Exhibit 99.2
EXECUTION COPY
MORGAN STANLEY CAPITAL I INC.
MORTGAGE PASS-THROUGH CERTIFICATES
Series 2006-5AR
UNDERWRITING AGREEMENT
New York, New York
March 27,
2006
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York
10036
Dear Sirs and Madams:
Morgan Stanley Capital I Inc., a Delaware corporation (the
"Company"), proposes to sell to you as representative (the
"Underwriter") the
Morgan Stanley Mortgage Loan Trust 2006-5AR (the "Issuing Entity"),
Mortgage
Pass-Through Certificates, Series 2006-5AR in the classes and in
the
respective original principal or notional amounts and with the
designations
described on Schedule A attached hereto (the "Securities"). The
Securities,
along with the Class B-1, Class B-2, Class B-3, Class P and Class
C
Certificates (the "Private Securities"), will be issued pursuant to
a pooling
and servicing agreement dated as of March 1, 2006 (the "Pooling and
Servicing
Agreement") among the Company, as depositor, Wells Fargo Bank,
National
Association ("Wells Fargo"), as the master servicer (the "Master
Servicer")
and as securities administrator (the "Securities Administrator"),
Morgan
Stanley Mortgage Capital Inc., as seller ("MSMCI"), and LaSalle
Bank National
Association, as trustee (the "Trustee"). The Securities will
represent
undivided beneficial ownership interests in a trust fund consisting
primarily
of a pool of fixed-rate mortgage loans, adjustable-rate mortgage
loans, and
hybrid adjustable-rate mortgage loans (the "Mortgage Loans"),
secured by first
liens on one- to four-family residential properties. The Mortgage
Loans may be
sold to the Depositor pursuant to various mortgage loan purchase
agreements
(such agreements, the "Mortgage Loan Purchase Agreements" and the
"Servicing
Agreements," respectively) between MSMCI and one or more sellers
(the
"Sellers"), a mortgage loan purchase agreement between MSMCI and
the Depositor
and assignment, assumption and recognition agreements between the
Depositor,
MSMCI, the Trustee and each Seller and/or servicer (each servicer,
a
"Servicer") (collectively, the "Assignment Agreements"), as
applicable.
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement, including
a
prospectus, relating to the Securities and has filed with the
Commission one
or more free writing prospectuses (together, the "Free Writing
Prospectus")
and prospectus supplement (the "Prospectus Supplement")
specifically relating
to the Securities pursuant to Rule 424 under the Securities Act of
1933 (the
"Securities Act") and the rules and regulations thereunder (the
"Securities
Act Regulations"). The term Registration Statement means such
registration
statement as amended to the date of the Underwriting Agreement. The
term Base
Prospectus means the prospectus included in the Registration
Statement. The
term Prospectus means the Base Prospectus together with the
Prospectus
Supplement specifically relating to the Securities, as filed with
the
Commission pursuant to Rule
<PAGE>
424. The term free writing prospectus means any free writing
prospectus, as
defined in Rule 405 of the Securities Act. Any reference in this
underwriting
agreement (the "Agreement") to the Registration Statement or the
Prospectus
shall be deemed to refer to and include the documents incorporated
by
reference therein pursuant to Item 12 of Form S-3 under the
Securities Act, as
of the effective date of the Registration Statement or the
Prospectus, as the
case may be. Terms not otherwise defined in this Agreement are used
in this
Agreement as defined in the Pooling and Servicing Agreement.
The term "Disclosure Package" means (i) the Base Prospectus,
as most recently amended or supplemented immediately prior to the
Initial Sale
Time (as defined herein) and (ii) any Free Writing Prospectus that
the parties
hereto shall hereafter expressly agree to treat as part of the
Disclosure
Package. If, subsequent to the date of this Agreement, the Company
and the
Underwriter have determined that the Disclosure Package included an
untrue
statement of material fact or omitted to state a material fact
necessary in
order to make the statements therein, in the light of the
circumstances under
which they were made, not misleading and have terminated their old
purchase
contracts and entered into new purchase contracts with purchasers
of the
Securities, then the "Disclosure Package" will refer to the
information
available to purchasers at the time of entry into the first such
new purchase
contract, including any information that corrects such material
misstatements
or omissions ("Corrective Information").
I.
The Company represents and warrants to and agrees with the
Underwriter that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration
Statement
is in
effect, and no proceedings for such purpose are pending
before or threatened by the Commission.
