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TENTH AMENDMENT TO 

COMMITMENT TO PURCHASE FINANCIAL INSTRUMENT 

and 

HFA PARTICIPATION AGREEMENT 

This Tenth Amendment to Commitment to Purchase Financial Instrument and HFA 

Participation Agreement (this “Amendment”) is entered into as of the date set forth on 

Schedule A attached hereto as the Tenth Amendment Date (the “Amendment Date”), by 

and among the United States Department of the Treasury (“Treasury”), the undersigned 

party designated as HFA whose description is set forth in Schedule A attached hereto (for 

convenience, a “state housing finance agency” or “HFA”) and the undersigned institution 

designated by HFA to participate in the program described below (“Eligible Entity”). 

Recitals 

WHEREAS, Treasury, HFA and Eligible Entity entered into that certain Commitment to 

Purchase Financial Instrument and HFA Participation Agreement (the “Original HPA”) dated 

as of the Closing Date set forth on Schedule A attached hereto, as previously amended by those 

certain Amendments to Commitment to Purchase Financial Instrument and HFA Participation 

Agreement dated as of their respective dates as set forth on Schedule A attached hereto (each, 

an “Amendment” and together with the Original HPA as amended thereby, the “Current 

HPA”), in connection with Treasury's federal housing program entitled the Housing Finance 

Agency Innovation Fund for the Hardest Hit Housing Markets (the “HHF Program”), which 

was established pursuant to the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 

5201 et seq.), as amended, and as the same may be amended from time to time (“EESA”);

WHEREAS, on February 19, 2016 Treasury announced that it would (i) extend the HHF 

Program through 2020, and (ii) make $2 billion of additional assistance available under the HHF 

Program (the “Fifth Round Funding”) to help prevent foreclosure and stabilize housing markets 

in certain states that had previously received HHF Program funding for such purposes; and 

WHEREAS, Treasury, HFA and Eligible Entity wish to enter into this Amendment to 

memorialize the extension of the HHF Program, increase the amount of HHF Program funds 

available to Eligible Entity hereunder, and make certain other changes to the terms of the Current 

HPA and the Exhibits and Schedules attached thereto. 

Accordingly, in consideration of the representations, warranties, and mutual agreements set forth 

herein and for other good and valuable consideration, the receipt and sufficiency of which 

are hereby acknowledged, Treasury, HFA and Eligible Entity agree as follows.

Agreement 

1. Amendments

A. End of Term. The definition of End of Term in Section 2(A)(14) of the Current 

HPA is hereby deleted and replaced with the following: 
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“End of Term” shall mean the last day of the calendar month in which the Eligible Entity 

makes the last disbursement of HHF Program funds in furtherance of the Services, which 

shall occur no later than December 31, 2021 (or such later date as Treasury may 

determine in its sole discretion with written notice to Eligible Entity and HFA). For the 

sake of clarity, Capital Draws shall not be permitted after the End of Term other than for 

payment of Permitted Expenses. 

B. Bring Down Certificate. Section 2(A)(15) of the Current HPA is hereby amended 

by (i) striking “on each anniversary of the Effective Date during the Term (as defined 

below)” and replacing it with “on each anniversary of the Effective Date through 

September 30, 2016, and from and after October 1, 2016, no later than one hundred 

twenty (120) days after the end of each of their respective fiscal years”, and (ii) by adding 

to the end “A final certification shall be delivered by each of HFA and Eligible Entity on 

the Final Repayment Date (as defined in the Financial Instrument).” 

C. Program Participation Cap. Section 3(D) of the Current HPA is hereby deleted in 

its entirety and replaced with the following: 

D. The value of this Agreement is limited to the amount set forth in Schedule A as the 

Program Participation Cap, as may be adjusted from time to time as set forth on Schedule 

F attached hereto (the “Program Participation Cap”). Notwithstanding anything to the 

contrary contained herein, the aggregate Purchase Price payable to Eligible Entity under 

this Agreement with respect to all Services described on the Service Schedules may not 

exceed the amount of the Program Participation Cap. 

D. Performance Reports. Section 4(A) is hereby amended by (i) striking the third 

sentence and replacing it with “HFA shall submit the Performance Report to Treasury or 

its designee no later than forty-five (45) days after the end of each calendar quarter and 

otherwise as requested by Treasury. After Treasury has communicated in writing that the 

Performance Report is in a form acceptable to Treasury, HFA shall promptly post the 

Performance Report to its website”; and (ii) adding to the end “A final Performance 

Report shall be delivered no later than forty-five (45) days after the end of the calendar 

quarter in which the End of Term occurs.” 

E. Financial Reporting. Section 4(G) of the Current HPA is hereby deleted in its 

entirety and replaced with the following: 

G. Each of HFA and Eligible Entity shall provide annual audited financial 

statements to Treasury no later than one hundred twenty (120) days after the end of 

its respective fiscal year, commencing with the first fiscal year ending after the 

Effective Date, and concluding with the fiscal year in which the End of Term occurs. 

Eligible Entity shall provide quarterly unaudited financial statements to Treasury no 

later than forty-five (45) days after the end of each quarter, commencing with the 

first full quarter ending after the Effective Date and concluding with the quarter in 

which the End of Term occurs. 
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F. Term. Section 5(A) of the Current HPA is hereby deleted in its entirety and 

replaced with the following: 

(A) The term of this Agreement (“Term”) shall begin on the Effective Date and 

extend to the End of Term, or earlier termination of this Agreement by Treasury 

pursuant to the provisions hereof, or earlier suspension or termination of the Services 

by Treasury. Subject to the foregoing, new Services may be undertaken (e.g., 

approval of assistance actions with respect to unique homeowners or properties, 

including, where applicable, final underwriting decisions and payment schedules), 

through and including December 31, 2020 (or such later date as may be determined 

by Treasury in its sole discretion upon prior written notice to Eligible Entity). It is 

understood and agreed that certain administrative, monitoring, reporting, compliance 

and oversight obligations and requirements set forth in this Agreement and the 

Financial Instrument survive the expiration or termination of this Agreement or the 

End of Term, and that funds are to be reserved as set forth in Schedule C to pay for 

the cost of the same, through and including the Final Repayment Date. 

