COMMITMENT TO PURCHASE FINANCIAL INSTRUMENT

and

HFA PARTICIPATION AGREEMENT

This Commitment to Purchase Financial Instrument and HFA Participation Agreement (the

"Agreement") is entered into as of the Effective Date (defined below), 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"). Certain information relating to HFA and Eligible

Entity is set forth in Schedule A attached hereto.

Recitals

WHEREAS, Treasury has established several programs under sections 101 and 109 of the

Emergency Economic Stabilization Act of 2008 (P.L. 110-343), as amended, as the same may be

amended from time to time ("EESA"), to stabilize the housing market by facilitating mortgage

loan modifications to prevent avoidable foreclosures, including through providing home price

decline protection incentives, encouraging foreclosure alternatives, such as short sales and deeds

in lieu of foreclosure, and making other foreclosure prevention services available to the

marketplace;

WHEREAS, the U.S. Department of Housing and Urban Development, as the nation's housing

agency, has partnered with Treasury in the administration's response to the mortgage and

foreclosure crisis;

WHEREAS, as a component of this partnership Treasury has created a federal housing program

entitled the Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (the

"HHF Program") as an additional program pursuant to EESA;

WHEREAS, Treasury has requested proposals from state housing finance agencies in designated

states for the use of funds allocated to the HHF Program to develop and implement innovative

housing initiatives tailored to their local conditions to help prevent foreclosures and stabilize

housing markets, including individual programs targeting unemployed borrowers, "underwater"

borrowers and second lien relief;

WHEREAS, HFA or Eligible Entity has submitted a proposal to Treasury outlining certain

programs to utilize HHF Program funds, which programs are described in the Service Schedules

attached hereto as Schedule B;

WHEREAS, as required under EESA, HFA has designated Eligible Entity as the financial

institution to receive HHF Program funds and act to implement the Services (as defined below);

WHEREAS, HFA and Eligible Entity wish to participate in the HHF Program on the terms and

subject to the conditions set forth herein;

TAMPAfHPA CalifomiaJ120I67.2
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. Services

A. Eligible Entity shall (i) contemporaneously with the execution and delivery of this

Agreement, deliver a fully executed Financial Instrument (the "Financial Instrument") to

Treasury evidencing its obligations under this Agreement, in the form attached hereto as

Exhibit A; (ii) perform the duties and obligations set forth in this Agreement and the

Financial Instrument; and (iii) provide and perform (or engage qualified vendors to provide

and perform) the Services described in the Service Schedules (as defined below).

B. Contemporaneously with the execution and delivery of this Agreement, HFA and

Eligible Entity shall deliver to Treasury multiple schedules (each a "Service Schedule" and

together, the "Service Schedules") describing the services (the "Services") to be performed

by Eligible Entity under the HHF Program. The Service Schedules will be numbered

sequentially as Service Schedule B-1, Service Schedule B-2, et. seq., and are referenced

herein, collectively, as Schedule B.

C. Contemporaneously with the execution and delivery of this Agreement, HFA and

Eligible Entity shall also deliver to Treasury a budget detailing the administrative expenses

necessary to carry out the Services (the "Permitted Expenses"). The budget detailing the

Permitted Expenses is attached hereto as Schedule C. Neither HFA nor Eligible Entity shall

expend HHF Program funds for administrative expenses in excess of the total amount of the

Permitted Expenses (reasonable variances between line items being permitted) without the

prior consent of Treasury, which may be withheld in Treasury's sole discretion.

Additionally, all administrative expenses paid with HHF Program funds shall be accounted

for and are subject to OMB Circular A-87 (revised 5/4/95, as further amended 8/29/97),

which can be found at hlliUlJ~~dliJ:ffiQ~JrQYLQjmhL~"!:illmC9.!J~~rm!illII::illllliml.

2. Representations, Warranties and Covenants

A. HFA and Eligible Entity. HFA and Eligible Entity, each for themselves, 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 hereunder.

(1) HFA and Eligible Entity each represent and warrant that it is in compliance with,

and covenants that all Services will be performed in compliance with, EESA and all

Federal, state and local laws, regulations, regulatory guidance, statutes, ordinances, codes

2

TAMPA/HPA - Califomia/l20167,2
and requirements, applicable to the provision of the Services by HFA and Eligible Entity,

or its officers, employees, agents or contractors, including, but not limited to, the Truth in

Lending Act, 15 U.s.c. §1601 et seq., the Home Ownership and Equity Protection Act,

15 U.S.c. § 1639, the Federal Trade Commission Act, 15 U.S.C. § 41 et seq., the Equal

Credit Opportunity Act, 15 U.S.C. § 701 et seq., the Fair Credit Reporting Act, 15 U.S.C.

§ 1681 et seq., the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., the Real

Estate Settlement Procedures Act, 12 U.S.C. §2601 et seq., the Fair Housing Act, 42

U.s.c. §3601, the Gramm Leach Bliley Act, 15 U.S.c. §6801-6809, and §§ 114 and 315

of the Fair and Accurate Credit Transactions Act of 2003 (the "FACT AcC), 15 U.S.c.

§§ 1681m(e) and 1681c(h), and all other Federal and state laws and regulations

applicable thereto, including, without limitation, those designed to prevent unfair,

discriminatory or predatory lending practices, tenant rights and licensing (collectively,

the "Applicable Laws").

(2) The performance of the Services will not conflict with, or be prohibited in any

way by, the Applicable Laws or any agreement or restriction by which HFA or Eligible

Entity is bound. Neither HFA nor Eligible Entity is aware of any other legal, financial or

other impediments to performing the Services or its obligations under this Agreement,

and shall promptly notify Treasury of any such impediments which may impair its ability

to perform the Services or its obligations under this Agreement, as applicable. Neither

HFA nor Eligible Entity is delinquent on any Federal tax obligation or any other debt

owed to the United States or collected by the United States for the benefit of others,

excluding any debts or obligations that are being contested by it in good faith.

(3) Neither HFA nor Eligible Entity has received written notice of any action, suit,

restraining order, injunction, investigation, proceeding or inquiry at law or in equity,

pending or threatened, by or before any judicial, quasi-judicial, legislative or

administrative court, agency or authority, or any arbitrator, nor to the best of HFA's and

Eligible Entity's knowledge is there any basis for any of the foregoing, wherein an

unfavorable determination, ruling or finding would materially adversely affect the

validity or enforceability of this Agreement, the Financial Instrument or the ability of

HFA or Eligible Entity to perform its respective obligations hereunder and thereunder.

(4) HFA and Eligible Entity each covenants that: (i) it will perform its obligations in

accordance with this Agreement and Applicable Laws, and will promptly provide such

performance or other reporting as may be required by Treasury, the Government

Accountability Office ("GAO"), Congressional Oversight Panel or the Special Inspector

General of the Troubled Asset Relief Program ("SIGTARP"); (ii) it will maintain

complete, accurate and appropriate records of, and supporting documentation for, all

Services provided in connection with the HHF Program; (iii) all Services will be offered

and performed in accordance with the Service Schedules, fully documented and serviced,

or otherwise performed, in accordance with this Agreement and EESA; and (iv) all data,

collection information and other information reported by HFA or Eligible Entity to

Treasury under this Agreement, including, but not limited to, information that is relied

upon by Treasury in calculating the Purchase Price (as defined below) or in performing

any compliance review will be true, complete and accurate in all material respects, and

consistent with all relevant business records, as and when provided.

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TAMPA/HPA Califomiall20167.2
(5) HFA and Eligible Entity each covenants that it will: (i) perform the Services and

obligations required under this Agreement in accordance with the practices, high

professional standards of care, and degree of attention used in a well-managed operation,

and no less than that which HFA or Eligible Entity exercises or would exercise for itself

under similar circumstances; and (ii) use qualified individuals with suitable training,

education, experience and skills to perform the Services. HFA and Eligible Entity each

acknowledges that HHF Program participation may require changes to, or the

augmentation of, its systems, staffing and procedures, and covenants and agrees to take

all reasonable actions necessary to ensure it has the capacity to implement the Services in

accordance with this Agreement.

(6) HFA and Eligible Entity each covenants that it will comply with all regulations on

conflicts of interest that are applicable to HFA or Eligible Entity, as the case may be, in

connection with the conduct of its business and performance of the Services and all

conflicts of interest and non-disclosure obligations and restrictions and related mitigation

procedures set forth in this Agreement.

(7) HFA and Eligible Entity each acknowledges that the prOVISIon of false or

misleading information to Treasury in connection with the HHF Program or the Services

may constitute a violation of: (a) Federal criminal law involving fraud, conflict of

interest, bribery, or gratuity violations found in Title 18 of the United States Code; or (b)

the civil False Claims Act (31 U.S.C. §§ 3729-3733). HFA and Eligible Entity each

covenants to immediately disclose to Treasury any discovered credible evidence, in

connection with this Agreement and the Services, that a management official, employee,

or contractor of Eligible Entity has committed, or may have committed, a violation of the

referenced statutes or other wrongdoing.

(8) HFA and Eligible Entity each covenants to disclose to Treasury any other material

facts or information in its possession that Treasury should expect to know about HFA or

Eligible Entity or its employees, management officials or contractors to help protect the

reputational interests of Treasury in connection with the HHF Program.

(9) HFA and Eligible Entity shall each be responsible for the supervIsIOn and

management of any contractor it engages to assist in the performance of the Services or

any obligation under this Agreement. HFA or Eligible Entity, as applicable, shall remove

and replace any contractor that it deems as failing to perform. HFA and Eligible Entity

shall each ensure that all of its contractors comply with the terms and provisions of this

Agreement. Each of HFA and Eligible Entity shall be responsible for the acts or

omissions of its respective contractors as if the acts or omissions were by the HFA or

Eligible Entity, respectively.

(10) HFA and Eligible Entity each covenants that it will timely inform Treasury of any

anticipated or actual Event of Default and of any suspected or actual Act of Bad Faith

(defined below).

(11) HFA and Eligible Entity each acknowledges that Treasury may be required to

respond, pursuant to the Privacy Act of 1974 (the "Privacy Act"), 5 U.S.C. § 552a, to

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TAMPA/HPA Califomia/120167.2
inquiries from borrowers and, pursuant to the Freedom of Information Act (the "Freedom

of Information Act"), 5 U.S.c. § 552, to inquiries from other parties, as well as formal

inquiries from Congressional committees and members, the Government Accounting

Office, Inspectors General and other government entities, as well as media and consumer

advocacy group inquiries about the HHF Program and its effectiveness. HFA and

Eligible Entity each covenants that it will respond promptly and accurately to all search

requests made by Treasury, comply with any related procedures which Treasury may

establish, and provide related training to employees and contractors.

(12) HFA and Eligible Entity each acknowledges that Treasury, SIGTARP, GAO and

other parties designated by Treasury or under Applicable Laws shall have the right during

normal business hours to conduct unannounced, informal onsite visits and to conduct

formal onsite and offsite physical, personnel and information technology testing, security

reviews, and audits of HFA and/or Eligible Entity and to examine all books, records and

data related to the Services provided and Purchase Price received in connection with the

Services.

(13) HFA and Eligible Entity each covenants that it will promptly take corrective and

remedial actions associated with reporting and reviews as directed by Treasury or its

designee and provide to Treasury evidence of the effective implementation of corrective

and remedial actions as Treasury shall require. HFA and Eligible Entity each

acknowledges that Treasury may conduct additional reviews based on its findings and the

corrective actions taken by HFA and/or Eligible Entity.

(14) In addition to any obligation to retain financial and accounting records under

Applicable Laws, HFA and Eligible Entity each covenants to retain all data, books,

reports, documents, audit logs and records, including electronic records, or copies

thereof, related to its obligations under this Agreement and the performance of the

Services, as applicable. In addition, HFA and Eligible Entity each agrees to maintain a

copy of all computer systems and application software necessary to review and analyze

these electronic records or copies of such records. Unless otherwise directed by

Treasury, HFA and Eligible Entity shall each retain these records for at least three (3)

years from the End of Term, or for such longer period as may be required pursuant to

Applicable Laws. Treasury may also notify HFA and/or Eligible Entity from time to

time of any additional record retention requirements resulting from litigation and

regulatory investigations in which Treasury or any agents of the United States may have

an interest, and HFA and Eligible Entity each agrees to comply with these litigation and

regulatory investigations requirements. "End of Term" shall mean the date that the

Services performed under all Service Schedules are fully complete, excluding

administrative functions (e.g. the last homeowner is assisted and any loan provided to

such homeowner is either repaid or fully forgiven).

(15) HFA and Eligible Entity shall each provide a bring-down certificate as to its

continuing compliance with, and the truth and accuracy of, the representations and

warranties set forth in this Agreement and the Financial Instrument, as applicable,

annually, on each anniversary of the Effective Date during the Term (as defined below),

in the form attached hereto as Exhibit B-1 with respect to the HFA (the "HFA

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TAMPA/HPA CalifornialJ20167.2
Certification") and Exhibit B-2 with respect to the Eligible Entity (the "Eligible Entity

Certification").

B. Eligible Entity. Additionally, Eligible Entity hereby makes 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 Eligible Entity. In the event that any of the representations or

warranties made herein ceases to be true and correct or Eligible Entity breaches any of its

covenants made herein, Eligible Entity agrees to notify Treasury immediately and the same

shall constitute an Event of Default hereunder.

(1) Eligible Entity constitutes a "financial institution" as such term is defined in

section 3(5) of EESA, has the legal power to receive funds from Treasury under the HHF

Program, and has been designated by HFA to, and hereby agrees to, provide the Services

and implement HFA's proposal to Treasury under the HHF Program.

(2) Eligible Entity is established under the laws of the United States or any state,

territory, or possession of the United States or the District of Columbia, has significant

operations in the United States and is not an agency or instrumentality of, or owned

directly or indirectly by, any foreign government.

(3) Eligible Entity is duly formed and validly existing and has the full corporate

power and authority to enter into, execute, and deliver this Agreement, the Financial

Instrument and any other closing documentation delivered to Treasury in connection with

this Agreement or the Financial Instrument, and to perform its obligations hereunder and

thereunder. Eligible Entity has, and its officers, employees, agents and contractors

providing the Services have, or will have prior to performing the Services, obtained all

licenses and any other approvals or consents required by law to carryon its business as

now being conducted and as contemplated by this Agreement.

C. HFA. Additionally, HFA hereby makes 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. In

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

correct or HFA breaches any of its covenants made herein, HFA agrees to notify Treasury

immediately and the same shall constitute an Event of Default hereunder.

(1) HFA is an instrumentality of the State as indicated in Schedule A.

(2) HFA has full legal power and authority to enter into, execute, and deliver this

Agreement and any other closing documentation delivered to Treasury in connection with

this Agreement, and to perform its obligations hereunder and thereunder.

D. Representations and Warranties. The foregoing representations and warranties set

forth in this Section 2 are hereby qualified and/or limited by the provisions set forth in

Schedule D attached hereto and incorporated herein.

6

TAMPAlHPA· CalifomiaJl20J67.2
3. Agreement to Purchase Financial Instrument; Payment of Purchase Price; Grant of

Security Interest

A. Treasury shall purchase, and Eligible Entity shall sell to Treasury, the Financial

Instrument that is executed and delivered by Eligible Entity in the form attached hereto as

Exhibit A, in consideration for the payment by Treasury of such amount as shall be set forth

in Schedule A as the Purchase Price (the "Purchase Price"). Payment of the Purchase Price

by Treasury shall be made in draws (each, a "Capital Draw" and collectively, the "Capital

Draws"). In order to make a Capital Draw, Eligible Entity shall submit to Treasury and its

designee a request for payment (a "Capital Draw Request") no less than ten (10) business

days prior to the date such Capital Draw is requested to be paid. Notwithstanding anything

in the Service Schedules to the contrary, Treasury shall not approve a Capital Draw Request

for a Capital Draw in an amount less than 2.5%, or more than 20%, of the Program

Participation Cap (defined below). In addition, no Capital Draw Requests shall be approved

by Treasury so long as Eligible Entity has HHF Program funds on hand of more than 5% of

the Program Participation Cap. The form of Capital Draw Request is attached hereto as

Exhibit C.

B. The conditions precedent Treasury's execution and delivery of this Agreement and

the payment by Treasury of the first Capital Draw are: (i) HFA's execution and delivery of

this Agreement with attached complete and approved Service Schedules, Exhibits and any

other closing documents, certificates or legal opinions as shall be required by Treasury to be

delivered by HFA; (ii) Eligible Entity's execution and delivery of this Agreement with

attached complete and approved Service Schedules, Exhibits, the Financial Instrument and

any other closing documents, certificates or legal opinions as shall be required by Treasury to

be delivered by Eligible Entity; (iii) the delivery of a legal opinion of counsel to HFA, which

may be internal legal counsel, in substantially the form attached hereto as Exhibit D-l; and

(iv) the delivery of a legal opinion of counsel to Eligible Entity, which may be internal legal

counsel, in substantially the form attached hereto as Exhibit D-2.

C. The conditions precedent to payment by Treasury of any subsequent Capital Draws

are: (i) delivery to Treasury and its designee of an executed and completed Capital Draw

Request using the form attached hereto as Exhibit C, without modification other than

completing requested information fields, and any certifications or information as may be

required by Treasury or its designee; (ii) the performance by Eligible Entity of the Services

described in the Service Schedules, in accordance with the terms and conditions of this

Agreement, to the satisfaction of Treasury; and (iii) the satisfaction by HFA and Eligible

Entity of such other obligations as are set forth in this Agreement.

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

Purchase Price (the "Program Participation Cap"). Accordingly, 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.

E. In the event of a discrepancy or error in the amount of the Purchase Price paid

hereunder, at Treasury's election, (i) Eligible Entity shall remit to Treasury the amount of

any overpayment within ten (10) business days of receiving a refund request from Treasury,

7

TAMPAlHPA Califomial120167.2
or (ii) Treasury may offset the amount of the overpayment against the next Capital Draw,

upon written notice to Eligible Entity. It is understood that HFA shall not be required to

advance any funds pursuant to this subsection.

F. At the election of Treasury and with prior notice to Eligible Entity, Treasury may

deduct from any amount payable to Eligible Entity any amount that Eligible Entity or HFA is

obligated to reimburse Treasury or the United States government.

G. The proceeds of each Capital Draw shall be deposited in an account (the "Depository

Account") held by The Bank of New York Mellon or such other depository institution chosen

by Treasury in its sole discretion (the "Depository"), the account title, account number and

other identifying information for which are provided in Schedule A. The Depository

Account shall be used as Eligible Entity's operating account for its performance of the

Services and other obligations set forth in the Financial Instrument and this Agreement. As

security for the performance of the Services and the other obligations of Eligible Entity under

this Agreement and the Financial Instrument, Eligible Entity hereby grants to Treasury a first

lien priority security interest in the Depository Account and in any moneys, or investments, if

any, held therein. Eligible Entity shall enter into a deposit account control agreement with

Treasury and the Depository, in form and substance acceptable to Treasury. Eligible Entity

shall file a financing statement (and any continuation thereof required by law to maintain the

perfection of the lien) identifying Eligible Entity as "debtor," Treasury as "secured party"

and describing the Depository Account in the UCC filing office for perfecting nonpossessory security interests in tangible and intangible personal property of Eligible Entity or

such other filing offices as Treasury may require. Copies of all filings and continuation

statements shall be provided to Treasury promptly after filing. Funds held in the Depository

Account may be invested in: (i) Cash, (ii) bank deposits, (iii) United States Treasury

securities with maturities of not more than ninety (90) calendar days, (iv) money market

mutual funds that (a) are registered with the SEC and regulated under Rule 2a-7 promulgated

under the Investment Company Act of 1940 and (b) invested exclusively in direct obligations

of the United States of America or obligations the prompt payment of the principal of and

interest on which is unconditionally guaranteed by the United States of America and (v) any

other investment approved by Treasury in writing.

4. Oversight; Internal Control Program

A. HFA shall develop and maintain operational and performance metrics and maintain a

detailed financial reporting system to track, to the satisfaction of Treasury, homeowners

receiving assistance from Eligible Entity, including metrics used to measure the effectiveness

of the Services against the stated objectives of Treasury and HFA pursuant to the Service

Schedules. Such information shall be compiled into a report in a form that will be provided

by Treasury and may be modified from time to time as Treasury determines (the

"Performance Report"); provided that Treasury, in its sole discretion, may modify the form

of the Performance Report at any time. HFA shall submit the Performance Report to

Treasury or its designee on a periodic basis and as otherwise requested by Treasury and shall

also post the completed Performance Report to its website quarterly (based on a calendar

year) by the fifteenth (15th) day of the second month following the end of such quarter.

Treasury, in its sole discretion, may request that HFA modify its performance criteria or seek

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TAMPA/HPA - CaIifornial120167.2
additional metrics as necessary. Treasury may make any or all data reported by HFA

available to the public. It is Treasury's policy not to release personal indentifying

information in its possession unless required to do so by law.

B. Eligible Entity shall develop, enforce and review on a quarterly basis for

effectiveness, an internal control program designed to minimize the risk of fraud, mitigate

conflicts of interest, maximize operational efficiency and effectiveness and ensure effective

delivery of Services and compliance with this Agreement, EESA and Applicable Laws to the

satisfaction of Treasury (the "Internal Control Program"). The Internal Control Program

must include documentation of the control objectives for the Services, the associated control

techniques, and mechanisms for testing and validating the controls. Eligible Entity shall

monitor its contractors, if any, as part of the Internal Control Program. Eligible Entity shall

certify, and provide an independent verification of the effectiveness of the Internal Control

Program in accordance with a reporting form that will be provided by Treasury and may be

modified from time to time as Treasury determines, at least annually no later than one

hundred twenty (120) days after the end of Eligible Entity's fiscal year, including an

assessment prior to the initial distribution of funds to perform Services, or at a reasonable

time thereafter with the consent of Treasury, to ensure that Eligible Entity has taken

appropriate steps to meet the HHF Program objectives. Said independent verification may be

provided by a third party contractor or a governmental entity or department of the State so

long as such entity or department is separate and distinct from HFA and Eligible Entity (e.g.

the State Inspector General). Notwithstanding the foregoing, Eligible Entity shall be

permitted to seek approval from Treasury to make a Capital Draw to conduct a pilot or test of

certain or all of the Services prior to full launch of the same.

C. HFA and Eligible Entity acknowledge that Treasury may develop and implement

practices to monitor and detect fraud related to loan modifications and any other programs

contemplated pursuant to the Services and to monitor compliance with applicable consumer

protection and fair lending laws, including among other laws, the Applicable Laws. HFA

and Eligible Entity covenant that they will fully and promptly cooperate with Treasury's

inquiries about any alleged, perceived or actual fraud and comply with any anti-fraud and

legal compliance procedures which Treasury may require.

D. HFA and Eligible Entity covenant that they will together develop and implement an

internal control program to ensure that HHF Program participants are meeting program

requirements; to monitor, detect and prevent loan modification fraud; and to monitor

compliance with applicable laws and regulations, including consumer protection and fair

lending laws, among other things (the "Internal Antifraud and Compliance Monitoring

Program"). The Internal Antifraud and Compliance Monitoring Program shall be developed

and complete within ninety (90) days from the Effective Date, unless Treasury, in its sole

discretion, consents to an extension of such time period. A copy of the plan for the Internal

Antifraud and Compliance Monitoring Program, including, but not limited to, the approach,

tools, techniques, staffing, cost and status of and time to implementation shall be submitted

to Treasury within the time period set forth in the preceding sentence. HFA and Eligible

Entity acknowledge that the Internal Antifraud and Compliance Monitoring Program will be

monitored as provided in this Agreement. Each of HFA and Eligible Entity shall notify

Treasury in writing if it desires to make any material modifications to its Internal Antifraud

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TAMPAfHPA CaliforniaJ120167.2
and Compliance Monitoring Program and the same shall be subject to Treasury's approval.

Additionally, HFA and Eligible Entity shall cooperate with Treasury with respect to its

findings and any inquiries based on any review by Treasury or its designee of the Internal

Antifraud and Compliance Monitoring Program or the results and data therefrom.

E. HFA and Eligible Entity shall provide Treasury or its designee with access to all

internal control reviews and reports that relate to the Services, including those proposed by

independent auditing firms, to enable Treasury to examine Eligible Entity and its contractors,

if any, for compliance with applicable provisions of EESA, the HHF Program, this

Agreement and Applicable Laws. A copy of the reviews and reports will be provided to

Treasury upon request.

F. HFA and Eligible Entity shall respond promptly to Treasury's request for information

regarding how the Eligible Entity's program(s) described in the Service Schedules will

interact with new or changed housing programs funded by EESA's Troubled Asset Relief

Program.

G. HFA shall provide annual audited financial statements to Treasury no later than one

hundred eighty (180) days after the end of its fiscal year, commencing with the first fiscal

year ending after the Effective Date. Eligible Entity shall provide (i) 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 (ii) annual

audited financial statements to Treasury no later than one hundred twenty (120) days after the

end of its fiscal year, commencing with the first fiscal year ending after the Effective Date.

5. Term

A. The term of this Agreement 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. Notwithstanding the

foregoing, 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 End of Term,

and that funds are to be reserved as set forth in Schedule C to pay for the cost of the same.

B. This Agreement, or any of the Services implemented under this Agreement, may be

terminated by Treasury prior to the end of the Term pursuant to Section 6 below.

6. Defaults, Acts of Bad Faith and Early Termination; Remedies for and Effects of

Defaults, Acts of Bad Faith and Early Termination

A. The following constitute events of default by HFA or Eligible Entity under this

Agreement (each, an "Event of Default" and, collectively, the "Events of Default"):

(1) HFA or Eligible Entity breaches a covenant under this Agreement or fails to

perform or comply with any of its obligations under this Agreement in any material

respect, including any additional request made by Treasury as authorized herein, or the

Financial Instrument, including, but not limited to, circumstances in which Eligible Entity

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TAMPA/HPA Califomiall20167.2
fails to ensure that all eligibility criteria and other conditions precedent specified in this

Agreement or EESA are satisfied prior to accepting any portion of the Purchase Price

and/or effectuating any Services in connection with the HHF Program.

(2) HFA is dissolved or its existence as a unit or instrumentality of state government

is terminated (unless HFA's duties, responsibilities and obligations as the state's housing

finance agency, including specifically its duties, responsibilities and obligations under

this Agreement, are transferred to and assumed by a successor state unit or

instrumentality of state government approved by Treasury).

(3) Eligible Entity is dissolved or its legal existence is terminated (unless Eligible

Entity's duties, responsibilities and obligations under this Agreement, are transferred to

and assumed by a successor entity approved by Treasury).

(4) HFA or Eligible Entity: (a) ceases to do business as a going concern; (b) makes a

general assignment for the benefit of, or enters into any arrangement with creditors in lieu

thereof; (c) admits in writing its inability to pay its debts as they become due; (d) files a

voluntary petition under any bankruptcy or insolvency law or files a voluntary petition

under the reorganization or arrangement provisions of the laws of the United States or

any other jurisdiction; (e) authorizes, applies for or consents to the appointment of a

trustee or liquidator of all or substantially all of its assets; (f) has any substantial part of

its property subjected to a levy, seizure, assignment or sale for or by any creditor or

governmental agency; or (g) enters into an agreement or resolution to take any of the

foregoing actions.

(5) HFA, Eligible Entity, any employee or contractor of HFA or Eligible Entity, or

any employee or contractor of HFA's or Eligible Entity's contractors, commits a grossly

negligent or reckless act, or willful or intentional misconduct (including, but not limited

to, misrepresentation or fraud) in connection with the performance of the Services or this

Agreement.

(6) Any representation or warranty made by HFA or Eligible Entity in this

Agreement or any other certification provided pursuant to this Agreement, is or becomes

false, misleading, incorrect, or incomplete in any material respect.

(7) Any failure to remit overpaid funds to Treasury in accordance with Section 3(D).

(8) An evaluation of performance that includes any specific findings by Treasury that

HFA's or Eligible Entity's performance under any performance criteria set forth in the

Service Schedules is insufficient.

(9) Any misapplication of, or levy on, funds held in the Depository Account.

(10) An Act of Bad Faith (defined below) involving an HHF Recipient (defined below)

occurs, or is believed by Treasury to have occurred, in connection with the Services.

- 11 -

TAMPA/HPA - Califomiall20167.2
B. Treasury, in its sole discretion, may take any or all of the following actions upon the

OCCUlTence of an Event of Default:

(1) Treasury may withhold some or all of the Purchase Price until, in Treasury's

determination, HFA and/or Eligible Entity (as the case may be) has cured such Event of

Default.

(2) Treasury may: (i) reduce the amounts payable to Eligible Entity under Section 3;

and/or (ii) obtain repayment of prior payments made to Eligible Entity under Section 3 to

the extent that such funds have not been expended or ilTevocably committed by Eligible

Entity.

(3) Treasury may require HFA and/or Eligible Entity to submit to additional

administrative oversight, including, but not limited to, additional compliance controls and

quality control reviews.

(4) Treasury may terminate this Agreement and cease its performance hereunder.

(5) Treasury may require HFA and/or Eligible Entity to submit to additional

information and reporting requirements with respect to its financial condition and ability

to continue to meet its obligations under this Agreement.

C. The following constitute acts of bad faith of servicers, lenders, borrowers, contractors

or any other recipient of HHF Program funds (individually, an "HHF Recipient" or

collectively "HHF Recipients") in connection with the Services (each, an "Act of Bad Faith"

and, collectively, the "Acts of Bad Faith"): an HHF Recipient commits a grossly negligent

act, willful or intentional misconduct, a reckless act (including, but not limited to,

misrepresentation or fraud), each in connection with any of the Services (including, but not

limited to, in connection with such HHF Recipient's response to questionnaires, the

execution or delivery to HFA or Eligible Entity or Treasury of any of the agreements relating

to such HHF Recipient's participation in the HHF Program and the production of supporting

documentation therefor and in connection with any audit or review by Treasury, its attorneys,

auditors or other consultants for compliance with the HHF Program requirements).

