Exhibit 1
MORGAN STANLEY ABS CAPITAL I INC.
MORTGAGE PASS-THROUGH CERTIFICATES
Series 2007-HE1
UNDERWRITING AGREEMENT
<PAGE>
New York, New York
January 24, 2007
Morgan Stanley & Co. Incorporated
as Representative of the Underwriters
1585 Broadway
New York, New York 10036
Dear Sirs:
Morgan Stanley ABS Capital I Inc., a Delaware corporation (the
"Company"), proposes to sell to you, Morgan Stanley & Co.
Incorporated, as
representative (the "Representative") of yourself and Countrywide
Securities
Corporation ("CSC" and together with the Representative, the
"Underwriters")
Morgan Stanley ABS Capital I Inc. Trust 2007-HE1 Mortgage
Pass-Through
Certificates, Series 2007-HE1 in the original principal amount and
with the
designation described on Schedule A attached hereto (the
"Offered
Certificates"). The Offered Certificates will be issued pursuant to
a pooling
and servicing agreement dated as of January 1, 2007 (the "Pooling
and Servicing
Agreement") among Morgan Stanley ABS Capital I Inc., as depositor
(the
"Depositor"), Countrywide Home Loans Servicing LP, as a servicer
("Countrywide
Servicing"), Saxon Mortgage Services, Inc., as a servicer (together
with
Countrywide Servicing, the "Servicers"), NC Capital Corporation, as
a
responsible party ("NC Capital"), Decision One Mortgage Company,
LLC, as a
responsible party (together with NC Capital, the "Responsible
Parties"), LaSalle
Bank National Association, as a custodian (the "Custodian") and
Deutsche Bank
National Trust Company, as trustee (the "Trustee"). In addition to
the Offered
Certificates, the Depositor will authorize for issuance the
Mortgage
Pass-Through Certificates, Series 2007-HE1, Class X, Class P, Class
R and Class
RX pursuant to the Pooling and Servicing Agreement (together with
the Offered
Certificates, the "Certificates").
The Company has filed with the Securities and Exchange
Commission
(the "Commission") a registration statement, including information
that is
contained in the Prospectus (as defined below) relating to the
Offered
Certificates and is deemed to be part of and included in such
registration
statement, and has filed with, or transmitted for filing to, the
Commission a
prospectus supplement specifically relating to the Offered
Certificates pursuant
to Rule 424 under the Securities Act of 1933 (the "Securities
Act"). The term
"Registration Statement" means such registration statement as such
registration
statement, including the exhibits thereto and information that is
contained in
the Prospectus and is deemed to be part of and included in such
registration
statement, may have been amended or supplemented at the date of the
Prospectus.
The prospectus first required to be filed to satisfy the condition
set forth in
Rule 172(c) and pursuant to Rule 424(b) under the Securities Act,
is hereinafter
called the "Base Prospectus"; such form of supplement to the Base
Prospectus
relating to the Certificates, in the form first required to be
filed to satisfy
the condition set forth in Rule 172(c) and pursuant to Rule 424(b)
under the
Securities Act (including the Base Prospectus as so supplemented)
is hereinafter
called the "Prospectus Supplement"; and the Base Prospectus and the
Prospectus
Supplement, together, are hereinafter called the "Prospectus".
Capitalized terms
not otherwise defined in this Agreement are used herein as defined
in the
Pooling and Servicing Agreement.
At or prior to the time when sales to investors of the Offered
Certificates were first made (the "Time of Sale"), the Company had
prepared the
following information (collectively, the "Time of Sale
Information"): the Morgan
Stanley ABS Capital I Inc. Trust 2007-HE1 Free Writing Prospectus,
dated January
10, 2007, the Company's Prospectus, dated September 21, 2006, and
any other
"free-writing prospectus" (as defined pursuant to Rule 405 under
the Securities
Act (as defined herein)) (a "Free Writing Prospectus") listed on
Schedule C
hereto. If, subsequent to the date of this Agreement, the Company
and the
Underwriters determine that such information 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 Offered
Certificates,
then "Time of Sale Information" 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") and "Time of Sale" will refer to the
time and date on
which such new purchase contracts were entered into.
I.
A. The Company represents and warrants to, and agrees with, the
Underwriters 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, and the Prospectus Supplement and each Free Writing
Prospectus
required to be filed by the Company pursuant to Section III.B.(e)
shall have
been filed or transmitted for filing by means reasonably calculated
to result in
a filing with the Commission pursuant to Rule 424(b) under the
Securities Act or
Rule 433 under the Securities Act, as applicable.