(b) (i) Each part of the Registration Statement, when such
part became effective, did not contain, and each such part, as
amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration
Statement, the Disclosure Package and the Prospectus comply,
and,
as amended or supplemented, if applicable, will comply in all
material respects with the Securities Act and the applicable
rules
and regulations of the Commission thereunder and (iii) each of
the
Disclosure Package and the Prospectus does not contain and, as
amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of
the
circumstances under which they were made, not misleading,
except
that the representations and warranties set forth in this
paragraph I(b) do not apply to statements or omissions in the
Registration Statement, the Disclosure Package or the
Prospectus
based upon and in conformity with information relating to the
Underwriter furnished to the Company in writing by the
Underwriter
expressly for use or incorporation therein.
(c) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the
State of Delaware, has the corporate power and authority to own
its property and to conduct its business as described in the
<PAGE>
Prospectus and to enter into and perform its obligations under
this Agreement and the Pooling and Servicing Agreement.
(d) This Agreement has been duly authorized, executed and
delivered by the Company.
(e) Each of the Pooling and Servicing Agreement and the
Assignment Agreements has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement
of
the Company, enforceable in accordance with its terms except as
the
enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights
generally
and to general principles of equity regardless of whether
enforcement is sought in a proceeding in equity or at law.
(f) The direction by the Company to the Securities
Administrator to execute, authenticate and deliver the
Securities
has been duly authorized by the Company, and the Securities,
when
executed
and authenticated in the manner contemplated in the
Pooling and Servicing Agreement, and delivered to and paid for
by
the Underwriter in accordance with the terms of this Agreement,
will be validly issued and outstanding and entitled to the
benefits of the Pooling and Servicing Agreement.
(g) Neither the execution and delivery by the Company of,
nor the performance by the Company of its obligations under,
this
Agreement, the Pooling and Servicing Agreement and the
Assignment
Agreements, will contravene any provision of applicable law or
the
certificate of incorporation or by-laws of the Company or any
agreement or other instrument binding upon the Company that is
material to the Company or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Company or any subsidiary, and no consent, approval,
authorization
or order of, or qualification with, any governmental body or
agency is required for the performance by the Company of its
obligations under this Agreement, the Pooling and Servicing
Agreement and the Assignment Agreements, except such as may be
required by the securities or Blue Sky laws of the various
states
in connection with the offer and sale of the Securities.
(h) There has not occurred any material adverse change, or
any development involving a prospective material adverse
change,
in the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries,
taken
as a whole, from that set forth in the Prospectus.
(i) There are no legal or governmental proceedings pending
or threatened to which the Company is a party or to which any
of
the properties of the Company are subject that are required to
be
described in the Registration Statement, the Disclosure Package
or
the Prospectus and that are not so described, nor are there any
statutes, regulations, contracts or other documents required to
be
described in the Registration Statement, the Disclosure Package
or
the Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required.
<PAGE>
(j) Each preliminary prospectus filed as part of the
Registration Statement as originally filed or as a part of any
amendment thereto, or filed pursuant to Rule 424 under the
Securities Act, complied as to form, when so filed, in all
material respects with the Securities Act and the rules and
regulations of the Commission thereunder.
(k) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are
defined
in the Investment Company Act of 1940, as amended (the
"Investment
Company Act").
(l) the Company is eligible to use Free Writing Prospectuses
in connection with this offering pursuant to Rules 164 and 433
of
the Securities Act Regulations; any Free Writing Prospectus
that
the Company is required to file pursuant to Rule 433(d) under
the
Securities Act Regulations has been, or will be, filed with the
Commission in accordance with the requirements of the
Securities
Act and the Securities Act Regulations; and each Free Writing
Prospectus that the Company has filed, or is required to file,
pursuant to Rule 433(d) under the Securities Act Regulations or
that was prepared by or on behalf of or used by the Company
complies or will comply in all material respects with the
requirements of the Securities Act and the Securities Act
Regulations.
(m) The characteristics of the Issuing Entity will not
subject the Issuing Entity to registration as an "investment
company" under the Investment Company Act.
II.
MSMCI represents and warrants to and agrees with the
Underwriter that:
(a) MSMCI has been duly incorporated, is validly existing as
a corporation in good standing under the laws of the State of
New
York, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and
to
enter into and perform its obligations under this Agreement and
the Pooling and Servicing Agreement.
(b) This Agreement has been duly authorized, executed and
delivered by MSMCI.
(c) Each of the Pooling and Servicing Agreement, the
Mortgage Loan
Purchase Agreements and the Assignment Agreements
has been duly authorized, executed and delivered by MSMCI and is
a
valid and binding agreement of MSMCI, enforceable in accordance
with its terms except as the enforceability thereof may be
limited
by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and to general principles of equity regardless
of
whether enforcement is sought in a proceeding in equity or at
law.
