EXHIBIT 1.1
Underwriting Agreement
January 24, 2001
FIRST HORIZON ASSET SECURITIES INC.
MORTGAGE PASS-THROUGH CERTIFICATES
(Issuable in Series)
UNDERWRITING AGREEMENT
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Bear, Xxxxxxx & Co., Inc. Xxx Xxxx, Xxx Xxxx
000 Xxxx Xxxxxx January 24, 0000
Xxx Xxxx, Xxx Xxxx 00000
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") between the Company, as depositor, First Horizon Home Loan Corporation,
as seller and master servicer, 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 Xxxxxx Mae, Xxxxxx Xxx or
Xxxxxxx 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 which 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
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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
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the date of the related Terms Agreement and on each Closing Date (as
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.
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(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, 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
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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
name 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
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of a Series shall be made at the offices of Xxxxxxx & Xxxxx, 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
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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:
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(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 13a-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.
(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
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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 related 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 L.L.P. 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 the Certificates underwritten pursuant to this Agreement under
securities and Blue Sky laws and the determination of
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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
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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) Xxxxxxx & Xxxxx 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,
will be validly issued and outstanding and entitled to the benefits of
such Pooling and Servicing Agreement;
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(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;
(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
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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) Xxxxxxx & Xxxxx, 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
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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.
(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,
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breaches and violations or defaults which, individually or on a
cumulative basis, would not have a material adverse effect on First
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; 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 Xxxxx & Xxxx 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
13
constitute a default under, the Articles of Organization, as amended, or
By-Laws 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) Xxxxxx Xxxxxxxx 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.
14
(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 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 pre-tax 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.
15
(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 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 Terms 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 party 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
16
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 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
17
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.
(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 party 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
18
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:
(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.
19
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 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 Xxxxxx, Xxxxxxx Acceptance Corporation I,
Xxxxxx, Peabody & Co. Incorporated, and Xxxxxx 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 "Xxxxxx 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
20
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 L.L.P. 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 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 L.L.P. 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 Term 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
21
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 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 parties 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., 0000 Xxxxxxx Xxx, Xxxxxx, Xxxxx 00000, Attention:
Xxxx Xxxxxx, with a copy to First Tennessee National Corporation, 000 Xxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000, Attention: Xxxxx X. Xxxxxxxx, Xx., Esq.
22
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 agreed upon and upon the
terms herein set forth and under the applicable Terms 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: /s/ Xxxx Xxxxxx
--------------------------
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
BEAR, XXXXXXX & CO., INC.
By: /s/ Xxxx Xxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Managing Director
FIRST HORIZON HOME LOAN CORPORATION
By: /s/ Xxxx Xxxxxx
--------------------------------
Name:
Title:
24
EXHIBIT A
FIRST HORIZON ASSET SECURITIES INC.
REMIC MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATES
SERIES ____-__
TERMS AGREEMENT
---------------
(to Underwriting Agreement,
dated [ ], 2001
between the Company and the Underwriter)
First Horizon Asset Securities Inc. [ ]
4000 Horizon Way [Date]
Xxxxxx, Xxxxx 00000
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
[ ]%]:
A-1
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
terms and conditions contained herein and in the Underwriting Agreement, to
purchase the principal balances of the Classes of Certificates specified
opposite its name below:
-------------------------------------------------------------------------------
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
FIRST HORIZON ASSET SECURITIES INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2001-1
TERMS AGREEMENT
---------------
(to Underwriting Agreement,
dated January 24, 2001
between the Company and the Underwriter)
First Horizon Asset Securities Inc. New York, New York
4000 Horizon Way March 26, 2001
Xxxxxx, Xxxxx 00000
Bear, Xxxxxxx & Co., Inc. (the "Underwriter") agrees, subject to the terms
and provisions herein and of the captioned Underwriting Agreement (the
"Underwriting Agreement"), to purchase such Classes of Series 2001-2
Certificates specified in Section 2(a) hereof (the "Offered Certificates") and
described in the Prospectus Supplement dated March 26, 2001 relating to the
Offered Certificates (the "Prospectus Supplement"). 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 2001-2
Certificates are registered with the Securities and Exchange Commission by means
of an effective Registration Statement (No. 333-47798). Capitalized terms used
and not defined herein have the meanings given them in the Underwriting
Agreement.