D. Treasury, in its sole discretion, may take any or all of the following actions if an Act

of Bad Faith involving an HHF Recipient occurs, or is believed by Treasury to have

occulTed, in connection with the Services:

(1) Treasury may withhold all or any portion of the Purchase Price until, in

Treasury's determination, the Act of Bad Faith has been cured or otherwise remedied to

Treasury's satisfaction.

(2) Treasury may: (i) reduce the amounts payable to Eligible Entity under Section 3;

(ii) obtain repayment of any or all prior payments made to Eligible Entity under Section 3

to the extent that such funds have not been expended or ilTevocably committed by HFA

or Eligible Entity; and/or (iii) work with Eligible Entity to obtain repayment from the

HHF Recipients who have committed the Act of Bad Faith.

- 12 - TAMPA/HPA· CaJiforniall20J67.2
(3) Treasury may require HFA or Eligible Entity to submit to additional

administrative oversight, including, but not limited to, additional compliance controls and

quality control reviews.

(4) Treasury may terminate this Agreement and cease its performance hereunder if

Treasury believes that Acts of Bad Faith occur on a recurring basis, are widespread

among the HHF Recipients, or occur in combination or in connection with one or more

Events of Default by HFA or Eligible Entity.

(5) Treasury may require HFA and/or Eligible Entity to submit to additional

information and reporting requirements with respect to its financial condition and ability

to continue to meet its obligations under this Agreement.

E. In addition to the termination rights set forth above, Treasury may terminate this

Agreement immediately upon written notice to Eligible Entity:

(1) in the event of a merger, acquisition, sale of substantially all assets or other

change of control of Eligible Entity;

(2) in the event that a material term of this Agreement is determined to be prohibited

or unenforceable as referred to in Section 13.C; or

(3) in the event the Financial Instrument is deemed to be unenforceable in its entirety.

F. In the event that this Agreement is terminated in connection with an Event of Default

by HFA or Eligible Entity, no portion of the Purchase Price will be paid to Eligible Entity

subsequent to termination.

G. Treasury may reduce the amounts payable to Eligible Entity under Section 3, or

obtain repayment of prior Capital Draws made, in connection with: (a) an evaluation of

HFA's and Eligible Entity's performance that includes any specific findings that HFA's or

Eligible Entity's performance under any performance criteria set forth in the Service

Schedules is materially insufficient, or (b) any failure by HFA or Eligible Entity to comply

materially with any directive issued by Treasury with respect to documents or data requested,

findings made, or remedies established, by Treasury in conjunction with such performance

criteria or other HHF Program requirements; provided, however, Treasury will seek to obtain

repayment of prior Capital Draws made under Section 3 only with respect to Services that are

determined by Treasury to have been impacted by, or that Treasury believes may have been,

or may be, impacted by, the findings giving rise to this remedy. Treasury may initially avail

itself of this remedy in lieu of a specific declaration of an Event of Default; provided,

however, that doing so shall not preclude Treasury from later declaring an Event of Default

or exercising any other rights or remedies otherwise available to it under this Section 6, or at

law or in equity, in connection with the event giving rise to this remedy, or any future events

giving rise to this remedy. Notwithstanding anything in this Agreement to the contrary,

Treasury may withhold payment of all or a portion of the Purchase Price if it determines, in

its sole discretion, that Eligible Entity is incapable of performing the Services. It is

understood that HFA shall not be required to advance or repay funds to Treasury unless and

13-

TAMPA/HPA Califomia/120167.2
only to the extent that, HFA has received HHF Program funds from Eligible Entity and the

same would not cause HFA to violate state law or its enabling legislation or governing

documents, as applicable, to do so.

H. The remedies available to Treasury upon an Event of Default or an Act of Bad Faith

under this Section are cumulative and not exclusive; further, these remedies are in addition

to, and not in lieu of, any other remedies available to Treasury at law or in equity.

I. In the event of the expiration or termination of this Agreement or any Service

implemented under this Agreement under any circumstances, HFA, Eligible Entity and

Treasury agree to cooperate with one another on an ongoing basis to ensure an effective and

orderly wind-down of the Services, including the provision of any information, reporting,

records and data required hereunder by Treasury.

J. Notwithstanding any provision to the contrary in this Agreement, temporary or

permanent forbearance on Capital Draws of funds by the Eligible Entity shall not, in and of

itself, constitute an Event of Default or an Act of Bad Faith by the HFA or the Eligible Entity

nor trigger a demand for repayment under this Section. The HFA or the Eligible Entity shall

provide Treasury with timely notice of any determination that such forbearance is necessary

and in such event Treasury may elect to reduce the Purchase Price to the aggregate of Capital

Draw Requests funded to date plus an amount for Administrative Expenses reasonably

required to comply with the surviving terms of this Agreement.

7. Governing Law; Venue

This Agreement shall be governed by and construed under Federal law and not the law of any

state or locality, without reference to or application of the conflicts of law principles; provided,

however, that the powers and authority of the HFA shall be governed by and construed in

accordance with the laws of its state. Any and all disputes between the parties that cannot be

settled by mutual agreement shall be resolved solely and exclusively in the United States Federal

courts located within the District of Columbia. All parties hereto consent to the jurisdiction and

venue of such courts and irrevocably waive any objections thereto.

8. Notices

All legal notices, reports, requests, demands and other communications under this Agreement

shall be in writing and referred to each party's point of contact or to such other point of contact

at such other address as may be designated in writing by such party. Notices, reports, requests,

demands and other communications sent to Treasury shall be sent by email to all of the email

addresses listed below. Performance Reports and Capital Draw Requests shall be sent to Bank of

New York Mellon only by email at the address listed below. The names and addresses of HFAs

and Eligible Entity's points of contact are set forth in Schedule A. All such notices under this

Agreement sent to HFA or Eligible Entity shall be considered received: (a) when personally

delivered; (b) when delivered by commercial overnight courier with verification receipt; (c) three

(3) days after having been sent, postage prepaid, via certified mail, return receipt requested; or

(d) upon sending an email.

- 14 - TAMPA/HPA Califomia/120167.2
Treasury Email Addresses: OFSChiefCounseINotices@do.treas.gov

HFAlnnovation@do.treas.gov

tarp.compliance@do.treas.gov

Bank of New York Mellon: tarpcppclosing@bnymellon.com

9. Modifications

A. Subject to Section 9.B., modifications to this Agreement shall be in writing and

signed by Treasury, HFA and Eligible Entity.

B. Treasury reserves the right to unilaterally modify or supplement the terms and

provisions of this Agreement that relate (as determined by Treasury, in its discretion) to the

compliance and performance requirements of the HHF Program, and/or to technical,

administrative, or procedural matters or compliance and reporting requirements that may

impact the administration of the HHF Program. For the avoidance of doubt, reasonable

incremental administrative expenses of the HFA or Eligible Entity associated with such a

modification or supplement shall be Permitted Expenses.

C. In the event that Treasury agrees that (i) Eligible Entity may provide additional

services under the HHF Program (a "New Service"), or (ii) the Services described in the

Service Schedules shall be modified in any way, a replacement service schedule describing

such additional or modified services, in substantially the form of the Service Schedules shall

be executed and delivered by Eligible Entity. Concurrently with the delivery of such service

schedule, HFA and Eligible Entity shall execute and deliver any such certificates, documents

and/or legal opinions as may be required by Treasury. No additions, modifications or

amendments to the Services shall be made without Treasury's prior approval. Additionally,

Eligible Entity may not propose any New Service after September 1, 2010 without

Treasury's and the Office of Management and Budget's consent, which may be withheld in

either party's sole discretion.

10. Publicity

HFA and Eligible Entity shall consult with Treasury to develop a communication and outreach

strategy to ensure that any public messages related to the Services is consistent with the intent of

the HHF Program. HFA, Eligible Entity and their respective affiliates, subcontractors or

servicers shall notify Treasury at least two (2) business days in advance and provide a copy of

any proposed press releases (or other public statements) that refers to the HHF Program, their

participation therein or the results thereof. Treasury shall have the right to object to or modify

such press release or statement, in its sole discretion. In the event Treasury does not respond to

the press release or statement within such two (2) business day period then it shall be deemed

permissible to publish. This Section shall survive the termination or expiration of this

Agreement.

11. 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

- 15 -

TAMPAlHPA . CaliforniaJ 120167.2
THIS 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 THIS AGREEMENT.

12. Indemnification

HFA and Eligible Entity agree respectively as set forth on Schedule E attached hereto and

incorporated herein.

13. Miscellaneous

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

incorporated herein by this reference.

B. This Agreement is not a Federal procurement contract and is therefore not subject to

the provisions of the Federal Property and Administrative Services Act (41 U.S.C. §§ 251-

260), the Federal Acquisition Regulations (48 CFR Chapter 1), or any other Federal

procurement law.

C. Any provision of this Agreement 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 this

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

such provision in any other jurisdiction.

D. Failure on the part of Treasury to insist upon strict compliance with any of the terms

hereof shall not be deemed a waiver, nor will any waiver hereunder at any time be deemed a

waiver at any other time. No waiver will be valid unless in writing and signed by an

authorized officer of Treasury. No failure by Treasury to exercise any right, remedy, or

power hereunder will operate as a waiver thereof or operate as a course of dealing as to

which Eligible Entity may justifiably rely. The rights, remedies, and powers provided herein

are cumulative and not exhaustive of any rights, remedies, and powers provided by law.

This Agreement shall inure to the benefit of and be binding upon the parties to this

Agreement, and their permitted successors-in-interest. Treasury shall be permitted to assign

its interest in this Agreement without the prior consent of HFA or Eligible Entity. Neither

HFA, nor Eligible Entity shall be permitted to assign its interest in this Agreement without

the prior written consent of Treasury, which may be withheld in Treasury's sole discretion.

