EXHIBIT 1.1
FIRST HORIZON ASSET SECURITIES INC.
MORTGAGE PASS-THROUGH CERTIFICATES
(Issuable in Series)
UNDERWRITING AGREEMENT
First Tennessee Bank National Association Memphis, Tennessee
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇ September 24, 2002
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
First Horizon Asset Securities Inc., a corporation organized and
existing under the laws of the State of Delaware (the "Company"), may offer for
sale to you and to each of the other several underwriters, if any, participating
in an underwriting syndicate managed by you, from time to time its Mortgage
Pass-Through Certificates evidencing interests in pools of mortgage loans (the
"Certificates"). The Certificates may be issued in various series, and within
each series, in one or more classes, in one or more offerings on terms
determined at the time of sale (each such series, a "Series" and each such
class, a "Class"). Each Series of the Certificates will be issued under a
separate Pooling and Servicing Agreement (each, a "Pooling and Servicing
Agreement") to be dated as of the respective cut-off date (each, a "Cut-off
Date") among the Company, as depositor, First Horizon Home Loan Corporation, as
seller and master servicer, you and The Bank of New York, as trustee (the
"Trustee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the related Pooling and Servicing Agreement.
The Certificates issued under each Pooling and Servicing Agreement will
represent the entire beneficial ownership interest in a trust fund (the "Trust
Fund") established by such Pooling and Servicing Agreement. The assets of each
Trust Fund will consist primarily of (i) one or more pools of conventional,
fixed rate, first lien, fully amortizing, one- to four-family residential
mortgage loans (the "Mortgage Loans") having the original terms to maturity
specified in the related Terms Agreement referred to hereinbelow, (ii) mortgage
pass-through securities issued or guaranteed by ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇ or
▇▇▇▇▇▇▇ Mac, or (iii) private mortgage-backed securities backed by first lien
mortgage loans secured by one- to four-family residential properties or
participations therein. If so specified in the related Terms Agreement, one or
more elections may be made to treat the assets of each Trust Fund as a real
estate mortgage investment conduit (each, a "REMIC") for federal income tax
purposes.
Whenever the Company determines to make an offering of Certificates
(each, a "Certificate Offering") pursuant to this Agreement through you, it will
enter into an agreement (the "Terms Agreement") providing for the sale of
specified Classes of Offered Certificates (as defined below) to, and the
purchase and public offering thereof by, you and such other underwriters, if
any, selected by you as have authorized you to enter into such Terms Agreement
on their behalf (the underwriters in any such Terms Agreement being referred to
herein as "Underwriters," which term shall include you whether acting alone in
the sale of any
Series of Certificates or as a member of the underwriting syndicate). Each such
Certificate Offering that the Company elects to make pursuant to this Agreement
shall be governed by this Agreement, as supplemented by the related Terms
Agreement. Each Terms Agreement, which shall be substantially in the form of
Exhibit A hereto, shall specify, among other things, the Classes of Certificates
to be purchased by the Underwriters (the "Offered Certificates"), the names of
the Underwriters participating in such offering (subject to substitution as
provided in Section 16 hereof) and the principal amount of the Offered
Certificates which each severally agrees to purchase, the names of such other
Underwriters, if any, acting as co-managers with you in connection with each
offering, the principal balance or balances of the Offered Certificates, each
subject to any stated variance, and the price or prices at which such Offered
Certificates are to be purchased by the Underwriters from the Company.
1. Representations and Warranties. The Company represents and
warrants to and agrees with each Underwriter, as of the date of the related
Terms Agreement, that:
(a) The registration statement specified in the related Terms
Agreement, on Form S-3, including a prospectus, has been filed with
the Securities and Exchange Commission (the "Commission") for the
registration under the Securities Act of 1933, as amended (the "Act"),
of mortgage pass-through certificates issuable in series, which
registration statement has been declared effective by the Commission.
Such registration statement, as amended to the date of the related
Terms Agreement, including any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Act which were filed
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), on or before the effective date of the Registration Statement,
is hereinafter called the "Registration Statement," and such
prospectus, as such prospectus is supplemented by a prospectus
supplement relating to the Offered Certificates of the related Series,
each in the form first filed after the date of the related Terms
Agreement pursuant to Rule 424(b) under the Act, including any
documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Act which were filed under the Exchange Act on or
before the date of such prospectus supplement (other than any such
incorporated documents that relate to Collateral Term Sheets (as
defined herein))(such prospectus supplement, including such
incorporated documents (other than those that relate to Collateral
Term Sheets), in the form first filed after the date of the related
Terms Agreement pursuant to Rule 424(b) is hereinafter called the
"Prospectus Supplement"), is hereinafter called the "Prospectus." Any
reference herein to the terms "amend," "amendment" or "supplement"
with respect to the Registration Statement, the Prospectus or the
Prospectus Supplement shall be deemed to refer to and include the
filing of any document under the Exchange Act after the effective date
of the Registration Statement or the issue date of the Prospectus or
Prospectus Supplement, as the case may be, deemed to be incorporated
therein by reference pursuant to Item 12 of Form S-3 under the Act.
(b) The related Registration Statement, at the time it became
effective, and the Prospectus contained therein, and any amendments
thereof and supplements thereto filed prior to the date of the related
Terms Agreement, conformed in all material respects to the
requirements of the Act and the rules and regulations of the
Commission thereunder, on the date of the related Terms Agreement and
on each Closing Date (as
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defined in Section 3 below), the related Registration Statement and
the related Prospectus, and any amendments thereof and supplements
thereto, will conform in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder;
such Registration Statement, at the time it became effective, did not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; such prospectus, on the date of any
filing pursuant to Rule 424(b) and on each Closing Date, will not
include any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light
of the circumstances under which they are made, not misleading; and
the detailed description (each, a "Detailed Description") filed in
connection with any Pre-Funding Arrangement referred to in such
Prospectus, on each closing date relating to the purchase of the
related Subsequent mortgage loans and the date of any filing thereof
under cover of Form 8-K, will not include any untrue statement of a
material fact or omit to state any information which such Prospectus
states will be included in such Detailed Description; provided,
however, that the Company makes no representations or warranties as to
the information contained in or omitted from (A) such Registration
Statement or such Prospectus (or any supplement thereto) in reliance
upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter specifically for use in the
preparation thereof or (B) any Current Report (as defined in Section
5(b) below), or in any amendment thereof or supplement thereto,
incorporated by reference in such Registration Statement or such
Prospectus (or any amendment thereof or supplement thereto).
(c) The Certificates of the related Series will conform to the
description thereof contained in the related Prospectus; will each, if
rated at the time of issuance in one of the two highest rating
categories by a nationally recognized statistical rating organization,
be when issued a "mortgage related security" as such term is defined
in Section 3(a)(41) of the Exchange Act, and will each on the related
Closing Date be duly and validly authorized, and, when validly
executed, countersigned, issued and delivered in accordance with the
related Pooling and Servicing Agreement and sold to the Underwriters
as provided herein and in the related Terms Agreement, will each be
validly issued and outstanding and entitled to the benefits of the
related Pooling and Servicing Agreement.
