R2005-112 AUTHORIZING THE PARTICIPATION IN THE ILLINOIS HOUSING DEVELOPMENT AUTHORITY

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(a) Use of Grant Proceeds. The Sponsor shall use the Grant proceeds to make five 5 ear no interest loans each a "Loan" to Homebu ers artici atin i , n the � ) Y � ) Y P P g Homebuyer Program to pay for costs of acquiring single-family, owner-occupied Residences. One-sixtieth(1/60`�)of the Loan shall be forgiven at the end of each month of the Loan. (b) Lead Based Paint. Each Residence shall comply with the Lead-Based Paint Poisoning Prevention Act, 42 U.S.C. 4821, et seq., and its implementing regulations, 24 C.F.R Part 35, each as respectively amended from time to time, and other applicable federal, state and local laws regulating lead-based paint and lead-based paint hazards. (c) Term and Use of Grant Proceeds. The Grant shall be available for use by the Sponsor for a period of two (2) years. The actual amount of Grant proceeds available to the Sponsor from the Effective Date through the first anniversary of the Effective Date ("First Year") and the actual amount of Grant proceeds available subsequent to the First Year through the second anniversary of the Effective Date ("Second Year") shall be determined by the Authority, in its sole discretion,based on the Sponsor's achievement of certain production goals and criteria established by the Authority. Prior to the end of the First Year, at least forty percent (40%) of the Grant shall have been either (i) actually expended (collectively"Expenditures"), or(ii) subject to an Unconditional Commitment to Expend (as hereinafter defined). In the event that Sponsor has made Expenditures and Unconditional Commitments to Expend for the First Year in an amount less than the First Year Funds (collectively "Allocated Expenditures") such deficiency in Allocated Expenditures compared to First Year Funds may not be carried over and may not be made available for use by the Sponsor during the Second Year. In addition, the deficiency in Allocated Expenditures compared to First Year Funds may result in a commensurate reduction in the amount of the Grant that will be available to the Sponsor in the Second Year. For purposes hereof an "Unconditional Commitment to Expend" shall mean those funds not yet actually distributed by Sponsor but are specifically identified and reserved for use in Sponsor's records for the acquisition of a Residence pursuant to a contract not subject to any contingencies entered into during the First Year but not scheduled to be closed until the Second Year. 3. Homebuver Program Agreement. Each Loan shall be governed by the terms of an agreement(the "Homebuyer Program Agreement")between the Sponsor and the Homebuyer that is to receive the Loan. For each Loan, the applicable Homebuyer Program Agreement shall provide that, except in the event of a Recapture Event (as hereinafter defined), the Loan shall be forgiven in its entirety at the end of its term. For purposes of this subparagraph, a "Recapture Event" shall mean the earliest to occur of the following: (i)the sale, conveyance or other transfer of ownership of the Residence for consideration, excluding for purposes hereof any sale, conveyance or transfer (A)to a spouse upon a dissolution of a marriage, (B)to the surviving spouse upon the death of a joint tenant Homebuyer, (C)by will or (D)by foreclosure or deed in lieu of foreclosure or otherwise by operation of law; (ii)the Residence is no longer the Homebuyer's principal residence or the Homebuyer converts the Residence to a rental unit; (iii)the refinancing of the first mortgage, if any, encumbering the Residence during the Loan term, except for a Pernutted Refinancing (as hereinafter defined); (iv) a default by the Homebuyer, beyond any 3