Unassociated Document


     

     

     

    MORGAN
      STANLEY ABS CAPITAL I INC. TRUST 2006-NC4

     

     

    _____________________

     

     

    AMENDMENT
      NO. 1 TO POOLING AND SERVICING AGREEMENT

     

    Dated
      as
      of November 7, 2006 

     

     

     

    _________________________

     

    Morgan
      Stanley ABS Capital I Inc. Trust 2006-NC4

    


    Mortgage
      Pass-Through Certificates, Series 2006-NC4

    


     

     

    AMENDMENT
      NO. 1

     

    AMENDMENT
      NO. 1 (this “Amendment”) effective as of June 1, 2006, among Morgan Stanley ABS
      Capital I Inc., as depositor (the “Depositor”), Wells Fargo Bank, N.A., as a
      servicer (“Wells Fargo”), New Century Mortgage Corporation, as a servicer (“New
      Century” and together with Wells Fargo, the “Servicers”), NC Capital
      Corporation, as responsible party (the “Responsible Party”) and Deutsche Bank
      National Trust Company, as trustee (the “Trustee”).

     

    PRELIMINARY
      STATEMENT

     

    WHEREAS,
      the Depositor, the Servicers, the Responsible Party and the Trustee, are parties
      to the Pooling and Servicing Agreement, dated as of June 1, 2006 (the
“Agreement”);

     

    WHEREAS,
      Section 10.01 of the Agreement provides that the Agreement may be amended by
      the
      Depositor, the Servicers, the Responsible Party and the Trustee;
      and

     

    NOW,
      THEREFORE, in consideration of the foregoing and of other good and valuable
      consideration, the receipt and sufficiency of which is hereby acknowledged,
      the
      parties hereto agree as follows:

     

    1.  Capitalized
      terms used but not defined herein shall have the meanings ascribed to such
      terms
      in the Agreement.

     

    2.  Amendment:
      In
      consideration of the mutual agreements herein contained, the receipt and
      sufficiency of which are hereby acknowledged, the parties hereto agree to amend
      the Agreement as provided in Exhibit A, attached hereto. Language appearing
      double underlined on Exhibit A will be added to the Agreement and language
      appearing in strikethrough will be removed from the Agreement.

     

    3.  Except
      as
      expressly modified or amended in this Amendment, all of the terms, covenants,
      provisions, agreements and conditions of the Agreement are hereby ratified
      and
      confirmed in every respect and shall remain unmodified and unchanged and shall
      continue in full force and effect.

     

    4.  The
      Depositor certifies that all conditions for the execution of this Amendment
      have
      been satisfied.

     

    5.  This
      Amendment shall become effective as of the date hereof when, and only when,
      the
      Agent shall have received executed counterparts of this Amendment from the
      parties hereto. 

     

    6.  This
      Amendment may be executed in counterparts, each of which shall be an original
      but all of which, taken together, shall constitute one and the same instrument.
      This Amendment shall be construed in accordance with the laws of the State
      of
      New York (excluding provisions regarding conflicts of laws) and the obligations,
      rights and remedies of the parties hereunder shall be determined in accordance
      with such laws.

    
 

    IN
      WITNESS WHEREOF, the parties have duly executed this Amendment No. 1 as of
      the
      date first above written.

    
      	 	 	 
	 	
              MORGAN
                STANLEY ABS CAPITAL I INC.,

              as
                Depositor

            
	 
 	 
 	 
 
	 	 	
              By:         
                /s/
                Steven Shapiro

            
	 	
              
                

              

            
	 	
              Name:    
                Steven
                Shapiro
                
                  Title:      
                    Managing
                    Director

                

              

            


    

     

    
      
        	 	 	 
	 	
                
                  NC
                    CAPITAL CORPORATION, as Responsible 

                  Party

                

              
	 
 	 
 	 
 
	 	 	
                By:         
                  /s/
                  Kevin Cloyd

              
	 	
                
                  

                

              
	 	
                Name:    
                  Kevin
                  Cloyd
                  
                    Title:      
                      President

                  

                

              


      

       

    

    
      
        	 	 	 
	 	
                
                  NEW
                    CENTURY MORTGAGE 

                  CORPORATION,
                    as a Servicer

                

              
	 
 	 
 	 
 
	 	 	
                By:         
                  /s/
                  Kevin Cloyd

              
	 	
                
                  

                

              
	 	
                Name:    
                  Kevin
                  Cloyd
                  
                    Title:      
                      President

                  

                

              


      

    

     

    
      
        	 	 	 
	 	
                
                  WELLS
                    FARGO BANK, N.A., as a Servicer

                

              
	 
 	 
 	 
 
	 	 	
                By:         
                  /s/
                  Laurie McGoogan

              
	 	
                
                  

                

              
	 	
                Name:    
                  Laurie
                  McGoogan
                  
                    Title:      
                      Vice
                      President

                  

                

              


      

    

    

      
        	 	 	 
	 	
                
                  
                    DEUTSCHE
                      BANK NATIONAL TRUST

                    COMPANY,
                      as Trustee

                  

                

              
	 
 	 
 	 
 
	 	 	
                By:         
                  /s/
                  Barbara Campbell

              
	 	
                
                  

                

              
	 	
                Name:    
                  Barbara
                  Campbell
                  
                    Title:      
                      Vice
                      President

                  

                

              


      

    

    
      	 	 	 
	 	
              
                
                   

                

              

            
	 
 	 
 	 
 
	 	 	
              By:         
                /s/
                Melissa Wilman

            
	 	
              
                

              

            
	 	
              Name:    
                Melissa
                Wilman
                
                  Title:      
                    Vice
                    President

                

              

            


    

    
 

    

      Exhibit
        A

      


      Section
        10.07   Assignment;
        Sales; Advance Facilities162

      Section
        10.08   Limitation
        on Rights of Certificateholders163

      Section
        10.09   Inspection
        and Audit Rights164

      Section
        10.10   Certificates
        Nonassessable and Fully Paid164

      Section
        10.11   Rule
        of
        Construction164

      Section
        10.12   Waiver
        of
        Jury Trial164

      Section
        10.13   Rights
        of
        the Swap Provider164

      Section
        10.14   Regulation
        AB Compliance; Intent of the Parties; Reasonableness.164

      


      SCHEDULES

       

      
        	Schedule
                I	
                Mortgage
                  Loan Schedule

              


      

      
        	Schedule
                II	
                Representations
                  and Warranties of New Century Mortgage Corporation, as
                  Servicer

              


      

      
        	Schedule
                III	
                Representations
                  and Warranties of the Responsible Party as to the Mortgage
                  Loans

              


      

      
        	Schedule
                IV	
                Representations
                  and Warranties of the Responsible Party as to the Responsible
                  Party

              


      

      
        	Schedule
                V	
                Representations
                  and Warranties of Morgan Stanley ABS Capital I Inc. as to the Mortgage
                  Loans

              


      

      
        	Schedule
                VI	
                Representations
                  and Warranties of Wells Fargo Bank, N.A., as
                  Servicer

              


      

       

      EXHIBITS

       

      
        	Exhibit
                A	
                Form
                  of Class A, Class M and Class B
                  Certificate

              


      

      
        	Exhibit
                B	
                Form
                  of Class P Certificate

              


      


        
          	Exhibit
                  C	
                  Form
                    of Class
                    R CertificateResidualCertificates

                


        


      
        	
                Exhibit
                  D

              	
                Form
                  of Class X Certificate

              


      

      
        	Exhibit
                E	
                Form
                  of Initial Certification of Trustee

              


      

      
        	Exhibit
                F	
                Form
                  of Document Certification and Exception Report of
                  Trustee

              


      

      
        	Exhibit
                G	
                Form
                  of Residual Transfer Affidavit

              


      

      
        	Exhibit
                H	
                Form
                  of Transferor Certificate

              


      

      
        	Exhibit
                I	
                Form
                  of Rule 144A Letter

              


      

      
        	Exhibit
                J	
                Form
                  of Request for Release

              


      

      
        	Exhibit
                K	
                Form
                  of Contents for Each Mortgage File

              


      

      
        	Exhibit
                L	
                Form
                  of Certification to be provided with Form
                  10-K

              


      

      
        	Exhibit
                M	
                Form
                  of Certification to be provided by the Trustee to be provided to
                  Depositor

              


      

      
        	Exhibit
                N	
                Form
                  of Certification of the Servicer to be provided by the applicable
                  Servicer
                  to Depositor

              


      

      
        	Exhibit
                O	
                Form
                  of Servicer Power of Attorney

              


      

      
        	Exhibit
                P	
                Servicing
                  Criteria

              


      

      
        	Exhibit
                Q	
                Additional
                  Form 10-D Disclosure

              


      

      
        	Exhibit
                R	
                Additional
                  Form 10-K Disclosure

              


      

      
        	Exhibit
                S	
                Form
                  8-K Disclosure Information

              


      

       

       

      REMIC
        III

       

      As
        provided herein, the Trustee will make an election to treat the segregated
        pool
        of assets consisting of the REMIC II Regular Interests as a REMIC for federal
        income tax purposes, and such segregated pool of assets will be designated
        as
“REMIC III”. The R-III Interest will represent the sole class of “residual
        interests” in REMIC III for purposes of the REMIC Provisions. The following
        table irrevocably sets forth the Class designation, Pass-Through Rate and
        Initial Certificate Principal Balance for each Class of Certificates that
        represents one or more of the “regular interests” in REMIC III created
        hereunder:

      


          
            	
                    Class
                      Designation

                  	 	
                    Initial
                      Certificate

                    Principal
                      Balance

                  	 	
                    Pass-Through
                      Rate

                  	 	
                    Assumed
                      Final 

                    Distribution
                      Date(1)

                  
	
                    Class
                      A-1

                  	 	
                    $    536,150,000.00 

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      A-2a

                  	 	
                    $    575,060,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      A-2b

                  	 	
                    $    182,020,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      A-2c

                  	 	
                    $    234,060,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      A-2d

                  	 	
                    $    145,570,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      M-1

                  	 	
                    $    102,464,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      M-2

                  	 	
                    $    100,307,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      M-3

                  	 	
                    $     
                      34,514,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      M-4

                  	 	
                    $     
                      38,829,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      M-5

                  	 	
                    $     
                      34,514,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      M-6

                  	 	
                    $     
                      30,200,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      B-1

                  	 	
                    $     
                      31,279,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      B-2

                  	 	
                    $     
                      23,729,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      B-3

                  	 	
                    $     
                      22,650,000.00

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      XInterest(3)

                  	 	
                    $     
                      65,793,943.63

                  	 	
                    (2)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      PInterest

                  	 	
                    $                 
                      100.00

                  	 	
                    N/A(4)

                  	 	
                    March
                      25, 2036

                  
	
                    Class
                      IO Interest

                  	 	
                    (5)

                  	 	
                    (6)

                  	 	
                    March
                      25, 2036

                  


          


      

      Class
        IO
        Interest  (5) (6) March
        25,
        2036

      
        	(1)	
                For
                  purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
                  regulations.