Section 1. The Mortgage Pool: The Series 2001-2 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 March 1, 2001 (the "Cut-off Date"):
(a) Aggregate Principal Amount of the Mortgage Pool: $173,258,758
-----------------------------------------------
aggregate principal balance as of the Cut-off Date, subject to an upward or
downward variance of up to 5%, the precise aggregate principal balance to
be determined by the Company.
(b) Original Terms to Maturity: The original term to maturity of each
--------------------------
Mortgage Loan included in the Mortgage Pool shall be between 20 and 30
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):
Principal Interest Class Purchase
Class Balance Rate Price Percentage
----- --------- -------- ----------------
A-1 $26,000,000.00 7.000% 99.87500%
A-2 $11,854,000.00 7.000% 99.87500%
A-3 $ 6,479,000.00 7.000% 99.87500%
A-4 $ 7,727,000.00 7.000% 99.87500%
A-5 $ 4,072,000.00 7.000% 99.87500%
A-6 $ 7,205,949.00 7.000% 99.87500%
A-7 $ 5,554,000.00 7.000% 99.87500%
A-8 $ 2,577,176.00 7.000% 99.87500%
A-9 $ 1,000,000.00 7.000% 99.87500%
A-10 $ 1,000,000.00 7.000% 99.87500%
A-11 $ 1,000,000.00 7.000% 99.87500%
A-12 $ 1,000,000.00 7.000% 99.87500%
A-13 $ 2,000,000.00 7.000% 99.87500%
A-14 $ 2,000,000.00 7.000% 99.87500%
A-15 $42,322,667.00 6.250% 99.87500%
A-16 $22,565,333.00 Variable (2) 99.87500%
A-17 (1) Variable (2) 99.87500%
A-18 $ 4,212,000.00 6.500% 99.87500%
A-19 $17,325,875.00 7.000% 99.87500%
A-R $ 50.00 7.000% 99.87500%
A-RL $ 50.00 7.000% 99.87500%
B-1 $ 3,292,000.00 7.000% 98.30206%
B-2 $ 1,559,000.00 7.000% 96.62077%
B-3 $ 866,000.00 7.000% 91.82251%
(1) The Class A-17 Certificates are interest only certificates and will accrue
interest during each interest accrual period based on a notional principal
amount. The initial notional principal amount will be approximately
$22,565,333. Reductions in the notional principal amount of the Class A-17
Certificates will occur concurrently with reductions in the class
certificate balance of the Class A-16 Certificates.
(2) The pass-through rates for the Class A-16 and Class A-17 Certificates are
calculated as described under "Description of the Certificates - Interest"
in the Prospectus Supplement.
2
(b) The Offered Certificates shall have such other characteristics as
described in the Prospectus Supplement.
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 per annum initial interest rate
applicable thereto from and including the Cut-off Date up to, but not including,
March 30, 2001 (the "Closing Date").
Section 4. Required Ratings: The Offered Certificates shall have received
----------------
Required Ratings of: (i) at least "AAA" from Fitch, Inc. ("Fitch") and "Aaa"
from Xxxxx'x Investor Service, Inc., in the case of the Class A-1, Class A-2,
Class A-3, Class A-4, Class A-5, Class A-6, Class A-7, Class A-8, Class A-9,
Class A-10, Class A-11, Class A-12, Class A-13, Class A-14, Class A-15, Class X-
00, Class A-17, Class A-18, Class A-19, Class A-R, Class A-L Certificates, (ii)
at least "AA" from Fitch, in the case of the Class B-1 Certificates, (iii) at
least "A" from Fitch in the case of the Class B-2 Certificates, and (iv) at
least "BBB" from Fitch in the case of the Class B-3 Certificates.
Section 5. Tax Treatment: One or more elections will be made to treat the
-------------
assets of the Trust Fund as two separate REMICs, as described in the Prospectus
Supplement.
3
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
Underwriter and the Company.
Very truly yours,
BEAR, XXXXXXX & CO., INC.
By: /s/ Xxxx Xxxxxxxx
--------------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Managing Director
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
FIRST HORIZON ASSET SECURITIES INC.
By: /s/ Xxxx Xxxxxx
------------------------------
Name:
Title:
FIRST HORIZON HOME LOAN CORPORATION
By: /s/ Xxxx Xxxxxx
------------------------------
Name:
Title:
