Bristol Cove Townhouse Association

Association Documents

Articles of Incorporation

ARTICLES OF INCORPORATION OF
BRISTOL COVE TOWNHOUSE ASSOCIATION,INC.

For the purpose of forming a Corporation not for profit under the Laws of the State of Colorado, the undersigned hereby signs and acknowledges the following Articles of Incorporation:




ARTICLE I

NAME

The name of the Corporation is BRISTOL COVE TOWNHOUSE ASSOCIATION, INC. (hereinafter called the "Association”).


ARTICLE II

DURATION


The period of duration of the Association shall be perpetual.


ARTICLE III

PURPOSES


The purposes and objects for which Association is organized shall be to administer the operation and management of the real property and improvements constructed and established on all or any part of the real property located in the County of Arapahoe, State of Colorado, described in attached Exhibit “A”.

The Development was created by K-B industries, Inc., a California corporation, filing in the Office of the Clerk and Recorder of the County of Arapahoe, Colorado, a Declaration of Covenants, Conditions, Restrictions and Easements (the "Declaration"). The operation and maintenance of the Development shall be administered in accordance with the Declaration and any and all amendments or modifications thereof from time to time adopted pursuant thereto, and recorded in the Office of the Arapahoe County Clerk and Recorder, including, without limitation, any amendment subjecting to the terms and provisions of the Declarations that portion or portions of said real property which were not made subject to said terms and provisions at the time the Declaration is initially recorded.



ARTICLE IV

POWERS


The Association shall have all of the powers, duties and privileges granted or permissible to a corporation not for profit under the laws of Colorado except as expressly limited by these Articles and the Declaration, including, but not limited to, the following:

(1) The right to make and establish rules and regulations governing the use and activities of the Development.

(2) The right to make, levy and collect assessments against members of the Association, in accordance with the terms of the Declaration and such By-Laws of this Association as may from time to time be adopted, to defray the cost, expenses and losses of the Association, and to use the proceeds in the exercise of its powers and duties.

(3) The right and obligation to maintain, repair, replace, operate and manage the Development, and the real and personal property comprising it including the right to reconstruct improvements after damage by casualty, to make further improvements of the Development property and to purchase replacements and additional property in furtherance of the purposes of the Association.

(4) The right to make contracts and incur liabilities, borrow or lend money at such rates of interest as the Association may determine, issue its notes, bonds and other obligations, and secure any of its obligations by mortgage and pledge of all or any of its property, franchises or income.

(5) The right to purchase, lease, take by gift, devise or bequest, or otherwise acquire, own, hold, improve, use or otherwise deal in and with real or personal property, or any interest therein.

(6) The right to purchase insurance upon any of the Development property and insurance for protection of the Association, its members as owners of units in the Development, and any mortgagees, lessees or other persons.

(7) The right to contract for the management of the Development and to delegate to such contractor or contractors all powers and duties of the Association except such as are specifically required by the Declaration to have approval of the Board of Directors or the membership of the Association or which may not be delegated pursuant to Colorado law. Any agreement for professional management of the Development, or any contract providing for services must provide for termination by either party without cause or payment of a termination fee on 30 days or less written notice and with a maximum contract term of one year.

(8) The right to employ personnel to perform the services required for the proper operation of the Development.

(9) The right to enforce by legal means the provisions of the Declaration, these Articles of Incorporation, the By-Laws of the Association which may be hereafter adopted from time to time, and the rules and regulations governing the use of the Development as may be hereafter duly established.

(10) The right and obligation to exercise, undertake and accomplish all of the rights, duties and obligations which may be granted to or imposed upon the Association by law or pursuant to the Declaration.


The powers of the Association shall be subject to, and shall be exercised in accordance with, the provisions of the Declaration and the By-Laws. The foregoing powers shall not be limited in any way, except as otherwise expressly provided, by reference to or inference from the terms of any other clause (or any other matter within the same clause), but shall be regarded as independent powers; and the enumeration of specified powers shall not be construed to exclude, limit or restrict in any manner any power, right or privilege given to the Association by law, or to limit or restrict in any manner the meaning of the general terms of such clauses, or the general powers of the Association, nor shall the expiration of one thing be deemed to exclude another, although it be of a like nature, not expressed.

