MORTGAGE LOAN PURCHASE AGREEMENT
THIS MORTGAGE
LOAN PURCHASE AGREEMENT dated as of July 30,
2004 by and between FIRST HORIZON HOME LOAN
CORPORATION, a Kansas
corporation (the "Seller"), and FIRST
TENNESSEE BANK NATIONAL
ASSOCIATION (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
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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.
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, or the State of Texas or New
York City is located are
authorized or obligated by law or executive
order to be closed.
CLOSING DATE:
July 30, 2004
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.
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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 July 30, 2004 by and
among The Bank of New
York, as trustee, First Horizon Home Loan
Corporation, as master
servicer, and the Custodian.
CUT-OFF DATE:
July 1, 2004.
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 25th day of each
month, or if such 25th
day is not a Business Day, the next
succeeding Business Day.
GAAP:
Generally applied
accounting principals 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.
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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 (R) 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.
MORTGAGE NOTE:
The original executed
note or other evidence
of indebtedness evidencing the
indebtedness of a Mortgagor under
a Mortgage Loan.
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.
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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:
$222,252,552.20.
PURCHASER:
First Tennessee Bank
National Association, 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 Home
Loan Corporation, a Kansas
corporation, 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
Tennessee Bank National
Association 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 Home Loan
Corporation, as transferor and subservicer,
and First Tennessee
Mortgage Services, Inc., as transferee and
servicer.
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
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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; (iv)
have a loan-to-value ratio no higher than
that of the Deleted
Mortgage Loan; (vii) have a remaining term
to maturity no greater
than (and not more than one year less than
that of) the Deleted
Mortgage Loan; (viii) not be a Cooperative
Loan unless the
Deleted Mortgage Loan was a Cooperative
Loan and (ix) 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
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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.
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"):
(a) (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
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party so endorsing, as noteholder or assignee thereof,
in and to that Mortgage Note); or
(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;
(b) 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;
(c) 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;
(d) the original or copies of each
assumption,
modification, written assurance or substitution
agreement, if any;
(e) 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 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, and
(f) in the case of a Cooperative Loan,
the originals of the
following documents or instruments:
(1) The Coop Shares,
together with a stock power
in blank;
(2) The executed
Security Agreement;
(3) The executed
Proprietary Lease;
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(4) The executed
Recognition Agreement;
(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 interest in
the Coop Shares and the Proprietary Lease; and
(6) Executed UCC-3
financing statements or other
appropriate UCC financing statements required by state
law, evidencing a complete and unbroken line from the
mortgagee to the Trustee with evidence of recording
thereon (or in a form suitable for recordation).
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 reco