(d) Neither the execution and delivery by MSMCI of, nor the
performance by the Company of its obligations under, the
Pooling
and Servicing Agreement, the Mortgage Loan Purchase Agreements
and
the Assignment Agreements, will contravene any provision of
applicable law or the certificate of incorporation or by-laws
of
MSMCI or any agreement or other instrument binding upon MSMCI
that
is material to MSMCI or
<PAGE>
any judgment, order or decree of any governmental body,
agency or court having jurisdiction over MSMCI or any
subsidiary,
and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required
for the performance by MSMCI of its obligations under the
Pooling
and Servicing Agreement, the Mortgage Loan Purchase Agreements
and
the Assignment Agreements.
III.
The Company hereby agrees to sell the Securities to the
Underwriter, and the Underwriter, upon the basis of the
representations and
warranties contained in this Agreement, but subject to the
conditions stated
in this Agreement, agrees to purchase the Securities from the
Company, for a
purchase price that is the sum of (i) 101.75% of the original
principal amount
of the Securities and (ii) accrued interest, if any, from the
Closing Date to
the date of payment and delivery.
IV.
A. The Underwriter proposes to make a public offering of the
Securities as soon as the Underwriter deems advisable after this
Agreement has
been executed and delivered. The terms of the public offering of
the
Securities are set forth in the Prospectus.
B. In connection with the offering of the Securities, the
Underwriter may prepare and provide to prospective investors Free
Writing
Prospectuses, or portions thereof, which the Company is required to
file with
the Commission in electronic format and will use reasonable efforts
to provide
to the Company such Free Writing Prospectuses, or portions thereof,
in either
Microsoft Word(R) or Microsoft Excel(R) format and not in a PDF,
except to the
extent that the Company, in its sole discretion, waives such
requirements,
subject to the following conditions (to which such conditions the
Underwriter
agrees):
(i) "Business Day" shall mean any day other than (i) a
Saturday or Sunday or (ii) a day on which banking
institutions in the State of New York or the jurisdiction in
which the offeree is located are required or authorized by
law or executive order
to be closed.
(ii) Unless preceded or accompanied by the Base
Prospectus, the Underwriter shall not convey or deliver any
written communication to any person in connection with the
initial offering of the Securities, unless such written
communication (1) is made in reliance on Rule 134 of the
Securities Act Regulations, (2) constitutes a prospectus
satisfying the requirements of Rule 430B of the Securities
Act Regulations or (3) constitutes a Free Writing Prospectus
and such Free Writing Prospectus is attached to this
Agreement as Schedule B. The Underwriter shall not convey or
deliver in connection with the initial offering of the
Securities any "ABS informational and computational
material," as defined in Item 1101(a) of Regulation AB of
the
Securities Act Regulations ("ABS Informational and
Computational Material"), in reliance upon Rules 167 and 426
of the Securities Act Regulations in lieu of a free writing
prospectus.
<PAGE>
(iii) The Underwriter shall deliver to the Depositor,
(a) no later than two Business Days prior to the date of
first use thereof, any Free Writing Prospectus prepared by
or on behalf of such Underwriter that contains any "issuer
information," as defined in Rule 433(h) of the Securities
Act Regulations and footnote 271 of the Commission's
Securities Offering Reform Release No. 33-8591 ("Issuer
Information") (which the parties hereto agree includes,
without limitation, Pool Information (as defined herein)),
and (b) upon first use, any Free Writing Prospectus or
portion thereof that contains only a description of the
final terms of the Securities. Notwithstanding the
foregoing, any Free Writing Prospectus that contains only
ABS Informational and Computational Materials shall be
delivered by any Underwriter to the Company not later than
the later of (a) two Business Days prior to the due date for
filing of the Prospectus pursuant to Rule 424(b) of the
Securities Act Regulations and (b) the date of first use of
such Free Writing Prospectus.
(iv) The Underwriter represents and warrants to the
Company that the Free Writing Prospectuses to be furnished
to the Company by the Underwriter pursuant to Section
3(b)(ii) above will constitute all Free Writing Prospectuses
of the type described in such Section that were furnished to
prospective investors by such Underwriter in connection with
its offer and sale of the Securities.
(v) The Underwriter represents and warrants to the
Company that each Free Writing Prospectus required to be
provided by it to the Company pursuant to Section 3(b)(ii)
above, did not, as of the Time of Sale, and will not as of
the Closing Date, include any untrue statement of a material
fact or, when read in conjunction with the other information
included in the Disclosure Package, omit any material fact
necessary to make the statements contained therein, in light
of the circumstances under which they were made, not
misleading; provided however, that such Underwriter makes no
representation to the extent such misstatements or omissions
were the result of any inaccurate Issuer Information
supplied by the Company to such Underwriter, which
information was not corrected by Corrective Information
subsequently supplied by the Company to the Underwriter
prior to the Time of Sale.
