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Exhibit 10.1
FHAMS 2007-AA2
MORTGAGE LOAN PURCHASE
AGREEMENT
THIS
MORTGAGE LOAN PURCHASE AGREEMENT dated as of June 29, 2007 by and
between FIRST HORIZON HOME LOANS, a division of First Tennessee
Bank National Association, a national banking association (the
“Seller”), and FIRST HORIZON ASSET SECURITIES INC., a
Delaware corporation (the “Purchaser”).
WHEREAS,
the Seller owns certain Mortgage Loans (as hereinafter defined)
which Mortgage Loans are more particularly listed and described in
Schedule A attached hereto and made a part
hereof.
WHEREAS,
the Seller and the Purchaser wish to set forth the terms pursuant
to which the Mortgage Loans, excluding the servicing rights
thereto, are to be sold by the Seller to the Purchaser.
WHEREAS,
the Seller will simultaneously transfer the servicing rights for
the Mortgage Loans to First Tennessee Mortgage Services, Inc.
(“FTMSI”) pursuant to the Servicing Rights Transfer and
Subservicing Agreement (as hereinafter defined).
WHEREAS,
the Purchaser will engage FTMSI to service the Mortgage Loans
pursuant to the Servicing Agreement (as hereinafter
defined).
NOW,
THEREFORE, in consideration of the foregoing, other good and
valuable consideration, and the mutual terms and covenants
contained herein, the parties hereto agree as follows:
ARTICLE I
Definitions
Agreement : This Mortgage Loan Purchase Agreement, as the
same may be amended, supplemented or otherwise modified from time
to time in accordance with the terms hereof.
Alternative Title Product : Any one of the following: (i)
Lien Protection Insurance issued by Integrated Loan Services or ATM
Corporation of America, (ii) a Mortgage Lien Report issued by EPN
Solutions/ACRAnet, (iii) a Property Plus Report issued by Rapid
Refinance Service through SharperLending.com, or (iv) such other
alternative title insurance product that the Seller utilizes in
connection with its then current underwriting criteria.
Business Day : Any day other than (i) a Saturday or a
Sunday, or (ii) a day on which banking institutions in the City of
Dallas, the State of Texas or New York City is located are
authorized or obligated by law or executive order to be
closed.
Closing Date : June 29, 2007
Code : The Internal Revenue Code of 1986, including any
successor or amendatory provisions.
Cooperative Corporation : The entity that holds title (fee
or an acceptable leasehold estate) to the real property and
improvements constituting the Cooperative Property and which
governs the Cooperative Property, which Cooperative Corporation
must qualify as a Cooperative Housing Corporation under Section 216
of the Code.
Coop Shares : Shares issued by a Cooperative
Corporation.
Cooperative Loan : Any Mortgage Loan secured by Coop Shares
and a Proprietary Lease.
Cooperative Property : The real property and improvements
owned by the Cooperative Corporation, including the allocation of
individual dwelling units to the holders of the Coop Shares of the
Cooperative Corporation.
Cooperative Unit : A single family dwelling located in a
Cooperative Property.
Custodian : First Tennessee Bank National Association, and
its successors and assigns, as custodian under the Custodial
Agreement dated as of June 29, 2007 by and among The Bank of New
York, as trustee, First Horizon, as master servicer, and the
Custodian.
Cut-Off Date : June 1, 2007.
Cut-off Date Principal Balance : As to any Mortgage Loan,
the Stated Principal Balance thereof as of the close of business on
the Cut-off Date.
Debt Service Reduction : With respect to any Mortgage Loan,
a reduction by a court of competent jurisdiction in a proceeding
under the Bankruptcy Code in the Scheduled Payment for such
Mortgage Loan which became final and non-appealable, except such a
reduction resulting from a Deficient Valuation or any reduction
that results in a permanent forgiveness of principal.
Deficient Valuation : With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged
Property in an amount less than the then-outstanding indebtedness
under the Mortgage Loan, or any reduction in the amount of
principal to be paid in connection with any Scheduled Payment that
results in a permanent forgiveness of principal, which valuation or
reduction results from an order of such court which is final and
non-appealable in a proceeding under the United States Bankruptcy
Reform Act of 1978, as amended.