(d) Neither the issuance nor sale of the Certificates of the
related Series nor the consummation of any other of the transactions
herein contemplated, nor the fulfillment of the terms hereof or of the
related Terms Agreement, will conflict with any statute, order or
regulation applicable to the Company of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
the Company or with any organizational document of the Company or any
instrument or any agreement under which the Company is bound or to
which it is a party.
(e) This Agreement and the related Terms Agreement have been duly
authorized, executed and delivered by the Company.
(f) At or prior to the related Closing Date, the Company will
have entered into the related Pooling and Servicing Agreement and,
assuming the due authorization,
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execution and delivery thereof by the other parties thereto, such Pooling
and Servicing Agreement (on such Closing Date) will constitute the valid
and binding agreement of the Company enforceable in accordance with its
terms, subject as to enforceability, to bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights and to
general principles of equity (regardless of whether the enforceability of
such Pooling and Servicing Agreement is considered in a proceeding in
equity or at law).
2. Purchase and Sale. Subject to the execution of the Terms Agreement for a
particular Certificate Offering and subject to the terms and conditions and in
reliance upon the representations and warranties set forth in this Agreement and
such Terms Agreement, the Company agrees to sell to each Underwriter, severally
and not jointly, and each Underwriter, severally and not jointly, agrees to
purchase from the Company, the respective original principal amounts of the
Offered Certificates set forth in the applicable Terms Agreement opposite the
flame of such Underwriter, plus any additional original principal amount of
Offered Certificates which such Underwriter may be obligated to purchase
pursuant to Section 16 hereof at the purchase price therefor set forth in such
Terms Agreement (the "Purchase Price").
The parties hereto agree that settlement for all securities sold pursuant
to this Agreement and the applicable Terms Agreement shall take place on the
settlement date agreed upon at the time of the related transaction and set forth
as the "Closing Date" in such Terms Agreement and not as set forth in Rule
15c6-1(a) of the Exchange Act.
3. Delivery and Payment. Delivery of and payment for the Offered
Certificates of a Series shall be made at the offices of ▇▇▇▇▇▇▇ & ▇▇▇▇▇ L.L.P.,
Dallas, Texas, at 10:00 A.M., Dallas time, on the Closing Date specified in the
related Terms Agreement, which date and time may be postponed by agreement
between you and the Company (such date and time being herein called the "Closing
Date"). Delivery of such Offered Certificates shall be made to you for the
respective accounts of the Underwriters against payment of the Purchase Price
thereof to or upon the order of the Company by wire transfer in federal or other
immediately available funds or by check payable in federal funds, as the Company
shall specify no later than five full business days prior to such Closing Date.
Unless delivery is made through the facilities of The Depository Trust Company,
the Offered Certificates shall be registered in such names and in such
authorized denominations as you may request not less than two full business days
in advance of each Closing Date.
The Company agrees to notify you at least two business days before each
Closing Date of the exact principal balance evidenced by the Offered
Certificates and to have such Offered Certificates available for inspection,
checking and packaging in Dallas, Texas, no later than 12:00 noon on the
business day prior to such Closing Date.
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4. Offering by the Underwriter. It is understood that the Underwriters
propose to offer the Offered Certificates of the related Series for sale to the
public as set forth in the related Prospectus.
5. Agreements. The Company agrees with each Underwriter that:
(a) The Company will cause the Prospectus as supplemented by a
Prospectus Supplement relating to the Offered Certificates to be filed
pursuant to Rule 424 under the Act and will promptly advise you when such
Prospectus as so supplemented has been so filed, and prior to the
termination of the Certificate Offering to which such Prospectus relates
also will promptly advise you (i) when any amendment to the related
Registration Statement specifically relating to such Offered Certificates
shall have become effective or any further supplement to such Prospectus
has been filed, (ii) of any request by the Commission for any amendment of
such Registration Statement or Prospectus or for any additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of such Registration Statement or the
institution or threatening of any proceeding for that purpose and (iv) of
the receipt by the Company of any written notification with respect to the
suspension of the qualification of such Offered Certificates for sale in
any jurisdiction or the initiation or threatening of any proceeding for
such purpose. The Company will not file any amendment of the related
Registration Statement or supplement to the related Prospectus (other than
any amendment or supplement specifically relating to one or more Series of
mortgage pass-through certificates other than the Series that includes the
related Offered Certificates or any Exchange Act filings other than Current
Reports) unless the Company has furnished you and your counsel with a copy
for your respective review prior to filing and you have consented to such
filing. The Company will use its best efforts to prevent the issuance of
any such stop order and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) The Company will cause any Computational Materials and any
Structural Term Sheets (each as defined in Section 8 below) with respect to
the Offered Certificates of a Series that are delivered by any Underwriter
to the Company pursuant to Section 8 to be filed with the Commission on a
Current Report on Form 8-K (each such filing of such materials, a "Current
Report") pursuant to Rule 13a-11 under the Exchange Act on the business day
immediately following the later of (i) the day on which such Computational
Materials and Structural Term Sheets are delivered to counsel for the
Company by such Underwriter, and (ii) the date on which this Agreement is
executed and delivered. The Company will cause any Collateral Term Sheet
(as defined in Section 9 below) with respect to the Offered Certificates of
a Series that is delivered by any Underwriter to the Company in accordance
with the provisions of Section 9 to be filed with the Commission on a
Current Report pursuant to Rule l3a-11 under the Exchange Act on the
business day immediately following the day on which such Collateral Term
Sheet is delivered to counsel for the Company by such Underwriter. Each
such Current Report shall be incorporated by reference in the related
Prospectus and the related Registration Statement.
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(c) If, at any time when a prospectus relating to the Offered
Certificates of a Series is required to be delivered under the Act, any
event occurs as a result of which the related Prospectus as then amended or
supplemented would include any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein in
light of the circumstances under which they were made not misleading, or if
it shall be necessary at any time to amend or supplement the related
Prospectus to comply with the Act or the rules thereunder, the Company
promptly shall prepare and file with the Commission, subject to the
penultimate sentence of paragraph (a) of this Section 5, an amendment or
supplement which will correct such statement or omission or an amendment
which will effect such compliance.
(d) The Company will furnish to each Underwriter and counsel for the
Underwriters, without charge, as many signed copies of the related
Registration Statement (including exhibits thereto) and, so long as
delivery of a prospectus by such Underwriter or dealer may be required by
the Act, as many copies of the related Prospectus and any supplements
thereto as such Underwriter may reasonably request.
(e) The Company will furnish such information, execute such
instruments and take such actions as may be reasonably requested by you to
qualify the Offered Certificates of a Series for sale under the laws of
such jurisdictions as the Underwriter may designate, to maintain such
qualifications in effect so long as required for the distribution of such
Offered Certificates and to determine the legality of such Offered
Certificates for purchase by institutional investors; provided, however,
that the Company shall not be required to qualify to do business in any
jurisdiction where it is not qualified on the date of the related Terms
Agreement or to take any action which would subject it to general or
unlimited service of process in any jurisdiction in which it is not, on the
date of the related Terms Agreement, subject to such service of process.
(f) So long as the Offered Certificates of a Series are outstanding,
the Company will furnish to each Underwriter, upon request, copies of the
annual independent public accountants' servicing report furnished to the
Trustee pursuant to the relaxed Pooling and Servicing Agreement.