F. This Agreement may be executed in two or more counterparts (and by different

parties on separate counterparts), each of which shall be an original, but all of which together

16

TAMPA/HPA· Californiall20167.2
shall constitute one and the same instrument. Facsimile or electronic copies of this

Agreement, together with the Financial Instrument, the Service Schedules, and any

certifications provided hereunder, shall be treated as originals for all purposes.

G. This Agreement, together with the Financial Instrument, Service Schedules, and the

Certifications, constitutes the entire agreement of the parties with respect to the subject

matter hereof.

H. Any provisions of this Agreement (including all documents incorporated by reference

thereto) that contemplate their continuing effectiveness, including, but not limited to,

Sections 2, 3, 4, 7, 10, 11, 12 and 13 of this Agreement, and the Financial Instrument, and

any other provisions (or portions thereof) in this Agreement that relate to, or may impact, the

ability of Treasury to fulfill its responsibilities in connection with the HHF Program, shall

survive the expiration or termination of this Agreement.

14. Defined Terms; Incorporation by Reference

A. All references to this "Agreement" necessarily include, in all instances, this

Agreement and all documents, exhibits and schedules incorporated into this Agreement by

reference, whether or not so noted contextually, and all amendments and modifications

thereto. Specific references throughout this Agreement to individual documents that are

incorporated by reference into this Agreement are not inclusive of any other documents that

are incorporated by reference, unless so noted contextually.

B. The term "Effective Date" means the date indicated as the Closing Date on Schedule

A.

C. Exhibit A - Form of Financial Instrument, Exhibits B-1 and B-2 - Forms of

Certification, Exhibit C - Form of Capital Draw Request, Exhibit D-l - Form of Legal

Opinion - FHA, Exhibit D-2 - Form of Legal Opinion - Eligible Entity (in each case, in form

and, upon completion, in substance), Schedule A - Basic Information, Schedule B - Service

Schedules, Schedule C - Permitted Expenses, Schedule D - Qualifications to Representations

and Warranties, Schedule E - Indenmification, including all amendments and modifications

thereto, are incorporated into this Agreement by this reference and given the same force and

effect as though fully set forth herein.

[SIGNATURE PAGE FOLLOWS; REMAINDER OF PAGE

INTENTIONALLY LEFT BLANK]

- 17 -

TAMPAlHPA CaJifomia/J20J67.2
In Witness Whereof, HFA, Eligible Entity and Treasury by their duly authorized officials

hereby execute and deliver this Commitment to Purchase Financial Instrument and HFA

Participation Agreement as of the Effective Date.

HFA:

CALIFORNIA HOUSING FINANCE

AGENCY

By: /s/ L. Steven Spears

Name: L. Steven Spears

Title: Executive Director

ELIGmLE ENTITY:

CALHFA MORTGAGE ASSISTANCE

CORPORATION

By: /s/ Diane M. Richardson

Name: Diane M. Richardson

Title: President

TREASURY:

UNITED STATES DEPARTMENT OF THE

TREASURY

By:

Name: Herbert M. Allison, Jr.

Title: Assistant Secretary for

Financial Stability

[Signature Page to Commitment to Purchase Financial InslIument and HFA Participation Agreement- California]
In Witness Whereof, HFA, Eligible Entity and Treasury by their duly authorized officials

hereby execute and deliver this Commitment to Purchase Financial Instrument and HFA

Participation Agreement as ofthe Effective Date.

BFA:

CALIFORNIA HOUSING FINANCE

AGENCY

By:

Name:

Title:

ELIGIBLE ENTITY:

CALHFA MORTGAGE ASSISTANCE

CORPORAnON

By:

Name:

Title:

TREASURY:

UNITED STATES DEPARTMENT OF THE

TREASURY

By:

Name: Herbert M. Allison, Jr

Title: Assistant Secretary £

Financial Stability

[Signature Page to Commitment to Purchase Financial Instrument and BFA Participation Agreement - California]
Exhibit A

Exhibit B-1

Exhibit B-2

Exhibit C

Exhibit D-1

Exhibit D-2

Schedule A

Schedule B

Schedule C

Schedule D

Schedule E

EXHIBITS AND SCHEDULES

Fonn of Financial Instrument

FOlm of HFA Certification

Form of Eligible Entity Certification

Form of Capital Draw Request

Form of Legal Opinion - HFA

Form of Legal Opinion - Eligible Entity

Basic Information

Service Schedules

Permitted Expenses

Qualifications to Representations and Warranties

Indemnification

TAMPNHPA California/l20167.2
EXHIBIT A

FORM OF FINANCIAL INSTRUMENT

This 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 "Agreement"), entered into as of the Effective Date, by and among the United

States Department of the Treasury ("Treasury"), the party designated as HFA in the Agreement

("HFA") and Eligible Entity. This Financial Instrument is effective as of the Effective Date. All

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

them in the Agreement.

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 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 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 (P.L. 110-343), as amended, as the same may be

amended from time to time ("EESA").

2. Repayment of Purchase Price. In the event a recipient of HHF Program funds repays any

or all of the funds received from Eligible Entity in connection with the Services, Eligible

Entity shall use such funds as follows:

(a) First, if such funds are repaid during the Term, Eligible Entity shall use such

repaid funds to continue to provide Services to other eligible homeowners.

(b) Second, if such funds are repaid after the termination or expiration of the Term,

Eligible Entity shall use such repaid amounts to replenish the required reserve for

administrative expenses until the reserve amount indicated on the Service

Schedule for such year is satisfied.

(c) Third, if such funds are repaid after the termination or expiration of the Term, and

no amounts are required to replenish the required reserve for administrative

expenses pursuant to Section 2(b) above, Eligible Entity shall remit such funds to

Treasury, monthly on the 15th day of each month or first business day thereafter.

TAMPA/HPA CaliforniaiI 201 672
3. Final Repayment. In the event Eligible Entity is holding any HHF Programs funds,

including, but not limited to, excess cash and amounts on deposit in the administrative

reserve, as of December 31, 2017, such funds shall be returned to Treasury or its designee

prior to 1:00 p.m. Eastern Standard Time on December 31,2017.

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 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 Financial Instrument by reference.

TAMPA/HPA Califomiall20167.2
IN WITNESS WHEREOF, Eligible Entity hereby executes this Financial Instrument on the date

set forth below.

[INSERT FULL LEGAL NAME OF ELIGIBLE ENTITY]

By:

Name: ----------- Title:

Date: 2010

TAMPA/HPA Califomial120167.2
EXHIBIT B-1

FORM OF HFA CERTIFICATION

This Certification is delivered as required by Section 2.A(l5) of that certain Commitment to

Purchase Financial Instrument and HFA Participation Agreement (the "Agreement"), effective as

of [INSERT CLOSING DATE], by and among the United States Department of the Treasury

("Treasury"), the undersigned party ("HFA") and the institution party thereto ("Eligible Entity").

All terms used, but not defined herein, shall have the meanings ascribed to them in the

Agreement.

HFA hereby certifies, represents and warrants as of the date hereof that each of the

representations and warranties of HFA contained in the Agreement are true, correct, accurate and

complete in all material respects as of the date hereof. All covenants of HFA contained in the

Agreement shall remain in full force and effect and HFA is not in breach of any such covenant.

Eligible Entity does not have HHF Program funds on hand of more than .

[INSERT AN AMOUNT EQUAL TO 5% OF THE PROGRAM PARTICIPATION CAP]

HFA knows of no material deficiencies in the Internal Antifraud and Compliance Monitoring

Program.

In the event that any part of the certification made herein is discovered not to be true and correct,

HFA agrees to notify Treasury immediately.

[INSERT FULL LEGAL NAME OF HFA]:

[Name of Authorized Official]

[Title of Authorized Official]

TAMPA/HPA· Califomia/l20167.2

Date
EXHIBIT B-2

FORM OF ELIGIBLE ENTITY CERTIFICATION

This Certification is delivered as required by Section 2.A(15) of the Commitment to Purchase

Financial Instrument and HFA Participation Agreement (the "Agreement"), effective as of

[INSERT CLOSING DATE], by and among the United States Department of the Treasury

("Treasury"), the party designated as HFA in the Agreement and the undersigned party ("Eligible

Entity"). All terms used, but not defined herein, shall have the meanings ascribed to them in the

Agreement.

Eligible Entity hereby certifies, represents and warrants as of the date hereof that each of the

representations and warranties of Eligible Entity contained in the Agreement are true, correct,

accurate and complete in all material respects as of the date hereof. All covenants of Eligible

Entity contained in the Agreement shall remain in full force and effect and Eligible Entity is not

in breach of any such covenant.

Eligible Entity does not have HHF Program funds on hand of more than "' .

[INSERT AN AMOUNT EQUAL TO 5% OF THE PROGRAM PARTICIPATION CAP]

Eligible Entity knows of no material deficiencies in the Internal Control Program or the Internal

Antifraud and Compliance Monitoring Program.

In the event that any part of the certification made herein is discovered not to be true and correct,

Eligible Entity agrees to notify Treasury immediately.

[INSERT FULL LEGAL NAME OF ELIGIBLE ENTITY]:

[Name of Authorized Official]

[Title of Authorized Official]

TAMPA/HPA Californial120167.2

Date
EXHIBIT C

FORM OF CAPITAL DRAW REQlJEST

[insert date]

The Bank of New York Mellon

tarpcppclosing@bnymellon.corn

Attn: Matthew Sabino

The United States Department of the Treasury

oFSChiefCounselNotices@do.treas.gov

HFAInnovation@do.treas.gov

tarp.compliance@do.treas.gov

Attention: HFA Hardest Hit Fund

Ladies/Gentlemen:

Reference is made to the Commitment to Purchase Financial Instrument and HFA

Participation Agreement dated as of the date set forth on Schedule A thereto (as amended,

supplemented or otherwise modified and in effect from time to time, the "HPA") by and among

[insert HFA name] ("HFA"), [insert Eligible Entity name] ("Eligible Entity") and the United

States Department of the Treasury ("Treasury"). Reference is also made to the Financial

Instrument dated the date set forth on Schedule A to the HPA delivered by Eligible Entity to

Treasury (the "Financial Instrument"). Capitalized terms used but not otherwise defined herein

shall have the meaning given them in the HPA.