Notwithstanding anything contained in these Articles or the Declaration to the contrary, no part of the net earnings of the Association shall inure to the benefit of or be distributable to any member, director or officer of the Association, or any private individual (except that reasonable compensation may be paid for services rendered to or for the Association effecting one or more of its purposes), and no member, director or officer of the Association, or any private individual, shall be entitled to share in the distribution of any of the corporate assets on dissolution of the Association; and provided, further, that no part of the activities of the Association shall be carrying on propaganda in order to influence legislation, or otherwise attempting to influence legislation, or participating or intervening in (including the publication or distribution of statements) any political campaign on behalf of any candidate for public office.




ARTICLE V

MEMBERSHIP AND VOTING RIGHTS

Members shall be the Owners of Lots within Project, but, if any Owner of a lot shall be more than one Person or shall be a corporation, then one of such persons or an officer of such corporation, as the case may be, shall be designated the Member with respect to such Lot in a notice delivered to the Secretary Treasurer of the Association subscribed to by all of such Persons, or by such corporation, as the case may be.

“Owner” shall mean and refer to the record owner, whether one or more persons or entities, of fee simple title to any Lot, but excluding those having such interest merely as security for the performance of any obligations, provided, that the purchaser at a foreclosure sale or trustee's sale shall be deemed an Owner following expiration of the redemption period, unless waived, if redemption has not occurred. The term Owner shall not include the Owner or Owners of any lesser estate or interest. At the time of transfer of any Lot, notice of such transfer shall be given to the Association by the transferor. Any transferor who fails to give such notice shall be personally liable for all assessments accruing after such failure and until such notice is given, but shall have none of the rights or privileges accruing to Owners hereunder.

Membership shall be appurtenant to, and may not be separated from, record ownership of a Lot and such Membership shall automatically transfer to the new Owner upon any sale, transfer or other disposition of a Lot subject to the provisions hereof. There shall not be more than one Member for each Lot within the Project. Upon any such transfer, sale or other disposition of all or some of the fee interest in a Lot, the then Owner shall comply with the provisions set forth above for designation of the Member with respect to such Lot. Notwithstanding anything contained in this Article to the contrary, until the owner of a Lot shall deliver to the Secretary/Treasurer of the Association a certified copy of the recorded deed or other recorded instrument establishing record title to a Lot and, if the Owner shall be more than one Person or a corporation, the designation of the Member as hereinabove provided, there shall be no Member with respect to the Owner's Lot and such Owner shall have no right to vote. Transfer of any Membership, except together with the Ownership of a Lot thereon, shall be null and void and of no effect and such transferee shall not be entitled to the benefits of being a Member.

The Association may suspend the voting rights of a member during any period or periods in which the Member fails to comply with the rules and regulations of the Association, or in which it fails to make payment when due on all assessments payable by such Owner to the Association.

The rights of all members of the Association shall be identical and each shall be entitled to one vote for each Lot as to which he is a Member. Members shall have no pre-emptive rights to purchase other Lots or the Memberships appurtenant thereto.

The By-Laws may contain such provisions not inconsistent hereto, setting forth the rights, privileges, duties and responsibilities of the Members.

















ARTICLE VI

BOARD OF DIRECTORS


The initial Board of Directors shall be three (3) in number and the Board may be increased in size by Resolution of the Board of Directors.

The business and affairs of the corporation shall be conducted, managed and controlled by the Board of Directors; members of the Board of Directors shall be elected in the manner provided in the By-Laws.


ARTICLE VII

REGISTERED OFFICE AND AGENT

The registered office of the corporation and registered agent shall be the management company for the Association. This information will be recorded annually with the Arapahoe County Clerk and Recorder.


ARTICLE VIII

INCORPORATOR

The incorporator of this corporation is Joseph Barton, 7549 South Cove Circle, Littleton, Colorado 80122.