              


      

      
        	(2)	
                Calculated
                  in accordance with the definition of “Pass-Through Rate”
                  herein.

              


      


        
          	(3)	
                  The
                    Class X CertificatesInterest
                    will not accrue interest on their Certificate Principal Balance,
                    but will
                    accrue interest at the Class X Pass-Through Rate on the Certificate
                    Notional Balance of the Class X CertificatesInterest
                    outstanding from time to time which shall equal the aggregate
                    of the
                    Uncertificated Principal Balances of the REMIC II Regular Interests
                    (other
                    than REMIC II Regular Interest LT-P).


                


        



        
          	
                  (4)

                	
                  The
                    Class P CertificatesInterest will not be entitled
                    to distributions of interest.

                


        


      
        	
                (5)

              	
                For
                  federal income tax purposes, the Class IO Interest will not have
                  a
                  Pass-Through Rate, but will be entitled to 100]% of the amounts
                  distributed on REMIC II Regular Interest LT-IO.


              


      

      
        	(6)	
                For
                  federal income tax purposes, the Class IO Interest will not have
                  an
                  Uncertificated Principal Balance, but will have a notional amount
                  equal to
                  the Uncertificated Notional Amount of REMIC II Regular Interest
                  IO.

              


      

      
 

      REMIC
        IV

       


        As
          provided herein, the Trustee will make an election to treat the segregated
          pool
          of assets consisting of the Class X Interest as a REMIC for federal income
          tax
          purposes, and such segregated pool of assets will be designated as “REMIC IV”.
          The R-IV Interest will represent the sole class of “residual interests” in REMIC
          IV for purposes of the REMIC Provisions. The following table irrevocably
          sets
          forth the Class designation, Pass-Through Rate and Initial Certificate
          Principal
          Balance for each Class of Certificates that represents one or more of the
          “regular interests” in REMIC IV created hereunder:


      


          
            	
                    
                      Class
                        Designation

                    

                  	
                    
                      
                        Initial
                          Certificate

                      

                      Principal
                        Balance

                    

                  	
                    Pass-Through
                      Rate

                  	
                    Assumed
                      Final Distribution Date(1)

                  
	
                    Class
                      X

                  	
                    
                      $    65,793,943.63

                    

                  	
                    (2)

                  	
                    March
                      25, 2036

                  
	
                    (1)  
                      For
                      purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
                      the
                      Distribution Date in the second month following the maturity
                      date for the
                      Mortgage Loan with the latest maturity date has been designated
                      as the
                      “latest possible maturity date” for the Class X
                      Certificates.

                  
	
                    (2)  
                      The
                      Class X Certificates will be entitled to 100% of amounts distributed
                      on
                      the Class X
                      Interest.

                  


          


      

       


      REMIC
        V

       


        As
          provided herein, the Trustee will make an election to treat the segregated
          pool
          of assets consisting of the Class P Interest as a REMIC for federal income
          tax
          purposes, and such segregated pool of assets will be designated as “REMIC V”.
          The R-V Interest will represent the sole class of “residual interests” in REMIC
          V for purposes of the REMIC Provisions. The following table irrevocably
          sets
          forth the Class designation, Pass-Through Rate and Initial Certificate
          Principal
          Balance for each Class of Certificates that represents one or more of the
          “regular interests” in REMIC V created hereunder:

         



        
          	
                  
                    Class
                      Designation

                  

                	
                  
                    
                      Initial
                        Certificate

                    

                    Principal
                      Balance

                  

                	
                  Pass-Through
                    Rate

                	
                  Assumed
                    Final Distribution Date(1)

                
	
                  Class
                    P

                	
                  
                    $    100

                  

                	
                  (2)

                	
                  March
                    25, 2036

                
	
                  (1)  
                    For
                    purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
                    the
                    Distribution Date in the second month following the maturity
                    date for the
                    Mortgage Loan with the latest maturity date has been designated
                    as the
                    “latest possible maturity date” for the Class P
                    Certificates.

                
	
                  (2)  
                    The
                    Class P Certificates will be entitled to 100% of amounts distributed
                    on
                    the Class P Interest.


                


        


      
 

      REMIC
        VI

       


        As
          provided herein, the Trustee will make an election to treat the segregated
          pool
          of assets consisting of the Class IO Interest as a REMIC for federal income
          tax
          purposes, and such segregated pool of assets will be designated as “REMIC VI”.
          The R-VI Interest will represent the sole class of “residual interests” in REMIC
          VI for purposes of the REMIC Provisions. The following table irrevocably
          sets
          forth the Class designation, Pass-Through Rate and Initial Certificate
          Principal
          Balance for each Class of Certificates that represents one or more of the
          “regular interests” in REMIC VI created hereunder:

         


      

          
            	
                    
                      Class
                        Designation

                    

                  	
                    
                      
                        Initial
                          Certificate

                      

                      Principal
                        Balance

                    

                  	
                    Pass-Through
                      Rate

                  	
                    Assumed
                      Final Distribution Date(1)

                  
	
                    Swap-IO

                  	
                    
                      $    (2)

                    

                  	
                    (3)

                  	
                    March
                      25, 2036

                  
	
                    (1)  
                      For
                      purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
                      the
                      Distribution Date in the second month following the maturity
                      date for the
                      Mortgage Loan with the latest maturity date has been designated
                      as the
                      “latest possible maturity date” for the REMIC VI Regular Interest
                      Swap-IO.

                  
	
                    (2)  
                      REMIC
                      VI Regular Interest Swap-IO will not have a Certificate Notional
                      Balance
                      but will be entitled to 100% of amounts distributed on the
                      Class IO
                      Interest.

                  
	
                    (3)  
REMIC
                      VI Regular Interest Swap-IO will be entitled to 100% of amounts
                      distributed on the Class IO Interest.


                  


          


         

      

       

        The
          minimum denomination for each Class of Certificates, other than the Class
          P,
          Class R,
          Class R-X
          and the
          Class X Certificates, will be $25,000 with integral multiples of $1 in
          excess
          thereof. The minimum denomination for the Class P and the Class X Certificates
          will each be a 1% Percentage Interest in such Class. The Class R Certificateand
          Class R-X Certificates
          will
          represent a 100% Percentage Interest in such Class.


       

      It
        is
        expected that each Class of Certificates will receive its final distribution
        of
        principal and interest on or prior to the Final Scheduled Distribution
        Date.

       

      Set
        forth
        below are designations of Classes of Certificates to the categories used
        herein:

       

      
        	
                Book-Entry
                  Certificates

              	 	
                All
                  Classes of Certificates other than the Physical
                  Certificates.

              


      

       

      
        	
                Class
                  A Certificates

              	 	
                Class
                  A-1, Class A-2a, Class A-2b, Class A-2c and Class
                  A-2d.

              


      

       

      
        	
                Delay
                  Certificates

              	 	
                None.

              


      

       

      ERISA-Restricted


        
          	
                  Certificates

                	 	
                  Class
                    RResidual
                    Certificates, Class P Certificates and Class X Certificates;
                    any
                    certificate with a rating below the lowest applicable permitted
                    rating
                    under the Underwriters’
Exemption.

                


        


       

      
        	
                Non-Delay
                  Certificates

              	 	
                Class
                  A, Class X and Subordinated
                  Certificates.

              


      

       

      
        	
                Offered
                  Certificates

              	 	
                All
                  Classes of Certificates other than the Private
                  Certificates.

              


      


         

        
          	
                  Physical
                    Certificates

                	 	
                  Class
                    P, Class X and Class
                    RResidual
                    Certificates.

                


        



         

        
          	
                  Private
                    Certificates

                	 	
                  Class
                    P, Class X and Class
                    RResidual
                    Certificates.

                


        


       

      
        	
                Rating
                  Agencies

              	 	
                Moody’s,
                  Fitch and Standard & Poor’s.

              


      


         

        
          	
                  Regular
                    Certificates

                	 	
                  All
                    Classes of Certificates other than the Class P and Class
                    RResidual
                    Certificates.

                


        



         

        
          	
                  Residual
                    Certificates

                	 	
                  Class
                    R
                    Certificates and Class R-X
                    Certificates.

                


        


       

      
        	
                Subordinated
                  Certificates

              	 	
                Class
                  M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
                  B-1,
                  Class B-2 and Class B-3
                  Certificates.

