EXECUTION
FIRST HORIZON ASSET SECURITIES INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2005-FA3
TERMS AGREEMENT
(to Underwriting Agreement,
dated May 23, 2002
between the Company and the Underwriter)
First Horizon Asset Securities Inc. March 28, 2005
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Countrywide Securities Corporation (the "Underwriter") agrees, subject
to the terms and provisions herein and of the captioned Underwriting Agreement
(the "Underwriting Agreement"), to purchase such Classes of Series 2005-FA3
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
2005-FA3 Certificates are registered with the Securities and Exchange Commission
by means of an effective Registration Statement (No. 333-119657). Capitalized
terms used and not defined herein have the meanings given them in the
Underwriting Agreement.
Section 1. The Mortgage Pools: The Series 2005-FA3 Certificates shall
evidence the entire beneficial ownership interest in two pools (the "Mortgage
Pools") of conventional, fixed rate, first lien, fully amortizing, one- to
four-family residential mortgage loans (the "Mortgage Loans") having the
following characteristics as of March 1, 2005 (the "Cut-off Date"):
(a) Aggregate Principal Amount of the Mortgage Pools:
Approximately $230,012,241 aggregate principal balance as of the
Cut-off Date, subject to an upward or downward variance of up to 5%,
principal balance to be determined by the Company.
(b) Original Terms to Maturity: The original term to maturity
of each Mortgage Loan included in Mortgage Pool I shall be between 240
and 360 months. The original term to maturity of each Mortgage Loan in
Mortgage Pool II shall be between 120 and 180 months.
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 5%:
Principal Interest Class Purchase
Class Balance Rate Price Percentage
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I-A-1 $141,162,000.00 3.350%(1) 100.515600000%
I-A-2 $ 41,175,000.00 3.350%(1) 100.515600000%
I-A-3 (2) 2.150%(1) 0.000000000%
I-A-4 $ 6,138,000.00 3.450%(1) 100.515600000%
I-A-5 (2) 2.050% 0.000000000%
I-A-6 $ 10,090,000.00 5.500% 100.515600000%
I-A-R $ 100.00 5.500% 100.515600000%
II-A-1 $ 18,777,000.00 5.000% 100.062500000%
(1) The pass-through rates for the Class I-A-1, Class I-A-2, Class I-A-3,
Class I-A-4 and Class I-A-5 Certificates are variable and will be
calculated as described in the prospectus supplement.
(2) The Class I-A-3 and Class I-A-5 Certificates are notional amount
certificates and will accrue interest during each interest accrual
period in a notional amount. The initial notional amount of the Class
I-A-3 and Class I-A-5 Certificates will be $182,337,000 and $6,138,000,
respectively.
(b) The Offered Certificates shall have such other
characteristics as described in the related Prospectus.
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 Certificate Principal
Balance thereof plus accrued interest at the per annum initial interest rate
applicable thereto from and including the Cut-off Date up to, but not including,
March 30, 2005 (the "Closing Date").
Section 4. Required Ratings: The Offered Certificates shall have
received Required Ratings of at least "AAA" from Standard & Poors Ratings
Service, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. ("S&P") and "AAA" from
Fitch Ratings.
Section 5. Tax Treatment: One or more elections will be made to treat
the assets of the Trust Fund as a REMIC.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Underwriter and the Company.
Very truly yours,
COUNTRYWIDE SECURITIES CORPORATION
By:
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Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
FIRST HORIZON ASSET SECURITIES INC.
By:
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
FIRST HORIZON HOME LOAN CORPORATION
By:
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Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Executive Vice President