In accordance with Section 3.A. of the HPA, the undersigned Eligible Entity hereby

requests that The Bank of New York Mellon ("BNYM"), on behalf of Treasury, disburse the

amounts set forth on the attached Capital Draw Schedule as a Capital Draw against the Purchase

Price as described in the HPA to Eligible Entity on [insert date] (the "Funding Date").

HFA and Eligible Entity, as applicable, hereby certify to Treasury and BNYM, as of the

date hereof and on the Funding Date, that:

(a) no default or Event of Default has occurred and is continuing as of the date hereof

and on the Funding Date [other than I;

(b) each of the representations and warranties made by HFA and Eligible Entity in the

HPA and Financial Instrument are true and correct on and as of such date, as if made

on and as of the date hereof and on the Funding Date lother than J

(c) HFA and Eligible Entity are in compliance with the covenants and other agreements

set forth in the HPA and Financial Instrument, which shall remain in full force and

effect [other than J

TAMPA/BPA CalifomiaJl20167.2
(d) all data and information set forth in this Capital Draw Request, including the Capital

Draw Schedule, is true and correct in all respects; and

(e) to our knowledge, there have been no Acts of Bad Faith by any HHF Recipient [other

than .1

In the event that any part of the certification made herein is discovered not to be true and

correct after the date hereof, HFA or Eligible Entity, as applicable, shall notify Treasury

immediately.

[INSERT FULL LEGAL NAME OF HFA]

[Name of Authorized Official]

[Title of Authorized Official]

[INSERT FULL LEGAL NAME OF ELIGIBLE ENTITY]

[Name of Authorized Official]

[Title of Authorized Official]

TAMPA/HPA CalifomiaJI20167.2
CAPITAL DRAW SCHEDULE

Capital Draw Request for:

f 1Program $

f 1Program $

f 1Program $

Permitted Administrative Expenses $

Total Capital Draw Request $

Total Capital Draw Request as a Percentage of Program Participation Cap1: %

Total Purchase Price funded to date, including current Capital Draw: $

Program Participation Cap: $.

Program Funds Remaining: $

Amount of HHF Program funds on hand prior to this Capital Draw: $

HHF Program funds on hand prior to this Capital Draw as a Percentage of .%

Program Participation Cap2:

1May not be less than 2.5% nor exceed 20%.

2 May not exceed 5.0% on the date ofsubmission of the Draw Request.

Depository Account InformationlWire Instructions

for payment of Capital Draw:

TAMPA/HPA Californiall20J67.2
EXHIBIT D-l

FORM OF LEGAL OPINION - HFA

[Customary introduction/qualifications]

1. HFA has been duly created and is validly existing as a under the laws of the

Stateof _

2. HFA has duly authorized the execution and delivery of the Agreement, and no further approval or

authorization is required by HFA.

3. HFA has the power and authority to execute and deliver the Agreement and to perform its

obligations thereunder.

4. The Agreement has been duly executed and delivered by HFA and, assuming due authorization,

execution and delivery by the other parties thereto, constitutes a valid, legal and binding obligation of

HFA, enforceable against HFA in accordance with its terms, except as the same may be limited by

applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement

of creditors' rights generally and general equitable principles, regardless of whether such enforceability is

considered in a proceeding at law or in equity.

5. The execution and delivery by HFA of the Agreement and the performance by HFA of its

obligations thereunder do not and will not: (i) violate the [organizational documentslEnabling Act] of

HFA, (ii) to the best of our knowledge, after due inquiry, constitute a breach of or a default under any

agreements or other instruments to which HFA is a party, (iii) to the best of our knowledge, after due

inquiry, violate any judgment, decree or order of any court or administrative tribunal to which HFA is

subject, or (iv) violate any Applicable Laws.

6. No consent, approval, authorization or other action by, or filing or registration with, any

governmental authority of the United States or the State of or any other entity having

jurisdiction over HFA is required to be obtained prior to the execution and delivery of the Agreement or

to perform the obligations contemplated thereby other than those consents, approvals, authorizations,

filings, actions and registrations which have been obtained as of the date hereof.

7. HFA has obtained all necessary permits and licenses to perform its obligations under the

Agreement.

8. There is no action, suit or proceeding, at law or in equity, or by or before any court or

governmental agency, now pending or, to our knowledge, overtly threatened in writing against HFA that

challenges the validity or enforceability of, or that seeks to enjoin the performance of, or seeks damages

with respect to the Agreements or any of HFA's obligations thereunder.

TAMPA/HPA Californiall20167.2
EXHIBIT D-2

FORM OF LEGAL OPINION - ELIGIBLE ENTITY

[Customary introduction/qualifications]

1. Eligible Entity has been duly incorporated and is validly existing as a and

is in good standing under the laws of the State of _

2. Eligible Entity has duly authorized the execution and delivery of the Agreement and the Financial

Instrument by all necessary [corporate] action, and no further approval or authorization is required by

Eligible Entity.

3. Eligible Entity has the power and authority to execute and deliver the Agreement and the Financial

Instrument and to perform its obligations thereunder.

4. Each of the Agreement and the Financial Instrument has been duly executed and delivered by

Eligible Entity and, assuming due authorization, execution and delivery by the other parties thereto, each

constitutes a valid, legal and binding obligation of Eligible Entity, enforceable against Eligible Entity in

accordance with its terms, except as the same may be limited by applicable bankruptcy, insolvency,

reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and

general equitable principles, regardless of whether such enforceability is considered in a proceeding at

law or in equity.

5. The execution and delivery by Eligible Entity of the Agreement and the Financial Instrument and

the performance by Eligible Entity of its obligations thereunder do not and will not: (i) violate the

[organizational documents] of Eligible Entity, (ii) to the best of our knowledge, after due inquiry,

constitute a breach of or a default under any agreements or other instruments to which Eligible Entity is a

party, (iii) to the best of our knowledge, after due inquiry, violate any judgment, decree or order of any

court or administrative tribunal to which Eligible Entity is subject, or (iv) violate any Applicable Laws.

6. No consent, approval, authorization or other action by, or filing or registration with, any

governmental authority of the United States or the State of or any other entity having

jurisdiction over Eligible Entity is required to be obtained prior to the execution and delivery of the

Agreement and the Financial Instrument or to perform the Services contemplated thereby other than those

consents, approvals, authorizations, filings, actions and registrations which have been obtained as of the

date hereof.

7. Eligible Entity has obtained all necessary permits and licenses to perform the Services it IS

obligated to perform under the Agreement.

8. There is no action, suit or proceeding, at law or in equity, or by or before any court or

governmental agency, now pending or, to our knowledge, overtly threatened in writing against Eligible

Entity that challenges the validity or enforceability of, or that seeks to enjoin the performance of, or seeks

damages with respect to, the Agreement, the Financial Instrument or the Services.

TAMPAlHPA Califomia/120167.2
Eligible Entity Information:

Name ofthe Eligible Entity:

SCHEDULE A

BASIC INFORMATION

CalHFA Mortgage Assistance Corporation

Corporate or other organizational form: Nonprofit Public Benefit Corporation

Jurisdiction of organization:

Notice Information:

With a copy to:

HFA Information:

NameofHFA:

Organizational form:

Date ofApplication:

Notice Information:

With a copy to:

TAMPA/BPA Califomial120167.2

Califomia

Califomia Housing Finance Agency

Agency ofthe State ofCalifornia

Apli116,2010
Program Participation Cap:

Closing Date:

$699,600,000.00

June 23,2010

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

Account Control Agreement between

Treasury and Eligible Entity regarding the

HHF Program.

TAMPAlHPA Califomiall20167.2
SCHEDULEB

SERVICE SCHEDULES

The attached Service Schedules (numbered sequentially as Service Schedule B-1, Service Schedule B-2,

et. seq.) together comprise Schedule B to that certain Commitment to Purchase Financial Instrument and

HFA Participation Agreement, entered into as of the Effective Date, by and among the United States

Department of the Treasury and the undersigned parties.

TAMPAlHPA CalifomiaJI201672
SERVICE SCHEDULE B-1

California Housing Finance Agency Mortgage Assistance Corporation ("CaIHFA MAC")

UNEMPLOYMENT MORTGAGE ASSISTAt~CE PROGRAM

1. Program Overview

2. Program Goals

3. Target

TAMPA/HPA - CalifornialJ20l67.2

Summary Guidelines

The Unemployment Mortgage Assistance Program (UMA) is

one of CalHFA MAC's federally-funded programs developed

to provide temporary financial assistance to eligible California

homeowners who wish to remain in their homes but have

suffered a loss of income due to unemployment.

CalHFA MAC is partnering with financial institutions to

directly provide program funds to subsidize an eligible

borrower's mortgage payments.

UMA provides a mortgage payment subsidy equal to the lesser

of $1,500 per month or 50% of the PITlA (principal, interest,

tax, insurance and homeowner's association dues) net the

borrower's contribution, for up to six (6) months, with the

purpose of preventing avoidable foreclosures until such time the

borrower retains employment sufficient to meet demands of

satisfying their regular mortgage payment.

The borrower will be required to contribute no more than or

equal to 31 % of their gross monthly household income towards

the monthly mortgage payment based on CalHFA MAC,

lenderlservicer determination.

UMA's goal is to help homeowners remain in their homes and

prevent avoidable foreclosures despite loss of income due to

unemployment.

The UMA subsidy will minimIze past due payments, and

provide a borrower with additional time to find alternate

employment and replace income needed to make their mortgage

payment.

UMA was designed to assist borrowers who are eligible to

receive unemployment benefits.

UMA was designed to complement other loss mitigation

programs, including increasing a borrower's eligibility for a

loan modification.

UMA IS designed to target low-to-moderate Income
Population/Areas

4. Program Allocation

(Excluding

Administrative

Expenses)

5. Borrower Eligibility

Criteria

6. PropertylLoan

Eligibility Criteria

TAMPA/HPA Califomia/120167.2

homeowners and address the needs of a borrower's specific

situation in lieu of targeting certain regions or counties.