G. Modifications. 

(a) Section 9(A) of the Current HPA is hereby amended by inserting “and except as 

expressly set forth herein,” after “Subject to Section 9.B.,” 

(b) Section 9(B) of the Current HPA is hereby amended by adding the following at the 

end: 

Notwithstanding anything to the contrary contained herein, Treasury may approve 

revisions proposed by Eligible Entity and HFA to any Schedule or Exhibit attached 

hereto, by written notice to Eligible Entity and HFA, pursuant to a procedure 

established by Treasury in its sole discretion and provided to Eligible Entity and 

HFA. The applicable Schedule or Exhibit shall be deemed modified for all 

purposes hereunder as of the date such written notice is received pursuant to 

Section 8 hereof. 

(c) Section 9(C) of the Current HPA is hereby amended by deleting the last sentence 

in its entirety. 

H. Exhibit A. Exhibit A attached to the Current HPA is hereby deleted in its entirety 

and replaced with Exhibit A attached to this Amendment. 

I. Schedule A. Schedule A attached to the Current HPA is hereby deleted in its 

entirety and replaced with Schedule A attached to this Amendment. 

J. Schedule B. Schedule B attached to the Current HPA is hereby deleted in its 

entirety and replaced with Schedule B attached to this Amendment. 

K. Schedule C. Schedule C attached to the Current HPA is hereby deleted in its 

entirety and replaced with Schedule C attached to this Amendment. 
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L. Schedule F. A new Schedule F is added to the Current HPA in the form attached 

to this Amendment as Schedule F. 

M. Definitions. All references in the Current HPA to the "Agreement" shall mean the 

Current HPA, as further amended by this Amendment; all references in the Current HPA 

to the “Financial Instrument” shall mean the Amended and Restated Financial Instrument 

in the form attached to this Amendment as Exhibit A; and all references in the Current 

HPA to Exhibit A or Schedules A, B, C or F shall mean the Exhibit A or Schedules A, B, 

C or F attached to this Amendment. All references herein to the "HPA" shall mean the 

Current HPA, as further amended by this Amendment. 

2. Substitution of Financial Instrument. 

Eligible Entity shall deliver to Treasury on the date hereof an Amended and Restated 

Financial Instrument in the form attached to this Amendment as Exhibit A. By executing 

this Amendment, Treasury, HFA and Eligible Entity authorize The Bank of New York 

Mellon to cancel the Financial Instrument previously delivered under the Current HPA 

against delivery of such Amended and Restated Financial Instrument and direct The Bank 

of New York Mellon to return the cancelled Financial Instrument to (or at the direction 

of) the Eligible Entity. 

3. Representations, Warranties and Covenants

A. HFA and Eligible Entity. HFA and Eligible Entity, each for itself, make 

the following representations, warranties and covenants to Treasury and the truth and 

accuracy of such representations and warranties and compliance with and performance of 

such covenants are continuing obligations of HFA and Eligible Entity, each as to itself. 

In the event that any of the representations or warranties made herein cease to be true and 

correct or HFA or Eligible Entity breaches any of its covenants made herein, HFA or 

Eligible Entity, as the case may be, agrees to notify Treasury immediately and the same 

shall constitute an Event of Default under the HPA.

(1) HFA and Eligible Entity each hereby certifies, represents and warrants as of 

the date hereof that each of the representations and warranties of HFA or Eligible 

Entity, as applicable, contained in the HPA are true, correct, accurate and complete in 

all material respects as of the date hereof. All covenants of HFA or Eligible Entity, 

as applicable, contained in the HPA shall remain in full force and effect and neither 

HFA, nor Eligible Entity is in breach of any such covenant. 

(2) Eligible Entity has the full corporate power and authority to enter into, 

execute, and deliver this Amendment, the Amended and Restated Financial Instrument, 

and any other closing documentation delivered to Treasury in connection therewith, 

and to perform its obligations hereunder and thereunder.

(3) HFA has the full legal power and authority to enter into, execute, and deliver 

this Amendment and any other closing documentation delivered to Treasury in 

connection therewith, and to perform its obligations hereunder and thereunder. 
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4. Miscellaneous

A. The recitals set forth at the beginning of this Amendment are true and accurate and 

are incorporated herein by this reference. 

B. Capitalized terms used but not defined herein shall have the meanings ascribed 

to them in the HPA.

C. Any provision of the HPA that is determined to be prohibited or unenforceable in 

any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such 

prohibition or unenforceability without invalidating the remaining provisions of the HPA, 

and no such prohibition or unenforceability in any jurisdiction shall invalidate such 

provision in any other jurisdiction. 

D. This Amendment may be executed in two or more counterparts (and by 

different parties on separate counterparts), each of which shall be deemed an original, but 

all of which together shall constitute one and the same instrument. Facsimile or 

electronic copies of this Amendment, the Amended and Restated Financial Instrument, and 

any other closing documentation delivered in connection therewith, shall be treated as originals 

for all purposes.

