EXHIBIT 1.1
Underwriting Agreement dated as of
December 23, 2002,
by and among Xxxxxxx Xxxxx,
the Registrant and FHHLC
FIRST HORIZON ASSET SECURITIES INC.
MORTGAGE PASS-THROUGH CERTIFICATES
(Issuable in Series)
UNDERWRITING AGREEMENT
Xxxxxxx Xxxxx & Co. New York, New York
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx December 23, 2002
Incorporated
4 World Financial Center, 00/xx/ Xxxxx
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 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
defined in Section
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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 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 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 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 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 the eligibility of the Certificates for investment, including filing
fees in connection
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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) 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;
(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
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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 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,
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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;
(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;
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(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.
(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:
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(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 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
11
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 Xxxxxx 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;
(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
12
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 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.
13
(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 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
14
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.
(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)
15
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 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
16
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.
(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;
17
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 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
18
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 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
19
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 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
20
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 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
21
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 SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
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.
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
22
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.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By: _______________________________
Name:
Title:
FIRST HORIZON HOME LOAN CORPORATION
By: _______________________________
Name:
Title:
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:
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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