$64.7 million.

• Low-to-moderate income limitation of 120% or less of

Area Median Income based upon the county where

borrower resides.

• Low-to-moderate income borrowers that have a loan

financed in whole or in part by bonds that are taxexempt under IRC section 143 are presumed to satisfy

income limits.

• Borrower must complete and sign a Hardship Affidavit

and document the reason for the hardship.

• Borrower has adequate income to sustain modified

mortgage payments per lender guidelines.

• Borrower IS able to satisfy program guidelines

established by CalHFA MAC.

• Borrower is eligible to receive unemployment benefits.

• The mortgage loan is delinquent or the servicer receives

documentation from the borrower that substantiates an

imminent default that meets hardship qualifications.

• General program eligibility is determined by CalHFA

MAC, the housing counselor or servicer based on

information received from the borrower. Programspecific eligibility is determined by CalHFA MAC on a

first-come/first-approved basis until program funds and

funding reserves have been exhausted. Loan servicer

will implement the HHF program based on participation

agreement terms and conditions.

• Funding allocation will be tracked, monitored and

performed by CalHFA MAC in a centralized processing

operation.

• The property is encumbered by a first lien mortgage

loan.

• The total original mortgage indebtedness cannot exceed

the GSE conforming limit of $729,750.

• The property securing the mortgage loan must not be

abandoned, vacant, condemned or in a serious state of

disrepair.

• The subject property IS the borrower's principal
7. Program Exclusions

8. Structure of

Assistance

9. Per Household

Assistance

10. Duration of

Assistance

11. Estimated Number of

Participating

Households

TAMPA/HPA - Califomiall 201 67.2

residence and the property is located in Califomia.

• The applicant must own and occupy the single family,

1-4 unit home (an attached or detached house or a

condominium unit) located m Califomia and must

currently reside in the home as their primary residence.

• Mortgage payments are delinquent 90 days or longer at

time of program application.

• Borrower owns other real property.

• Borrower's "hardship" is a result of voluntary

resignation of employment; the borrower is no longer

eligible for unemployment benefits from the Califomia

Employment Development Department (EDD) benefit

or such benefits will expire within 90 days.

• Loan was originated after January 1, 2009.

• Borrower consummated a "cash-out" refinance of the

subject property.

In the event that CalHFA MAC receives less than 100% match

by the lender/servicer, CalHFA MAC will structure the

assistance as a non-interest bearing subordinate loan in favor of

the Eligible Entity secured by the property in the amount of the

total reduced principal, interest, taxes, insurance and

homeowner's association dues, as applicable comprised of HHF

monies and lender forgiveness. If the lender/servicer matches

the assistance in an amount equal to or greater than 100% of the

HHF Program assistance provided to the borrower, then the

assistance is not required to be structured as a loan to the

borrower. The subordinate loan will be forgiven over a three

year period provided the loan remains in good standing and the

borrower complies with program guidelines.

Up to $9,000 per household total (average funding of $7,228),

equaling the lesser of $1,500 per month of 50% of PITIA, net

the borrower's contribution, (and in all cases, subject to the

HHF Program maximum benefit cap~of $50,000 with respect to

monies previously received under other HHF Programs, if any).

Borrower participation m UMA IS limited to 6 months

maximum.

Approximately 8,953. This figure is based on loans with unpaid

principal balances ranging from $200,000 to $400,000 with an

average funding of $7,228.
12. Program Inception/

Duration

UMA will be available to borrowers within five months after

approval of UMA by Treasury and will last up to three years.

13. Program Interactions UMA will serve as a gateway to borrower programs aimed at

with Other HFA reinstatement and principal reduction.

Programs

14. Program Interactions

withHAMP

15. Program Leverage

with Other Financial

Resources

TAMPAlHPA - CaliforniaJl20167,2

Servicers will be required to ensure that eligible borrowers have

exhausted HAMP unemployment assistance prior to utilization

of this HHF program.

This benefit may extend the U.S. Treasury's Housing Program

Enhancements (released on March 26, 2010) for temporary

unemployment assistance by up to a total of one year. The U.S.

Treasury program currently offers a minimum of three months

and up to six months for some borrowers.

The goal of the program is for the applicable servicer/lender to

match UMA funds on a dollar-for-dollar basis, net the

borrower's contribution. The servicer/lender's matching funds

will be paid no later than at the time of CalHFA MAC program

funding.

CalHFA MAC will request that the loan servicer waive fees

(e.g., NSF and late charges).
SERVICE SCHEDULE B-2

California Housing Finance Agency Mortgage Assistance Corporation ("CaIHFA MAC")

MORTGAGE REINSTATEMENT ASSISTANCE PROGRAM

Summary Guidelines

1. Program Overview

2. Program Goals

3. Target

Population/Areas

4. Program Allocation

(Excluding

Administrative

Expenses)

5. Borrower

Eligibility Criteria

TAMPNHPA California/l20167.2

The Mortgage Reinstatement Assistance Program (MRAP) is

one of CalHFA MAC's federally-funded programs developed

to provide temporary financial assistance to eligible

homeowners who wish to remain in their homes but are in

imminent danger of losing their home to foreclosure.

MRAP provides funds to assist income-qualified borrowers to

help them cure their delinquent first mortgage loan arrearages,

which may also include payments needed to reinstate their

loans from foreclosure.

The MRAP subsidy will prevent avoidable foreclosures by

helping borrowers reinstate their past due first mortgage loans.

MRAP will also mitigate the need for large reinstatement

dollars to be capitalized with remaining loan balance, and thus,

broaden the population of borrowers who otherwise may not

qualify for modification.

MRAP is designed to target low-to-moderate income

homeowners and address the needs of a borrower's specific

situation in lieu of targeting certain regions or counties.

$129.4 million.

• Low-to-moderate income limitation of 120% or less of

Area Median Income based upon the county where

borrower resides.

• Low-to-moderate income borrowers that have a loan

financed in whole or in part by bonds that are taxexempt under IRC section 143 are presumed to satisfy

income limits.

• Borrower must complete and sign a Hardship Affidavit

and document the reason for the hardship.

• Borrower has adequate income to sustain modified

mortgage payments per lender guidelines.
6. PropertylLoan

Eligibility Criteria

7. Program

Exclusions

8. Structure of

Assistance

TAMPA/HPA Californiall20167.2

• Borrower is able to satisfy program guidelines

established by CalHFA MAC.

• The mortgage loan is delinquent or the servicer receives

documentation from the borrower that substantiates an

imminent default that meets hardship qualifications.

• General program eligibility is determined by CalHFA

MAC, the housing counselor or serVlcer based on

information received from the borrower. Programspecific eligibility is determined by CalHFA MAC on a

first-come/first-approved basis until program funds and

funding reserves have been exhausted. Loan servicer

will implement the HHF program based on participation

agreement terms and conditions.

• Funding allocation will be tracked, monitored and

performed by CalHFA MAC in a centralized processing

operation.

• The property is encumbered by a first lien mortgage

loan.

• The total original mortgage indebtedness cannot exceed

to GSE conforming limit of $729,750.

• The property securing the mortgage loan must not be

abandoned, vacant, condemned or in a serious state of

disrepair.

• The subject property is the borrower's principal

residence and the property is located in California.

• The applicant must own and occupy the single family,

1-4 unit home (an attached or detached house or a

condominium unit) located III California and must

currently reside in the home as their primary residence.

• Borrower owns other real property.

• Loan was originated after January 1, 2009.

• Borrower consummated a "cash-out" refinance of the

subject property.

In the event that CalHFA MAC receives less than 100% match

by the lender/servicer. CalHFA MAC will structure the

assistance as a non-interest bearing subordinate loan in favor of

the Eligible Entity secured by the property in the amount of the

total reduced principal, interest, taxes, insurance and

homeowner's association dues, as applicable comprised of

HHF monies and lender forgiveness. If the lender/servicer

matches the assistance in an amount equal to or greater than

100% of the HHF Program assistance provided to the
borrower, then the assistance is not required to be structured as

a loan to the borrower. The subordinate loan will be forgiven

over a three year period provided the loan remains in good

standing and the borrower complies with program guidelines.

9. Per Household Up to $15,000 per household (average funding of $7,484) or

Assistance 50% of PITIA arrearages, whichever is less (and in all cases,

subject to the HHF Program maximum benefit cap of $50,000

with respect to monies previously received under other HHF

Programs, if any).

10. Duration of Borrower participation in Program is a one time payment.

Assistance

11. Estimated Number Approximately 17,293. This figure is based on loans with

of Participating unpaid principal balances ranging from $200,000 to $400,000

Households with an average funding of $7,484.

12. Program MRAP will be available to borrowers within five months after

InceptionJDuration approval of MRAP by Treasury and will last up to three years.

13. Program MRAP will serve as a gateway to other loss mitigation

Interactions with programs including loan modification which may include

OtherHFA principal reduction, including other HHF Programs and the

Programs Principal Reduction Program.

14. Program MRAP will serve as a gateway to HAMP which may include

Interactions with principal reduction of borrower's mortgage.

HAMP

15. Program Leverage The goal of the program is for the applicable servicer/lender to

with Other match MRAP funds on a dollar-for-dollar basis. The

Financial servicer/lender's matching funds will be paid no later than at

Resources the time of CalHFA MAC program funding.

CalHFA MAC will request that the loan servicer waive fees

(e.g., NSF and late charges).

TAMPA/HPA - Californiall 20167.2
SERVICE SCHEDULE B-3

California Housing Finance Agency Mortgage Assistance Corporation ("CaIHFA MAC")

PRINCIPAL REDUCTION PROGRAM

Summary Guidelines

1. Program Overview

2. Program Goals

3. Target

Population/Areas

4. Program Allocation

(Excluding

Administrative

Expenses)

5. Borrower

Eligibility Criteria

TAMPAfHPA - California/I 20167.2

The Principal Reduction Program (PRP) is one of CalHFA

MAC's federally-funded programs developed with a goal to

provide capital on a dollar-for-dollar matching basis with

participating lenders to reduce over a three year period the

outstanding principal balances of qualifying properties with

negative equity.

