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d. Adjusted Resale Price Not to Exceed Affordable Housing Cost. The Base Resale Price as adjusted, is
<br />hereinafter referred to as the "Adjusted Resale Price." Notwithstanding any other provision hereof to the contrary, in no event shall
<br />the Adjusted Resale Price exceed the Affordable Housing Cost.
<br />13. Priority and Effectiveness of the Option.
<br />a. Recordation. This Agreement shall be recorded in the Office of the Recorder of the County of Alameda
<br />prior to any sale, conveyance, transfer or other disposition of the Property, or of any estate or interest therein, by Owner. The Option
<br />shall have priority over any subsequent sale, conveyance, transfer, lease, or other disposition or encumbrance of the Property, or of
<br />any estate or interest therein, and in the event of exercise of the Option by City, the City shall take the Property subject only to senior
<br />liens and encumbrances. Except as otherwise provided in Section 14(a), the exercise of the Option by the City at any time and from
<br />time to time shall not extinguish the Option or cause a merger of the Option into any estate or other interest in the Property, and the
<br />Option shall continue to exist and be effective with respect to the Property against any and all subsequent owners in accordance with
<br />the terms and conditions hereof.
<br />b. Reauest for Notice of Default. The City shall file a Request for Notice of Default for recordation in the
<br />Office of the Recorder of the County of Alameda promptly upon execution of this Agreement.
<br />14. Survival of Option Upon Transfer.
<br />a. In General. The City's right to exercise the Option shall survive any transfer of the Property by Owner.
<br />The Option may be exercised against the Property whether owned, possessed or occupied by (i) an Eligible Household, (ii) any
<br />successor, transferee, asskjnee, heir, executor, or administrator of an Eligible Household, including a debtor4n-possession, debtor or
<br />trustee pursuant to Title 11 of the United States Code, or (iii) any person owning, possessing or occupying the Property who does not
<br />meet the eligibility criteria established by the City under the Program (collectively all referred to and defined herein as "Owner").
<br />Notwithstanding the foregoing, the Option shall not survive (1) the sale and transfer of the Property under a judicial or non -judicial
<br />foreclosure or a deed-in4ieu of foreclosure pursuant to a mortgage or deed of trust recorded against the Property in the Office of the
<br />Recorder of the County of Alameda on or prior to the date of this Agreement, provided that the City has received timely notice of such
<br />Option event and has failed to either reinstate said mortgage or deed of trust or complete the purchase of the Property pursuant to its
<br />Option prior to the date of the foreclosure sale, or (2) the recording of an instrument conveying Owner's interest in the Property to the
<br />City, or its assignee, provided the conveyance is in accordance with the terms of this Agreement.
<br />b. HUD Insured or CaIHFA Held Mortgage. If Owner has acquired the Property by a mortgage insured by
<br />the Secretary of the United States Department of Housing and Urban Development or held by the California Housing Finance Agency,
<br />and provided that the City has received timely notice of such purchase option event (which notice could include a notice of default
<br />recorded pursuant to California Civil Code Section 2924 or successor provisions), then this Option shall automatically terminate if title
<br />to the Property is transferred by foreclosure or deed -in -lieu of foreclosure, or if the insured mortgage is assigned to the Secretary.
<br />15. Voidable Transfers. As long as the Option has not been abandoned pursuant to Section 6(e), any actual or
<br />attempted sale, conveyance, transfer or other disposition of the Property, or of any estate or interest therein, in violation of the terms
<br />and conditions of this Agreement, shall be voidable at the election of the City.
<br />16. Permitted Transfers. The following transfers ("Permitted Transfers") of title to the Property, or of any estate or
<br />interest therein, shall not be subject to the City's prior approval, shall not trigger the exercise of the Option, and shall not be
<br />considered Option Events: (a) taking of title by a surviving joint tenant; and (b) any good faith transfer to an Eligible Household. The
<br />following inheritances are not unconditionally permitted, but do allow a compassion period: (c) inheritance of the unit by a Non -
<br />Eligible child or step child (at which time the City will allow a one-year compassion period between the time the estate is settled and
<br />the time when the property must be sold to an Eligible Household); and inheritance by any other Non -Eligible person (at which time
<br />the City shall require resale to an Eligible Household within 180 days).
<br />17. Permitted Encumbrances and Refinances. This Option shall not become exercisable as the result of Owners
<br />encumbering the Property for the purpose of securing financing to purchase the Property pursuant to the Program, or to refinance
<br />existing indebtedness incurred to purchase the Property pursuant to the Program. The maximum amount (the "Permitted
<br />Encumbrance Amount") of any refinancing permitted by this section shall not exceed an amount equal to ninety percent (90°x) of the
<br />Base Resale Price calculated as provided in Section 11, as modified by this section. The Permitted Encumbrance Amount shall be
<br />the Base Resale Price calculated as if the City has received notification of an Option Event on the earlier of (a) the date on which the
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