ARTICLE IX

AMENDMENTS

Amendments to these Articles of Incorporation may be adopted at a meeting by the Board of Directors upon receiving the vote of a majority of the Directors in office; provided, that no amendments shall be adopted which would render these Articles inconsistent with the Declaration.










ARTICLE X

BY-LAWS

The first By-Laws of the corporation shall be adopted by the Board of Directors, and may be altered, amended or rescinded in the manner provided by the By-Laws; provided, however, that no provision of the By-Laws shall be contrary to or inconsistent with any provision hereof or of the Declaration.

IN WITNESS WHEREOF, for the purpose of forming this corporation under the laws of the State of Colorado, the undersigned, constituting the Incorporator of this Association, has executed these Articles of Incorporation this 2nd day of November, 1978.


/s/ Joseph Barton
JOSEPH BARTON
7549 South Cove Circle
Littleton, Colorado 80122


STATE OF COLORADO
ss.
COUNTY OF JEFFERSON

I, Elaine R. Spurgeon, Notary Public in and for said County and State, do hereby certify that on the 2nd day of November, 1978, personally appeared before me Joseph Barton, who, being by me first duly sworn, declared that he is of the age of 21 years or more, that he is the person who signed the foregoing document as Incorporator, and that the statements therein contained are true.

WITNESS my hand and official seal.
My Commission Expires: 11/14/80

(SEAL)
/s/ Elaine R. Spurgeon
Notary Public

By-Laws

BY-LAWS OF
BRISTOL COVE TOWNHOUSE ASSOCIATION,INC.

BY-LAWS
OF
BRISTOL COVE TOWNHOUSE ASSOCIATION, INC.

ARTICLE I

OFFICES

The principal office of the Association shall be located in the County of Arapahoe, Colorado.


ARTICLE II

PLAN OF HOME OWNERSHIP


Section 1. Home Ownership.

The property located in the County of Arapahoe, State of Colorado, and more particularly described on Exhibit "A" to the Declaration of Covenant, Conditions, Restrictions and Easements of Bristol Cove Townhouse Association, Inc. (the Declaration), recorded in the real property records of the County of Arapahoe, State of Colorado, will be subject to the provisions of the Declaration. The Development thereby created is known as Bristol Cove (sometimes herein referred to as the "Project" of the "Development").

Section 2. Personal Application.

All owners, mortgagees, lessees and occupants of Units within Bristol Cove and any other person who may use the facilities of the project in any manner are subject to these By-Laws, the Declaration and to the rules and regulations established by the Board of Directors as hereinafter set forth. The acceptance of a deed or instrument of conveyance, or the entering into of a lease, or the act of occupancy of a Lot or Unit shall constitute an agreement that these By-Laws, and the rules and regulations adopted pursuant to the By-Laws, the provisions of the Declaration, as they may be amended from time to time, are accepted, ratified and will be complied with.

Section 3. Definitions.

The words and terms used herein shall have the same meaning as set forth in the Declaration and the corporate Articles except as may otherwise herein be provided or if the context shall otherwise require.





ARTICLE III

MEMBERS, MEETINGS AND ELECTIONS




Section 1. Membership in Association.

Membership in the Association shall be determined as provided in Article V. of the Articles of Incorporation of the Association.




Section 2. Voting.

Each Member subject to the provisions hereof and of the Declaration, shall be entitled to one vote at all meetings of the Association for each Lot owned by such Person, and as to which he is a Member. Forfeiture of the right to vote or to be a Member as provided herein or in the Articles of Incorporation or the Declaration shall not affect the obligations or liabilities of such Owner to pay assessments and to abide by the provisions of the Declaration, the By-Laws and the rules and regulations adopted pursuant hereto. At any meeting of the Association, every Member having the right to vote shall be entitled to vote in person, or by written proxy. Such proxy shall only be valid for such meeting or subsequent adjourned meetings thereof and shall be filed with the Secretary Treasurer prior to the meeting at which the same is to be used. A notation of such proxies shall be made in the minutes of the meeting.




