[Execution Copy]
INDEMNIFICATION AGREEMENT
MORGAN STANLEY ABS CAPITAL I INC.
IXIS REAL ESTATE CAPITAL TRUST
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2005-HE3
WHEREAS, Morgan Stanley ABS Capital I Inc. (the "Depositor") is
acting
as depositor with respect to (i) the Prospectus (the "Base
Prospectus"), dated
May 10, 2005, (ii) the Prospectus Supplement, dated August 29, 2005
(the
"Prospectus Supplement" and together with the Base Prospectus, the
"Prospectus")
and (iii) the Confidential Private Placement Memorandum, dated
August 30, 2005
(the "Private Placement Memorandum" and together with the
Prospectus, the
"Offering Documents"), relating to IXIS Real Estate Capital Trust
2005-HE3,
Mortgage Pass-Through Certificates, Series 2005-HE3, (the
"Certificates") to be
issued pursuant to a Pooling and Servicing Agreement, dated as of
August 1, 2005
(the "P&S"), among IXIS Real Estate Capital Inc., as
Unaffiliated Seller (the
"Unaffiliated Seller"), the Depositor, Countrywide Home Loans
Servicing LP, as
Servicer (the "Servicer") Deutsche Bank National Trust Company, as
custodian
(the "Custodian") and JPMorgan Chase Bank, N.A., as trustee (the
"Trustee");
WHEREAS, the Depositor purchased the Mortgage Loans from the
Unaffiliated Seller pursuant to an Unaffiliated Seller's Agreement
dated as of
August 1, 2005 (the "Unaffiliated Seller's Agreement"), by and
between the
Depositor and the Unaffiliated Seller;
WHEREAS, Morgan Stanley & Co. Incorporated, as initial
purchaser (the
"Initial Purchaser"), is agreeing, subject to the terms and
conditions of the
Certificate Purchase Agreement, dated as of August 30, 2005 (the
"Certificate
Purchase Agreement"), between the Depositor and the Initial
Purchaser, to
purchase on the Closing Date described therein the Class A-1
Certificates (the
"Class A-1 Certificates") as described therein; and
WHEREAS, Morgan Stanley & Co. Incorporated, as representative
(the
"Representative"), of itself and the other underwriters named in
the
Underwriting Agreement (collectively, the "Underwriters"), dated
August 30, 2005
(the "Underwriting Agreement"), between the Depositor and the
Representative
pursuant to which the Representative on behalf of the Underwriters
is agreeing,
subject to the terms and conditions therein, that the Underwriters
purchase on
the Closing Date described therein the Offered Certificates (the
"Offered
Certificates") as described therein.
NOW THEREFORE, in consideration of the agreements contained herein,
and other valuable consideration the receipt and sufficiency of
which is hereby
acknowledged, the Unaffiliated Seller, the Depositor and the
Representative
agree as follows:
ARTICLE I Indemnification and Contribution.
Section 1.01 The Unaffiliated Seller agrees to indemnify and hold
harmless
the Depositor, the Initial Purchaser and each Underwriter, their
respective
officers and directors and each person, if any, who controls the
Depositor, the
Initial Purchaser or any Underwriter within the meaning of either
Section 15 of
the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the
Securities Exchange Act of 1934, as amended (the "1934 Act"),
against any
and all losses, claims, damages or liabilities, joint or several,
to which they
or any of them may become subject under the 1933 Act, the 1934 Act
or other
federal or state statutory law or regulation, at common law or
otherwise,
insofar as such losses, claims, damages or liabilities (or actions
in respect
thereof) arise out of or are based in whole or in part upon any
untrue statement
or alleged untrue statement of a material fact contained in the
Prospectus
Supplement, the Private Placement Memorandum or in the Comp
Materials or any
omission or alleged omission to state in the Prospectus Supplement,
the Private
Placement Memorandum or in the Comp Materials a material fact
required to be
stated therein or necessary to make the statements therein, in
light of the
circumstances in which they were made, not misleading, or any such
untrue
statement or omission or alleged untrue statement or alleged
omission made in
any amendment of or supplement to the Prospectus Supplement, the
Private
Placement Memorandum or to the Comp Materials, and agrees to
reimburse the
Depositor, the Initial Purchaser and each Underwriter and each such
officer,
director and controlling person promptly upon demand for any legal
or other
expenses reasonably incurred by any of them in connection with
investigating or
defending or preparing to defend against any such loss, claim,
damage, liability
or action as such expenses are incurred; provided however, that the
Unaffiliated
Seller shall be liable in any such case only to the extent that any
such loss,
claim, damage, liability or action arises out of, or is based upon,
any untrue
statement or alleged untrue statement or omission or alleged
omission made in
reliance upon and in conformity with the Seller Information. The
foregoing
indemnity agreement is in addition to any liability which the
Unaffiliated
Seller may otherwise have to the Initial Purchaser, the
Underwriters, the
Depositor or any such director, officer or controlling person of
the Initial
Purchaser, the Underwriters or of the Depositor.
