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<br />2. The initial purchaser of each Target Unit shall execute an instrument or <br />agreement approved by the City restricting the sale of the Target Unit in <br />accordance with this Article during the applicable use restriction period. <br />Such instrument or agreement shall be recorded against the parcel <br />containing the Target Unit and shall contain such provisions as the City <br />may require in order to ensure continued compliance with this Article and <br />the state Density Bonus Law; <br /> <br />3. Renewed restrictions will be entered into on each change of ownership, <br />with a 45-year renewal term, upon transfer of an owner-occupied Target <br />Unit prior to the expiration of the 45-year affordability period not be <br />subject to any requirement of this Article thereafter; <br /> <br />4. Target Units may be refinanced if the loan-to-resale value does not exceed <br />100 percent and the homeowners receive no cash out except cash that <br />would be used for major rehabilitation; <br /> <br />5. The maximum sales price permitted on resale of the Target Unit <br />designated for owner-occupancy shall be the lower of: (1) fair market <br />value or (2) the seller's lawful purchase price, increased by the lesser of (i) <br />the rate of increase of Area Median Income during the seller's ownership <br />or (ii) the rate at which the consumer price index increased during the <br />seller's ownership. The City shall enter into an equity sharing agreement <br />in accordance with Government Code Section 65915(c) to address <br />disposition of proceeds upon resale; <br /> <br />6. Title in the Target Unit may change due to changes in circumstance, <br />including death, marriage and divorce. Except as otherwise provided, if a <br />change in title is occasioned by events that change the financial situation <br />of the Household so that it is no longer income-eligible, then the property <br />must be sold to an income-eligible Household within 180 days. Upon the <br />death of one of the owners, title in the property may transfer to the <br />surviving joint tenant without respect to the income-eligibility of the <br />Household. Upon the death of a sole owner or all owners and inheritance <br />of the Target Unit by a non-income-eligible child or stepchild of one or <br />more owners, there will be a one year compassion period between the time <br />when the estate is settled and the time when the property must be sold to <br />an income-eligible Household. Inheritance of a Target Unit by any other <br />person whose Household is not income-eligible shall require resale of the <br />unit to an income-eligible Household as soon as is feasible but not more <br />than 180 days; and <br /> <br />7. Target Units shall remain owner-occupied. No renting or leasing shall be <br />allowed. <br /> <br />ORDINANCE NO. 2006-010 10 <br />