(g) Unless otherwise specified in the related Terms Agreement, the
company will pay, and First Horizon Home Loan Corporation will cause the
Company to pay, all expenses incident to the performance of the Company's
obligations under this Agreement and the applicable Terms Agreement (other
than the expenses of Deloitte & Touche LLP under Sections 8(c) and 9(c)
hereof, the Underwriters' due diligence expenses, the Underwriters' counsel
fees and the Underwriters' own expenses, which will be paid by the
Underwriters), including and without limitation those related to: (i) the
filing of the Registration Statement with respect to the Certificates and
all amendments thereto, (ii) the printing or photocopying and delivery to
the Underwriters, in such quantities as you may reasonably request, of
copies of this Agreement and the Terms Agreement, (iii) the preparation,
registration, issuance and delivery to the Underwriters of the Certificates
underwritten pursuant to this Agreement, (iv) the fees and disbursements of
the Company's counsel and accountants, and of any counsel rendering a
closing opinion with respect to matters of local law, (v) the qualification
of
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the Certificates underwritten pursuant to this Agreement under securities
and Blue Sky laws and the determination of the eligibility of the
Certificates for investment, including filing fees in connection therewith,
(vi) the printing and delivery to the Underwriters, in such quantities as
they may reasonably request, of copies of the Registration Statement with
respect to the Certificates underwritten pursuant to this Agreement and all
amendments thereto, of any preliminary prospectus and preliminary
prospectus supplement and of the Final Prospectus and all amendments and
supplements thereto and all documents incorporated therein (other than
exhibits to any Current Report), and of any Blue Sky Survey and Legal
Investment Survey, (vii) the printing or photocopying and delivery to the
Underwriters, in such quantities as you may reasonably request, of copies
of the applicable Pooling Agreement, (viii) the fees charged by investment
rating agencies requested by the Company to rate the Certificates
underwritten pursuant to this Agreement, (ix) the fees and expenses, if
any, incurred in connection with the listing of the Certificates
underwritten pursuant to this Agreement on any national securities
exchange, and (x) the fees and expenses of the Trustee and its counsel.
6. Conditions to the Obligations of the Underwriters. The obligations of
the Underwriters to purchase the Offered Certificates of any Series shall be
subject to the accuracy in all material respects of the representations and
warranties on the part of the Company contained in this Agreement, as
supplemented by the related Terms Agreement, as of the respective dates thereof
and the related Closing Date, to the accuracy of the statements of the Company
made in any applicable officers' certificates pursuant to the provisions hereof,
to the performance by the Company of its obligations under this Agreement and
such Terms Agreement and to the following additional conditions applicable to
the related Certificate Offering:
(a) No stop order suspending the effectiveness of the related
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(b) ▇▇▇▇▇▇▇ & ▇▇▇▇▇ L.L.P., counsel for the Company, shall have
furnished to you an opinion addressed to the Underwriters, dated the
related Closing Date, to the effect that:
(i) this Agreement and the related Terms Agreement have been
duly executed and delivered by the Company under the laws of the State
of New York;
(ii) the related Pooling and Servicing Agreement has been duly
executed and delivered by the Company under the laws of the State of
New York and is a legal, valid and binding agreement of the Company
enforceable against the Company in accordance with its terms;
(iii) the Offered Certificates, when duly executed and
countersigned by the Trustee in accordance with the related Pooling
and Servicing Agreement,
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will be validly issued and outstanding and entitled to the benefits of
such Pooling and Servicing Agreement;
(iv) the related Pooling and Servicing Agreement is not required
to be qualified under the Trust Indenture Act of 1939, as amended, and
the trust created thereunder is not required to be registered under
the investment Company Act of 1940, as amended;
(v) such counsel confirms that the related Registration
Statement is effective under the Act and, to the best of such
counsel's knowledge, no stop order with respect thereto has been
issued, and no proceeding for that purpose has been instituted or
threatened by the Commission; such Registration Statement (except the
financial statements and schedules and other financial and statistical
data included therein and the documents incorporated by reference
therein, as to which such counsel need express no view), at the time
it became effective and the related Prospectus (except the financial
statements and schedules, the other financial and statistical data
included therein and the documents incorporated by reference therein),
as of the date of the Prospectus Supplement conformed in all material
respects to the requirements of the Act and the rules and regulations
thereunder; and no information has come to the attention of such
counsel that causes it to believe that (A) such Registration Statement
(except the financial statements and schedules and the other financial
and statistical data included therein and the documents incorporated
by reference therein, as to which such counsel need express no view)
at the time it became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading or (B) such Prospectus or any amendment or supplement
thereto (except the financial statements and schedules and the other
financial and statistical data included therein), as of the date of
the Prospectus Supplement, or at the related Closing Date, contained
or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading;
(vi) the statements set forth under the heading "Description of
the Certificates" in the related Prospectus, insofar as such
statements purport to summarize certain provisions of the related
Pooling and Servicing Agreement and the related Offered Certificates,
provide a fair summary of such provisions;
(vii) the statements set forth in the related Prospectus under
the headings "Certain Legal Aspects of the Mortgage Loans," "Material
Federal Income Tax Consequences" (insofar as they relate specifically
to the purchase, ownership and disposition of the related Offered
Certificates) and "ERISA Considerations" (insofar as they relate
specifically to the purchase, ownership and disposition of such
Offered Certificates), to the extent that they constitute matters of
law or legal conclusions, provide a fair summary of such law or
conclusions;
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(viii) assuming compliance with all provisions of the related
Pooling and Servicing Agreement, for federal income tax purposes, (A)
if any election is made to treat the assets of the Trust Fund as a
REMIC: the related Trust Fund (and any specified subgrouping therein)
will qualify as a REMIC pursuant to Section 860D of the Internal
Revenue Code of 1986, as amended (the "Code"), each Class of
Certificates of the related Series, other than the related Residual
Class or Classes, will constitute a class of "regular interests" in
the related REMIC within the meaning of the Code, and each Class of
such Certificates specified in the related Prospectus as a Class of
Residual Certificates will constitute the "residual interest" in the
related REMIC within the meaning of the Code; (B) if no such REMIC
election is made: the Trust Fund will be treated as a "grantor trust;"
and
(ix) assuming that some or all of the Offered Certificates of
the related Series shall be rated at the time of issuance in one of
the two highest rating categories by a nationally recognized
statistical rating organization, each Offered Certificate so rated
will be at the time of issuance, a "mortgage related security" as such
term is defined in Section 3(a)(41) of the Exchange Act.
Such opinion may express its reliance as to factual matters on the
representations and warranties made by, and on certificates or other documents
furnished by, officers of the parties to this Agreement, the related Terms
Agreement or the related Pooling and Servicing Agreement. Such opinion may
assume the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than the Company.
Such opinion may be qualified, insofar as it concerns the enforceability of the
documents referred to therein, to the extent that such enforceability may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights in general and by general equity
principles (regardless of whether such enforcement is considered in a proceeding
in equity or at law). Such opinion may be further qualified as expressing no
opinion as to (x) the statements in the related Prospectus under the heading
"Certain Legal Aspects of the Mortgage Loans" except insofar as such statements
relate to the laws of the State of New York and the laws of the United States,
and (y) the statements in such Prospectus under the headings "ERISA
Considerations" and "Material Federal Income Tax Consequences" except insofar as
such statements relate to the laws of the United States. In addition, such
opinion may be qualified as an opinion only on the laws of the States of New
York and Texas and the federal laws of the United States of America.