[SIGNATURE PAGE FOLLOWS; REMAINDER OF PAGE 

INTENTIONALLY LEFT BLANK] 
[Signature Page to Tenth Amendment to HPA – Tennessee] 

In Witness Whereof, HFA, Eligible Entity and Treasury by their duly authorized officials 

hereby execute and deliver this Tenth Amendment to Commitment to Purchase Financial 

Instrument and HFA Participation Agreement as of the Amendment Date. 

HFA: TREASURY: 

TENNESSEE HOUSING DEVELOPMENT 

AGENCY 

UNITED STATES DEPARTMENT OF THE 

TREASURY 

By: /s/ Ralph M. Perrey By: 

Name: Ralph M. Perrey Name: Mark McArdle 

Title: Executive Director Title: Deputy Assistant Secretary for 

 Financial Stability 

 

ELIGIBLE ENTITY:

TENNESSEE HOUSING DEVELOPMENT 

AGENCY 

By: /s/ Ralph M. Perrey 

Name: Ralph M. Perrey 

Title: Executive Director 

 
 

EXHIBITS AND SCHEDULES 

Exhibit A Form of Amended and Restated Financial Instrument 

Schedule A Basic Information 

Schedule B Service Schedules 

Schedule C Permitted Expenses 

Schedule F HHF Fifth Round Funding Reallocation Model 
 

EXHIBIT A 

FORM OF AMENDED AND RESTATED FINANCIAL INSTRUMENT 

This Amended and Restated Financial Instrument is delivered by the undersigned party 

(“Eligible Entity”) as provided in Section 1 of the Commitment to Purchase Financial Instrument 

and HFA Participation Agreement (the “Commitment”), entered into as of the Effective Date, as 

modified by those certain Amendments to Commitment to Purchase Financial Instrument and 

HFA Participation Agreement dated as of the dates set forth on Schedule A to the Commitment 

(together, the “Agreement”), by and among the United States Department of the Treasury 

(“Treasury”), the party designated as HFA in the Commitment (“HFA”) and Eligible Entity. 

This Amended and Restated Financial Instrument is effective as of April 1, 2016. All of the 

capitalized terms that are used but not defined herein shall have the meanings ascribed to them in 

the Agreement. 

Recitals 

WHEREAS, Eligible Entity executed and delivered that certain Financial Instrument dated as of 

the Effective Date to Treasury (“Original Financial Instrument”); and 

WHEREAS, Treasury and Eligible Entity desire to amend certain terms of the Original Financial 

Instrument regarding repayment of the Purchase Price in connection with the extension of the 

HHF Program through 2020 and availability of additional assistance under the HHF Program 

Fifth Round Funding; and 

WHEREAS, Treasury and the Eligible Entity desire to restate and replace the Original Financial 

Instrument in its entirety. 

Accordingly, for good and valuable consideration, the receipt and sufficiency of which are 

hereby acknowledged, Eligible Entity agrees as follows: 

1. Eligible Entity Obligation; Purchase Price Consideration. 

(a) Eligible Entity shall perform all Services described in the Service Schedules in 

consideration for the Purchase Price described in subsection (b) below, in 

accordance with the terms and conditions of the Agreement, to the satisfaction of 

Treasury. The conditions precedent to the payment by Treasury of the Purchase 

Price with respect to the Services are set forth in Section 3(B) of the Agreement. 

(b) This Amended and Restated Financial Instrument is being purchased by Treasury 

pursuant to Section 3 of the Agreement through the payment by Treasury of 

various payments referred to collectively in the Agreement as the “Purchase 

Price”. This Amended and Restated Financial Instrument is being purchased by 

Treasury in connection with Eligible Entity’s participation in the Housing Finance 

Agency Innovation Fund for the Hardest Hit Housing Markets program (the 

“HHF Program”) created under the Emergency Economic Stabilization Act of 
2008 (12 U.S.C. 5201 et seq.) as amended, as the same may be amended from 

time to time (“EESA”). 

2. Repayment of Purchase Price. 

If a recipient of HHF Program funds repays any or all of the funds received from Eligible 

Entity in connection with the Services (“Repaid Funds”), and such repayment occurs on 

or before the Final Repayment Date (hereinafter defined), Eligible Entity shall deposit 

such Repaid Funds in the Depository Account and use such Repaid Funds to provide 

Services or to fund the Permitted Expenses to the extent the full amount as indicated on 

Schedule C to the Agreement has not been drawn from Treasury pursuant to Section 3(A) 

of the Agreement. Any Repaid Funds retained by Eligible Entity to fund Permitted 

Expenses shall correspondingly reduce the amount that Eligible Entity may draw from 

Treasury pursuant to Section 3(A) of the Agreement to fund Permitted Expenses. 

For the sake of clarity, if a recipient of HHF Program funds repays any or all of the funds 

received from Eligible Entity in connection with the Services, and such repayment occurs 

after the Final Repayment Date, such repaid funds shall not be considered HHF Program 

funds. 

3. Final Repayment. In the event Eligible Entity is holding any HHF Program funds, 

including, but not limited to, amounts reserved for payment of Permitted Expenses and 

Repaid Funds, as of the date that is ninety (90) days after the End of Term (the “Final 

Repayment Date”), all such funds shall be returned to Treasury or its designee prior to 

1:00pm Eastern Time on the Final Repayment Date. For the sake of clarity, no Capital 

Draws will be permitted after the Final Repayment Date. 

4. Security Interest. As security for the performance of the Services and the other 

obligations of Eligible Entity under the Agreement, as such obligations are evidenced in 

this Amended and Restated Financial Instrument, Eligible Entity has granted to Treasury 

a first lien priority security interest in the Depository Account and in any moneys, or 

investments, if any, held therein. 