(vi) The Company agrees to file with the Commission
the following:
(a) Any Free Writing Prospectus or portion
thereof delivered by the Underwriter to the Company
pursuant to Article IV(B)(ii); and
(b) Any Free Writing Prospectus for which the
Company or any person acting on its behalf provided,
authorized or approved information that is prepared
and published or disseminated by a person unaffiliated
with the Company or any other offering participant
that is in the business of publishing, radio or
television broadcasting or otherwise disseminating
communications.
<PAGE>
(vii) Any Free Writing Prospectus required to be filed
pursuant to Article IV(B)(v) by the Company shall be filed
with the Commission not later than the date of first use of
the Free Writing Prospectus, except that:
(a) Any Free Writing Prospectus or portion
thereof required to be filed that contains only the
description of the final terms of the Securities shall
be filed by the Company with the Commission within two
days of the
later of the date such final terms have
been established for all classes of Securities and the
date of first use;
(b) Any Free Writing Prospectus or portion
thereof required to be filed that contains only ABS
Informational and Computational Material shall be
filed by the Company with the Commission not later
than the later of the due date for filing the final
Prospectus relating to the Securities pursuant to Rule
424(b) of the Securities Act Regulations and two
Business Days after the first use of such Free Writing
Prospectus;
(c) Any Free Writing Prospectus required to be
filed pursuant to Article IV(B)(v)(b) shall, if no
payment has been made or consideration has been given
by or on behalf of the Company for the Free Writing
Prospectus or its dissemination, be filed by the
Company with the Commission not later than four
Business Days after the Company becomes aware of the
publication, radio or television broadcast or other
dissemination of the Free Writing Prospectus; and
(d) The Company shall not be required to file
(1) Issuer Information contained in any Free Writing
Prospectus of an Underwriter or any other offering
participant other than the Company, if such
information is included or incorporated by reference
in a prospectus or Free Writing Prospectus previously
filed with the Commission that relates to the offering
of
the Securities or (2) any Free Writing Prospectus
or portion thereof that contains a description of the
Securities or the offering of the Securities which
does not reflect the final terms thereof.
(viii) The Underwriter shall file with the Commission
any Free Writing Prospectus that is used or referred to by
it and distributed by or on behalf of the Underwriter in a
manner reasonably designed to lead to its broad,
unrestricted dissemination not later than the date of the
first use of such Free Writing Prospectus.
(ix) Notwithstanding the provisions of Article
IV(B)(vii), the Underwriter shall file with the Commission
any Free Writing Prospectus for which such Underwriter or
any person acting on its behalf provided, authorized or
approved information that is prepared and published or
disseminated by a person unaffiliated with the Company or
any other offering participant that is in the business of
publishing, radio or television broadcasting or otherwise
disseminating written communications and for which no
payment was made or
<PAGE>
consideration given by or on behalf of the Company or
any other offering participant, not later than four Business
Days after such Underwriter becomes aware of the
publication, radio or television broadcast or other
dissemination of the Free Writing Prospectus.
(x) Notwithstanding the provisions of Articles
IV(B)(v) and IV(B)(vii), neither the Company nor any
Underwriter shall be required to file any Free Writing
Prospectus that does not contain substantive changes from or
additions to a Free Writing Prospectus previously filed with
the Commission.
(xi) The Company and each Underwriter each agree that
any Free Writing Prospectuses prepared by it shall contain
the following legend:
"The depositor has filed a registration statement
(including a prospectus) with the SEC for the
offering to which this communication relates.
Before you invest, you should read the prospectus
in that registration statement and other documents
the depositor has filed with the SEC for more
complete information about the issuing entity and
this offering. You may get these documents for free
by visiting EDGAR on the SEC Web site at
www.sec.gov. Alternatively, the depositor, any
underwriter or any dealer participating in the
offering will arrange to send you the prospectus if
you request it by calling toll-free 1-866-718-1649."
(xii) The Company and each Underwriter agree to retain
all Free Writing Prospectuses that they have used and that
are not required to be filed pursuant to this Article IV for
a
period of three years following the initial bona fide
offering of the Securities.
(a) In the event that any Underwriter becomes
aware that, as of the Time of Sale, any Free Writing
Prospectus prepared by or on behalf of such
Underwriter and delivered to such investor contained
any untrue statement of a material fact or, when read
in conjunction with the other information included in
the Disclosure Package, omitted to state a material
fact necessary in order to make the statements
contained therein, in the light of the circumstances
under which they were made, not misleading (such Free
Writing Prospectus, a "Defective Free Writing
Prospectus"), such Underwriter shall notify the
Company
thereof within one Business Day after
discovery.
(b) Provided that the Defective Free Writing
Prospectus was an Issuer Free Writing Prospectus or
contained Issuer Information, such Underwriter shall,
if requested by the Company:
(1) Prepare a Free Writing Prospectus with
Corrective Information that corrects the material
misstatement