              


      

       


        Certificates
          pursuant to Section 4.05; provided, however, that immediately following
          the
          Distribution Date on which a Subsequent Recovery is distributed, the Class
          Certificate Balances of any Class or Classes of Certificates that have
          been
          previously reduced by Applied Realized Loss Amounts will be increased,
          in order
          of seniority, by the amount of the Subsequent Recovery distributed on such
          Distribution Date (up to the amount of the Unpaid Realized Loss Amount
          for such
          Class or Classes for such Distribution Date). With respect to the Class
          X
          Certificates and any Distribution Date, the excess, if any, of (i) the
          then
          Stated Principal Balance of the Mortgage Loans over (ii) the then aggregate
          Certificate Balance of the Class A Certificates, Class M Certificates and
          the
          Class P Certificates. The Class
          RResidual
          Certificates have no Certificate Balance.


       

      “Certificate
        Owner”: With respect to a Book-Entry Certificate, the Person who is the
        beneficial owner of such Book-Entry Certificate.

       

      “Certificate
        Register”: The register maintained pursuant to Section 5.02.

       

      “Certificateholder”
        or “Holder”: The person in whose name a Certificate is registered in the
        Certificate Register, except that, solely for the purpose of giving any consent
        pursuant to this Agreement, any Certificate registered in the name of the
        Depositor or any Affiliate of the Depositor shall be deemed not to be
        Outstanding and the Percentage Interest evidenced thereby shall not be taken
        into account in determining whether the requisite amount of Percentage Interests
        necessary to effect such consent has been obtained; provided, however, that
        if
        any such Person (including the Depositor) owns 100% of the Percentage Interests
        evidenced by a Class of Certificates, such Certificates shall be deemed to
        be
        Outstanding for purposes of any provision hereof that requires the consent
        of
        the Holders of Certificates of a particular Class as a condition to the taking
        of any action hereunder. The Trustee is entitled to rely conclusively on
        a
        certification of the Depositor or any Affiliate of the Depositor in determining
        which Certificates are registered in the name of an Affiliate of the
        Depositor.

       

      “Class”:
        All Certificates bearing the same class designation as set forth in the
        Preliminary Statement.

       

      “Class
        A
        Certificates”:
        As
        specified in the Preliminary Statement.

       

      “Class
        A
        Certificate Group”: The Group I Class A Certificates or the Group II Class A
        Certificates, as applicable.

       

      “Class
        A
        Principal Allocation Percentage”: With respect to any Distribution Date, the
        percentage equivalent of a fraction, determined as follows: (A) with respect
        to
        the Group I Class A Certificates, a fraction, the numerator of which is (x)
        the
        portion of the Principal Remittance Amount for such Distribution Date that
        is
        attributable to the principal received or advanced on the Group I Mortgage
        Loans
        and the denominator of which is (y) the Principal Remittance Amount for such
        Distribution Date and (B) with respect to the Group II Class A Certificates,
        a
        fraction, the numerator of which is (x) the portion of the Principal Remittance
        Amount for such Distribution Date that is attributable to the principal received
        or advanced on the Group II Mortgage Loans and the denominator of which is
        (y)
        the Principal Remittance Amount for such Distribution Date.

       

      aggregate
        Stated Principal Balance of the Mortgage Loans for such Distribution Date
        and
        (B) the excess, if any, of the aggregate Stated Principal Balance of the
        Mortgage Loans for such Distribution Date over
        $10,785,700.22.

       

      “Class
        M-6 Certificates”:
        All
        Certificates bearing the class designation of “Class M-6,” and evidencing (i) a
        REMIC Regular Interest in REMIC III, (ii) the right to receive the related
        Basis
        Risk CarryForward Amount and (iii) the obligation to pay any Class IO
        Distribution Amount.

       

      “Class
        M-6 Principal Distribution Amount”: With respect to any Distribution Date, the
        excess of (i) the sum of (A) the aggregate Class Certificate Balances of
        the
        Class A Certificates (after taking into account the distribution of the Class
        A
        Principal Distribution Amount for such Distribution Date), (B) the Class
        Certificate Balance of the Class M-1 Certificates (after taking into account
        the
        distribution of the Class M-1 Principal Distribution Amount for such
        Distribution Date), (C) the Class Certificate Balance of the Class M-2
        Certificates (after taking into account the distribution of the Class M-2
        Principal Distribution Amount for such Distribution Date), (D) the Class
        Certificate Balance of the Class M-3 Certificates (after taking into account
        the
        distribution of the Class M-3 Principal Distribution Amount for such
        Distribution Date), (E) the Class Certificate Balance of the Class M-4
        Certificates (after taking into account the distribution of the Class M-4
        Principal Distribution Amount for such Distribution Date), (F) the Class
        Certificate Balance of the Class M-5 Certificates (after taking into account
        the
        distribution of the Class M-5 Principal Distribution Amount for such
        Distribution Date) and (G) the Class Certificate Balance of the Class M-6
        Certificates immediately prior to such Distribution Date over (ii) the lesser
        of
        (A) 86.70% of the aggregate Stated Principal Balance of the Mortgage Loans
        for
        such Distribution Date and (B) the excess, if any, of the aggregate Stated
        Principal Balance of the Mortgage Loans for such Distribution Date over
        $10,785,700.22.

       

      “Class
        P
        Certificates”: All Certificates bearing the class designation of “Class
        P”.

       


        “Class
          P Interest”: An uncertificated interest in the Trust Fund held by Trustee on
          behalf of the Holders of the Class P Certificates, evidencing a Regular
          Interest
          in REMIC III for the purposes of the REMIC provisions.


       

      “Class
        R
        Certificates”: All Certificates bearing the class designation of “Class R,” and
        evidencing ownership of the Class R-I Interest, the Class R-II Interest and
        the
        Class R-III Interest.

       


        “Class
          R-X Certificates”: All Certificates bearing the class designation of “Class
          R-X,” and evidencing the ownership of the Class R-IV Interest, the Class R-V
          Interest and the Class R-VI Interest.


       

      “Class
        R-I Interest”: The uncertificated residual interest in REMIC I.

       

      “Class
        R-II Interest”: The uncertificated residual interest in REMIC II.

       

      “Class
        R-III Interest”: The uncertificated residual interest in REMIC III.

       


        “Class
          R-IV Interest”: The uncertificated residual interest in REMIC
          IV.


       


        “Class
          R-V Interest”: The uncertificated residual interest in REMIC
          V.


       


        “Class
          R-VI Interest”: The uncertificated residual interest in REMIC
          VI.


       


        “Class
          X
          Certificate”: All Certificates bearing the designation “Class X” and evidencing
          (i) a REMIC Regular Interest in REMIC IIIIV,
          (ii)
          the obligation to pay Basis Risk Shortfall and (iii) the obligation to
          pay any
          Class IO Distribution Amount. 


       

      “Class
        X
        Distributable Amount”: On any Distribution Date, the sum of (i) as a
        distribution in respect of interest, the amount of interest that has accrued
        on
        the Class X Interest and not applied as an Extra Principal Distribution Amount
        on such Distribution Date, plus any such accrued interest remaining
        undistributed from prior Distribution Dates, plus, without duplication (ii)
        as a
        distribution in respect of principal, any portion of the principal balance
        of
        the Class X Certificates which is distributable as a Subordination Reduction
        Amount, minus (iii) any amounts paid from the Excess Reserve Fund Account
        to pay
        any Basis Risk CarryForward Amount or any Swap Termination Payment.

       


        “Class
          X Interest”: An uncertificated interest in the Trust Fund held by the trustee on
          behalf of the Holders of the Class X Certificates, evidencing a Regular
          Interest
          in REMIC III for purposes of the REMIC Provisions.


       

      “Closing
        Date”: June 23, 2006.

       

      “Closing
        Date Deposit Amount”: $196.61 deposited by the Depositor into the Distribution
        Account on the Closing Date. $0.29 of the Closing Date Deposit Amount shall
        be
        attributable to interest in respect of the Group I Mortgage Loans and $42.05
        of
        the Closing Date Deposit Amount shall be attributable to principal in respect
        of
        the Group I Mortgage Loans. $1.08 of the Closing Date Deposit amount shall
        be
        attributable to interest in respect of the Group II Mortgage Loans and $154.56
        of the Closing Date Deposit Amount shall be attributable to principal in
        respect
        of the Group II Mortgage Loans.

       

      “Code”:
        The Internal Revenue Code of 1986, including any successor or amendatory
        provisions.

       

      “Collection
        Account”: As defined in Section 3.10(a).

       

      “Combined
        Loan to Value Ratio” or “CLTV”: As of any date and as to any Second Lien
        Mortgage Loan, the ratio, expressed as a percentage, of the (a) sum of (i)
        the
        outstanding principal balance of the Second Lien Mortgage Loan and (ii) the
        outstanding principal balance as of such date of any mortgage loan or mortgage
        loans that are senior or equal in priority to the Second Lien Mortgage Loan
        and
        which are secured by the same Mortgaged Property to (b) the Appraised Value
        as
        determined pursuant to the Underwriting Guidelines of the related Mortgaged
        Property as of the origination of the Second Lien Mortgage Loan.

       

      “Commission”:
        The
        United States Securities and Exchange Commission.

       

      appear
        on
        Telerate Page 3750, the rate for such date will be determined on the basis
        of
        the rates at which one-month U.S. dollar deposits are offered by the Reference
        Banks at approximately 11:00 a.m. (London time) on such date to prime banks
        in
        the London interbank market. In such event, the Trustee shall request the
        principal London office of each of the Reference Banks to provide a quotation
        of
        its rate. If at least two such quotations are provided, the rate for that
        date
        will be the arithmetic mean of the quotations (rounded upwards if necessary
        to
        the nearest whole multiple of 1/16%). If fewer than two quotations are provided
        as requested, the rate for that date will be the arithmetic mean of the rates
        quoted by major banks in New York City, selected by the Trustee (after
        consultation with the Depositor), at approximately 11:00 a.m. (New York City
        time) on such date for one-month U.S. dollar loans to leading European
        banks.

       

      “LIBOR
        Determination Date”: With respect to any Interest Accrual Period for the Offered
        Certificates, the second London Business Day preceding the commencement of
        such
        Interest Accrual Period.