PRP will provide monies to reduce the principal balance of the

first mortgage loan of varying size and term, for the purposes of

establishing an appropriate level of debt for eligible borrowers

with qualifying properties.

The PRP subsidy will, in cooperation with participating lenders,

leverage the HHF dollars by reducing the principal balances of

underwater mortgages and provide an incentive for qualifying

homeowners to remain in their homes during this period of

steep declines in value.

A reduction in principal through PRP can achieve desired

income ratios and affordability for a borrower on the existing

mortgage loan or can be used in conjunction with a loan

modification.

PRP is designed to target low-to-moderate income homeowners

and address the needs of a borrower's specific situation in lieu

of targeting certain regions or counties.

$420.6 million.

• Low-to-moderate income limitation of 120% or less of

Area Median Income based upon the county where

borrower resides.

• Low-to-moderate income borrowers that have a loan

financed in whole or in part by bonds that are taxexempt under IRC section 143 are presumed to satisfy

income limits.
6. Property!Loan

Eligibility Criteria

7. Program

Exclusions

8. Structure of

Assistance

TAMPAlHPA CalifornialJ20167.2

• Borrower must complete and sign a Hardship Affidavit

and document the reason for the hardship.

• Borrower has adequate income to sustain modified

mortgage payments per lender guidelines.

• Borrower IS able to satisfy program guidelines

established by CalHFA MAC.

• The mortgage loan is delinquent or the servicer receives

documentation from the borrower that substantiates an

imminent default that meets hardship qualifications.

• Program-specific eligibility is determined by CalHFA

MAC and loan servicer on a first-come/first-approved

basis until program funds and funding reserves have

been exhausted. Loan servicer will implement the HHF

program based on participation agreement terms and

conditions.

• Funding allocation will be tracked, monitored and

performed by CalHFA MAC in a centralized processing

operation.

• The property is encumbered by a first lien mortgage

loan.

• The total mortgage indebtedness cannot exceed to GSE

conforming limit of $729,750.

• The property securing the mortgage loan must not be

abandoned, vacant, condemned or in a serious state of

disrepair.

• The subject property IS the borrower's principal

residence and the property is located in California.

• The applicant must own and occupy the single family,

1-4 unit home (an attached or detached house or a

condominium unit) located III California and must

currently reside in the home as their primary residence.

• Hardship caused by voluntary resignation of

employment.

• Borrower owns other real property.

• Borrower fails to satisfy lender underwriting guidelines,

including a LTV of 120% or less.

• Loan was originated after January 1, 2009.

• Borrower consummated a "cash-out" refinance of the

subject property.

In the event that CalHFA MAC receives less than 100% match

by the lender/servicer, CalHFA MAC will structure the

assistance as a non-interest bearing subordinate loan in favor of
9. Per Household

Assistance

10. Duration of

Assistance

11. Estimated Number

of Participating

Households

12. Program

InceptionJDuration

13. Program

Interactions with

OtherHFA

Programs

14. Program

Interactions with

HAMP

15. Program Leverage

with Other

Financial

Resources

TAMPNHPA - Californiall 20167.2

the Eligible Entity secured by the property in the amount of the

total reduced principal, interest, taxes, insurance and

homeowner's association dues, as applicable comprised of HHF

monies and lender forgiveness. If the lenderlservicer matches

the assistance in an amount equal to or greater than 100% of the

HHF Program assistance provided to the borrower, then the

assistance is not required to be structured as a loan to the

borrower. The subordinate loan will be forgiven over a three

year period provided the loan remains in good standing and the

borrower complies with program guidelines.

Up to $50,000 per household (average funding of $33,063), less

program monies previously received under other HHF

Programs.

Three years.

Approximately 13,375. This figure is based on loans with

unpaid principal balances ranging from $200,000 to $400,000

with an average funding of $33,063.

PRP will be available to borrowers within five months after

approval of the PRP by Treasury and will last up to three years.

PRP may be used in conjunction with MRAP aimed at

reinstatement.

PRP may work in conjunction with a standard HAMP

modification to help eligible borrowers achieve desired income

ratios and affordability. PRP may not be combined or used in

conjunction with the HAMP Principal Reduction Alternative

(PRA). PRP layering with HAMP PRA is strictly prohibited.

PRP funds are not eligible in any combination to qualify for

HAMP PRA investor incentive compensation.

The goal of the program is for the applicable servicer/lender to

match PRP funds on a dollar-for-dollar basis. The

servicer/lender's matching funds will be paid no later than at

the time of CalHFA MAC program funding.

CalHFA MAC will request that the loan servicer waive fees

(e.g., NSF and late charges).
SERVICE SCHEDULE B-4

California Housing Finance Agency Mortgage Assistance Corporation ("CaIHFA MAC")

THE TRANSITION ASSISTANCE PROGRAM

Summary Guidelines

1. Program Overview The Transition Assistance Program (TAP) is one of CalHFA

MAC's federally-funded programs developed to provide

eligible homeowners with transition assistance when it IS

determined that they can no longer afford their home.

TAP will be used in conjunction with short sale and deed-inlieu programs to help borrowers make a smooth transition to

housing. Borrowers will be required to occupy and maintain the

property until the home is sold or returned to the lender as

negotiated.

Program funds would be available on a one-time only basis up

to $5,000 per household and can be used or layered with other

CalHFA MAC HHF Programs. No funds will go directly to the

borrower. All funds will be sent to the Servicer subject to

Servicer/lnvestor approval of short sale or deed-in-lieu of

foreclosure. Funds are intended to help the borrower secure new

housing (e.g., rent, moving expenses, and security deposits) and

will be available for transition assistance counseling services.

2. Program Goals

3. Target

Population/Areas

4. Program Allocation

(Excluding

Administrative

Expenses)

TAMPA/HPA Califomiall20167,2

CalHFA MAC envisions that these monies would be used to

complement other federal or lender programs designed

specifically to stabilize communities by providing assistance to

borrowers who have suffered a financial hardship and as a

result are no longer financially able to afford their mortgage

payments.

TAP is designed to target low-to-moderate income homeowners

and address the needs of a borrower's specific situation in lieu

of targeting certain regions or counties.

$32.3 million.
5. Borrower

Eligibility Criteria

6. PropertylLoan

Eligibility Criteria

7. Program

Exclusions

8. Structure of

Assistance

TAMPAlHPA Californiall20167.2

• Low-to-moderate income limitation of 120% or less of

Area Median Income based upon the county where

borrower resides.

• Low-to-moderate income borrowers that have a loan

financed in whole or in part by bonds that are taxexempt under IRC section 143 are presumed to satisfy

income limits.

• Borrower must complete and sign a Hardship Affidavit

and document the reason for the hardship.

• Borrower IS able to satisfy program guidelines

established by CalHFA MAC.

• The mortgage loan is delinquent or the servicer receives

documentation from the borrower that substantiates an

imminent default that meets hardship qualifications.

• Program-specific eligibility is determined by CalHFA

MAC and loan servicer on a first-come/first-approved

basis until program funds and funding reserves have

been exhausted. Loan servicer will implement the HHF

program based on participation agreement terms and

conditions.

• Funding allocation will be tracked, monitored and

performed by CalHFA MAC in a centralized processing

operation.

• The property is encumbered by a first lien mortgage

loan.

• The total original mortgage indebtedness cannot exceed

the GSE conforming limit of $729,750.

• The property securing the mortgage loan must not be

abandoned, vacant, condemned or in a serious state of

disrepair.

• The subject property IS the borrower's principal

residence and the property is located in California.

• The applicant must own and occupy the single family,

1-4 unit home (an attached or detached house or a

condominium unit) located III California and must

currently reside in the home as their primary residence.

• Borrower owns other real property.

• Loan was originated after January 1, 2009.

• Borrower consummated a "cash-out" refinance of the

subject property.

TAP assistance will not be structured as a loan.
9. Per Household Up to $5,000 per household (average funding of $5,000).

Assistance

10. Duration of Borrower participation in Program is a one time payment.

Assistance

11. Estimated Number Approximately 6,471. This figure is based on loans with unpaid

of Participating principal balances ranging from $200,000 to $400,000 with an

Households average funding of $5,000.

12. Program Inception! TAP will be available to borrowers within five months after

Duration approval of TAP by Treasury and will last up to three years.

13. Program Leverage TAP benefits may be available to the borrower even if UMA,

flnteractions with MRAP and/or PRP benefits have been utilized, subject to the

Other HFA HHF Program maximum benefit cap of $50,000.

Programs

14. Program TAP complements HAMP and HAFA. The funds will leverage

Interactions with monies being made available through HAFA. Servicer is

HAMP required to follow HAFA guidelines for allowable costs. In

cases where the Servicer has approved the borrower for a

HAFA transaction, TAP dollars will be limited to $2,000 in

order to maintain the $5,000 HHF Program maximum per

household.

15. Program Leverage None.

with Other

Financial

Resources

TAMPAlHPA Califomia/120167.2
SCHEDULEC

PERMITTED EXPENSES

One-time / Start-U Ex enses:

Initial Personnel

Buildin , E ui ment, Technolo

Professional Services

Su lies / Miscellaneous

Marketin /Communications

Travel

Website develo ment /Translation

Cantin enc

Operating / Administrative

Ex enses:

Salaries

Professional Services (Legal,

Com Iiance, Audit, Monitorin

Travel

Buildin s, Leases & E ui ment

Information Technology &

Comm unications

Office Supplies/Postage and

Deliver /Subscri tions

Risk Mana ementllnsurance

Trainin

Marketin /PR

Miscellaneous

Transaction Related Ex enses:

Recordin Fees

Wire Transfer Fees

Counselin Ex enses

File Intake

Decision Costs

Successful File

Ke Business Partners On-Gain

Subtotal

TAMPAlHPA - Califomiall20167.2

$242,343

$114,514

$2,194,065

$25,500

$204,156

$17,500

$0

$808,908

$5,719,410

$22,429,780

$94,500

$432,000

$216,970

$59,500

$800,000

$90,000

$435,000

$0

$4,890,780

$1,260,075

$0

$12,435,000

$0

$0