5. Representations, Warranties and Covenants. Eligible Entity represents and warrants that 

the representations and warranties set forth in the Agreement, on the date hereof, are, and 

on the date of each Capital Draw hereunder, shall be, true, correct, accurate and complete 

in all material respects. The truth and accuracy of such representations and warranties 

are continuing obligations of Eligible Entity. Additionally, all covenants of Eligible 

Entity set forth in Section 2 of the Agreement are incorporated herein by reference and 

Eligible Entity, on the date hereof, is not, and on the date of each Capital Draw 

hereunder, shall not be in breach of any such covenants. In the event that any of the 

representations or warranties made herein or in the Agreement cease to be true and 

correct, or the Eligible Entity breaches any of the covenants made herein or in the 

Agreement, Eligible Entity agrees to notify Treasury immediately and the same shall 

constitute an Event of Default hereunder. 
6. Limitation of Liability 

IN NO EVENT SHALL TREASURY, OR ITS OFFICERS, EMPLOYEES, AGENTS 

OR AFFILIATES BE LIABLE TO ELIGIBLE ENTITY WITH RESPECT TO THE 

SERVICES OR THE AGREEMENT, OR FOR ANY ACT OR OMISSION 

OCCURRING IN CONNECTION WITH THE FOREGOING, FOR ANY DAMAGES 

OF ANY KIND, INCLUDING, BUT NOT LIMITED TO DIRECT DAMAGES, 

INDIRECT DAMAGES, LOST PROFITS, LOSS OF BUSINESS, OR OTHER 

INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES OF ANY 

NATURE OR UNDER ANY LEGAL THEORY WHATSOEVER, EVEN IF ADVISED 

OF THE POSSIBILITY OF SUCH DAMAGES AND REGARDLESS OF WHETHER 

OR NOT THE DAMAGES WERE REASONABLY FORESEEABLE; PROVIDED, 

HOWEVER, THAT THIS PROVISION SHALL NOT LIMIT TREASURY’S 

OBLIGATION TO REMIT PURCHASE PRICE PAYMENTS TO ELIGIBLE ENTITY 

IN ACCORDANCE WITH THE AGREEMENT. 

7. Indemnification 

Eligible Entity agrees as set forth on Schedule E to the Agreement, which Schedule E is 

hereby incorporated into this Amended and Restated Financial Instrument by reference. 

IN WITNESS WHEREOF, Eligible Entity hereby executes this Amended and Restated Financial 

Instrument on the date set forth below. 

[INSERT FULL LEGAL NAME OF ELIGIBLE ENTITY] 

By: 

Name: 

Title: 

Date: ____________ __, 2016 
A-1 

SCHEDULE A

BASIC INFORMATION 

Eligible Entity Information: 

Name of the Eligible Entity: Tennessee Housing Development Agency1

Corporate or other organizational form: body, politic and corporate; political subdivision 

and instrumentality of the State of Tennessee, 

established and existing under the Tennessee 

Housing Development Agency Act, Tenn. Code 

Ann. § 13-23-101 et seq. 

Jurisdiction of organization: Tennessee

Notice Information: 

 

HFA Information: 

Name of HFA: Tennessee Housing Development Agency1

Organizational form: body, politic and corporate; political subdivision 

and instrumentality of the State of Tennessee, 

established and existing under the Tennessee 

Housing Development Agency Act, Tenn. Code 

Ann. § 13-23-101 et seq. 

Date of Application: September 1, 2010 

Date of Action Plan: September 1, 2010 

Notice Information: 

Program Participation Cap: $269,260,804.00 

 

1

 References in the Agreement to the term “HFA” shall mean Tennessee Housing Development Agency (“THDA”) in its 

capacity as an HFA as such term is used in the Agreement; references in the Agreement to the term “Eligible Entity” shall 

mean THDA, in its capacity as Eligible Entity as such term is used in the Agreement. 

Notwithstanding anything to the contrary in the Agreement, (A) for purposes of Section 4(G) thereof (as amended by the 

Tenth Amendment), annual audited financial statements shall be due no later than one hundred eighty (180) days after the 

end of THDA’s fiscal year, and (B) for purposes of Section 7 thereof, the powers and authority of THDA shall be 

governed and construed in accordance with the laws of the State of Tennessee. 

For the avoidance of doubt, THDA has no obligation to ensure that the funds in the Depository Account are collateralized 

should the amount of money in the account be in excess of the FDIC insurance limits. 
A-2 

Portion of Program Participation Cap 

Representing Original HHF Funds: N/A 

Portion of Program Participation Cap 

Representing Unemployment HHF Funds: $81,128,260.00 

Rounds 1-4 Funding Allocation: $217,315,593.00 

Round 5 Funding Allocation: $51,945,211.00 

Permitted Expenses: $30,028,719.41 

Closing Date: September 23, 2010 

First Amendment Date: September 29, 2010 

Second Amendment Date: December 16, 2010 

Third Amendment Date: May 25, 2011 

Fourth Amendment Date: September 28, 2011 

Fifth Amendment Date: December 8, 2011 

Sixth Amendment Date: May 3, 2012 

Seventh Amendment Date: November 15, 2012 

Eighth Amendment Date: June 11, 2014 

Ninth Amendment Date: September 29, 2015 

Tenth Amendment Date: April 1, 2016 

Eligible Entity Depository Account Information: See account information set forth in the 

Depository Account Control Agreement between 

Treasury and Eligible Entity regarding the HHF 

Program. 
SCHEDULE B

SERVICE SCHEDULES

The Service Schedules attached as Schedule B to the Current HPA are hereby deleted in their 

entirety and replaced with the attached Service Schedules (numbered sequentially as Service 

Schedule B-1, Service Schedule B-2, et. Seq.), which collectively comprise Schedule B to the 

HPA.
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SCHEDULE B-1

Tennessee Housing Development Agency 

Hardest Hit Fund Program (HHFP)

Summary Guidelines

1. Program Overview The Tennessee Housing Development Agency (THDA) Hardest

Hit Fund Program (HHFP) will provide loans to unemployed or 

substantially underemployed homeowners, or those homeowners

impacted by a recent divorce or death of a spouse, who, through

no fault of their own, are financially unable to make their

mortgage payments and are in danger of losing their homes to

foreclosure.