       

      “Liquidated
        Mortgage Loan”: With respect to any Distribution Date, a defaulted Mortgage Loan
        (including any REO Property) which either (a) was liquidated in the calendar
        month preceding the month of such Distribution Date and as to which the
        applicable Servicer has certified to the Trustee that it has received all
        amounts it expects to receive in connection with the liquidation of such
        Mortgage Loan including the final disposition of an REO Property, or (b)
        is a
        Second Lien Mortgage Loan (1) that is delinquent 180 days or longer, (2)
        for
        which the related first lien mortgage loan is not a Mortgage Loan, and (3)
        as to
        which the applicable Servicer has certified to the Trustee that it does not
        believe there is a reasonable likelihood that any further net proceeds will
        be
        received or recovered with respect to such Second Lien Mortgage
        Loan.

       

      “Liquidation
        Proceeds”: Cash received in connection with the liquidation of a Liquidated
        Mortgage Loan, whether through a trustee’s sale, foreclosure sale or otherwise,
        including any Subsequent Recoveries.

       

      “Loan
        Group”: The Group I Mortgage Loans or the Group II Mortgage Loans, as
        applicable.

       

      “Loan
        Group Cap”: The Group I Loan Cap or the Group II Loan Cap, as
        applicable.

       

      “Loan-to-Value
        Ratio” or “LTV”: With respect to any First Lien Mortgage Loan, the ratio
        (expressed as a percentage) of the original outstanding principal amount
        of the
        First Lien Mortgage Loan as of the Cut-off Date (unless otherwise indicated),
        to
        the lesser of (a) the Appraised Value of the Mortgaged Property at origination,
        and (b) if the First Lien Mortgage Loan was made to finance the acquisition
        of
        the related Mortgaged Property, the purchase price of the Mortgaged
        Property.

       

      “London
        Business Day”: Any day on which dealings in deposits of United States dollars
        are transacted in the London interbank market.

       


        “Marker
          Rate”: With respect to the Class A Certificates, Class M Certificates and Class
          B
          CertificatesX
          Interest
          and any
          Distribution Date, a per annum rate equal to two (2)
          times

      

      (xiii) the
        Class
        B-2 Certificates, the lesser of (i) LIBOR plus the applicable Pass-Through
        Margin and (ii) the WAC Cap;

       

      (xiv) the
        Class
        B-3 Certificates, the lesser of (i) LIBOR plus the applicable Pass-Through
        Margin and (ii) the WAC Cap; and

       


        (xv) the
          Class
          X CertificatesInterest,
          a per
          annum rate equal to the percentage equivalent of a fraction, the numerator
          of
          which is the sum of the amounts calculated pursuant to clauses (A) through
          (Q)
          below, and the denominator of which is the aggregate Uncertificated Principal
          Balance of REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-A1,
          REMIC II Regular Interest LT-A2a, REMIC II Regular Interest LT-A2b, REMIC
          II
          Regular Interest LT-A2c, REMIC II Regular Interest LT-A2d, REMIC II Regular
          Interest LT-M1, REMIC II Regular Interest LT-M2, REMIC II Regular Interest
          LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular Interest LT-M5,
          REMIC
          II Regular Interest LT-M6, REMIC II Regular Interest LT-B1, REMIC II Regular
          Interest LT-B2, REMIC II Regular Interest LT-B3 and REMIC II Regular Interest
          LT-ZZ. For purposes of calculating the Pass-Through Rate for the Class
          X
CertificatesInterest,
          the
          numerator is equal to the sum of the following components:


       

      (A)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-AA
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-AA;

       

      (B)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A1
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-A1;

       

      (C)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2a,
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-A2a;

       

      (D)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2b,
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-A2b;

       

      (E)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2c,
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-A2c;

       

      (F)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2d,
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-A2d;

       

      (G)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M1
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-M1;

       

      (H)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M2
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-M2;

       

      (I)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M3
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-M3;

       

      (J)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M4
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-M4;

       

      (K)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M5
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-M5;

       

      (L)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M6
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-M6;

       

      (M)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B1
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-B1;

       

      (N)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B2
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-B2;

       

      (O)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B3
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-B3;

       

      (P)  the
        Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-ZZ
        minus the Marker Rate, applied to an amount equal to the Uncertificated
        Principal Balance of REMIC II Regular Interest LT-ZZ; and

       

      (Q)  100%
        of
        the interest on REMIC II Regular Interest LT-P.

       


        (xvi) the
          Class X Certificates, 100% of the interest distributable to the Class X
          Interest, expressed as a per annum rate.


       

      “PCAOB”:
        The
        Public Company Accounting Oversight Board.

       

      “Percentage
        Interest”: As to any Certificate, the percentage interest evidenced thereby in
        distributions required to be made on the related Class, such percentage interest
        being set forth on the face thereof or equal to the percentage obtained by
        dividing the Denomination of such Certificate by the aggregate of the
        Denominations of all Certificates of the same Class.

       

      REMIC
        II
        Regular Interest LT-A2d, REMIC II Regular Interest LT-M1, REMIC II Regular
        Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular Interest
        LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular Interest LT-M6,
        REMIC
        II Regular Interest LT-B1, REMIC II Regular Interest LT-B2 and REMIC II Regular
        Interest LT-B3 for such Distribution Date, with the rate on each such REMIC
        II
        Regular Interest subject to a cap equal to the related Pass-Through
        Rate.

       

      “REMIC
        II
        Sub WAC Allocation Percentage”: 50% of any amount payable or loss attributable
        from the Mortgage Loans, which shall be allocated to REMIC II Regular Interest
        LT-1SUB, REMIC II Regular Interest LT-1GRP, REMIC II Regular Interest LT-2SUB,
        REMIC II Regular Interest LT-2GRP and REMIC II Regular Interest
        LT-XX.

       

      “REMIC
        II
        Subordinated Balance Ratio”: The ratio among the Uncertificated Principal
        Balances of each REMIC II Regular Interest ending with the designation “SUB”,
        equal to the ratio between, with respect to each such REMIC II Regular Interest,
        the excess of (x) the aggregate Stated Principal Balance of the Group I Mortgage
        Loans and the Group II Mortgage Loans, as applicable, over (y) the current
        Certificate Principal Balance of the related Senior Certificates.

       

      “REMIC
        II
        Targeted Overcollateralization Amount”: 0.50% of the Targeted
        Overcollateralization Amount.

       


        “REMIC
          III”: The
          segregated pool of assets consisting of all of the REMIC II Regular Interests
          conveyed in trust to the Trustee, for the benefit of the REMIC III
          Certificateholders
          pursuant to Section 2.07,,
          and all
          amounts deposited therein, with respect to which a separate REMIC election
          is to
          be made.


       

      “REMIC
        III
        Certificate”: Any Regular Certificate or Class R Certificate.

       

      “REMIC
        III Certificateholder”: The Holder of any REMIC III Certificate.

       


        “REMIC
          III Regular Interest”: Any of the Class X Interest, Class P Interest, Class IO
          Interest and any “regular interest” in REMIC III the ownership of which is
          represented by a Senior Certificate or Subordinate
          Certificate.


       


        “REMIC
          IV”: The segregated pool of assets consisting of all the Class X Interest
          conveyed in trust to the Trustee, for the benefit of the Holders of the
          Regular
          Certificates and the Holders of the Class R-X Certificates (in respect
          of the
          Class R-IV Interest), and all amounts deposited therein, with respect to
          which a
          separate REMIC election is to be made.


       


        “REMIC
          V”: The segregated pool of assets consisting of all of the Class P Interest
          conveyed in trust to the Trustee, for the benefit of the Holders of the
          Class P
          Certificates and the Holders of the Class R-X Certificates (as holders
          of the
          Class R-V Interest), and all amounts deposited therein, with respect to
          which a
          separate REMIC election is to be made.


       


        “REMIC
          VI”: The segregated pool of assets consisting of all of the Class IO Interest
          conveyed in trust to the Trustee, for the benefit of the Holders of REMIC
          VI
          Regular Interest IO and the Holders of the Class R-X Certificates (as holders
          of
          the Class R-VI Interest), and all amounts deposited therein, with respect
          to
          which a separate REMIC election is to be made.


       


        “REMIC
          VI Regular Interest IO”: An uncertificated interest in the Trust Fund held by
          the Trustee, evidencing a Regular Interest in REMIC VI for purposes of
          the REMIC
          Provisions.


       

      “REMIC
        Opinion”: Shall mean an Opinion of Counsel to the effect that the proposed
        action will not have an adverse affect on any REMIC created
        hereunder.

       

      “REMIC
        Provisions”: Provisions of the federal income tax law relating to real estate
        mortgage investment conduits, which appear at Sections 860A through 860G
        of
        Subchapter M of Chapter 1 of the Code, and related provisions, and regulations
        promulgated thereunder, as the foregoing may be in effect from time to time
        as
        well as provisions of applicable state laws.

       


        “REMIC
          Regular Interest”: Any REMIC I Regular Interest, REMIC II Regular Interest,
Class
          X Interest, Class P Interest, Regular
          Certificate or Class IO Interest.


       

      “Remittance
        Date”: With respect to any Distribution Date, the third Business Day immediately
        preceding such Distribution Date.

       

      “REO
        Disposition”: The final sale by the applicable Servicer of any REO
        Property.

       

      “REO
        Imputed Interest”: As to any REO Property, for any period, an amount equivalent
        to interest (at the Mortgage Rate net of the Servicing Fee Rate that would
        have
        been applicable to the related Mortgage Loan had it been outstanding) on
        the
        unpaid principal balance of the Mortgage Loan as of the date of acquisition
        thereof (as such balance is reduced pursuant to Section 3.17 by any income
        from
        the REO Property treated as a recovery of principal).

       

      “REO
        Mortgage Loan”: A Mortgage Loan where title to the related Mortgaged Property
        has been obtained by the applicable Servicer in the name of the Trustee on
        behalf of the Certificateholders.

