10-K/A 1 nel06he3_10ka-2006.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A Amendment No. 1 The Issuing Entity is filing this Form 10-K/A to replace Exhibits 31, 33(a) and 34(a) to the original Form 10-K filed on April 2, 2007. American Security Insurance Company, Standard Guaranty Insurance Company and TrackSure Insurance Agency, Inc. (formerly, "Safeco Financial Institution Solutions, Inc.") ("Assurant Inc.") recently provided the Issuing Entity with a revised report on assessment of compliance with servicing criteria for asset-backed securities and a related attestation. In the original assessment previously provided to the Issuing Entity, Assurant Inc. excluded Item 1122(d)(4)(xii) from the scope of its assessment. Assurant Inc. recently provided the Issuing Entity with a revised assessment of compliance that assesses Assurant Inc.'s compliance with Item 1122(d)(4)(xii) and identifies material instance of non compliance with this criterion. This material instance of non compliance is noted in this Form 10-K/A under "ADDITIONAL DISCLOSURE ITEMS PURSUANT TO GENERAL INSTRUCTION J" The Issuing Entity has included this revised assessment of compliance under Exhibit 33(a), the related attestation under Exhibit 34(a) and a revised Rule 13a-14(d)/15d-14(d) Certification under Exhibit 31. This Form 10-K/A does not otherwise amend the original Form 10-K filed with the Commission on April 2, 2007. (Mark one) /X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2006 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 333-132109-03 Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series 2006-HE3 (exact name of issuing entity as specified in its charter) Nomura Home Equity Loan, Inc. (exact name of the depositor (as registrant on behalf of the issuing entity) as specified in its charter) Nomura Credit & Capital, Inc. (exact name of the sponsor as specified in its charter) Delaware 20-2748651 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Nomura Home Equity Loan, Inc. 2 World Financial Center Building B New York, NY 10281 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212)667-9300 Securities registered pursuant to Section 12(b) of the Act: NONE. Securities registered pursuant to Section 12(g) of the Act: NONE. Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ___ No X Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ___ No X Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K ( 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Not applicable. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer ___ Accelerated filer ___ Non-accelerated filer X Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ___ No X State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter. Not applicable. Documents Incorporated by Reference List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1)Any annual report to security holders; (2) Any proxy or information statement; and (3)Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980). Not applicable. PART I Item 1. Business. Omitted. Item 1A. Risk Factors. Omitted. Item 1B. Unresolved Staff Comments. None. Item 2. Properties. Omitted. Item 3. Legal Proceedings. Omitted. Item 4. Submission of Matters to a Vote of Security Holders. Omitted. PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Omitted. Item 6. Selected Financial Data. Omitted. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. Omitted. Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Omitted. Item 8. Financial Statements and Supplementary Data. Omitted. Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. Omitted. Item 9A. Controls and Procedures. Omitted. Item 9A(T). Controls and Procedures. Omitted. Item 9B. Other Information. None. PART III Item 10. Directors, Executive Officers and Corporate Governance. Omitted. Item 11. Executive Compensation. Omitted. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. Omitted. Item 13. Certain Relationships and Related Transactions, and Director Independence. Omitted. Item 14. Principal Accounting Fees and Services. Omitted. ADDITIONAL DISCLOSURE ITEMS PURSUANT TO GENERAL INSTRUCTION J Item 1112(b) of Regulation AB, Significant Obligor Financial Information. None. Item 1114(b)(2) of Regulation AB, Credit Enhancement and Other Support, except for Certain Derivative Instruments (Information regarding Significant Enhancement Providers' Financial Information). No entity or group of affiliated entities provides any external credit enhancement, uses any derivative instruments or other support for the certificates within this transaction as described under Item 1114(a) of Regulation AB. Item 1115(b) of Regulation AB, Certain Derivative Instruments. The significance percentage related to each entity or group of affiliated entities providing derivative instruments described in Item 1115 of Regulation AB is less than 10%. Item 1117 of Regulation AB, Legal Proceedings. On March 20, 2007, People's Choice Home Loan, Inc. filed a Chapter 11 petition in the United States Bankruptcy Court for the Central District of California, Santa Ana Division, Case No. 07-10765. In addition, on March 20, 2007, its parent company, People's Choice Financial Corporation and that company's qualified REIT subsidiary, People's Choice Funding, Inc., have also filed Chapter 11 petitions in the same court (Case No. 07-10772 and 07-10767, respectively). Item 1119 of Regulation AB, Affiliations and Certain Relationships and Related Transactions. No applicable updates. Item 1122 of Regulation AB, Compliance with Applicable Servicing Criteria. Reports on assessment of compliance with the servicing criteria for asset-backed securities are attached hereto under Item 15. Assurant, Inc. previously excluded the applicable servicing criteria set forth in Item 1122 (d)(4)(xii) from the scope of its assessment of compliance. Assurant, Inc. has now assessed its compliance with the Applicable Servicing Criteria for