Loan proceeds will be used to pay all mortgage and mortgagerelated expenses (e.g., property taxes, homeowner insurance,

homeowner dues) (i) until, for those unemployed or substantially

underemployed homeowners, the homeowner secures

employment or completes training for a new career and (ii) for 

all eligible homeowners, subject to maximum assistance criteria

described in Section 9.

For homeowners who were unemployed or substantially

underemployed and accumulated payment arrearages, but have

since found a new job, reinstatement assistance will be available.

2. Program Goals To assist unemployed or substantially underemployed

homeowners, or those homeowners impacted by a recent

divorce or death of a spouse, to remain in their homes and make

monthly payments on their mortgages and mortgage related

expenses such as property taxes, homeowner insurance,

homeowner dues, and/or past-due mortgage payments 

(arrearages) so that they may avoid delinquency and foreclosure.

3. Target Population /

Areas

This program will be available in all Tennessee counties.

THDA previously provided additional assistance over a longer

period of time to eligible homeowners living in targeted or 

“hardest hit” counties, defined as those counties showing greater

than average distress based on a combination of unemployment

rate, the percent of the state’s foreclosures in that county, and

delinquency rates. Twenty-nine counties were chosen as targeted

based on the fact that they scored high on two of three factors, as 

follows: having an unemployment rate at or above the state

average rate, having a high percentage of the state’s foreclosure
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filings (in the 75th percentile of counties), having a high

delinquency rate (again, in the 75th percentile of counties).

4. Program Allocation

(Excluding

Administrative

Expenses)

$233,732,084.59

$81,128,260 of this program allocation is reserved to provide

assistance to borrowers whose hardship is employment-related.

5. Borrower Eligibility

Criteria

Unemployed or substantially underemployed homeowners, or

those homeowners impacted by a recent divorce or death of a

spouse, who, through no fault of their own, are unable to make

their mortgage payments and are at risk of foreclosure.

Homeowners will be required to provide a financial hardship

affidavit with appropriate documentation as to the cause of their

hardship, as specified in the program guidelines. Homeowners 

will be required to provide continual documentation certifying to

their ongoing hardship.

Employed homeowners who have previously been unemployed

or substantially underemployed and who are delinquent, but who 

can resume future payments without additional assistance.

Substantially underemployed homeowners are those

homeowners whose income has been reduced by 30% or more.

The event or incident which results in unemployment or 

substantially underemployment, or the applicable divorce or 

death of a spouse impacting a homeowner, must have occurred

after January 1, 2008.

Principal, Interest, Taxes and Insurance > 31% of household

income after job loss/reduction of income.

Asset test: Borrower must not have > 6 months reserves.

Borrower must be a low- or moderate-income homeowner 

(maximum $92,680 household income).

Eligibility for program assistance will be determined primarily

by participating foreclosure prevention partners using THDA 

underwriting criteria stated above.

Funds will be allocated on a first-come/approved, first-served

basis.
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6. Property / Loan 

Eligibility Criteria

Existing single-family homes or condominiums (attached or

detached) including manufactured homes on foundations

permanently affixed to real estate owned by the borrower.

Tennessee owner-occupied, primary residences only.

7. Program Exclusions Total unpaid principal balances > $275,000. 

Manufactured homes not considered real property.

Non-legal U.S. resident.

8. Structure of Assistance 0% interest, non-recourse, deferred-payment, forgivable,

subordinate loan. A forgiveness clause will reduce the loan

amount by 20% a year for every year the borrower stays in the

home up until five years. At the end of five years, the note will

be considered satisfied and THDA will release the lien securing

the note.

Loan funds are due and payable if property is sold, refinanced or 

no longer owner occupied and there are sufficient equity

proceeds available (unless otherwise prohibited under applicable

federal law).

All deferred, subordinate mortgages will be evidenced by a

Home Equity Line of Credit promissory note and secured by a

deed of trust on the property. Borrowers will be required to sign

and acknowledge via written agreement indicating the program

guidelines.

Any funds returned according to established program guidelines

will be recaptured and used to assist additional homeowners 

in accordance with the Agreement.

9. Per Household

Assistance

Maximum amount available per homeowner:

• Assistance for up to 36 months, subject to a maximum

assistance cap of $40,000.

• There is no maximum monthly payment amount;

however, total loan amount cannot exceed applicable

benefit.

10. Duration of Assistance Homeowners may receive assistance up to a maximum of 36 

months. Should a homeowner become reemployed within the

applicable period, the homeowner may continue receiving

assistance for up to an additional two months after
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reemployment. Additionally, if a homeowner becomes 

reemployed within the applicable period and the homeowner’s 

mortgage payment exceeds 31% of their current income, they

are eligible for continued assistance.

Any reinstatement assistance shall be made in one payment.

11. Estimated Number of 

Participating 

Households

Based on the current average amount of assistance of $25,000, 

we would expect to assist approximately 7,355 homeowners. 