Delay Delivery Mortgage Loans : The Mortgage Loans for which
all or a portion of a related Mortgage File is not delivered to the
Trustee or to the Custodian on its behalf on the Closing Date. The
number of Delay Delivery Mortgage Loans shall not exceed 25% of the
aggregate number of Mortgage Loans as of the Closing
Date.
Deleted Mortgage Loan : As defined in Section 4.1(c)
hereof.
Determination Date : The earlier of (i) the third Business
Day after the 15th day of each month, and (ii) the second Business
Day prior to the 25 th day of each month, or if such 25
th day is not a Business Day, the next succeeding
Business Day.
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First Horizon : First Horizon Home Loans, a division of
First Tennessee Bank National Association, a national banking
association.
GAAP : Generally accepted accounting principles as in effect
from time to time in the United States of America.
Insurance Proceeds : Proceeds paid by an insurer pursuant to
any insurance policy, including all riders and endorsements thereto
in effect, including any replacement policy or policies, in each
case other than any amount included in such Insurance Proceeds in
respect of expenses covered by such insurance policy.
Liquidation Proceeds : Amounts, including Insurance
Proceeds, received in connection with the partial or complete
liquidation of defaulted Mortgage Loans, whether through
trustee’s sale, foreclosure sale or otherwise or amounts
received in connection with any condemnation or partial release of
a Mortgaged Property.
MERS : Mortgage Electronic Registration Systems, Inc., a
corporation organized and existing under the laws of the State of
Delaware, or any successor thereto.
MERS Mortgage Loan : Any Mortgage Loan registered with MERS
on the MERS System.
MERS® System : The system of recording transfers of
mortgages electronically maintained by MERS.
MIN : The Mortgage Identification Number for any MERS
Mortgage Loan.
MOM Loan : Any Mortgage Loan as to which MERS is acting as
mortgagee, solely as nominee for the originator of such Mortgage
Loan and its successors and assigns.
Mortgage : The mortgage, deed of trust or other instrument
creating a first lien on the property securing a Mortgage
Note.
Mortgage File : The mortgage documents listed in Section 3.1
pertaining to a particular Mortgage Loan and any additional
documents required to be added to the Mortgage File pursuant to
this Agreement.
Mortgage Loans : The mortgage loans transferred, sold and
conveyed by the Seller to the Purchaser, pursuant to this
Agreement.
Mortgage Loan Purchase Price : With respect to any Mortgage
Loan required to be purchased by the Seller pursuant to Section
4.1(c) hereof, an amount equal to the sum of (i) 100% of the unpaid
principal balance of the Mortgage Loan on the date of such
purchase, and (ii) accrued interest thereon at the applicable
Mortgage Rate from the date through which interest was last paid by
the Mortgagor to the first day in the month in which the Mortgage
Loan Purchase Price is to be distributed to the Purchaser or its
designees.
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Mortgage Note : The original executed note or other evidence
of indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
Mortgage Rate : The annual rate of interest borne by a
Mortgage Note from time to time, net of any insurance premium
charged by the mortgagee to obtain or maintain any primary
insurance policy.
Mortgaged Property : The underlying property securing a
Mortgage Loan, which, with respect to a Cooperative Loan, is the
related Coop Shares and Proprietary Lease.
Mortgagor : The obligor(s) on a Mortgage Note.
Principal Prepayment : Any payment of principal by a
Mortgagor on a Mortgage Loan that is received in advance of its
scheduled Due Date and is not accompanied by an amount representing
scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.
Proprietary Lease : With respect to any Cooperative Unit, a
lease or occupancy agreement between a Cooperative Corporation and
a holder of related Coop Shares.
Purchase Price : $242,912,842.93
Purchaser : First Horizon Asset Securities Inc., in its
capacity as purchaser of the Mortgage Loans from the Seller
pursuant to this Agreement.
Recognition Agreement : With respect to any Cooperative
Loan, an agreement between the Cooperative Corporation and the
originator of such Mortgage Loan which establishes the rights of
such originator in the Cooperative Property.
Scheduled Payment : The scheduled monthly payment on a
Mortgage Loan due on the first day of the month allocable to
principal and/or interest on such Mortgage Loan which, unless
otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the
amount of the monthly payment due on such Mortgage Loan.
Security Agreement : The security agreement with respect to
a Cooperative Loan.
Seller : First Horizon and its successors and assigns, in
its capacity as seller of the Mortgage Loans.