Section 3. Election of Directors and Annual Meetings.

Members shall be entitled to vote for the election of Directors. At each meeting at which Directors are elected by Members, each such Member shall be entitled to cast his vote for as many persons as there are Directors to be elected by the Members. There shall be no cumulative voting. The candidate receiving the highest number of votes shall be declared elected. Annual Meetings shall be held on any date determined by the Board, provided such date shall not be more than thirteen (13) months from the date of last Annual Meeting. At each Annual Meeting there shall be elected, by ballot of the Members, a Board of Directors in accordance with the requirements of Article IV of these By-Laws. The Owners may also transact such other business of the Association as may properly come before them.








Section 4. Special Meetings.

It shall be the duty of the President to call a special meeting of the Owners as provided in this Section, and in Article IV, Section 2 and Article VII, Section 3 hereof, or upon a petition signed by a majority of the Members having been presented to the Secretary Treasurer. The date of any special meeting being called upon such a petition shall be not less than fourteen (14) days nor more than thirty (30) days from receipt of such petition by the Secretary Treasurer.



Section 5. Quorum.

A quorum shall consist of at least one-half (1/2) of all Members entitled to vote whether present in person or by written proxy except as otherwise provided in these By-Laws or in the Declaration. If no quorum be present, the presiding officer may adjourn the meeting to some other time, not later than seven (7) days from the date of such meeting, and such adjourned meeting shall have the same effect as if held on the day appointed.

When a quorum is present at any meeting, the vote of a majority of the Members present in person or represented by written proxy shall decide all questions and such vote shall be binding upon all Owners, unless the question is one upon which, by express provision of the Declaration, Articles of Incorporation, law, or of these By-Laws, a different vote is required, in which case such express provisions shall govern and control the decision of such question.



Section 6. Waiver and Consent.

Whenever the vote of Members at a meeting is required or permitted by any provision of the Declaration, Articles of Incorporation, law or of these By-Laws to be taken in connection with any action, the meeting and vote of Members may be dispensed with if all Members who would have been entitled to vote upon the action is such meeting were held, shall consent in writing to such action being taken.



Section 7. Place of Meetings.

Meetings shall be held at such suitable place within the State of Colorado convenient to the Owners as may be designated by the Board of Directors.



Section 8. Notice of Meetings.

It shall be the duty of the Secretary Treasurer at least fourteen (14), but not more than thirty (30), days prior to each annual or special meeting to mail a notice stating the purpose thereof as well as the time and place where it is to be held, to each Member, by regular mail addressed to the Unit owned by such Member in the Project.

Section 9. Order of Business.

The order of business at all meetings shall be as follows to the extent required:

(a) Roll call.
(b) Proof of notice of meeting or waiver of notice.
(c) Reading of minutes of preceding meeting.
(d) Report of officers.
(e) Report of the Board of Directors.
(f) Report of committees.
(g) Election of inspectors of election (in the event there is an election).
(h) Election of Directors (in the event there is an election).
(i) Unfinished business.
(j) New business
(k) Adjournment.



ARTICLE IV

BOARD OF DIRECTORS



Section 1. Number, Qualification and Term.

The number of Directors which shall constitute the whole Board shall be as follows: The Board shall consist of three (3) members.

All Directors shall be Owners or an officer of an Owner if the Owner shall be a corporation and any such Director who ceases to be an Owner shall automatically be deemed to have resigned. Members shall elect Directors for a term of three (3) years to fill the vacancies created by expired terms. All Directors shall hold office until their successors have been elected and qualify.





Section 2. Vacancy and Replacement.

If the office of any Director or Directors becomes vacant by reasons of death, resignation, retirement, disqualification, removal from office or otherwise, a special meeting of the members shall promptly be called and a new Director or new Directors shall be elected. Such successor or successors shall hold office for the unexpired term in respect to which such vacancy occurred.


Section 3. Removal.