       

      “REO
        Property”: A Mortgaged Property acquired by the Trust Fund through foreclosure
        or deed-in-lieu of foreclosure in connection with a defaulted Mortgage
        Loan.

       

      “Replacement
        Swap Provider Payment”:
        Any
        payments that have been received by the Supplemental Interest Trust as a
        result
        of entering into a replacement interest rate swap agreement following an
        Additional Termination Event described in Part 1(h)(ii) of the Interest Rate
        Swap Agreement.

       

      “Reportable
        Event”:
        As
        defined in Section 8.12(g).

       

      “Repurchase
        Price”: With respect to any Mortgage Loan repurchased by the Depositor or the
        Responsible Party, an amount equal to the sum of (i) the unpaid principal
        balance of such Mortgage Loan as of the date of repurchase, (ii) interest
        on
        such unpaid principal



        “Startup
          Day”: The Closing
          DateStartup
          Date for REMIC I, REMIC II and REMIC III shall be the Closing Date. The
          Startup
          Day for REMIC IV, REMIC V and REMIC VI shall be November
          7, 2006.


       

      “Stated
        Principal Balance”: As to each Mortgage Loan and as of any date of
        determination, (i) the principal balance of the Mortgage Loan at the Cut-off
        Date after giving effect to payments of principal due on or before such date
        (whether or not received), minus (ii) all amounts previously remitted to
        the
        Trustee with respect to the related Mortgage Loan representing payments or
        recoveries of principal including advances in respect of scheduled payments
        of
        principal. For purposes of any Distribution Date, the Stated Principal Balance
        of any Mortgage Loan will give effect to any scheduled payments of principal
        received by the related Servicer on or prior to the related Determination
        Date
        or advanced by the related Servicer for the related Remittance Date and any
        unscheduled principal payments and other unscheduled principal collections
        received during the related Prepayment Period, and the Stated Principal Balance
        of any Mortgage Loan that has prepaid in full or has become a Liquidated
        Mortgage Loan during the related Prepayment Period shall be zero.

       

      “Stepdown
        Date”: The later to occur of (i) the earlier to occur of (a) the Distribution
        Date in July 2009 and (b) the Distribution Date following the Distribution
        Date
        on which the aggregate Class Certificate Balances of the Class A Certificates
        have been reduced to zero and (ii) the first Distribution Date on which the
        Senior Enhancement Percentage (calculated for this purpose only after taking
        into account payments of principal on the Mortgage Loans applied to reduce
        the
        Stated Principal Balances of the Mortgage Loans for the applicable Distribution
        Date but prior to any allocation of the Principal Distribution Amount and
        principal payments from the Swap Account to the Certificates on such
        Distribution Date) is greater than or equal to the Senior Specified Enhancement
        Percentage.

       

      “Subcontractor”:
        Any
        third-party or Affiliated vendor, subcontractor or other Person utilized
        by a
        Servicer, a Subservicer or the Trustee, as applicable, that is not responsible
        for the overall servicing (as “servicing” is commonly understood by participants
        in the mortgage-backed securities market) of Mortgage Loans but performs
        one or
        more discrete functions identified in Item 1122(d) of Regulation AB with
        respect
        to Mortgage Loans.

       

      “Subordinated
        Amount”: With respect to any Distribution Date, the excess, if any, of (a) the
        aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
        Date over (b) the aggregate of the Class Certificate Balances of the Offered
        Certificates and the Class P Certificates as of such Distribution Date (after
        giving effect to the payment of the Principal Remittance Amount on such
        Certificates on such Distribution Date).

       

      “Subordinated
        Certificates”: As specified in the Preliminary Statement.

       

      “Subordination
        Deficiency”: With respect to any Distribution Date, the excess, if any, of (a)
        the Specified Subordinated Amount applicable to such Distribution Date over
        (b)
        the Subordinated Amount applicable to such Distribution Date.


      “Swap
        Assets”:
        Collectively, the Swap Account, the Interest Rate Swap Agreement, the Class
        IO
        Interest and the right to receive Class IO Shortfalls, subject to the obligation
        to pay amounts specified in Section 4.06.

       

      “Swap
        LIBOR”: With respect to any Distribution Date (and the related Interest Accrual
        Period), the product of (i) USD-LIBOR-BBA (as used in the Interest Swap
        Agreement), (ii) two, and (iii) the quotient of (a) the actual number of
        days in
        the Interest Accrual Period for the Offered Certificates divided by (b)
        30.

       

      “Swap
        Payment Allocation”: For any Class of Certificates and any Distribution Date,
        that Class’s pro
        rata
        share of
        the Net Swap Receipts, if any, for that Distribution Date, based on the Class
        Certificate Balances of the Classes of Certificates.

       

      “Swap
        Payment Rate”: For any Distribution Date, a fraction, the numerator of which is
        any Net Swap Payment or Swap Termination Payment owed to the Swap Provider
        for
        such Distribution Date and the denominator of which is the aggregate Stated
        Principal Balance of the Mortgage Loans at the beginning of the related Due
        Period, multiplied by 12.

       

      “Swap
        Provider”: Morgan Stanley Capital Services Inc., a Delaware corporation, and its
        successors in interest.

       

      “Swap
        Termination Payment”:
        Any
        payment payable by the Supplemental Interest Trust or the Swap Provider upon
        termination of the Interest Rate Swap Agreement as a result of an Event of
        Default (as defined in the Interest Rate Swap Agreement) or a Termination
        Event
        (as defined in the Interest Rate Swap Agreement).

       


        “Tax
          Matters Person”:
          The
          Holder of the Class R Certificates designated as “tax matters person” of
each
          Trust REMIC
          I,
          REMIC II and REMIC III in the manner provided under Treasury Regulations
          Section
          1.860F-4(d) and Treasury Regulations Section 301.6231(a)(7)-1. The Holder
          of the
          Class R-X Certificates designated as “tax matters person” of REMIC IV, REMIC V
          and REMIC VI
          in the
          manner provided under Treasury Regulations Section 1.860F-4(d) and Treasury
          Regulations Section 301.6231(a)(7)-1.


       

      “Tax
        Service Contract”: As defined in Section 3.09(a).

       

      “Telerate
        Page 3750”: The display page currently so designated on the Bridge Telerate
        Service (or such other page as may replace that page on that service for
        displaying comparable rates or prices).

       

      “Total
        Monthly Excess Spread”: As to any Distribution Date, an amount equal to the
        excess if any, of (i) the interest on the Mortgage Loans received by the
        Servicers on or prior to the related Determination Date (other than Prepayment
        Interest Excesses) or advanced by the Servicers for the related Remittance
        Date
        (net of Expense Fees) over (ii) the sum of (A) the amounts payable to the
        Certificates pursuant to Section 4.02(a)(i) on such Distribution Date, (B)
        any
        Net Swap Payments to the Swap Provider and (C) any Swap Termination Payment
        (other than a Defaulted Swap Termination Payment that is not a Senior Defaulted
        Swap Termination Payment) to the Swap Provider.

       

      “Transfer”:
        Any direct or indirect transfer or sale of any Ownership Interest in a Residual
        Certificate.

       

      “Transfer
        Affidavit”: As defined in Section 5.02(c).

       

      “Transferor
        Certificate”: As defined in Section 5.02(b).

       

      “Trigger
        Event”: Either a Cumulative Loss Trigger Event or a Delinquency Trigger
        Event.

       

      “Trust”:
        The express trust created hereunder in Section 2.01(c).

       

      “Trust
        Fund”: The corpus of the trust created hereunder consisting of (i) the Mortgage
        Loans and all interest and principal with respect thereto received on or
        after
        the related Cut-off Date, other than such amounts which were due on the Mortgage
        Loans on or prior to the related Cut-off Date; (ii) the Collection Accounts,
        Excess Reserve Fund Account, the Distribution Account, and all amounts deposited
        therein pursuant to the applicable provisions of this Agreement; (iii) property
        that secured a Mortgage Loan and has been acquired by foreclosure, deed-in-lieu
        of foreclosure or otherwise; (iv) the Closing Date Deposit Amount; (v) the
        Interest Rate Swap Agreement; (vi) the Swap Assets; and (vii) all proceeds
        of
        the conversion, voluntary or involuntary, of any of the foregoing.

       


        “Trust
          REMIC”: Any of REMIC I, REMIC II
          or,
          REMIC
          III,
          REMIC IV, REMIC V and REMIC VI.


       

      “Trustee”:
        Deutsche Bank National Trust Company, a national banking association, and
        its
        successors in interest and, if a successor trustee is appointed hereunder,
        such
        successor.

       

      “Trustee
        Fee”: As to any Distribution Date, an amount equal to the product of (a)
        one-twelfth of the Trustee Fee Rate and (b) (i) the aggregate Stated Principal
        Balance of the Mortgage Loans as of the first day of the related Interest
        Accrual Period and (ii) with respect to the Distribution Date in July 2006
        only,
        the portion of the Closing Date Deposit Amount allocable to
        principal.

       

      “Trustee
        Fee Rate”: With respect to each Mortgage Loan, 0.0021% per annum.

       

      “Trustee
        Float Period”: With respect to the Distribution Date and the related amounts in
        the Distribution Account, the period commencing on the Business Day immediately
        preceding such Distribution Date and ending on such Distribution
        Date.

       

      “Uncertificated
        Accrued Interest”: With respect to each Uncertificated REMIC Regular Interest on
        each Distribution Date, an amount equal to one month’s interest at the related
        Uncertificated Pass-Through Rate on the Uncertificated Principal Balance
        of such
        REMIC Regular Interest. In each case, Uncertificated Accrued Interest will
        be
        reduced by any Prepayment Interest Shortfalls and shortfalls resulting from
        application of the Relief Act (allocated to such REMIC Regular Interests
        as set
        forth in Section 8.14).