(c) ▇▇▇▇▇▇▇ & ▇▇▇▇▇ L.L.P., counsel for the Company, shall have
furnished to you an opinion addressed to the Underwriters, dated the
related Closing Date, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power to own its properties, to conduct
its business as described in the related prospectus and to enter into
and perform its obligations under this Agreement, the related Terms
Agreement, the related Pooling and Servicing Agreement and the
Certificates of the related Series;
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(ii) The Company has full power and authority to sell the
related Mortgage Loans as contemplated herein and in the related
Pooling and Servicing Agreement;
(iii) This Agreement, the related Terms Agreement and the related
Pooling and Servicing Agreement have been duly authorized, executed
and delivered by the Company under the laws of the State of Delaware;
(iv) The issuance and sale of the Offered Certificates have been
duly authorized by the Company;
(v) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation by the
Company of the transactions contemplated herein or in the related
Pooling and Servicing Agreement, except such as may be required under
the blue sky laws of any jurisdiction and such other approvals as have
been obtained;
(vi) Neither the issuance of the Certificates of the related
Series nor delivery of the related Offered Certificates, nor the
consummation of any other of the transactions contemplated in this
Agreement, the related Terms Agreement or the related Pooling and
Servicing Agreement, nor the fulfillment of the terms of the related
Certificates, the related Pooling and Servicing Agreement, this
Agreement or the related Terms Agreement will conflict with or violate
any term or provision of the articles of incorporation or by-laws of
the Company or any statute, order or regulation applicable to the
Company of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Company and will not
conflict with, result in a breach or violation or the acceleration of
or constitute a default under the terms of any indenture or other
agreement or instrument known to such counsel to which the Company is
a party or by which it is bound; and
(vii) There are no actions, proceedings or investigations pending
or, to the best knowledge of such counsel, threatened before any
court, administrative agency or other tribunal (i) asserting the
invalidity of this Agreement, the related Terms Agreement, the related
Pooling and Servicing Agreement or the related Certificates, (ii)
seeking to prevent the issuance of the Certificates of the related
Series or the consummation by the Company of any of the transactions
contemplated by this Agreement, such Terms Agreement or such Pooling
and Servicing Agreement, or (iii) which might materially and adversely
affect the performance by the Company of its obligations under, or the
validity or enforceability of, this Agreement, such Terms Agreement,
such Pooling and Servicing Agreement or the related Certificates.
In rendering his or her opinion such counsel may rely as to matters of
fact, to the extent deemed proper and as stated therein, on certificates of
responsible officers of the Company or public officials. In addition, such
opinion may be qualified as an opinion only on the general corporation laws of
the State of Delaware.
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(d) In-house counsel for First Horizon Home Loan Corporation (or its
ultimate parent) shall have furnished to you an opinion addressed to the
Underwriters, dated the related Closing Date, to the effect that:
(i) First Horizon Home Loan Corporation has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Kansas, with corporate power to own its
properties, to conduct its business as described in the related
Prospectus and to enter into and perform its obligations under this
Agreement, the related Terms Agreement, the related Pooling and
Servicing Agreement and the Certificates of the related Series;
(ii) First Horizon Home Loan Corporation has full power and
authority to sell and master service the related Mortgage Loans as
contemplated herein and in the related Pooling and Servicing
Agreement;
(iii) This Agreement, the related Terms Agreement and the related
Pooling and Servicing Agreement have been duly authorized, executed
and delivered by First Horizon Home Loan Corporation under the law of
the State of Kansas;
(iv) The issuance and sale of the Offered Certificates have been
duly authorized by First Horizon Home Loan Corporation;
(v) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation by
First Horizon Home Loan Corporation of the transactions contemplated
herein or in the related Pooling and Servicing Agreement, except such
as may be required under the blue sky laws of any jurisdiction and
such other approvals as have been obtained;
(vi) Neither the issuance of the Certificates of the related
Series nor delivery of the related Offered Certificates, nor the
consummation of any other of the transactions contemplated in this
Agreement, the related Terms Agreement or the related Pooling and
Servicing Agreement, nor the fulfillment of the terms of the related
Certificates, the related Pooling and Servicing Agreement, this
Agreement or the related Terms Agreement will conflict with or violate
any term or provision of the articles of incorporation or by-laws of
First Horizon Home Loan Corporation or any statute, order or
regulation applicable to First Horizon Home Loan Corporation of any
court, regulatory body, administrative agency or governmental body
having jurisdiction over First Horizon Home Loan Corporation and will
not conflict with, result in a breach or violation or the acceleration
of or constitute a default under the terms of any indenture or other
agreement or instrument known to such counsel to which First Horizon
Home Loan Corporation is a party or by which it is bound, other than
such conflicts, breaches and violations or defaults which,
individually or on a cumulative basis, would not have a material
adverse effect on First
11
Horizon Home Loan Corporation and its subsidiaries taken as a whole,
or on the issuance and sale of the Certificates or the consummation of
the transactions contemplated hereby; and
(vii) There are no actions, proceedings or investigations pending
or, to the best knowledge of such counsel, threatened before any
court, administrative agency or other tribunal (i) asserting the
invalidity of this Agreement, the related Terms Agreement, the related
Pooling and Servicing Agreement or the related Certificates, (ii)
seeking to prevent the issuance of the Certificates of the related
Series or the consummation by First Horizon Home Loan Corporation of
any of the transactions contemplated by this Agreement, such Terms
Agreement or such Pooling and Servicing Agreement, or (iii) which
might materially and adversely affect the performance by First Horizon
Home Loan Corporation of its obligations under, or the validity or
enforceability of, this Agreement, such Terms Agreement, such Pooling
and Servicing Agreement or the related Certificates.
In rendering his or her opinion such counsel may rely as to matters of
fact, to the extent deemed proper and as stated therein, on certificates of
responsible officers of First Horizon Home Loan Corporation or public officials.
In addition, such opinion may be qualified as an opinion which is based solely
upon a review of the general corporations law of the State of Kansas without
regard to the interpretational case law thereof.
(e) You shall have received from ▇▇▇▇▇ ▇▇▇▇▇▇ LLP, counsel for the
Underwriters, such opinion or opinions, dated the related Closing Date,
with respect to the issuance and sale of the Certificates of the related
Series, the related Registration Statement, the related Prospectus and such
other related matters as the Underwriters may reasonably require, and the
Company shall have furnished to such counsel such documents as the
Underwriters may reasonably request for the purpose of enabling them to
pass upon such matters.