With the increase in available assistance amounts and terms, we 

do expect the average amount of assistance to increase and the

number of homeowners assisted to decrease. Recaptured funds 

will be returned to the program and used for additional

homeowners, which could extend the program until as late as 

December 31, 2020.

12. Program Inception /

Duration

The program began serving the targeted, hardest hit counties

January 1, 2011. On March 1, 2011, the program was expanded

and all counties became eligible for the program. All funds are

expected to be committed by December 31, 2014. Recaptured

funds will be returned to the program and used for additional

homeowners, which could extend the program until as late as 

December 31, 2020.

13. Program Interactions

with Other HFA

Programs

None.

14. Program Interactions

with HAMP

Borrowers can receive HAMP assistance (including UP program

assistance) prior to or after receiving Hardest Hit Fund 

assistance.

15. Program Leverage with 

Other Financial

Resources

None.
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SCHEDULE B-2

Tennessee Housing Development Agency 

HHF Blight Elimination Program (BEP)

Summary Guidelines

1. Program Overview The Tennessee Housing Development Agency (THDA) will

administer the Hardest Hit Fund Blight Elimination Program

(BEP) to assist in the removal of blighted properties in targeted

areas within the State of Tennessee.

THDA will work in partnership with approved non-profit

partners (Program Partners) to strategically target blighted

residential single-family properties for demolition, site

improvement, and acceptable reuse.

2. Program Goals The BEP will reduce foreclosures, promote neighborhood

stabilization, and maintain or improve property values through

the demolition of vacant, abandoned, blighted residential

structures, and subsequent greening/improvement of the

remaining parcels.

THDA has identified meaningful indicators that will enable

THDA to track and quantify the program’s impact in the

targeted areas.

3. Target Population /

Areas

This program will focus on targeted counties in Tennessee with

the highest number of vacancies and foreclosures. This program

will be made available to the following counties: Shelby,

Montgomery, Davidson, Rutherford, Hamilton, and Knox.

THDA program guidelines will ensure that demolition and

greening/improvement is designed to increase values of

neighboring properties and will promote a positive effect on 

preserving existing neighborhoods.

4. Program Allocation

(Excluding

Administrative

Expenses)

$5,500,000.
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5. Property Eligibility

Criteria

• Existing single-family (one to four unit) home.

• The property must be located in the State of Tennessee.

• The property must be located in a targeted area as defined

in the program guidelines.

• The property must be vacant at the time of acquisition. For 

any requests submitted on or after January 15, 2016, the 

property must not be legally occupied at the time of any 

review or approval by the HFA or eligible entity (as 

applicable) for blight elimination activity.

• The property is a nuisance due to abandonment and/or other

adverse conditions as identified in the program guide.

• The cost to acquire (if necessary), demolish, green, and

maintain the property for up to three years does not exceed

$25,000.

• THDA will determine property eligibility including the

following requirements:

(1) Pass a Uniform Physical Condition Standard test;

(2) Meet the State of Tennessee’s definition of “Blight”

according to Title 13, Public Planning and Housing;

and

(3) Qualify for lawful demolition.

6. Ownership / Loan 

Eligibility Criteria

Program Partner must hold title to the property (may acquire

title in conjunction with the program transaction).

The property must be subject to a loan that can be modified or 

extinguished.

7. Program Exclusions • Commercial properties, multifamily properties.

• Properties listed on a state, national, or local historic

register.

• Properties not meeting THDA’s eligibility requirements as 

specified in the program guidelines.
B-2-3

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8. Structure of Assistance THDA will determine acceptability of project sites in direct

consultation with Program Partners.

Program Partners will be responsible for acquisition of the

property (if applicable), demolition work, greening/site

improvement and on-going property maintenance.

The Program Partner will submit an application to THDA 

containing the location of the property, neighborhood conditions,

estimated cost of structure removal, estimated cost of greening (if

applicable), and the end use of the vacant lot.

Required documentation must be submitted by the Program

Partner to THDA for review and approval in THDA’s sole

discretion pursuant to the program guidelines.

Upon completion of blight elimination activity on the property

and verification by THDA, THDA will provide HHF funds to the

holder of the note for the loan on the property after the execution

of a promissory note in favor of THDA. Total assistance will

provide for acquisition costs (if applicable), demolition work, 

greening/site improvement costs, on-going property maintenance,

and a one-time administrative fee of $1,000 per property for the

Program Partner.

• Funds will be provided as a secured loan up to a maximum of

$25,000 with a deferred payment, forgivable over a 3 year

term at 33.3% per year with a 0% interest rate so long as 

THDA’s requirements are met.

Eligible costs include removal of debris, contractor’s fees, permit

fees, final inspections, environmental assessments, greening and

maintenance fees in the amount of $1,800 for a three-year period,

and any other fees or charges required to complete the property

removal and site improvement, not to exceed $25,000. If the cost

to demolish the property exceeds the $25,000 maximum, the nonprofit partner must pay the excess amount upfront.
B-2-4

Doc#: US1:10242895v1

The outstanding loan balance will become due and payable if the

property is sold, its title transferred, or it is used for an

unauthorized purpose prior to the end of the loan term. Special

considerations may be made by THDA to release or subordinate

its lien prior to the end of the loan term based upon the merit of 

the request and the proposed positive impact to the community.

The method for calculating the portion of the outstanding balance

to be forgiven or released will be determined based upon the

closing date of the HHF funding.

Any funds returned according to established program guidelines

will be recaptured and used in the program in accordance with 

the Agreement.

9. Per Property 

Assistance

Maximum amount of assistance may not exceed $25,000 per

property. Maximum assistance amount includes acquisition costs

(if applicable); demolition and greening/improvement costs; and a

one-time project management and maintenance fee to cover

management and maintenance expenses for a period of three (3)

years.