Directors may be removed with or without cause by an affirmative vote of a majority of the Members (except that any Directors whose terms do not expire at the next Annual owners Meeting may be removed only by vote of at least two-thirds of the Members) at any meeting of Members when the notice therefore indicates the purpose. No Director shall continue to serve on the Board if, during his term of office, he shall cease to be an Owner.


Section 4. Powers.

The Board shall have general charge, management and control of the affairs, funds and property of the Association and shall authorize and control all expenditures pursuant and subject to the Articles of Incorporation, the Declaration and these By-Laws. It shall have the powers granted to the Association in the Articles of Incorporation and the duty to carry out the purposes of the Association according to law and as set forth in said Articles, these By-Laws and the Declaration.




Section 5. Committees.

The Board of Directors may, by resolution or resolutions, pass by a majority of the whole Board, designate one or more committees. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. Committees established by resolution of the Board of Directors shall keep regular minutes of their proceedings and shall report the same to the Board as required.

By resolution of the Board of Directors on September 9, 1981 four committees were established:

1. Architectural

2. Recreation

3. Estate

4. Council


The first three committees will be formed with a minimum of three Association Members, including a Director. The fourth, Council Committee, will be formed from the chairperson of each of the above three committees, including a Director. The four committees may be supported with budgeted funding and by legal counsel of the Association through the Directors.


Architectural Committee: The Committee will preview and make recommendations to the Directors for approval or disapproval of all structural alterations submitted to the Directors under Section 8, Article VII of the Declaration of Covenants, Restriction and Easements of Bristol Cove Townhouses. It shall also, at the request of the Directors, review existing alterations which have been undertaken and completed without prior approval.


Recreation Committee: The Committee will include the Tennis Chairperson and additional Members to draw up rules for use of the recreational amenities and, as it considers appropriate, a program of recreational/social events.


Estate Committee: The Committee will accomplish the planning, budgeting, and execution of annual programs for care and maintenance of grounds and improvements. Trees, lawns, pavements, walkways and drainage features will be the concern of the Committee.


Council Committee: The Committee will review and adjudicate all violations by Association Members of the documents governing the Bristol Cove Townhouse Association, Inc. upon acceptance of any report of violation or complaint by an Association Member. The Council Committee will preview the annual budget. The Committee will be formed from the Chairperson of the established Committees and a Director.




Section 6. Compensation.

Directors and officers shall receive no compensation for their services as such.



Section 7. Meetings.

(a) The annual meeting of each Board of Directors newly elected by the Owners shall be held immediately upon adjournment of the meeting at which they were elected, provided a quorum shall then be present, or as soon thereafter as may be practicable at the same place as the Owners meeting, at which time the dates, places and times of regularly scheduled meetings of the Board shall be set.

(b) There shall be held at least two regularly scheduled meetings of the Board each year without special notice to the Directors.

(c) Special meetings of the Board may be called by the President on seven (7) days' notice (except in emergency when less notice may be given) to each Director either personally or by mail or telegram except in the event of an emergency when less notice may be given. Special meetings shall be called by the President or Secretary Treasurer in a like manner and on like notice on the written request of at least two (2) Directors. All such notices of special meetings shall state the purpose thereof.

(d) At all meetings of the Board, a majority of the Directors shall be necessary and sufficient to constitute a quorum for the transaction of business, and an act of the majority of the Directors present at any meeting at which there is a quorum shall be the act of the Board, except as may be otherwise specifically provided by statute, the Articles of Incorporation or by the Declaration or by these By-Laws. If a quorum shall not be present at any meeting of directors, the Directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

(e) Before, at or after any meeting of the Board of Directors, any Director may, in writing, waive notice of such meeting and such waiver shall be deemed equivalent to the giving of such notice. Attendance by a Director at any meeting of the Board shall be a waiver of notice by him of the time and place thereof. If all the directors are present at any meeting of the Board, no notice except as provided in Section 7 of this Article IV shall be required and any business may be transacted at such meeting.



Section 8. Meetings Open to Owners.

Meetings of the Board shall be open to all Owners within Bristol Cove.



Section 9. Fidelity Bonds.