(f) The Company shall have furnished to you a certificate of the
Company, signed by the President or any Vice President or the principal
financial or accounting officer of the Company, dated the related Closing
Date, to the effect that the signers of such certificate have carefully
examined the related Registration Statement (excluding any Current Reports
and any other documents incorporated by reference therein), the related
Prospectus, any Detailed Description (excluding any related Current
Report), this Agreement and the related Terms Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the related Closing Date with the same effect as if made on such
Closing Date, and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied
at or prior to such Closing Date;
12
(ii) no stop order suspending the effectiveness of such
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to their knowledge, threatened; and
(iii) nothing has come to their attention that would lead them to
believe that such Registration Statement (excluding any Current
Report) contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the related
Prospectus (excluding any related Current Report) contains any untrue
statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, or that any Detailed Description includes any untrue
statement of a material fact or omits to state any information which
the Prospectus (or the related Prospectus Supplement) states will be
included in such Detailed Description.
(g) Counsel for the Trustee shall have furnished to you an opinion
addressed to the Underwriters, dated the related Closing Date, to the
effect that:
(i) the Trustee has been duly incorporated and is validly
existing as a New York banking corporation in good standing under the
laws of the State of New York with corporate power to own its
properties and conduct its business as presently conducted by it, to
conduct business as a trustee and to enter into and perform its
obligations under the related Pooling and Servicing Agreement;
(ii) the related Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Trustee and constitutes the
legal, valid and binding agreement of the Trustee enforceable against
the Trustee in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization or other similar
laws affecting the enforcement of creditors' rights generally and to
judicial discretion, and general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law);
(iii) the Trustee has duly accepted its appointment as trustee
under the related Pooling and Servicing Agreement;
(iv) no consent, approval, authorization or order of any New
York or federal court or government agency or body is required on the
part of the Trustee for the consummation of the transactions
contemplated in the related Pooling and Servicing Agreement, except
such as may be required under any federal or state securities law; and
(v) the performance on the part of the Trustee of any of the
transactions contemplated in the related Pooling and Servicing
Agreement does not conflict with or result in a breach or violation of
any term or provision of, or constitute a default under, the Articles
of Organization, as amended, or By-Laws
13
of the Trustee, or any New York or federal statute or regulation
applicable to the Trustee, or to such counsel's knowledge, any
indenture or other agreement or instrument to which the Trustee is a
party or by which it is bound, or, to such counsel's knowledge, any
order of any state or federal court, regulatory body, administrative
agency or governmental body having jurisdiction over the Trustee.
In addition, such counsel shall furnish to you such opinions as to the
treatment of the Trust Fund for purposes of New York tax law as are reasonably
satisfactory to the Underwriter.
(h) KPMG LLP shall have furnished to you a letter addressed to the
Underwriters, dated as of the date of the related Terms Agreement, in form
and substance satisfactory to you, stating in effect that they have
performed certain specified procedures as a result of which they have
determined that such information as you may reasonably request of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the general
accounting records of First Horizon Home Loan Corporation) set forth in the
related Prospectus Supplement under the caption "Servicing of Mortgage
Loans - Foreclosure, Delinquency and Loss Experience" agrees with the
accounting records of First Horizon Home Loan Corporation, excluding any
questions of legal interpretation.
(i) Deloitte & Touche LLP shall have furnished to you a letter
addressed to the Underwriters, dated as of the related Closing Date, in
form and substance satisfactory to you, stating in effect that they have
performed certain specified procedures as a result of which they have
determined that such information as you may reasonably request of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the general
accounting records of the Company and which is obtained from an analysis of
a sample of the Mortgage Loans included in the related pool) set forth in
the related Prospectus Supplement under the caption "The Mortgage Pool" and
in any Detailed Description relating to such Prospectus Supplement is
mutually consistent and agrees with the accounting records of the Company
and, where applicable, the related Mortgage Loan files of the Company,
excluding any questions of legal interpretation. In addition, if
applicable, such accountants shall have furnished to you a letter addressed
to the Underwriters, dated as of the related Closing Date, which shall
include a statement or statements to the effect that based upon the
assumptions and methodology agreed to by the Company (and which is
consistent with the manner in which any final PAC Balances, TAC Balances,
Scheduled Balances, Maximum and Minimum Scheduled Balances or any other
scheduled balances are to be calculated as set forth in the related
Prospectus), all of which shall be described by reference in such letter,
such accountants shall have verified the mathematical accuracy of any final
PAC Balances Table, TAC Balances Table, Scheduled Balances Table, Maximum
or Minimum Scheduled Balances Table or other scheduled balances table
attached as an exhibit to the related Pooling and Servicing Agreement.
(j) Deloitte & Touche LLP shall have furnished to you (addressed to
the Underwriters) and the Company a letter or letters, dated as of the date
of the related
14
Terms Agreement, in form and substance satisfactory to you and the Company,
including, without limitation, statements, if applicable, to the effect
that:
(i) based upon the assumptions and methodology set forth in the
related Prospectus, all of which shall be described by reference in
such letter, they recomputed the percentages of initial principal
balance outstanding as of each of the Distribution Dates (as defined
in such Prospectus) indicated and the weighted average lives of each
Class of Offered Certificates at each of the indicated percentages of
the applicable Prepayment Assumption, and they compared the recomputed
percentages and weighted average lives to the corresponding
percentages and weighted average lives set forth in the related tables
and found them to be in agreement;
(ii) based upon the assumptions and methodology set forth in
such Prospectus, all of which shall be described by reference in such
letter, they have verified the mathematical accuracy of any Scheduled
Final Distribution Dates for the Offered Certificates, PAC Balances,
TAC Balances, Scheduled Balances, Maximum and Minimum Scheduled
Balances or any other scheduled balances set forth in such Prospectus
for each indicated Distribution Date, and have verified the
mathematical accuracy of any initial Effective Ranges of any PAC
Certificates, Scheduled Certificates or other scheduled Certificates
set forth in such Prospectus; and
(iii) based upon the assumptions and methodology set forth in
such Prospectus, all of which shall be described by reference in such
letter, they have verified the mathematical accuracy of the pre-tax
yields to maturity and, if applicable, aggregate cash flows of any
Class of Certificates for which such pretax yields and, if applicable,
aggregate cash flows are set forth in such Prospectus at the indicated
percentages of the Prepayment Assumption and, if applicable, at the
indicated values of COFI, LIBOR or any other index, as applicable.
(k) The Offered Certificates of the related Series shall have
received the ratings specified in the related Terms Agreement (the
"Required Ratings").
(l) Prior to the related Closing Date, the Company shall have
furnished to the Underwriters such further information, certificates and
documents as the Underwriters may reasonably request.
(m) If any Certificates of the related Series are to be sold to any
other underwriter and/or offered in reliance upon an exemption from the
registration requirements of the Act, the sale at or prior to the related
Closing Date of such Certificates to the purchaser thereof shall have
occurred.
(n) Subsequent to the date of the related Terms Agreement, there
shall not have been any change, or any development involving a prospective
change, in or affecting the business or properties of the Company which the
Underwriters conclude in
15
their respective reasonable judgment, after consultation with the Company,
materially impairs the investment quality of the Offered Certificates of
the related Series so as to make it impractical or inadvisable to proceed
with the public offering or the delivery of such Offered Certificates as
contemplated by the related Prospectus.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects with respect to the particular Offered
Certificates of a Series when and as provided in this Agreement and the related
Terms Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement and the related Terms Agreement shall not be in all
material respects reasonably satisfactory in form and substance to the
Underwriters and their counsel, this Agreement (with respect to the related
Offered Certificates) and the related Terns Agreement and all obligations of the
Underwriters hereunder (with respect to the related Offered Certificates) and
thereunder may be canceled at, or at any time prior to, the related Closing Date
by the Underwriters. Notice of such cancellation shall be given to the Company
in writing, or by telephone or telegraph confirmed in writing.
