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Exhibit 99.2
MORTGAGE LOAN PURCHASE
AGREEMENT
Dated as of June 28,
2007
between
FIRST HORIZON ASSET SECURITIES
INC.
(Purchaser)
and
FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
(Seller)
First Horizon ABS Trust
2007-HE1
MORTGAGE
LOAN PURCHASE AGREEMENT, dated as of June 28, 2007 (this
“Agreement”), between First Tennessee Bank National
Association (the “Seller”) and First Horizon Asset
Securities Inc. (the “Purchaser”).
W I T N E S S E T
H
WHEREAS,
the Seller is the owner of the notes or other evidence of
indebtedness (the “Mortgage Notes”) indicated on
Schedule I hereto (the “Mortgage Loan Schedule”), and
the Related Documents (as defined in Section 2.03 below, and
together with the Mortgage Notes, the “Mortgage
Loans”);
WHEREAS,
the Seller, as of the date hereof, owns the mortgages (the
“Mortgages”) on the properties (the “Mortgaged
Properties”) securing the Mortgage Loans, including rights to
(a) any property acquired by foreclosure or deed in lieu of
foreclosure or otherwise and (b) the proceeds of any insurance
policies covering the Mortgage Loans or the Mortgaged Properties or
the obligors on the Mortgage Loans;
WHEREAS,
the parties hereto desire that the Seller sell the Mortgage Loans
to the Purchaser pursuant to the terms of this Agreement;
and
WHEREAS,
pursuant to the terms of a Sale and Servicing Agreement dated as of
June 1, 2007 (the “Sale and Servicing Agreement”)
among the Seller, as seller and as servicer, the Purchaser, as
depositor, The Bank of New York, as indenture trustee (the
“Indenture Trustee”) and First Horizon ABS Trust
2007-HE1 (the “Trust”), the Purchaser will convey the
Mortgage Loans to the Trust.
NOW,
THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section
1.01 Definitions . All capitalized terms used but not
defined herein shall have the meanings assigned thereto in the Sale
and Servicing Agreement.
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE
PRICE
Section
2.01 Sale of Mortgage Loans . The Seller, concurrently with
the execution and delivery of this Agreement, does hereby sell,
assign, set over, and otherwise convey to the Purchaser, without
recourse, all of its right, title and interest in and to (i) each
Mortgage Loan and the related Mortgage File, including its Cut-Off
Date Principal Balance (including all Additional Balances resulting
from Draws made pursuant to the related Mortgage Note prior to the
termination of the Trust; provided, however, that the Purchaser
does not assume any obligation under any Mortgage Note to fund any
such future Draws, and the Purchaser will not be obligated or
permitted to fund any such future Draws) and all collections in
respect of interest and principal received after the related
Cut-Off Date; (ii) property that secured a Mortgage Loan and which
has been acquired by foreclosure or deed in lieu of
foreclosure;
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(iii) its rights under any insurance policies
maintained in respect of the Mortgage Loans (including any
insurance proceeds); and (iv) any and all proceeds of the
foregoing.
Section
2.02 Reserved .
Section
2.03 Obligations of Seller Upon Sale . In connection with
any transfer pursuant to Section 2.01 hereof, the Seller further
agrees, at its own expense, on or prior to the Closing Date, (a) to
indicate in its books and records that the Mortgage Loans have been
sold to the Purchaser or to the Owner Trustee as assignee of the
Purchaser, as applicable, pursuant to this Agreement and (b) to
deliver to the Purchaser or at the direction of the Purchaser, to
the Indenture Trustee, as applicable, a computer file containing a
true and complete list of all such Mortgage Loans specifying, among
other things, for each such Mortgage Loan, as of the Cut-Off Date,
(1) its account number and (2) the Cut-Off Date Principal Balance.
Such file, which forms a part of Exhibit A to the Sale and
Servicing Agreement, shall also be marked as Schedule I to this
Agreement and is hereby incorporated into and made a part of this
Agreement.
In
connection with such transfer by the Seller, the Seller agrees
to:
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(i)
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on behalf of the Purchaser, on or before the
Closing Date, deliver to and deposit with the Purchaser or, at the
direction of the Purchaser, to the Indenture Trustee (or its
designee), the Mortgage Loan Schedule in computer readable format;
and
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(ii)
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on behalf of the Purchaser, deliver to and
deposit with the Custodian, for the benefit of the Indenture
Trustee and the Insurer, the following documents or instruments
with respect to each Mortgage Loan so assigned:
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(A)
the original Mortgage Note, endorsed in blank, or a copy of such
original Mortgage Note with an accompanying Lost Note
Affidavit;
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(B)
the original Assignment of Mortgage from the Seller to “The
Bank of New York, as Indenture Trustee for First Horizon ABS Trust
2007-HE1”, which assignment shall be in form and substance
acceptable for recording;
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(C)
the original recorded Mortgage or a copy of such recorded Mortgage,
certified by the Seller as being a true and complete copy thereof;
provided that if the original Mortgage has been delivered for
recording to the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located but has not
yet been returned to the Seller by such recording office, the
Seller shall deliver to the Custodian a copy of such original
Mortgage, certified by the Seller as being a true and complete copy
thereof and certifying that such original Mortgage has been so
delivered to such recording office; in all such instances, the
Seller shall deliver or cause to be delivered to the Custodian the
original recorded Mortgage, or a copy thereof, certified by the
Seller as being a true and complete copy thereof, promptly upon its
receipt thereof;
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(D)
(i) if the Credit Limit for such Mortgage Loan is greater than
$500,000, the original attorney’s opinion of title or the
original policy of title insurance, or a copy of the original
attorney’s opinion of title or the original policy of title
insurance, certified by the Seller as being a true and complete
copy thereof; or (ii) if the Credit Limit for such Mortgage
Loan is equal to or less than $500,000, the Seller may deliver to
the Custodian an original lender’s policy of title insurance
or a copy of the original lender’s policy of title insurance,
certified by the Seller as being a true and complete copy thereof,
or, if the Mortgage Loan is insured by alternative title protection
evidenced by a certificate of lien protection policy, the Seller
may deliver to the Custodian an original lien protection
certificate or copy of the original lien protection certificate,
certified by the Seller as being a true and complete copy thereof;
or (iii) if the Mortgage Loan is a “combo loan”
pursuant to which the Seller has also originated the related Senior
Lien, the Seller may deliver to the Custodian a copy of the
original attorney’s opinion of title or the original policy
of title insurance for the first lien mortgage loan;
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(E)
all original intervening recorded assignments, or copies of such
intervening assignments certified by the Seller as being true and
complete copies of the interim assignments (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 related Mortgage); 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; and
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(F)
originals of all assumption and modification agreements, if any, or
copies thereof, certified by the Seller as being true and complete
copies thereof,
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provided, however, that as to any Mortgage Loan,
if as evidenced by an Opinion of Counsel delivered to and in form
and substance satisfactory to the Owner Trustee, the Indenture
Trustee, the Insurer and the Rating Agencies, (x) an optical image
or other representation of the related documents specified in
clause (ii)(C) above is enforceable in the relevant jurisdictions
to the same extent as the original of such document and (y) such
optical image or other representation does not impair the ability
of an owner of such Mortgage Loan to transfer or perfect its
interest in such Mortgage Loan, such optical image or other
representation may be delivered as required in clause (ii)
above.