The Board shall require that all officers of the Association handling or responsible for Association funds shall furnish adequate fidelity bonds.

Section 10. Management Agent.

The Board of Directors may employ under a term contract or otherwise at a compensation established by the Board of Directors a management agent to perform such duties and services as the Board shall authorize. Such contract shall be subject to Article IV, Section 7 of the corporate Articles pertaining to termination and length of the agreement.

Section 11. Indemnification.

The Association shall have the power to indemnify any director or officer or former director or officer of the Association against expenses actually and reasonably incurred by him in connection with the defense of any action, suit or proceeding, civil or criminal, in which he is made a party by reason of being or having been such director or officer, except in relation to matters as to which he shall be adjudged in such action, suit or proceeding to be liable for gross negligence or intentional misconduct in the performance of his duty to the Association.



ARTICLE V

OFFICERS


Section 1. Elective Officers.

The Board shall elect at its annual meeting each year a President, a Vice President, and a Secretary Treasurer. All officers must be Owners.

Section 2. Term.

Each officer shall hold office for a period of one year and until his successor is elected and shall qualify, but any officer may be removed and/or replaced with or without cause, at any time, by the affirmative vote of a majority of the whole Board of Directors.










Section 3. The President.

The President shall be the Chief Executive Officer of the Association. He shall preside at all meetings of the Association and Board of Directors, shall be an ex-officio member of all standing committees except any nominating committee, and shall perform such other duties as are incident to the office or properly required of him by the Board. The President may serve more than one year in office with approval of the Board.

Section 4. The Vice President.

The Vice President shall perform such duties as are properly required of him by the Board of Directors, and, in the absence or disability of the President, take the place and perform all duties of the President.

Section 5. The Secretary Treasurer.

The Secretary Treasurer shall keep the minutes of all meetings of the Association and of the Board and shall issue all general notices. The minutes of all such meetings shall be available for inspection by Owners at all reasonable times. The Secretary Treasurer shall have the custody of the Association funds and securities and shall keep full and accurate chronological account of receipts and disbursements in books belonging to the Association including the vouchers for such disbursements, and shall deposit all monies and other valuable effects in the name and to the credit of the Association in such depositories as may be designated by the Board of Directors.

He shall disburse the funds of the Association as ha may be ordered by the Board, making proper vouchers for such disbursements and shall render to the President and Directors at the regular meetings of the Board or whenever they may require it, an account of all his transactions as Secretary Treasurer and of the financial condition of the Association.

He shall keep detailed financial records and books of account of the Association, including a separate account for each Unit which, among other things, shall contain the amount of each Assessment against such Unit, the date when due, the amounts paid thereon and the balance remaining unpaid.

He shall perform all other duties incident to his office or which may be properly required of him by the Board. Duties of the Secretary/Treasurer may be assigned to or assumed by the Management Agent as directed by the Board of Directors.


Section 6. Agreements.

All agreements and other instruments authorized by the Board shall be executed by the President and/or such other person or persons as may be designated by the Board.


ARTICLE VI

NOTICES

Whenever under the provisions of the Declaration, the Articles or these By-Laws, notice is required or permitted to be given to the Board, any Director, Member, or Owner, it shall not be construed to mean personal notice. Such notice shall be in writing and either delivered personally or mailed. Any notice given by mail shall be deemed effectively and sufficiently given when deposited in the United States mail postpaid, addressed to the Board, such Director or Owner at such address as appears on the books of the Association.

Whenever any notice is required to be given under the provisions of the Declaration, the Articles or these By-Laws, a waiver thereof, in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed the equivalent thereof.




ARTICLE VII

ASSESSMENTS


Section 1. Determination of Common Expenses and Monthy Assessments.