7. Indemnification and Contribution.
(a) The Company and First Horizon Home Loan Corporation jointly and
severally agree to indemnify and hold harmless each Underwriter and each
person who controls any Underwriter within the meaning of the Act or the
Exchange Act against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject under the
Act, the Exchange Act, or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement relating to the Offered
Certificates of the applicable Series as it became effective or in any
amendment or supplement thereof, or in such Registration Statement or the
related Prospectus, or in any amendment thereof, or in any Detailed
Description referred to in such Prospectus (or the related prospectus
Supplement) or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agree to
reimburse each such indemnified ▇▇▇▇▇ for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action; provided, however, that
(i) neither the Company nor First Horizon Home Loan Corporation will be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or
alleged untrue statement or omission or alleged omission made therein (A)
in reliance upon and in conformity with written information furnished to
the Company or First Horizon Home Loan Corporation, as the case may be, as
herein stated by or on behalf of any Underwriter specifically for use in
connection with the preparation thereof or (B) in any Current Report or any
amendment or supplement thereof, except to the extent that any untrue
statement or alleged untrue statement therein or omission therefrom results
(or is alleged to have resulted) directly from an error (a "Mortgage Pool
Error") in the information concerning the characteristics of the Mortgage
Loans furnished by the Company or First Horizon
16
Home Loan Corporation, as the case may be, to any Underwriter in writing or
by electronic transmission that was used in the preparation of either (x)
any Computational Materials or ABS Term Sheets (or amendments or
supplements thereof) included in such Current Report (or amendment or
supplement thereof) or (y) any written or electronic materials furnished to
prospective investors on which the Computational Materials or ABS Term
Sheets (or amendments or supplements) were based and (ii) such indemnity
with respect to any Corrected Statement (as defined below) in such
Registration Statement or the related Prospectus (or any amendment or
supplement thereto) shall not inure to the benefit of any Underwriter (or
any person controlling such Underwriter) from whom the person asserting any
loss, claim, damage or liability purchased the Certificates of the related
Series that are the subject thereof if such person did not receive a copy
of an amendment or supplement to such Registration Statement or the related
Prospectus at or prior to the confirmation of the sale of such Certificates
and the untrue statement or omission of a material fact contained in such
Registration Statement or the related Prospectus (or any amendment or
supplement thereto) was corrected (a "Corrected Statement") in such other
amendment or supplement and such amendment or supplement was furnished by
the Company or First Horizon Home Loan Corporation, as the case may be, to
such Underwriter prior to the delivery of such confirmation. This indemnity
agreement will be in addition to any liability which the Company and First
Horizon Home Loan Corporation may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers, and each person
or entity (including each of its directors and officers) who controls the
Company within the meaning of the Act or the Exchange Act, to the same
extent as the foregoing indemnities from the Company and First Horizon Home
Loan Corporation to the Underwriter, but only with reference to (A) written
information furnished to the Company by or on behalf of such Underwriter
specifically for use in the preparation of the documents referred to in the
foregoing indemnity with respect to the related Series, or (B) any
Computational Materials or ABS Term Sheets (or amendments or supplements
thereof) furnished to the Company by such Underwriter pursuant to Section 8
or Section 9 and incorporated by reference in such Registration Statement
or the related Prospectus or any amendment or supplement thereof (except
that no such indemnity shall be available for any losses, claims, damages
or liabilities, or actions in respect thereof, resulting from any Mortgage
Pool Error). This indemnity agreement will be in addition to any liability
which the Underwriters may otherwise have. The Company acknowledges, unless
otherwise specified in writing by an Underwriter, that the statements set
forth in the first sentence of the last paragraph appearing on the cover
page of the related Prospectus Supplement as such statements relate to such
Offered Certificates and the second sentence of the first paragraph and the
first sentence of the second paragraph in each case under the heading
"Method of Distribution" in such Prospectus Supplement as such statements
relate to such Offered Certificates constitute the only information
furnished in writing by or on behalf of such Underwriter for inclusion in
the related Prospectus (other than any Computational Materials or ABS Term
Sheets (or amendments or supplements thereof) furnished to the Company by
such Underwriter), and such Underwriter confirms that such statements are
correct.
17
(c) Promptly after receipt by an indemnified party under Section 7 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
this Section 7, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to any indemnified
party otherwise than under this Section 7, except to the extent that the
omission to so notify the indemnifying party causes or exacerbates a loss.
In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the
extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified
party, to assume the defense thereof, with counsel satisfactory to such
indemnified party; provided, however, that if the defendants in any such
action include both the indemnified party and the indemnifying party and
the indemnified party shall have reasonably concluded that there may be
legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party,
the indemnified party or parties shall have the right to select separate
counsel to assert such legal defenses and to otherwise participate in the
defense of such action on behalf of such indemnified party or parties. Upon
receipt of notice from the indemnifying party to such indemnified party of
its election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying ▇▇▇▇▇ will not be liable to
such indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof unless (i) the indemnified party shall have employed
separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the next preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for
the expenses of more than one separate counsel approved by the indemnified
party in the case of subparagraph (a) or (b), representing the indemnified
parties under subparagraph (a) or (b), who are parties to such action),
(ii) the indemnifying party shall not have employed counsel satisfactory to
the indemnified party to represent the indemnified party within a
reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party; and except
that, if clause (i) or (iii) is applicable, such liability shall be only in
respect of the counsel referred to in such clause (i) or (iii).