10. Duration of Assistance Funds will be disbursed on a first-come-first-served basis.

11. Estimated Number of 

Properties

Demolished

Based on the maximum amount of assistance of $25,000, 

approximately 220 blighted properties are anticipated to be

demolished and greened. Program will be expanded if funds are

available.

12. Program Inception /

Duration

The program will begin on November 1, 2015 and will last as 

long as the allocation of funds is available or until December 31, 

2020.

13. Program Interactions 

with Other HFA

Programs

None.

14. Program Interactions 

with HAMP

None.

15. Program Leverage with 

Other Financial

Resources

If the cost to demolish and green the property are in excess of the

$25,000 program cap, the Program Partner must pay the excess

amount up front.
C-1 

SCHEDULE C 

PERMITTED EXPENSES 

 Tennessee

One-time / Start-Up Expenses: 

 

Initial Personnel $50,264.40

Building, Equipment, Technology $230,209.59

Professional Services $19,668.00

Supplies / Miscellaneous $3,265.33

Marketing /Communications $741.73

Travel $1,786.15

Website development /Translation $15,000.00

Contingency $0.00

Subtotal $320,935.20

 

Operating / Administrative Expenses: 

Salaries $14,751,149.66

Professional Services (Legal, Compliance, 

Audit, Monitoring) $377,653.83

Travel $309,173.18

Buildings, Leases & Equipment $0.00

Information Technology & Communications $819,452.10

Office Supplies/Postage and 

Delivery/Subscriptions $418,346.00

Risk Management/ Insurance $0.00

Training $172,729.73

Marketing/PR $1,271,454.55

Miscellaneous $243,517.88

Subtotal $18,363,476.93

 

Transaction Related Expenses: 

Recording Fees $2,976,158.20

Wire Transfer Fees $557,149.08

Counseling Expenses 

File Intake $0.00

Decision Costs $0.00

Successful File $7,811,000.00

Key Business Partners On-Going $0.00

Subtotal $11,344,307.28

 

Grand Total $30,028,719.41
C-2 

 

% of Total Award 11.15%

Award Amount $269,260,804.00

 
F-1 

SCHEDULE F 

HHF FIFTH ROUND FUNDING REALLOCATION MODEL 

This Schedule F describes a uniform model (the “Reallocation Model”) designed to maximize 

the utilization of the $2 billion made available under the HHF Program Fifth Round Funding. In 

general, the Reallocation Model reallocates unused Fifth Round funding to states participating in 

the HHF Program that meet certain defined criteria for utilization of HHF Program funds. The 

aggregate amount obligated under the Fifth Round Funding will not increase at any time. 

I. Definitions 

(a) “2016 Utilization Threshold” shall mean having Drawn at least 70% of the Rounds 1-4 

Funding Allocation. 

(b) “2017 Utilization Threshold” shall mean having Drawn at least 95% of the Rounds 1-4 

Funding Allocation. 

(c) “2018 Utilization Threshold” shall mean having Drawn at least 80% of the Program 

Participation Cap. 

(d) “Annual Reallocation Amount” shall mean the aggregate amount, if any, by which the 

Program Participation Caps set forth in all HFA Participation Agreements are reduced 

pursuant to the Reallocation Model, as applied with respect to each Utilization Threshold. 

(e) “Drawn” shall mean having made Capital Draws pursuant to Section 3(A) of the 

Agreement. 

(f) “HFA Participation Agreements” shall mean, collectively, the Commitments to Purchase 

Financial Instrument and HFA Participation Agreements entered into by the States, as 

amended from time to time. 

(g) “Population” shall mean the most recent Annual Estimate of the Resident Population for 

a State as determined by the United States Census Bureau from time to time. 

(h) “Recipient State” shall mean each State that has achieved the Utilization Threshold for 

the applicable year, provided that such State is not then in default under its HFA 

Participation Agreement. Notwithstanding the foregoing, in the event a State declines an 

increase to its Program Participation Cap and Round 5 Funding Allocation for which it is 

eligible pursuant to this Schedule F, such State shall not be considered a Recipient State. 

(i) “Rounds 1-4 Funding Allocation” is the amount set forth on Schedule A as “Rounds 1-4 

Funding Allocation.” 

(j) “Round 5 Funding Allocation” is the amount set forth on Schedule A as “Round 5 

Funding Allocation”, as adjusted from time to time in accordance with this Schedule F. 
F-2 

(k) “Share of Annual Reallocation Amount” shall mean a Recipient State’s share of the 

applicable Annual Reallocation Amount, as determined using the methodology described 

in Section IV below. If the Annual Reallocation Amount is zero, then the Share of 

Annual Reallocation Amount will be zero for the applicable year. 

(l) “State” shall mean any or each of Alabama, Arizona, California, Florida, Georgia, 

Illinois, Indiana, Kentucky, Michigan, Mississippi, New Jersey, Nevada, North Carolina, 

Ohio, Oregon, Rhode Island, South Carolina, Tennessee, and Washington, D.C. 

(m)“Utilization Threshold” means each of the 2016 Utilization Threshold, the 2017 

Utilization Threshold and the 2018 Utilization Threshold. 

II. Reduction of Program Participation Cap and Round 5 Funding Allocation: 

(a) If Eligible Entity does not achieve the 2016 Utilization Threshold on or before December 

31, 2016, each of the Program Participation Cap and Round 5 Funding Allocation shall 

be reduced by an amount equal to 50% of the Round 5 Funding Allocation as of such 

date. 