The Board shall cause to be prepared an estimated annual budget for each fiscal year of the Association. Such budget shall take into account the estimated Common Area expenses and cash requirement of the Association for the year, including without limitation, salaries, wages, payroll taxes, supplies, materials, parts, services, utilities, maintenance, repairs, replacements, landscaping, insurance, fuel, power and other common expenses (as distinguished from individual mortgage payments, real estate taxes and individual telephone, electricity and other individual utility expenses billed or charged to the Owners on an individual or separate basis rather than a common basis). The annual budget shall also take into account the estimated net available cash income for the year and a reserve for replacements, in reasonable amounts as determined by the Board. To the extent that the Assessments and other cash income collected from the Owner during the preceding year, the surplus or deficit, as the case may be, shall also be taken into account.




Section 2. Approval of Budget.

The estimated annual budget for each fiscal year shall be approved by the Board. A copy of the proposed annual budget shall be mailed to Owners not less than thirty (30) days prior to the meeting of the Board at which the budget is to be considered, together with notice of the meeting, specifying the time and place at which it will be held.

Section 3. When Owners Approval Required.

If the Board shall adopt either an annual budget or a supplemental budget for any fiscal year which requires an Annual Assessment per Lot greater than 115% of the previous Annual Assessment per Lot, then the Members shall be entitled to call a special membership meeting upon written application by at least 10% of all the Members. Such meeting shall be held within thirty (30) days from the date of receipt by the Board of the required applications, and notice shall be furnished to the Owners in accordance with provisions of these By-Laws concerning Special Meetings of the Members. At the meeting, the Members may consider and enact a revision of the annual budget. The revision of the budget shall require the affirmative vote of a majority of all the Members, whether or not all the Members are present at the meeting.

Section 4. Working Capital, Deposit.

The Board may require each Owner to make a reasonable deposit with the Association for working capital or contingent expenses and may collect the same as a Special Assessment.

By resolution of the Board of Directors on November 11,1982 each Member of the Association shall contribute to Working Capital.

The Working Capital Deposit shall be equal to two (2) month's maintenance assessment at time of closing on Unit.

The Working Capital Deposit shall be refunded to each Owner in an amount equal to his contribution at the time his Unit is resold. Monies earned on the Working Capital Deposit will be contributed solely towards the operating funds of the Bristol Cove Townhouse Association and will not be returned to Owners.

At the time a unit is sold, the purchaser of that unit will be required to make a contribution to Working Capital equivalent to two (2) month's maintenance assessment at the prevailing rate at the time of closing.

The Association has the authority to withhold the working capital deposit for monies owed and due the Association by a unit owner.







Section 5. Revised Budget/Partial Fiscal Year.

If any fiscal year shall be less than a full calendar year, then the monthly Assessments for each Lot shall be proportionate to the number of months and days in the period covered by such budget.

Section 6. Maintenance of Records.

The Board shall maintain accounting records according to generally accepted accounting practices, which records shall be open to inspection by the Owners and Mortgagees at reasonable times and upon reasonable notice. These accounting records shall include a record of Receipts and expenditures and a separate account for each owner showing the Assessments charged to and paid by such Owner. Within ninety (90) days after the end of each year covered by an annual budget, or as soon thereafter as shall be practicable the Board shall cause to be furnished to each Owner and each Mortgagee listed in the Association's register thereof a statement of the business conditions and affairs of the Association, including a balance sheet and profit and loss statement and a notice of the holding of the Annual Owners Meeting.

Upon reasonable notice to the Board of Directors, any Owner shall be furnished a statement of his account setting forth the amount of any unpaid Assessments or other charges due and owing from him.

Section 7. Capital Expenditures.

The Board of Directors shall not approve any capital expenditures in excess of $5,000.00 other than for rebuilding, repairing or replacing damaged property nor create any reserve or sinking fund in excess of such amount without the approval of Members representing Owners of at least two-thirds of the Lots. Any reserve or sinking fund so approved shall be separately designated for such purpose and shall not be commingled with any of the Association's other funds.


Section 8. Mechanic's Lien.

The Board may cause the Association to discharge any mechanic's lien or other encumbrance which in the opinion of the Board may constitute a lien against the property owned or managed by the Association. When less than all the Owners are responsible for the existence of any such lien, the Owners responsible shall be jointly and severally liable for any payment necessary to discharge the same and for all costs and expenses (including attorney's fees) incurred by reason of such lien and Association may impose an Extraordinary Assessment to obtain payment thereof.