(d) If the indemnification provided for in paragraph (a) or (b) of
this Section 7 is due in accordance with its terms but is for any reason
held by a court to be unavailable from the Company, First Horizon Home Loan
Corporation or any Underwriter, on grounds of policy or otherwise, or if
the indemnified party failed to give notice under paragraph (c) of this
Section 7 in respect of a claim otherwise subject to indemnification in
accordance with paragraph (a) or (b) of this Section 7, the Company, First
Horizon Home Loan Corporation and such Underwriter shall contribute to the
aggregate losses, claims, damages and liabilities (including legal and
other expenses reasonably incurred in connection with investigating or
defending same) to which the Company, First Horizon Home Loan Corporation
and such Underwriter may be subject, as follows:
18
(i) in the case of any losses, claims, damages and liabilities
(or actions in respect thereof) which do not arise out of or are not
based upon any untrue statement or omission of a material fact in any
Computational Materials or ABS Term Sheets (or any amendments or
supplements thereof) or in any written or electronic materials
distributed to prospective investors on which the Computational
Materials are based, in such proportion so that such Underwriter is
responsible for that portion represented by the difference between the
proceeds to the Company in respect of the Offered Certificates
appearing on the cover page of the Prospectus Supplement for the
related Series and the total proceeds received by such Underwriter
from the sale of such Offered Certificates (the "Underwriting
Discount"), and the Company and First Horizon Home Loan Corporation
are jointly and severally responsible for the balance; provided,
however, that in no case shall such Underwriter be responsible under
this subparagraph (i) for any amount in excess of such Underwriting
Discount applicable to the Offered Certificates purchased by such
Underwriter pursuant to this Agreement and the related Terms
Agreement; and
(ii) in the case of any losses, claims, damages and liabilities
(or actions in respect thereof) which arise out of or are based upon
any untrue statement or omission of a material fact in any
Computational Materials or ABS Term Sheets (or any amendments or
supplements thereof) or in any written or electronic materials
distributed to prospective investors on which the Computational
Materials are based, in such proportion as is appropriate to reflect
the relative fault of the Company or First Horizon Home Loan
Corporation, as the case may be, on the one hand and such Underwriter
on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in
respect thereof) as well as any other relevant equitable
considerations; provided, however, that in no case shall such
Underwriter be responsible under this subparagraph (ii) for any amount
in excess of the Underwriting Discount applicable to the Offered
Certificates purchased by such Underwriter pursuant to this Agreement
and the related Terms Agreement. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact in such Computational Materials or
ABS Term Sheets (or any amendments or supplements thereof or such
written or electronic materials) results from information prepared by
the Company or First Horizon Home Loan Corporation, as the case may
be, on the one hand or such Underwriter on the other and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
Notwithstanding anything to the contrary in this Section 7(d), no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 7, each person
who controls an Underwriter within the meaning of either the Act or the Exchange
Act shall have the same rights to contribution as such Underwriter, and each
person who controls the Company or First Horizon Home Loan
19
Corporation, as the case may be, within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company or First Horizon Home Loan
Corporation, as the case may be, shall have the same rights to contribution as
the Company or First Horizon Home Loan Corporation, as the case may be, subject
in each case to the immediately preceding sentence of this paragraph (d).
8. Computational Materials and Structural Term Sheets.
(a) On the business day before the date on which the Current Report
relating to the Offered Certificates of a Series is required to be filed by
the Company with the Commission pursuant to Section 5(b) hereof, each
Underwriter shall deliver to the Company five complete copies of all
materials provided by such Underwriter to prospective investors in such
Offered Certificates that constitute (i) "Computational Materials" within
the meaning of the no-action letter dated May 20, 1994, issued by the
Division of Corporation Finance of the Commission to ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Acceptance Corporation I, ▇▇▇▇▇▇, Peabody & Co. Incorporated, and ▇▇▇▇▇▇
Structured Asset Corporation and the no-action letter dated May 27, 1994,
issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (together, the "▇▇▇▇▇▇ Letters"), the filing
of which material is a condition of the relief granted in such letter (such
materials being the "Computational Materials"), and (ii) "Structural Term
Sheets" within the meaning of the no-action letter dated February 17, 1995,
issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (the "PSA Letter"), the filing of which
material is a condition of the relief granted in such letter (such
materials being the "Structural Term Sheets"). Each delivery of
Computational Materials and Structural Term Sheets to the Company pursuant
to this paragraph (a) shall be effected by delivering four copies of such
materials to counsel for the Company on behalf of the Company at the
address specified in Section 3 hereof and one copy of such materials to the
Company.
(b) If, at any time when a prospectus relating to the Offered
Certificates of a Series is required to be delivered under the Act, it
shall be necessary to amend or supplement the related Prospectus as a
result of an untrue statement of a material fact contained in any
Computational Materials or Structural Term Sheets provided by any
Underwriter pursuant to this Section 8 or the omission to state therein a
material fact required, when considered in conjunction with the related
Prospectus and Prospectus Supplement, to be stated therein or necessary to
make the statements therein, when read in conjunction with the related
Prospectus and Prospectus Supplement, not misleading, or if it shall be
necessary to amend or supplement any Current Report relating to any
Computational Materials or Structural Term Sheets to comply with the Act or
the rules thereunder, such Underwriter shall prepare and furnish to the
Company for filing with the Commission an amendment or supplement which
will correct such statement or omission or an amendment or supplement which
will effect such compliance.
(c) Each Underwriter shall cause Deloitte & Touche LLP to furnish to
the Company a letter, dated as of the date on which you deliver any
Computational Materials or Structural Term Sheets to the Company pursuant
to Section 8(a), in form
20
and substance satisfactory to the Company, stating in effect that they have
verified the mathematical accuracy of any calculations performed by such
Underwriter and set forth in such Computational Materials or Structural
Term Sheets, as applicable.
9. Collateral Term Sheets.
(a) On the business day immediately following the date on which any
Collateral Term Sheet (as defined in the PSA Letter) was first delivered to
a prospective investor in such Offered Certificates, each Underwriter shall
deliver to the Company five complete copies of all materials provided by
such Underwriter to prospective investors in the Offered Certificates that
constitute "Collateral Term Sheets." Each delivery of a Collateral Term
Sheet to the Company pursuant to this paragraph (a) shall be effected by
delivering four copies of such materials to counsel for the Company on
behalf of the Company at the address specified in Section 3 hereof and one
copy of such materials to the Company. (Collateral Term Sheets and
Structural Term Sheets are, together, referred, to herein as "ABS Term
Sheets.")
(b) If, at any time when a prospectus relating to the Offered
Certificates of a Series is required to be delivered under the Act, it
shall be necessary to amend or supplement the related Prospectus as a
result of an untrue statement of a material fact contained in any
Collateral Term Sheets provided by an Underwriter pursuant to this Section
9 or the omission to state therein a material fact required, when
considered in conjunction with the related Prospectus and Prospectus
Supplement, to be stated therein or necessary to make the statements
therein, when read in conjunction with the related Prospectus and
Prospectus Supplement, not misleading, or if it shall be necessary to amend
or supplement any Current Report relating to any Collateral Term Sheets to
comply with the Act or the rules thereunder, such Underwriter shall prepare
and furnish to the Company for filing with the Commission an amendment or
supplement which will correct such statement or omission or an amendment or
supplement which will effect such compliance.
(c) Each Underwriter shall cause Deloitte & Touche LLP to furnish to
the Company a letter, dated as of the date on which you deliver any
Collateral Term Sheets to the Company pursuant to Section 9(a), in form and
substance satisfactory to the Company, stating in effect that they have
verified the mathematical accuracy of any calculations performed by such
Underwriter and set forth in such Collateral Terns Sheets, as applicable.
10. Termination. This Agreement (with respect to a particular Certificate
Offering) and the related Terms Agreement shall be subject to termination in
your absolute discretion, by notice given to the Company prior to delivery of
and payment for the related Offered Certificates, if prior to the related
Closing Date (i) trading in securities generally on the New York Stock Exchange
shall have been suspended or materially limited, (ii) a general moratorium on
commercial banking activities in New York shall have been declared by either
federal or New York State authorities, or (iii) there shall have occurred any
outbreak or escalation of hostilities or other calamity, event or crisis the
effect of which on the financial
21
markets of the United States is such as to make it, in your reasonable judgment,
impracticable to market such Offered Certificates.
11. Representations and Indemnities to Survive Delivery. The agreements,
representations, warranties, indemnities and other statements of the Company (or
First Horizon Home Loan Corporation, as the case may be) or its officers and of
each Underwriter set forth in or made pursuant to this Agreement and the related
Terms Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company (or First
Horizon Home Loan Corporation, as the case may be) or any of the officers,
directors or controlling persons referred to in Section 7 hereof, and will
survive delivery of and payment for the related Offered Certificates. The
provisions of Section 7 hereof shall survive the termination or cancellation of
this Agreement and the related Terms Agreement.