The
Seller hereby confirms to the Purchaser that it has made the
appropriate entries in its general accounting records, to indicate
clearly and unambiguously that such Mortgage Loans have been sold
to the Purchaser by the Seller, sold by the Purchaser to the Trust
and pledged by the Trust to the Indenture Trustee and constitute
part of the Trust in accordance with the terms of the Sale and
Servicing Agreement.
The
Purchaser hereby acknowledges its acceptance of all right, title
and interest to the Mortgage Loans and other property, now existing
and hereafter created, conveyed to it pursuant to Section 2.01
above.
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The
Seller hereby acknowledges that, within 90 days following the
occurrence of an Assignment Event specified in clause (i) of the
definition thereof, the Seller shall (i) segregate (a) the Related
Documents from documents and instruments relating to mortgage loans
that are not Mortgage Loans and (b) the Mortgage Note from the
Related Documents for each Mortgage Loan and shall assemble and
maintain the Mortgage Notes together (separate and apart from the
Related Documents) and (ii) prepare an Assignment of Mortgage for
each Mortgage Loan. The Assignments of Mortgage will be held by the
Seller pursuant to Section 2.01(b) of the Sale and Servicing
Agreement.
The
Seller acknowledges that the Indenture Trustee is required to
review the Mortgage Notes and Related Documents in the case of any
delivery required upon the occurrence of an Assignment Event
pursuant to Sections 2.01(d) and (e) of the Sale and Servicing
Agreement and if the Indenture Trustee finds any document or
documents not to have been properly executed, or to be missing or
to be defective in any material respect, the Indenture Trustee is
required to notify the Seller. If the Seller does not within the
time period specified in Section 2.02(b) of the Sale and Servicing
Agreement correct or cure such omission or document deficiency, the
Seller shall either repurchase such relevant Mortgage Loan directly
from the Trust or substitute an Eligible Substitute Mortgage Loan
for such Mortgage Loan, in either case, within the time frame and
in the manner specified in Section 2.02(b) of the Sale and
Servicing Agreement.
Without
limiting the generality of the foregoing, the Seller hereby agrees
to take such actions described in Section 2.01(a) of the Sale and
Servicing Agreement as are necessary to complete and file any UCC
Financing Statements and any continuation statements required to
perfect and protect the Purchaser’s interest in the Mortgage
Loans.
Section
2.04 Payment of Purchase Price for the Mortgage Loans . (a)
In consideration of the sale of the Mortgage Loans from the Seller
to the Purchaser on or before the Closing Date, the Purchaser
agrees to pay to the Seller on the Closing Date by transfer of
immediately available funds, an amount equal to the sum of
$306,079,000 in respect of the Mortgage Loans (the “Purchase
Price”). The Purchaser shall pay all expenses it incurs in
connection with the Trust’s issuance of the Notes, including,
without limitation, printing fees incurred in connection with the
prospectus relating to the Notes, blue sky registration fees and
expenses, fees and expenses of Purchaser’s counsel, fees of
the rating agencies requested to rate the Notes, accountant’s
fees and expenses and the fees of the Insurer as set forth in the
Insurance and Indemnity Agreement.
(b)
Each Mortgage Note permits the related Mortgagor to make Draws
against its Mortgage Loan. Such Draws will create Additional
Balances, which Additional Balances the Seller shall sell to the
Purchaser or its assignee from time to time. In consideration of
the sale of Additional Balances by the Seller to the Purchaser from
time to time, the Purchaser agrees to pay the Seller on the date
any such Additional Balance is delivered an amount equal to the
outstanding principal balance of such Additional Balance. Payment
will be made, (i) during the Managed Amortization Period, (A) from
Principal Collections, to the extent that Principal Collections
exceed Draws, and/or (B) by increasing the value of the Transferor
Interest, to the extent that Draws exceed Principal Collections,
and (ii) during the Rapid Amortization Period, by increasing the
value of the Transferor Interest. Any increase in the value of
the
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Transferor Interest, which shall initially be
held by the Seller, will result in a corresponding increase in the
value of the Seller’s interest in the Trust.
(c)
The Seller, at its expense, shall within 90 days of an Assignment
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