       

      (R)  to
        the
        Excess Reserve Fund Account, the amount of any Basis Risk Payment (without
        regard to Net Swap Receipts) for such Distribution Date;

       

      (S)  from
        funds on deposit in the Excess Reserve Fund Account with respect to such
        Distribution Date, an amount equal to any remaining Basis Risk CarryForward
        Amount with respect to the Offered Certificates for such Distribution Date,
        allocated to the Offered Certificates in the same order and priority in which
        the Accrued Certificate Interest Distribution Amount is allocated among such
        Classes of Certificates, with the allocation to the Class A Certificates
        being
        (a) first, among the Class A Certificates, pro
        rata,
        based
        on their respective Class Certificate Balances and (b) second, any remaining
        amounts to the Class A Certificates, pro
        rata,
        based
        on any Basis Risk CarryForward Amounts remaining unpaid, in order to reimburse
        such unpaid amounts;

       

      (T)  to
        the
        Swap Account, the amount of any remaining Defaulted Swap Termination Payment
        owed to the Swap Provider;

       

      (U)  to
        the
        Class X Certificates, the remainder of the Class X Distributable Amount not
        distributed pursuant to Sections 4.02(a)(iii)(A)-(U); and

       

      (V)  if
        such
        Distribution Date follows the Prepayment Period during which occurs the latest
        date on which a Prepayment Charge may be required to be paid in respect of
        any
        Mortgage Loan, to the Class P Certificates, in reduction of the Class
        Certificate Balance thereof; and 

       


        (W)  to
          the
Class
          RResidual
          Certificates, any remaining amount in the Trust REMICs.


       

      (ii)  Solely
        for purposes of interest allocation calculations, the Interest Remittance
        Amount
        attributable to Group I Mortgage Loans will be allocated:

       

      (1)  first,
        to
        the Class A-1 Certificates, the Accrued Certificate Interest Distribution
        Amount
        and any Unpaid Interest Amount for the Class A-1 Certificates; and

       

      (2)  second,
        concurrently, to the Class A-2a, Class A-2b, Class A-2c, and Class A-2d
        Certificates, pro rata (based on the amounts distributable or payable under
        Section 4.02(a)(i)(B) to such Classes of Certificates), the Accrued Certificate
        Interest Distribution Amount and any Unpaid Interest Amount for the Class
        A-2a,
        Class A-2b, Class A-2c and Class A-2d Certificates, respectively, to the
        extent
        not otherwise previously paid from the Interest Remittance Amount attributable
        to Group II Mortgage Loans.

       

      (iii)  Solely
        for purposes of interest allocation calculations, the Interest Remittance
        Amount
        attributable to Group II Mortgage Loans will be allocated:

       

      first,
        concurrently, to the Class A-2a, Class A-2b, Class A-2c and Class A-2d
        Certificates, pro rata (based on the amounts distributable or
        payable


      Trustee
        shall deposit the Swap Termination Payment into the reserve account that
        is a
        sub-account of the Swap Account. On each subsequent Distribution Date (so
        long
        as funds are available in the reserve account), the Supplemental Interest
        Trust
        Trustee shall withdraw from the reserve account and deposit into the Swap
        Account an amount equal to the amount of any Net Swap Receipt due the
        Supplemental Interest Trust (calculated in accordance with the terms of the
        original Interest Rate Swap Agreement) and treat such amount as a Net Swap
        Receipt for purposes of determining the distributions from the Swap Account.
        In
        no event shall the Supplemental Interest Trust Trustee be responsible for
        the
        selection of any successor or replacement swap provider or any shortfalls
        caused
        by a failure to enter into a replacement interest rate swap
        agreement.

       

      Upon
        termination of the Trust, any amounts remaining in the Swap Account shall
        be
        distributed pursuant to the priorities set forth in this Section
        4.06.

       

      In
        the
        event that, upon the Supplemental Interest Trust entering into a replacement
        interest rate swap following the occurrence of an Additional Termination
        Event
        of the type described in Part 1(h)(ii) of the Interest Rate Swap Agreement,
        the
        Supplemental Interest Trust is entitled to receive a payment from a replacement
        swap provider, the Supplemental Interest Trust Trustee shall direct the
        replacement swap provider to make such payment to the Swap Account. Any Senior
        Defaulted Swap Termination Payment shall be made from the Swap Account to
        the
        Swap Provider immediately upon receipt of such payment, regardless of whether
        the date of receipt thereof is a Distribution Date. To the extent that any
        Replacement Swap Provider Payment is made to an account other than the Swap
        Account, then, notwithstanding anything to the contrary contained in this
        Agreement, any Senior Defaulted Swap Termination Payment shall be paid to
        the
        Swap Provider immediately upon receipt of such Replacement Swap Provider
        Payment, regardless of whether the date of receipt thereof is a Distribution
        Date and without regard to anything to the contrary contained in this Agreement.
        For the avoidance of doubt, the parties agree that the Swap Provider shall
        have
        first priority to any Replacement Swap Provider Payment over the payment
        by the
        Trust to Certificateholders, the Servicer, the Responsible Party, the Trustee
        or
        any other Person.

       


        The
          beneficial owners of the Swap Account are the Class X Certificateholders.
          For
          federal income tax purposes, Net Swap Payments and Swap Termination Payments
          payable to the Swap Provider shall be deemed to be paid to the Swap Account
          from
          REMIC IIIVI,
          first,
          by the Class IO Interest and second, other than any Defaulted Swap Termination
          Payment, from REMIC III by the Holders of the applicable Class or Classes
          of
          Offered Certificates (in respect of Class IO Shortfalls) as and to the
          extent
          provided in Section 8.13.


       

      Any
        Basis
        Risk CarryForward Amounts distributed by the Trustee to the Offered
        Certificateholders shall be accounted for by the Trustee, for federal income
        tax
        purposes, as amounts paid first to the Holders of the Class X Certificates,
        and
        then to the respective Class or Classes of Offered Certificates. In addition,
        the Trustee shall account for the rights of Holders of each Class of Offered
        Certificates to receive payments of Basis Risk CarryForward Amounts from
        the
        Swap Account (along with Basis Risk CarryForward Amounts payable from the
        Excess
        Reserve Fund Account) as rights in a separate limited recourse interest rate
        cap
        contract written by the Class X Certificateholders in favor of Holders of
        each
        such Class.

       

      At
        the
        option of a Certificateholder, Certificates may be exchanged for other
        Certificates of the same Class in authorized denominations and evidencing
        the
        same aggregate Percentage Interest upon surrender of the Certificates to
        be
        exchanged at the office or agency of the Trustee. Whenever any Certificates
        are
        so surrendered for exchange, the Trustee shall execute, authenticate, and
        deliver the Certificates which the Certificateholder making the exchange
        is
        entitled to receive. Every Certificate presented or surrendered for registration
        of transfer or exchange shall be accompanied by a written instrument of transfer
        in form satisfactory to the Trustee duly executed by the Holder thereof or
        his
        attorney duly authorized in writing.

       

      No
        service charge to the Certificateholders shall be made for any registration
        of
        transfer or exchange of Certificates, but payment of a sum sufficient to
        cover
        any tax or governmental charge that may be imposed in connection with any
        transfer or exchange of Certificates may be required.

       

      All
        Certificates surrendered for registration of transfer or exchange shall be
        cancelled and subsequently destroyed by the Trustee in accordance with the
        Trustee’s customary procedures.

       


        No
          transfer of a Private Certificate shall be made unless such transfer is
          made
          pursuant to an effective registration statement under the Securities Act
          and any
          applicable state securities laws or is exempt from the registration requirements
          under said Act and such state securities laws. In determining whether a
          transfer
          is being made pursuant to an effective registration statement, the Trustee
          shall
          be entitled to rely solely upon a written notice to such effect from the
          Depositor. Except with respect to (i) the transfer of the Class X, Class
          P or
Class
          RResidual
          Certificates to the Depositor or
          an
          Affiliate of the Depositor or, in the case of the Class R-X Certificates,
          the
          initial transfer by an Affiliate of the Depositor or the first transfer
          by the
          initial transferee of
          an
          Affiliate of the Depositor, (ii) the transfer of the Class X or Class P
          Certificates to the NIM Issuer or the NIM Trustee, or (iii) a transfer
          of the
          Class X or Class P Certificates from the NIM Issuer or the NIM Trustee
          to the
          Depositor or an Affiliate of the Depositor, in the event that a transfer
          of a
          Private Certificate which is a Physical Certificate is to be made in reliance
          upon an exemption from the Securities Act and such laws, in order to assure
          compliance with the Securities Act and such laws, the Certificateholder
          desiring
          to effect such transfer shall certify to the Trustee in writing the facts
          surrounding the transfer in substantially the form set forth in Exhibit
          H (the
“Transferor
          Certificate”)
          and
          either (i) there shall be delivered to the Trustee a letter in substantially
          the
          form of Exhibit I (the “Rule
          144A Letter”)
          or
          (ii) there shall be delivered to the Trustee at the expense of the transferor
          an
          Opinion of Counsel that such transfer may be made without registration
          under the
          Securities Act. In the event that a transfer of a Private Certificate which
          is a
          Book-Entry Certificate is to be made in reliance upon an exemption from
          the
          Securities Act and such laws, in order to assure compliance with the Securities
          Act and such laws, the Certificateholder desiring to effect such transfer
          will
          be deemed to have made as of the transfer date each of the certifications
          set
          forth in the Transferor Certificate in respect of such Certificate and
          the
          transferee will be deemed to have made as of the transfer date each of
          the
          certifications set forth in the Rule 144A Letter in respect of such Certificate,
          in each case as if such Certificate were evidenced by a Physical Certificate.
          The Depositor shall provide to any Holder of a Private Certificate and
          any
          prospective transferee designated by any such Holder, information regarding
          the
          related Certificates and the Mortgage

      

      Loans
        and
        such other information as shall be necessary to satisfy the condition to
        eligibility set forth in Rule 144A(d)(4) for transfer of any such Certificate
        without registration thereof under the Securities Act pursuant to the
        registration exemption provided by Rule 144A. The Trustee and the Servicers
        shall cooperate with the Depositor in providing the Rule 144A information
        referenced in the preceding sentence, including providing to the Depositor
        such
        information regarding the Certificates, the Mortgage Loans and other matters
        regarding the Trust Fund as the Depositor shall reasonably request to meet
        its
        obligation under the preceding sentence. Each Holder of a Private Certificate
        desiring to effect such transfer shall, and does hereby agree to, indemnify
        the
        Trustee, the Depositor and each Servicer against any liability that may result
        if the transfer is not so exempt or is not made in accordance with such federal
        and state laws.