(b) (i) Each part of the Registration Statement, when such part
became or was deemed to become 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 and the Prospectus comply, and, as amended
or
supplemented, if applicable, will comply, as of its effective date
or deemed
effective date pursuant to Rule 430B under the Securities Act, in
all material
respects with the Securities Act and the applicable rules and
regulations of the
Commission thereunder and (iii) 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.A.(b) do not apply to the information set forth in the
fourth full
paragraph under the heading "Plan of Distribution" in the
Prospectus Supplement
or any other information contained in the Registration Statement,
the
Prospectus, the Time of Sale Information or any revision or
amendment thereof or
supplement thereto based upon and in conformity with information
furnished in
writing to the Company by any Underwriter specifically for use in
connection
with the preparation of the Registration Statement, the Prospectus,
the Time of
Sale Information or any revision or amendment thereof or supplement
thereto
(such information or statements described in the exception above
being
collectively referred to as "Underwriter Statements").
(c) The Time of Sale Information, at the Time of Sale, did not,
and at the Closing Date will not, contain any untrue statement of a
material
fact or omit 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; provided that the Company makes no representation or
warranty with
respect to any statements or omissions made in reliance upon and in
conformity
with the Underwriter Statements.
(d) Other than the Prospectus, the Company (including its
agents
and representatives other than the Representative in its capacity
as such) has
not made, used, prepared, authorized, approved or referred to and
will not make,
use, prepare, authorize, approve or refer to any "written
communication" (as
defined in Rule 405 under the Securities Act) that constitutes an
offer to sell
or solicitation of an offer to buy the Offered Certificates other
than (i) any
document not constituting a prospectus pursuant to Section
2(a)(10)(a) of the
Securities Act or Rule 134 under the Securities Act, (ii) the Time
of Sale
Information, and (iii) each other written communication of the
Company or its
agents and representatives approved in writing in advance by the
Underwriters or
in any other manner mutually agreed by the Underwriters and the
Company (each
such communication referred to in clause (ii) and this clause (iii)
constituting
an "issuer free writing prospectus", as defined in Rule 433(h)
under the
Securities Act, being referred to as an "Issuer Free Writing
Prospectus"). Each
such Issuer Free Writing Prospectus complied or, if used after the
date hereof,
will comply in all material respects with the Securities Act, has
been filed or
will be filed in accordance with Section III (to the extent
required thereby)
and did not at the Time of Sale, and at the Closing Date will not,
contain any
untrue statements of a material fact or (when read in conjunction
with the other
Time of Sale Information) omit 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; provided that the Company makes no
representation and
warranty with respect to any statements or omissions made in
reliance upon and
in conformity with any Underwriter Statements.
(e) 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 Prospectus and the Time of Sale
Information and to
enter into and perform its obligations under this Agreement and the
Pooling and
Servicing Agreement.
(f) This Agreement has been duly authorized, executed and
delivered by the Company.
(g) The Pooling and Servicing Agreement 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.
(h) The direction by the Company to the Trustee to execute,
authenticate and deliver the Offered Certificates has been duly
authorized by
the Company, and the Offered Certificates, when executed and
authenticated in
the manner contemplated in the Pooling and Servicing Agreement, and
delivered to
and paid for by the Underwriters 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.
(i) Neither the execution and delivery by the Company of, nor
the
performance by the Company of its obligations under, this Agreement
or the
Pooling and Servicing Agreement, 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 and the Pooling and Servicing Agreement, 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 Offered Certificates.
(j) 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 or the Time of Sale Information.
(k) 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 Prospectus or the Time of Sale Information or
necessary in order
to make the statements therein in the light of the circumstances
under which
they were made, not misleading 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 Prospectus or the Time of Sale
Information or to
be filed as exhibits to the Registration Statement that are not
described or
filed as required.
(l) 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.
(m) 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.
(n) The Company is not, and on the date on which the first bona
fide offer of the Offered Certificates is made (within the meaning
of Rule
164(h)(2) under the Securities Act) will not be, an "ineligible
issuer", as
defined in Rule 405 under the Securities Act.
II.
The Company hereby agrees to sell the Offered Certificates to
each of the Underwriters, and each of the Underwriters, upon the
basis of the
representations and warranties herein contained, but subject to the
conditions
hereinafter stated, severally and not jointly agrees to purchase
the Offered
Certificates from the Company, for a purchase price which is 99.70%
of the sum
of the original Class Certificate Balances of the Offered
Certificates as set
forth on Schedule A hereto, in accordance with the allocation set
forth on
Schedule B hereto.