Servicing Agreement : The servicing agreement, dated as of
November 26, 2002 by and between First Horizon Asset
Securities Inc. and its assigns, as owner, and First Tennessee
Mortgage Services, Inc., as servicer.
Servicing Rights Transfer and Subservicing Agreement : The
servicing rights transfer and subservicing agreement, dated as of
November 26, 2002 by and between First Horizon, as transferor and
subservicer, and First Tennessee Mortgage Services, Inc., as
transferee and servicer.
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Stated Principal Balance : As to any Mortgage Loan, the
unpaid principal balance of such Mortgage Loan as specified in the
amortization schedule at the time relating thereto (before any
adjustment to such amortization schedule by reason of any
moratorium or similar waiver or grace period) after giving effect
to any previous partial Principal Prepayments and Liquidation
Proceeds allocable to principal (other than with respect to any
Liquidated Mortgage Loan) and to the payment of principal due on
such date and irrespective of any delinquency in payment by the
related Mortgagor.
Substitute Mortgage Loan : A Mortgage Loan substituted by
the Seller for a Deleted Mortgage Loan which must, on the date of
such substitution, (i) have a Stated Principal Balance, after
deduction of the principal portion of the Scheduled Payment due in
the month of substitution, not in excess of, and not more than 10%
less than the Stated Principal Balance of the Deleted Mortgage
Loan; (ii) have a Mortgage Rate not lower than the Mortgage Rate of
the Deleted Mortgage Loan; (iii) have a maximum mortgage rate not
more than 1% per annum higher or lower than the maximum mortgage
rate of the Deleted Mortgage Loan; (iv) have a minimum mortgage
rate specified in its related Mortgage Note not more than 1% per
annum higher or lower than the minimum mortgage rate of the Deleted
Mortgage Loan; (v) have the same mortgage index, reset period and
periodic rate as the Deleted Mortgage Loan and a gross margin not
more than 1% per annum higher or lower than that of the Deleted
Mortgage Loan (vi) be accruing interest at a rate no lower than and
not more than 1% per annum higher than, that of the Deleted
Mortgage Loan; (vii) have a loan-to-value ratio no higher than that
of the Deleted Mortgage Loan; (viii) have a remaining term to
maturity no greater than (and not more than one year less than that
of) the Deleted Mortgage Loan; (ix) not be a Cooperative Loan
unless the Deleted Mortgage Loan was a Cooperative Loan and (x)
comply with each representation and warranty set forth in
Schedule B hereto.
Trustee : The Bank of New York and its successors and, if a
successor trustee is appointed hereunder, such
successor.
ARTICLE II
Purchase and Sale
Section
2.1 Purchase Price . In consideration for the payment
to it of the Purchase Price on the Closing Date, pursuant to
written instructions delivered by the Seller to the Purchaser on
the Closing Date, the Seller does hereby transfer, sell and convey
to the Purchaser on the Closing Date, but with effect from the
Cut-off Date, (i) all right, title and interest of the Seller in
the Mortgage Loans, excluding the servicing rights thereto, and all
property securing such Mortgage Loans, including all interest and
principal received or receivable by the Seller with respect to the
Mortgage Loans on or after the Cut-off Date and all interest and
principal payments on the Mortgage Loans received on or prior to
the Cut-off Date in respect of installments of interest and
principal due thereafter, but not including payments of principal
and interest due and payable on the Mortgage Loans on or before the
Cut-off Date, and (ii) all proceeds from the foregoing. Items (i)
and (ii) in the preceding sentence are herein referred to
collectively as “Mortgage Assets.”
Section
2.2 Timing . The sale of the Mortgage Assets hereunder
shall take place on the Closing Date.