Section 1.02 The Initial Purchaser agrees to indemnify and hold
harmless
the Unaffiliated Seller, its officers and directors and each
person, if any, who
controls the Unaffiliated Seller within the meaning of either
Section 15 of the
1933 Act or Section 20 of the 1934 Act, against any and all losses,
claims,
damages or liabilities, joint or several, to which the Unaffiliated
Seller may
become subject under the 1933 Act, the 1934 Act or other federal or
state
statutory law or regulation, at common law or otherwise, insofar as
such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or
are based in whole or in part upon any untrue statement or alleged
untrue
statement of a material fact contained in the Private Placement
Memorandum or
any omission or alleged omission to state in the Private Placement
Memorandum a
material fact required to be stated therein or necessary to make
the statements
therein, in light of the circumstances in which they were made, not
misleading,
or any such untrue statement or omission or alleged untrue
statement or alleged
omission made in any amendment of or supplement to the Private
Placement
Memorandum, and including in each case any information included
therein by its
incorporation by reference into the Offering Documents and agrees
to reimburse
the Unaffiliated Seller, and each such director, officer or
controlling person
for any legal or other expenses reasonably incurred by any of them
in connection
with investigating or defending or preparing to defend against any
such loss,
claim, damage, liability or action as such expenses are incurred;
provided
however, that the Initial Purchaser shall be liable in any such
case only to the
extent that any such loss, claim, damage, liability or action
arises out of, or
is based upon, any untrue statement or alleged untrue statement or
omission or
alleged omission made in reliance upon and in conformity with the
Initial
Purchaser Information. The foregoing indemnity agreement is in
addition to any
liability which the Initial Purchaser may otherwise have to the
Unaffiliated
Seller or any such director, officer or controlling person of the
Unaffiliated
Seller.
2
Section 1.03 Each Underwriter, severally but not jointly, agrees to
indemnify and hold harmless the Unaffiliated Seller, its officers
and directors
and each person, if any, who controls the Unaffiliated Seller
within the meaning
of either Section 15 of the 1933 Act or Section 20 of the 1934 Act,
against any
and all losses, claims, damages or liabilities, joint or several,
to which the
Unaffiliated Seller may become subject under the 1933 Act, the 1934
Act or other
federal or state statutory law or regulation, at common law or
otherwise,
insofar as such losses, claims, damages or liabilities (or actions
in respect
thereof) arise out of or are based in whole or in part upon any
untrue statement
or alleged untrue statement of a material fact contained in the
Prospectus
Supplement or any omission or alleged omission to state in the
Prospectus
Supplement a material fact required to be stated therein or
necessary to make
the statements therein, in light of the circumstances in which they
were made,
not misleading, or any such untrue statement or omission or alleged
untrue
statement or alleged omission made in any amendment of or
supplement to the
Prospectus Supplement, and including in each case any information
included
therein by its incorporation by reference into the Prospectus and
agrees to
reimburse the Unaffiliated Seller, and each such director, officer
or
controlling person for any legal or other expenses reasonably
incurred by any of
them in connection with investigating or defending or preparing to
defend
against any such loss, claim, damage, liability or action as such
expenses are
incurred; provided however, that the Underwriters shall be liable
in any such
case only to the extent that any such loss, claim, damage,
liability or action
arises out of, or is based upon, any untrue statement or alleged
untrue
statement or omission or alleged omission made in reliance upon and
in
conformity with the Underwriter Information. The foregoing
indemnity agreement
is in addition to any liability which the Underwriter may otherwise
have to the
Unaffiliated Seller or any such director, officer or controlling
person of the
Unaffiliated Seller.
As used herein:
"Depositor Information" means the statements set forth in the
Prospectus Supplement under the caption "Transaction Overview -
Parties - The
Depositor".
"Initial Purchaser Information" means the statements set forth
under
the caption "Method of Placement" in the Private Placement
Memorandum.
"Seller Information" means (x) the information and data concerning
the
Mortgage Loans set forth on any computer tape (or other electronic
or printed
medium) furnished to the Depositor and/or the Unaffiliated Seller,
in the Comp
Materials, (as defined below) to the extent such Comp Materials
were approved by
the Unaffiliated Seller, and (y) the information set forth in the
Prospectus
Supplement, other than the Depositor Information, the Servicer
Information, the
Initial Purchaser Information and the Underwriter Information.
"Servicer Information" means the information concerning the
Servicer
under the caption "Transaction Overview--The Servicer" and "The
Servicer".
"Underwriter Information" means the statements set forth (i) in the
last paragraph on