       


        Except
          with respect to (A) the transfer of the Class R,
          Class X orX,
          Class P
or
          Residual Certificates
          to the Depositor or
          an
          Affiliate of the Depositor or, in the case of the Class R-X Certificates,
          the
          initial transfer by an Affiliate of the Depositor or the first ransfer
          by the
          initial transferee of
          an
          Affiliate of the Depositor, (B) the transfer of the Class X or Class P
          Certificates to the NIM Issuer or the NIM Trustee, or (C) a transfer of
          the
          Class X or Class P Certificates from the NIM Issuer or the NIM Trustee
          to the
          Depositor or an Affiliate of the Depositor, no transfer of an ERISA-Restricted
          Certificate shall be made unless the Trustee shall have received either
          (i) a
          representation from the transferee of such Certificate acceptable to and
          in form
          and substance satisfactory to the Trustee (in the event such Certificate
          is a
          Class P Certificate or a Residual Certificate, such requirement is satisfied
          only by the Trustee’s receipt of a representation letter from the transferee
          substantially in the form of Exhibit I), to the effect that such transferee
          is
          not an employee benefit plan or arrangement subject to Section 406 of ERISA,
          a
          plan subject to Section 4975 of the Code or a plan subject to any Federal,
          state
          or local law (“Similar
          Law”)
          materially similar to the foregoing provisions of ERISA or the Code, nor
          a
          Person acting on behalf of any such plan or arrangement nor using the assets
          of
          any such plan or arrangement to effect such transfer, or (ii) in the case
          of an
          ERISA-Restricted Certificate other than a Residual Certificate or a Class
          P
          Certificate that has been the subject of an ERISA-Qualifying Underwriting,
          and
          the purchaser is an insurance company, a representation that the purchaser
          is an
          insurance company that is purchasing such Certificates with funds contained
          in
          an “insurance company general account” (as such term is defined in Section V(e)
          of Prohibited Transaction Class Exemption 95-60 (“PTCE
          95-60”))
          and
          that it is eligible for exemptive relief under PTCE 95-60 prior to termination
          of the Supplemental Interest Trust and the purchase and holding of such
          Certificates are covered under Sections I and III of PTCE 95-60 after
          termination of the Supplemental Interest Trust or (iii) in the case of
          any such
          ERISA-Restricted Certificate other than a Residual Certificate or Class
          P
          Certificate presented for registration in the name of an employee benefit
          plan
          subject to Title I of ERISA, a plan or arrangement subject to Section 4975
          of
          the Code (or comparable provisions of any subsequent enactments), or a
          plan
          subject to Similar Law, or a trustee of any such plan or any other person
          acting
          on behalf of any such plan or arrangement or using such plan’s or arrangement’s
          assets, an Opinion of Counsel satisfactory to the Trustee, which Opinion
          of
          Counsel shall not be an expense of the Servicers, the Depositor, the Trustee
          or
          the Trust Fund, addressed to the Trustee, to the effect that the purchase
          or
          holding of such ERISA-Restricted Certificate will not constitute or result
          in a
          non-exempt prohibited transaction within the meaning of ERISA, Section
          4975 of
          the Code or any Similar Law and will not subject the Depositor, the Trustee
          or
          the Servicers to any obligation in addition to those expressly undertaken
          in
          this Agreement or to any liability. For purposes of the preceding sentence,
          with
          respect to an ERISA-Restricted Certificate that is not a Class P Certificate
          or
          a

         


      (b)  the
        Trustee from withholding payment of such tax, if permitted by law, pending
        the
        outcome of such proceedings);

       

      (c)  cause
        federal, state or local income tax or information returns to be signed by
        the
        Trustee or such other Person as may be required to sign such returns by the
        Code
        or state or local laws, regulations or rules; and

       

      (d)  maintain
        records relating to each Trust REMIC created hereunder, including the income,
        expenses, assets, and liabilities thereof on a calendar year basis and on
        the
        accrual method of accounting and the fair market value and adjusted basis
        of the
        assets determined at such intervals as may be required by the Code, as may
        be
        necessary to prepare the foregoing returns, schedules, statements or
        information.

       


        The
          Holder of the largest Percentage Interest of the Class R Certificates shall
          act
          as Tax Matters Person for each
          Trust REMIC
          I,
          REMIC II and REMIC III,
          within
          the meaning of Treasury Regulations Section 1.860F-4(d),
          and the.
          The
          Holder of the largest Percentage Interest of the Class R-X Certificates
          shall
          act as Tax Matters Person for REMIC IV, REMIC V and REMIC VI, within the
          meaning
          of Treasury Regulations Section 1.860F-4(d). The
          Trustee
          is hereby designated as agent of such Certificateholder for such purpose
          (or if
          the Trustee is not so permitted, such Holder shall be the Tax Matters Person
          in
          accordance with the REMIC Provisions). In such capacity, the Trustee shall,
          as
          and when necessary and appropriate, represent each Trust REMIC created
          hereunder
          in any administrative or judicial proceedings relating to an examination
          or
          audit by any governmental taxing authority, request an administrative adjustment
          as to any taxable year of each Trust REMIC created hereunder, enter into
          settlement agreements with any governmental taxing agency, extend any statute
          of
          limitations relating to any tax item of each Trust REMIC created hereunder,
          and
          otherwise act on behalf of each Trust REMIC in relation to any tax matter
          or
          controversy involving it.


       

      To
        enable
        the Trustee to perform its duties under this Agreement, the Depositor shall
        provide to the Trustee within ten days after the Closing Date all information
        or
        data that the Trustee requests in writing and determines to be relevant for
        tax
        purposes to the valuations and offering prices of the Certificates, including
        the price, yield, prepayment assumption, and projected cash flows of the
        Certificates and the Mortgage Loans. Moreover, the Depositor shall provide
        information to the Trustee concerning the value, if any, to each Class of
        Certificates of the right to receive Basis Risk CarryForward Amounts from
        the
        Excess Reserve Fund Account and Basis Risk CarryForward Amounts from the
        Swap
        Account. Thereafter, the Depositor shall provide to the Trustee promptly
        upon
        written request therefor any additional information or data that the Trustee
        may, from time to time, reasonably request to enable the Trustee to perform
        its
        duties under this Agreement; provided,
        however,
        that
        the Depositor shall not be required to provide any information regarding
        the
        Mortgage Loans that the Servicer is required to provide to the Trustee pursuant
        to this Agreement. The Depositor hereby indemnifies the Trustee for any losses,
        liabilities, damages, claims, or expenses of the Trustee arising from any
        errors
        or miscalculations of the Trustee that result from any failure of the Depositor
        to provide pursuant to this paragraph accurate information or data to the
        Trustee on a timely basis.

       

      Neither
        the Servicers nor the Trustee shall (i) permit the creation of any interests
        in
        any Trust REMIC other than the regular and residual interests set forth in
        the
        Preliminary


      cancellation,
        shall be given promptly by the Trustee by letter to Certificateholders mailed
        not earlier than the 10th day and not later than the 15th day of the month
        of
        such final distribution. Any such Notice of Final Distribution shall specify
        (a)
        the Distribution Date upon which final distribution on the Certificates will
        be
        made upon presentation and surrender of Certificates at the office therein
        designated, (b) the amount of such final distribution, (c) the location of
        the
        office or agency at which such presentation and surrender must be made, and
        (d)
        that the Record Date otherwise applicable to such Distribution Date is not
        applicable, distributions being made only upon presentation and surrender
        of the
        Certificates at the office therein specified. The Trustee will give such
        Notice
        of Final Distribution to each Rating Agency at the time such Notice of Final
        Distribution is given to Certificateholders.

       

      In
        the
        event such Notice of Final Distribution is given, Wells Fargo shall cause
        all
        funds in its Collection Account to be remitted to the Trustee for deposit
        in the
        Distribution Account on the Business Day prior to the applicable Distribution
        Date in an amount equal to the final distribution in respect of the
        Certificates. Upon such final deposit with respect to the Trust Fund and
        the
        receipt by the Trustee of a Request for Release therefor, the Trustee shall
        promptly release to Wells Fargo, the Custodial Files for the Mortgage
        Loans.

       

      Upon
        presentation and surrender of the Certificates, the Trustee shall cause to
        be
        distributed to the Certificateholders of each Class (after reimbursement
        of all
        amounts due to Wells Fargo, the Depositor and the Trustee hereunder), in
        each
        case on the final Distribution Date and in the order set forth in Section
        4.02,
        in proportion to their respective Percentage Interests, with respect to
        Certificateholders of the same Class, up to an amount equal to (i) as to
        each
        Class of Regular Certificates (except the Class X Certificates), the Certificate
        Balance thereof plus for each such Class and the Class X Certificates accrued
        interest thereon in the case of an interest-bearing Certificate and all other
        amounts to which such Classes are entitled pursuant to Section 4.02 and (ii)
        as
        to the Residual Certificates, the amount, if any, which remains on deposit
        in
        the Distribution Account (other than the amounts retained to meet claims)
        after
        application pursuant to clause (i) above.