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ARTICLE III
Conveyance and Delivery
Section
3.1 Delivery of Mortgage Files . In connection with
the transfer and assignment set forth in Section 2.1 above, the
Seller has delivered or caused to be delivered to the Trustee or to
the Custodian on its behalf (or, in the case of the Delay Delivery
Mortgage Loans, will deliver or cause to be delivered to the
Trustee or to the Custodian on its behalf within thirty (30) days
following the Closing Date) the following documents or instruments
with respect to each Mortgage Loan so assigned (collectively, the
“Mortgage Files”):
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(a)
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(1) the
original Mortgage Note endorsed by manual or facsimile signature in
blank in the following form: “Pay to the order of
________________, without recourse,” with all intervening
endorsements showing a complete chain of endorsement from the
originator to the Person endorsing the Mortgage Note (each such
endorsement being sufficient to transfer all right, title and
interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note); or
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(2) with
respect to any Lost Mortgage Note, a lost note affidavit from the
Seller stating that the original Mortgage Note was lost or
destroyed, together with a copy of such Mortgage Note;
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(b)
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except as provided below and for each Mortgage
Loan that is not a MERS Mortgage Loan, the original recorded
Mortgage or a copy of such Mortgage certified by the Seller as
being a true and complete copy of the Mortgage, and in the case of
each MERS Mortgage Loan, the original Mortgage, noting the presence
of the MIN of the Mortgage Loans and either language indicating
that the Mortgage Loan is a MOM Loan if the Mortgage Loan is a MOM
Loan or if the Mortgage Loan was not a MOM Loan at origination, the
original Mortgage and the assignment thereof to MERS, with evidence
of recording indicated thereon, or a copy of the Mortgage certified
by the public recording office in which such Mortgage has been
recorded;
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(c)
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a duly executed assignment of the Mortgage in
blank (which may be included in a blanket assignment or
assignments), together with, except as provided below, all interim
recorded assignments of such mortgage (each such assignment, when
duly and validly completed, to be in recordable form and sufficient
to effect the assignment of and transfer to the assignee thereof,
under the Mortgage to which the assignment relates); provided that,
if the related Mortgage has not been returned from the applicable
public recording office, such assignment of the Mortgage may
exclude the information to be provided by the recording
office;
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(d)
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the original or copies of each assumption,
modification, written assurance or substitution agreement, if
any;
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(e)
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either the original or duplicate original title
policy (including all riders thereto) with respect to the related
Mortgaged Property, if available, provided that the
title
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policy (including all riders thereto) will be
delivered as soon as it becomes available, and if the title policy
is not available, and to the extent required pursuant to the second
paragraph below or otherwise in connection with the rating of the
Certificates, a written commitment or interim binder or preliminary
report of the title issued by the title insurance or escrow company
with respect to the Mortgaged Property, or, in lieu thereof, an
Alternative Title Product; and
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(f)
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in the case of a Cooperative Loan, the originals
of the following documents or instruments:
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(1) The Coop Shares, together with a stock power
in blank;
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(2) The executed Security Agreement;
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(3) The executed Proprietary Lease;
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(4) The executed Recognition
Agreement;
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(5) The executed
UCC-1 financing statement with evidence of recording thereon which
have been filed in all places required to perfect the
Seller’s |
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interest in the Coop
Shares and the Proprietary Lease; and |
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(6) Executed UCC-3
financing statements or other appropriate UCC financing statements
required by state law, evidencing a complete and
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line from the mortgagee
to the Trustee with evidence of recording thereon (or in a form
suitable for recordation). |
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In
the event that in connection with any Mortgage Loan that is not a
MERS Mortgage Loan the Seller cannot deliver (i) the original
recorded Mortgage or (ii) all interim recorded assignments
satisfying the requirements of clause (b) or (c) above,
respectively, concurrently with the execution and delivery hereof
because such document or documents have not been returned from the
applicable public recording office, the Seller shall promptly
deliver or cause to be delivered to the Trustee or the Custodian on
its behalf such original Mortgage or such interim assignment, as
the case may be, with evidence of recording indicated thereon upon
receipt thereof from the public recording office, or a copy
thereof, certified, if appropriate, by the relevant recording
office, but in no event shall any such delivery of the original
Mortgage and each such interim assignment or a copy thereof,
certified, if appropriate, by the relevant recording office, be
made later than one year following the Closing Date; provided,
however, in the event the Seller is unable to deliver or cause to
be delivered by such date each Mortgage and each such interim
assignment by reason of the fact that any such documents have not
been returned by the appropriate recording office, or, in the case
of each such interim assignment, because the related Mortgage has
not been returned by the appropriate recording office, the Seller
shall deliver or cause to be delivered such documents to the
Trustee or the Custodian on its behalf as promptly as possible upon
receipt thereof and, in any event, within 720 days following the
Closing Date; provided, further, however, that the Seller shall not
be required to provide an original or duplicate lender’s
title policy (together with all riders thereto) if the Seller
delivers an Alternative Title Product in lieu thereof.
The
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