sent to the Company, be addressed
to
it at HSI Asset Securitization Corporation, 000 Xxxxx Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Head MBS Principal Finance, or, if sent
to
the Seller, be addressed to it at HSBC Bank USA, National Association, 000
Xxxxx
Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Head MBS Principal Finance.
11
8. Miscellaneous.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated except by a writing signed by the party against
whom enforcement of such change, waiver, discharge or termination is sought.
This Agreement may be signed in any number of counterparts, each of which shall
be deemed an original, which taken together shall constitute one and the same
instrument. This Agreement shall bind and inure to the benefit of and be
enforceable by the Company and the Seller and their respective successors and
assigns.
[SIGNATURE
PAGE FOLLOWS]
12
IN
WITNESS WHEREOF, the Company and the Seller have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
| HSI ASSET SECURITIZATION CORPORATION | ||
| |
|
|
| By: | /s/ Xxxxxx Xxxxx | |
|
Name: Xxxxxx Xxxxx Title:
Vice President
|
||
| HSBC BANK USA, NATIONAL ASSOCIATION | ||
| |
|
|
| By: | /s/ Xxx X. Xxxxxxxx | |
|
Name:
Xxx X. Xxxxxxxx
Title:
Officer #14311
|
||
EXHIBIT
1
Mortgage
Loan Schedule
[To
be
retained in a separate closing binder entitled “HASCO 2006-HE1 Mortgage Loan
Schedules” at the Washington, D.C. offices of XxXxx Xxxxxx LLP]
1-1
EXHIBIT
2
Assignment
Agreements
1. Assignment,
Assumption and Recognition Agreement, dated as of October 1, 2006, among HSBC
Bank USA, National Association, HSI Asset Securitization Corporation,
Countrywide Home Loans Servicing LP and Countrywide Home Loans, Inc., and
acknowledged by Xxxxx Fargo Bank, N.A., and Deutsche Bank National Trust
Company, not individually but solely as trustee on behalf of the HSI
Asset
Securitization Corporation Trust 2006-HE1.
2. Assignment,
Assumption and Recognition Agreement, dated as of October 1, 2006, among HSBC
Bank USA, National Association, HSI Asset Securitization Corporation
and
NC
Capital Corporation.
3. Assignment,
Assumption and Recognition Agreement, dated as of October 1, 2006, among HSBC
Bank USA, National Association, HSI Asset Securitization Corporation
and
Option One Mortgage Corporation.
4. Assignment,
Assumption and Recognition Agreement, dated as of October 1, 2006, among HSBC
Bank USA, National Association, HSI Asset Securitization Corporation and
WMC
Mortgage Corp.
2-1