       


        In
          the
          event that any affected Certificateholders shall not surrender Certificates
          for
          cancellation within six months after the date specified in the above mentioned
          written notice, the Trustee shall give a second written notice to the remaining
          Certificateholders to surrender their Certificates for cancellation and
          receive
          the final distribution with respect thereto. If within six months after
          the
          second notice all the applicable Certificates shall not have been surrendered
          for cancellation, the Trustee may take appropriate steps, or may appoint
          an
          agent to take appropriate steps, to contact the remaining Certificateholders
          concerning surrender of their Certificates, and the cost thereof shall
          be paid
          out of the funds and other assets which remain a part of the Trust Fund.
          If
          within one year after the second notice all Certificates shall not have
          been
          surrendered for cancellation, the Class
          RResidual
          Certificateholders shall be entitled to all unclaimed funds and other assets
          of
          the Trust Fund which remain subject hereto.


       

      Additional
        Termination Requirements.
        In the
        event Wells Fargo exercises its purchase option with respect to the Mortgage
        Loans as provided in Section 9.01, the Trust Fund shall be terminated in
        accordance with the following additional requirements, unless the Trustee
        has
        been supplied with an Opinion of Counsel, at the expense Wells Fargo, to
        the
        effect that the failure to comply with the requirements of this Section 9.03
        will not (i) result in


       

      MORGAN
        STANLEY ABS CAPITAL I INC.

       

      Morgan
        Stanley ABS Capital I Inc. Trust 2006-NC4

      Mortgage
        Pass-Through Certificates, Series 2006-NC4


        CLASS
          [R][R-X]


       

      evidencing
        a percentage interest in the distributions allocable to the Certificates
        of the
        above-referenced Class.

       


        Distributions
          in respect of this Certificate is distributable monthly as set forth herein.
          This Class [R][R-X]
          Certificate has no Certificate Balance and is not entitled to distributions
          in
          respect of principal or interest. This Certificate does not evidence an
          obligation of, or an interest in, and is not guaranteed by the Depositor,
          the
          Trustee or any other party to the Agreement referred to below or any of
          their
          respective affiliates. Neither this Certificate nor the Mortgage Loans
          are
          guaranteed or insured by any governmental agency or
          instrumentality.


       

      This
        certifies that ______________________ is the registered owner of the Percentage
        Interest specified above of any monthly distributions due to the Class R
        Certificates pursuant to a Pooling and Servicing Agreement dated as of the
        Cut-off Date specified above (the “Agreement”)
        among
        Morgan Stanley ABS Capital I Inc., as depositor (the “Depositor”),
        Wells
        Fargo Bank, N.A., as a servicer, New Century Mortgage Corporation, as a
        servicer, NC Capital Corporation, as responsible party, and Deutsche Bank
        National Trust Company, as trustee (the “Trustee”).
        To
        the extent not defined herein, the capitalized terms used herein have the
        meanings assigned in the Agreement. This Certificate is issued under and
        is
        subject to the terms, provisions and conditions of the Agreement, to which
        Agreement the Holder of this Certificate by virtue of the acceptance hereof
        assents and by which such Holder is bound.

       


        Any
          distribution of the proceeds of any remaining assets of the Trust Fund
          will be
          made only upon presentment and surrender of this Class [R][R-X]
          Certificate at the offices designated by the Trustee for such purposes
          or such
          other location specified in the notice to Certificateholders.


       


        No
          transfer of a Class [R][R-X]
          Certificate shall be made unless the Trustee shall have received a
          representation letter from the transferee of such Certificate, acceptable
          to and
          in form and substance satisfactory to the Trustee, to the effect that such
          transferee is not an employee benefit plan or arrangement subject to Section
          406
          of ERISA, a plan or arrangement subject to Section 4975 of the Code or
          a plan
          subject to Similar Law, or a person acting on behalf of any such plan or
          arrangement nor using the assets of any such plan or arrangement to effect
          such
          transfer, which representation letter shall not be an expense of the Trustee,
          the Servicers or the Trust Fund. In the event that such representation
          is
          violated, or any attempt is made to transfer to a plan or arrangement subject
          to
          Section 406 of ERISA or a plan subject to Section 4975 of the Code or a
          plan
          subject to Similar Law, or a person acting on behalf of any such plan or
          arrangement or using the assets of any such plan or arrangement, such attempted
          transfer or acquisition shall be void and of no effect.

         



        Each
          Holder of this Class [R][R-X]
          Certificate shall be deemed by the acceptance or acquisition an Ownership
          Interest in this Class [R][R-X]
          Certificate to have agreed to be bound by the following provisions, and
          the
          rights of each Person acquiring any Ownership Interest in this Class
[R][R-X]
          Certificate are expressly subject to the following provisions: (i) each
          Person
          holding or acquiring any Ownership Interest in this Class [R][R-X]
          Certificate shall be a Permitted Transferee and shall promptly notify the
          Trustee of any change or impending change in its status as a Permitted
          Transferee, (ii) no Ownership Interest in this Class [R][R-X]
          Certificate may be registered on the Closing Date or thereafter transferred,
          and
          the Trustee shall not register the Transfer of this Certificate unless,
          in
          addition to the certificates required to be delivered to the Trustee under
          Section 5.02(b) of the Agreement, the Trustee shall have been furnished
          with a
          Transfer Affidavit of the initial owner or the proposed transferee in the
          form
          attached as Exhibit G to the Agreement, (iii) each Person holding or acquiring
          any Ownership Interest in this Class [R][R-X]
          Certificate shall agree (A) to obtain a Transfer Affidavit from any other
          Person
          to whom such Person attempts to Transfer its Ownership Interest this Class
          [R][R-X]
          Certificate, (B) to obtain a Transfer Affidavit from any Person for whom
          such
          Person is acting as nominee, trustee or agent in connection with any Transfer
          of
          this Class [R][R-X]
          Certificate, (C) not to cause income with respect to the Class [R][R-X]
          Certificate to be attributable to a foreign permanent establishment or
          fixed
          base, within the meaning of an applicable income tax treaty, of such Person
          or
          any other U.S. Person and (D) not to Transfer the Ownership Interest in
          this
          Class [R][R-X]
          Certificate or to cause the Transfer of the Ownership Interest in this
          Class
[R][R-X]
          Certificate to any other Person if it has actual knowledge that such Person
          is a
          Non-Permitted Transferee and (iv) any attempted or purported Transfer of
          the
          Ownership Interest in this Class [R][R-X]
          Certificate in violation of the provisions herein shall be absolutely null
          and
          void and shall vest no rights in the purported Transferee.


       

      Reference
        is hereby made to the further provisions of this Certificate set forth on
        the
        reverse hereof, which further provisions shall for all purposes have the
        same
        effect as if set forth at this place.

       

      This
        Certificate shall not be entitled to any benefit under the Agreement or be
        valid
        for any purpose unless manually authenticated by an authorized signatory
        of the
        Trustee.

       

       

      *     *     *


       

      EXHIBIT
        G

       

      RESIDUAL
        TRANSFER AFFIDAVIT

       

      Morgan
        Stanley ABS Capital I Inc. Trust 2006-NC4,

      Mortgage
        Pass-Through Certificates,

      Series
        2006-NC4

      
        	
                STATE
                  OF_____________

              	
                )

              	 
	 	
                )

              	
                ss.:

              
	
                COUNTY
                  OF___________

              	
                )

              	 


      

      


       

      The
        undersigned, being first duly sworn, deposes and says as follows:

       


        1.    The
          undersigned is an officer of ___________________, the proposed Transferee
          of an
          Ownership Interest in a Class [R][R-X]
          Certificate (the “Certificate”)
          issued
          pursuant to the Pooling and Servicing Agreement (the “Agreement”),
          relating to the above-referenced Series, by and among Morgan Stanley ABS
          Capital
          I Inc., as Depositor, Wells Fargo Bank, N.A., as a Servicer, New Century
          Mortgage Corporation, as a Servicer, NC Capital Corporation, as Responsible
          Party, and Deutsche Bank National Trust Company, as Trustee (the “Trustee”).
          Capitalized terms used, but not defined herein, shall have the meanings
          ascribed
          to such terms in the Agreement. The Transferee has authorized the undersigned
          to
          make this affidavit on behalf of the Transferee for the benefit of the
          Depositor
          and the Trustee.


       

      2.    The
        Transferee is, as of the date hereof, and will be, as of the date of the
        Transfer, a Permitted Transferee. The Transferee is acquiring its Ownership
        Interest in the Certificate for its own account. The Transferee has no knowledge
        that any such affidavit is false.

       

      3.    The
        Transferee has been advised of, and understands that (i) a tax will be imposed
        on Transfers of the Certificate to Persons that are Non-Permitted Transferees;
        (ii) such tax will be imposed on the transferor, or, if such Transfer is
        through
        an agent (which includes a broker, nominee or middleman) for a Person that
        is a
        Non-Permitted Transferee, on the agent; and (iii) the Person otherwise liable
        for the tax shall be relieved of liability for the tax if the subsequent
        Transferee furnished to such Person an affidavit that such subsequent Transferee
        is a Permitted Transferee and, at the time of Transfer, such Person does
        not
        have actual knowledge that the affidavit is false.

       

      4.    The
        Transferee has been advised of, and understands that a tax will be imposed
        on a
“pass-through entity” holding the Certificate if at any time during the taxable
        year of the pass-through entity a Person that is a Non-Permitted Transferee
        is
        the record holder of an interest in such entity. The Transferee understands
        that
        such tax will not be imposed for any period with respect to which the record
        holder furnishes to the pass-through entity an affidavit that such record
        holder
        is a Permitted Transferee and the pass-through entity does not have actual
        knowledge that such affidavit is false. (For this purpose, a “pass-through
        entity” includes a regulated investment company, a real estate investment trust
        or common trust fund, a partnership, trust or estate, and certain cooperatives
        and, except as may be provided in Treasury Regulations, persons holding
        interests in pass-through entities as a nominee for another
        Person.)