III.
A. The Underwriters propose to make a public offering of the
Offered Certificates as soon as this Agreement is entered into. The
terms of the
public offering of the Offered Certificates are set forth in the
Prospectus and
the Time of Sale Information.
B. In connection with the offering of the Certificates, the
Underwriters may prepare and provide to prospective investors Free
Writing
Prospectuses (as defined below), 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 Underwriters agree (provided that the Underwriters
shall not be
responsible for any breach of the following conditions by any other
Underwriter
or underwriter)):
(a) Unless preceded or accompanied by the Prospectus, the
Underwriters shall not convey or deliver any written communication
to any person
in connection with the initial offering of the Offered
Certificates, unless such
written communication (1) is made in reliance on Rule 134 under the
Securities
Act, (2) constitutes a prospectus satisfying the requirements of
Rule 430B under
the Securities Act or (3) constitutes Time of Sale Information or a
Free Writing
Prospectus that does not constitute Time of Sale Information.
Without the
Company's prior written consent, the Representative shall not
convey or deliver
in connection with the initial offering of the Offered Certificates
any "ABS
informational and computational material," as defined in Item
1101(a) of
Regulation AB under the Securities Act ("ABS Informational and
Computational
Material"), in reliance upon Rules 167 and 426 under the Securities
Act. Without
the Company's and the Representative's prior written consent, CSC
shall not
convey or deliver in connection with the initial offering of the
Offered
Certificates any ABS Informational and Computational Material, in
reliance upon
Rules 167 and 426 under the Securities Act.
(b) The Underwriters shall deliver to the Company, no later
than
two business days prior to the date of first use thereof or such
later date as
may be agreed to by the Company, (a) any Free Writing Prospectus
that was
prepared by or on behalf of any Underwriter (an "Underwriter Free
Writing
Prospectus") and contains any "issuer information", as defined in
Rule 433(h)
under the Securities Act and footnote 271 of the Commission's
Securities
Offering Reform Release No. 33-8591 ("Issuer Information"), and (b)
any Free
Writing Prospectus or portion thereof that contains only a
description of the
final terms of the Offered Certificates. CSC shall not prepare or
distribute any
Underwriter Free Writing Prospectus without the prior written
consent of
Representative. Notwithstanding the foregoing, any Free Writing
Prospectus that
contains only ABS Informational and Computational Materials may 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) under
the Securities Act or (B) the date of first use of such Free
Writing Prospectus.
(c) The Underwriters represent and warrant to the Company that
the Free Writing Prospectuses to be furnished to the Company by the
Underwriters
pursuant to Section III.B.(b) will constitute all Free Writing
Prospectuses of
the type described therein that were furnished to prospective
purchasers of
Offered Certificates by the Underwriters in connection with its
offer and sale
of the Offered Certificates.
(d) The Underwriters represent and warrant to the Company that
each Free Writing Prospectus required to be provided by it to the
Company
pursuant to Section III.B.(b), when read in conjunction with the
Time of Sale
Information, 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 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
the Underwriters make no representation to the extent such
misstatements or
omissions were the result of any inaccurate Issuer Information,
which
information was not corrected by Corrective Information
subsequently supplied by
the Company to the Underwriters within a reasonable period of time
prior to the
Time of Sale.
(e) The Company agrees to file with the Commission the
following:
(A) any Issuer Free Writing Prospectus; (B) any Free Writing
Prospectus or
portion thereof delivered by the Underwriters to the Company
pursuant to Section
III.B.(b); and (C) 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.
Notwithstanding the foregoing, the Company shall not be required to
file (1)
Issuer Information contained in any Underwriter Free Writing
Prospectus or Free
Writing Prospectus of 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 Offered Certificates, or (2) any Free Writing
Prospectus or
portion thereof that contains a description of the Offered
Certificates or the
offering of the Offered Certificates which does not reflect the
final terms
thereof.
(f) Any Free Writing Prospectus required to be filed pursuant
to
Section III.B.(e) 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 Offered Certificates
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
Offered
Certificates 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 Offered Certificates pursuant to Rule 424(b) under the
Securities Act or two
business days after the first use of such Free Writing Prospectus;
and (C) any
Free Writing Prospectus required to be filed pursuant to Section
III.B.(e)(C)
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.
(g) Each 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 any 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. Notwithstanding the foregoing, each
Unde