the Reporting Period of January 1, 2006 through December 31, 2006 and has identified a material instance of noncompliance with that servicing criterion. Specifically, Assurant, Inc. did not have, during the Reporting Period, sufficient policies and procedures to capture the information with respect to the Platform Transactions necessary to determine compliance with Item 1122(d)(4)(xii). Accordingly, Assurant, Inc. has restated its previous assessment for the Reporting Period, which excluded evaluation of the criterion, to include the criterion and reflect the material noncompliance as a result of its assessment. The 1122 statements for First American Real Estate Solutions of Texas, L.P. (as Sub-Contractor for Ocwen Loan Servicing, LLC)("First American") have disclosed the following material instance of noncompliance with the servicing criteria set forth in Item 1122(d)(2)(vii)(B) of Regulation AB applicable to First American during the twelve months ended December 31, 2006. Account reconciliations for all asset-backed securities related bank accounts were not prepared within 30 calendar days after the bank statement cutoff date, or such other number of days specified in the transaction agreements as required by Item 1122(d)(2)(vii)(B) of Regulation AB. The 1122 statements for Wells Fargo Bank, National Association (Corporate Trust Services)("Wells Fargo") has disclosed material noncompliance with criterion 1122(d)(3)(i), as applicable to Wells Fargo during the twelve months ended December 31. 2006. Certain monthly investor or remittance reports included errors in the calculation and/or the reporting of delinquencies for the pool assets. Item 1123 of Regulation AB, Servicer Compliance Statement. Servicer Compliance Statements are attached hereto under Item 15. PART IV Item 15. Exhibits, Financial Statement Schedules. (a) Exhibits (4) The Pooling and Servicing Agreement, dated as of August 1, 2006, among Nomura Home Equity Loan, Inc., as depositor, Nomura Credit & Capital, Inc., as sponsor, Wells Fargo Bank, National Association, as master servicer and securities administratror, Ocwen Loan Servicing, LLC, as a servicer, and HSBC Bank, USA, National Association, as trustee (incorporated herein by reference from Exhibit 4.1 of the Current Report on Form 8-K of the registrant as filed with the Commission). (31) Rule 13a-14(d)/15d-14(d) Certifications. (33) Reports on assessment of compliance with servicing criteria for asset-backed securities. a) Assurant Inc., as Sub-Contractor for Ocwen Loan Servicing, LLC b) First American Real Estate Solutions of Texas, L.P., as Sub-Contractor for Ocwen Loan Servicing, LLC c) Ocwen Loan Servicing, LLC, as Servicer d) Regulus Group LLC as Sub-Contractor for Ocwen Loan Servicing, LLC e) Wells Fargo Bank, N.A., as Master Servicer f) Wells Fargo Bank, N.A., as Securities Administrator g) Wells Fargo Bank, N.A., as Paying Agent h) Wells Fargo Bank, N.A., as Custodian
(34) Attestation reports on assessment of compliance with servicing criteria for asset-backed securities. a) Assurant Inc., as Sub-Contractor for Ocwen Loan Servicing, LLC b) First American Real Estate Solutions of Texas, L.P., as Sub-Contractor for Ocwen Loan Servicing, LLC c) Ocwen Loan Servicing, LLC, as Servicer d) Regulus Group LLC as Sub-Contractor for Ocwen Loan Servicing, LLC e) Wells Fargo Bank, N.A., as Master Servicer f) Wells Fargo Bank, N.A., as Securities Administrator g) Wells Fargo Bank, N.A., as Paying Agent h) Wells Fargo Bank, N.A., as Custodian
(35) Servicer compliance statements. a) Ocwen Loan Servicing, LLC, as Servicer b) Wells Fargo Bank, N.A., as Master Servicer c) Wells Fargo Bank, N.A., as Securities Administrator
(b) Not applicable. (c) Omitted. Filed herewith. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Nomura Home Equity Loan, Inc., Home Equity Loan Trust, Series 2006-HE3 (Issuing Entity) Wells Fargo Bank, N.A. (Master Servicer) /s/ Kristen Ann Cronin Kristen Ann Cronin, Vice President (senior officer in charge of the servicing function of the master servicer) Date: May 27, 2008 Exhibit Index Exhibit No. (4) The Pooling and Servicing Agreement, dated as of August 1, 2006, among Nomura Home Equity Loan, Inc., as depositor, Nomura Credit & Capital, Inc., as sponsor, Wells Fargo Bank, National Association, as master servicer and securities administratror, Ocwen Loan Servicing, LLC, as a servicer, and HSBC Bank, USA, National Association, as trustee (incorporated herein by reference from Exhibit 4.1 of the Current Report on Form 8-K of the registrant as filed with the Commission). (31) Rule 13a-14(d)/15d-14(d) Certifications. (33) Reports on assessment of compliance with servicing criteria for asset-backed securities. a) Assurant Inc., as Sub-Contractor for Ocwen Loan Servicing, LLC b) First American Real Estate Solutions of Texas, L.P., as Sub-Contractor for Ocwen Loan Servicing, LLC c) Ocwen Loan Servicing, LLC, as Servicer d) Regulus Group LLC, as Sub-Contractor for Ocwen Loan Servicing, LLC e) Wells Fargo Bank, N.A., as Master Servicer f) Wells Fargo Bank, N.A., as Securities Administrator g) Wells Fargo Bank, N.A., as Paying Agent h) Wells Fargo Bank, N.A., as Custodian
(34) Attestation reports on assessment of compliance with servicing criteria for asset-backed securities. a) Assurant Inc., as Sub-Contractor for Ocwen Loan Servicing, LLC b) First American Real Estate Solutions of Texas, L.P., as Sub-Contractor for Ocwen Loan Servicing, LLC c) Ocwen Loan Servicing, LLC, as Servicer d) Regulus Group LLC as Sub-Contractor for Ocwen Loan Servicing, LLC e) Wells Fargo Bank, N.A., as Master Servicer f) Wells Fargo Bank, N.A., as Securities Administrator g) Wells Fargo Bank, N.A., as Paying Agent h) Wells Fargo Bank, N.A., as Custodian
(35) Servicer compliance statements. a) Ocwen Loan Servicing, LLC, as Servicer b) Wells Fargo Bank, N.A., as Master Servicer c) Wells Fargo Bank, N.A., as Securities Administrator