(b) If Eligible Entity does not achieve the 2017 Utilization Threshold on or before December 

31, 2017, each of the Program Participation Cap and the Round 5 Funding Allocation 

shall be reduced by up to 100% of the Round 5 Funding Allocation as of such date. 

(c) If Eligible Entity does not achieve the 2018 Utilization Threshold on or before December 

31, 2018, each of the Program Participation Cap and Round 5 Funding Allocation shall 

be reduced by an amount equal to that portion of the Round 5 Funding Allocation which 

has not yet been Drawn nor obligated with respect to a unique homeowner or property as 

of such date. 

III. Increase of Program Participation Cap and Round 5 Funding Allocation: 

(a) If Eligible Entity achieves the 2016 Utilization Threshold on or before December 31, 

2016, each of the Program Participation Cap and Round 5 Funding Allocation shall be 

increased by the State’s Share of the Annual Reallocation Amount with respect to such 

date. 

(b) If Eligible Entity achieves the 2017 Utilization Threshold on or before December 31, 

2017, each of the Program Participation Cap and the Round 5 Funding Allocation shall 

be increased by the State’s Share of the Annual Reallocation Amount with respect to 

such date. 

(c) If Eligible Entity achieves the 2018 Utilization Threshold on or before December 31, 

2018, each of the Program Participation Cap and Round 5 Funding Allocation shall be 

increased by the State’s Share of the Annual Reallocation Amount with respect to such 

date. 

IV. Methodology for Determining Recipient State’s Share of Annual Reallocation Amount 
F-3 

If Eligible Entity has achieved the Utilization Threshold and the Annual Reallocation Amount 

is greater than zero for the applicable year, the Program Participation Cap and Round 5 

Funding Allocation will be increased by an amount calculated as follows: 

First, calculate the “Per Capita Amount” for each Recipient State. The Per Capita Amount 

shall be calculated as the Annual Reallocation Amount divided by the sum of the Population 

of all Recipient States. 

Second, calculate the “Utilization Percentage” for each Recipient State. 

The Utilization Percentage with respect to the 2016 Utilization Threshold and the 2017 

Utilization Threshold shall be calculated as the lesser of (I) the ratio of (x) aggregate Capital 

Draws made by the Recipient State under its HFA Participation Agreement as of December 

31, 2016 and December 31, 2017, respectively, to (y) the Recipient State’s Rounds 1-4 

Funding Allocation as of such dates, or (II) 100%. 

The Utilization Percentage with respect to the 2018 Utilization Threshold shall be calculated 

as the ratio of (x) aggregate Capital Draws made by the Recipient State under its HFA 

Participation Agreement as of December 31, 2018, to (y) such Recipient State’s Program 

Participation Cap as of such date. 

Third, calculate a “Utilization Score” for each Recipient State by standardizing the Utilization 

Percentages using the z-score methodology, a standard statistical standardization procedure. 

The Utilization Score for each Recipient State is calculated as (I)(x) the Utilization Percentage 

for such Recipient State, less (y) the mean Utilization Percentage for all Recipient States 

(“Average”), divided by (II) the standard deviation of the Utilization Percentages for all 

Recipient States. If a Recipient State’s Utilization Percentage is greater than the Average, the 

Utilization Score will be positive. If a Recipient State’s Utilization Percentage is less than 

Average, the Utilization Score will be negative. 

Fourth, calculate a “Need Factor” for each Recipient State. The Need Factor is a fixed dollar 

amount which will be multiplied by each Utilization Score to determine the dollar amount by 

which each Recipient State’s Per Capita Amount will be adjusted. The Need Factor is 

calculated as the dollar amount that would result in the highest adjusted Per Capita Amount 

for a Recipient State being no more than three (3) times that of the lowest adjusted Per Capita 

Amount for a Recipient State (i.e., a Min/Max Factor of 3). 

Fifth, calculate an “Adjusted Per Capita Amount” for each Recipient State by adding to or 

subtracting from the Recipient State’s Per Capita Amount the product of (x) the Need Factor 

and (y) the Recipient State’s Utilization Score. Recipient States with positive Utilization 

Scores will have dollars added to the Recipient State’s Per Capita Amount, and Recipient 

States with negative Utilization Scores will have dollars subtracted from the Recipient State’s 

Per Capita Amount. 

Sixth, calculate the “Share of the Annual Reallocation Amount” for each Recipient State by 

first multiplying the Recipient State’s Adjusted Per Capita Amount by the Recipient State’s 
F-4 

Population to arrive at a “Preliminary Share”. The Preliminary Share for each Recipient 

State is then normalized to arrive at the Share of the Annual Reallocation Amount by 

multiplying (x) a ratio, the numerator of which is the Preliminary Share for such Recipient 

State and the denominator of which is the sum of the Preliminary Shares for all Recipient 

States, and (y) the Annual Reallocation Amount. 

V. Notices; Modifications 

(a) Treasury will notify Eligible Entity in writing of any adjustment to the Program 

Participation Cap and Round 5 Funding Allocation pursuant to this Schedule F. Related 

adjustments to program allocations and other amounts set forth in the Service Schedules, 

and Permitted Expenses set forth on Schedule C, shall be made as set forth in such 

written notice. 

(b) For the avoidance of doubt, a written amendment to the Agreement shall not be required 

to effectuate an adjustment of the Program Participation Cap or Round 5 Funding 

Allocation pursuant to this Schedule F. The Program Participation Cap and Round 5 

Funding Allocation set forth on Schedule A to the Agreement shall be deemed to be 

modified upon receipt of the written notice sent pursuant to Section V (a) above. 

 

(c) Treasury reserves the right to unilaterally modify or supplement the terms and provisions 

of this Schedule F, at any time with prior written notice to the Eligible Entity.