12. Successors. This Agreement and the related Terms Agreement will inure
to the benefit of and be binding upon the patties hereto and thereto and their
respective successors and the officers, directors and controlling persons
referred to in Section 7 hereof, and their successors and assigns, and no other
person will have any right or obligation hereunder or thereunder. No purchaser
of any Offered Certificate from any Underwriter shall be deemed a successor or
assign by reason of such purchase.
13. APPLICABLE LAW. THIS AGREEMENT AND THE RELATED TERMS AGREEMENT WILL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
14. Miscellaneous. This Agreement, as supplemented by the related Terms
Agreement, supersedes all prior and contemporaneous agreements and
understandings relating to the subject matter hereof. This Agreement and the
related Terms Agreement or any term of each may not be changed, waived,
discharged or terminated except by an affirmative written agreement made by the
party against whom enforcement of the change, waiver, discharge or termination
is sought. The headings in this Agreement and the related Terms Agreement are
for purposes of reference only and shall not limit or otherwise affect the
meaning hereof or thereof.
15. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to you, will be delivered to it at the address
first above written; or if sent to the Company, will be delivered to First
Horizon Asset Securities Inc., ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, with a
copy to First Tennessee National Corporation, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Esq.
16. Default by One or More of the Underwriters. If one or more of the
Underwriters shall fail on the Closing Date to purchase the Offered Certificates
which it or they are obligated to purchase hereunder and under the applicable
Terms Agreement (the "Defaulted Certificates"), you shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Certificates in such amounts as may be
22
agreed upon and upon the terms herein set forth and under the applicable Terns
Agreement. If, however, you have not completed such arrangements within such
24-hour period, then:
(a) if the aggregate original principal amount of Defaulted
Certificates does not exceed 10% of the aggregate original principal amount
of the Certificates to be purchased pursuant to such Terms Agreement, the
non-defaulting Underwriters named in such Terms Agreement shall be
obligated to purchase the full amount thereof in the proportions that their
respective underwriting obligations thereunder bear to the underwriting
obligations of all non-defaulting Underwriters; and
(b) if the aggregate original principal amount of Defaulted
Certificates exceeds 10% of the original principal amount of the Offered
Certificates to be purchased pursuant to such Terms Agreement, the
applicable Terms Agreement shall terminate without any liability on the
part of any non-defaulting Underwriter.
No action taken pursuant to this Section 16 and nothing in this Agreement
shall relieve any defaulting Underwriter from liability in respect of its
default.
In the event of any such default which does not result in a termination of
this Agreement or such applicable Terms Agreement, either you or the Company
shall have the right to postpone the Closing Date for a period of time not
exceeding seven days in order to effect any required changes in the Registration
Statement or in any other documents or arrangements.
* * *
23
If the foregoing, is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Company and you.
Very truly yours,
FIRST HORIZON ASSET SECURITIES INC.
By: _______________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
FIRST TENNESSEE BANK NATIONAL
ASSOCIATON
By:________________________________________
Name:
Title:
FIRST HORIZON HOME LOAN CORPORATION
By:________________________________________
Name:
Title:
24
EXHIBIT A
FIRST HORIZON ASSET SECURITIES INC.
REMIC MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATES
SERIES ___ - ___
TERMS AGREEMENT
(to Underwriting Agreement,
dated [[________ ___, 200__]]
between the Company and the Underwriter)
First Horizon Asset Securities Inc. [ ]
4000 Horizon Way [Date]
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Each of [ ] (the "Underwriters") severally agrees,
subject to the terms and provisions herein and of the captioned Underwriting
Agreement (the "Underwriting Agreement"), to purchase such Classes of Series
______-______ Certificates specified in Section 2(a) hereof (the "Offered
Certificates"). This letter supplements and modifies the Underwriting Agreement
solely as it relates to the purchase and sale of the Offered Certificates
described below. The Series ______-______ Certificates are registered with the
Securities and Exchange Commission by means of an effective Registration
Statement (No. 333-_______). Capitalized terms used and not defined herein have
the meanings given them in the Underwriting Agreement.
Section 1. The Mortgage Pool: The Series ______-______ Certificates shall
evidence the entire beneficial ownership interest in a mortgage pool (the
"Mortgage Pool") of conventional, fixed rate, fully amortizing one- to
four-family residential mortgage loans (the "Mortgage Loans") having the
following characteristics as of _______________ ____, ______ (the "Cut-off
Date"):
(a) Aggregate Principal Amount of the Mortgage Pool: $[ ]
aggregate principal balance as of the Cut-off Date, subject to [an upward
or downward variance of up to [ ]%, the precise aggregate principal
balance to be determined by the Company][a permitted variance such that the
aggregate Scheduled Principal Balance thereof will be not less than
$[ ] or greater than $[ ].
(b) Original Terms to Maturity: The original term to maturity of
each Mortgage Loan included in the Mortgage Pool shall be between _____ and
_____ years.
Section 2. The Certificates. The Offered Certificates shall be issued as
follows:
(a) Classes: The Offered Certificates shall be issued with the
following Class designations, interest rates and principal balances,
subject in the aggregate to the
variance referred to in Section 1(a)[and, as to any particular Class, to an
upward or downward variance of up to [ ]%]:
Principal Interest Class Purchase
Class Balance Rate Price Percentage
----- ------- ---- ----------------
(b) The Offered Certificates shall have such other characteristics as
described in the related Prospectus.
Each of the Underwriters agrees, severally and not jointly, subject to the
terns and conditions contained herein and in the Underwriting Agreement, to
purchase the principal balances of the Classes of Certificates specified
opposite its name below:
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Series [ ]
Designation [Underwriter] [Underwriter]
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Section 3. Purchase Price: The Purchase Price for each Class of the
Offered Certificates shall be the Class Purchase Price Percentage therefor (as
set forth in Section 2(a) above) of the initial Class Certificates Principal
Balance thereof plus accrued interest at the rate of [ ]% per annum from and
including the Cut-off Date up to, but not including, __________ ____, ______
(the "Closing Date").
Section 4. Required Ratings: The Offered Certificates shall have received
Required Ratings of at least [ ] from [ ].
Section 5. Tax Treatment: [One or more elections will be made to treat the
assets of the Trust Fund as a REMIC.] [The Trust Fund will be treated as a
"grantor trust" for federal income tax purposes.]
[Section 6. Additional Expenses:]*
-----------------------------------
* to be inserted if applicable.
A-2
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the undersigned a counterpart hereof, whereupon this
letter and your acceptance shall represent a binding agreement between the
Underwriters and the Company.
Very truly yours,
CO-MANAGER:
[UNDERWRITER]
By:______________________________________
Name:
Title:
CO-MANAGER:
[UNDERWRITER]
By:______________________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
FIRST HORIZON ASSET SECURITIES INC.
By:___________________________________
Name:
Title:
FIRST HORIZON HOME LOAN CORPORATION
By:___________________________________
Name:
Title:
A-3