Section 9. Extraordinary Assessments.

The Board may levy Extraordinary Assessments against one or more of the Lots to pay for improvements, repairs or replacements which are attributable only to those Lots in accordance with the terms of the Declaration. Extraordinary Assessments shall be due and payable on demand after notice thereof is given unless the notice shall specify a longer period.


ARTICLE VIII

RULES AND REGULATIONS

Reasonable uniform rules and regulations governing the use of the Common Area and the conduct of persons entitled to use such Property may be adopted and amended from time to time by the Board. All Owners shall obey the rules and regulations as promulgated by the Board.



ARTICLE IX

MORTGAGES

Section 1. Notice to Association.

An Owner who mortgages his Unit shall notify the Association of the name and address of the Mortgagee and shall file a conformed copy of the Mortgage with the Association. The Association shall maintain such information in a book entitled "Mortgagees of Homes".



Section 2. Notice of Default.

The Association, when giving notice to an Owner of a default in payment of Assessments of Common Area expenses or other default, shall send a copy of such notice to each holder of a Mortgage covering such Unit.


ARTICLE X

AMENDMENT

These By-Laws may be amended, altered or rescinded upon the proposal of a majority of the Board.



ARTICLE XI

MISCELLANEOUS

Section 1. Severability.

Should any of the covenants, terms or provisions herein imposed be void or be or become unenforceable at law or in equity, the remaining provisions of these By-Laws shall, nevertheless, be and remain in full force and effect.

Section 2. Construction.

Wherever the masculine singular form of the pronoun is used in these By-Laws, it shall be construed to mean the masculine, feminine or neuter; singular or plural; wherever the context so required.

In case any of these By-Laws conflict with the provisions of any statute, the Articles of Incorporation, or of the Declaration, the provisions of such statute, the Articles of Incorporation, or of the Declaration, whichever the case may be, shall control.

Section 3. Rules of Procedure.

Where not otherwise provided for by these By-Laws, the rules or parliamentary procedure as set forth in Roberts' "Parliamentary Law" shall prevail at all meetings.


Section 4. Interpretations.

In the event that any question arises with respect to the construction of any of the provisions of the By-Laws or of the rules or regulations of the Association, the decision of the Board with respect thereto shall be final and binding upon the Association and the Owners.




EXHIBIT "A" TO
ARTICLES OF INCORPORATION OF
BRISTOL COVE TOWNHOUSE ASSOCIATION, INC.


INITIAL PROPERTIES

Bristol Cove Subdivision, Filing #1, except the individual lots described therein as Lots 1 through 9, Block One; and Lots 1 through 33, and Lots 141 through 162, Block 2, Arapahoe
County, Colorado.

Declaration of Covenants, Conditions, Restrictions and Easements

DECLARATION OF COVENANTS, CONDITIONS RESTRICTION AND EASEMENTS

BRISTOL COVE TOWNHOUSE ASSOCIATION,INC.


THIS DECLARATION, made on the 1st day of October, 1978, by K-B INDUSTRIES INC. a California corporation, and herein amended by the Bristol Cove Townhouse Association Board of Directors at its January 16, 1990 meeting called for such purpose.


WITNESSETH:

Now, therefore, the Association declares that all of the properties located in the County of Arapahoe, State of Colorado, more specifically described in Exhibit "A", shall be held, sold and conveyed subject to the following easements, restrictions, covenants and conditions, which are for the purpose of protecting the value and desirability of, and which shall run with the real property and be binding on all parties having any right title or interest in the described properties or any part hereof, their heirs, successors and assigns, and shall inure to the benefit of every owner thereof.


ARTICLE I

DEFINITIONS


Section 1. "Approval" or "Consent" shall mean securing the prior written approval or consent as required herein before doing, making, suffering that for which such approval or consent is required.

Section 2. "Articles of Incorporation" shall mean the Articles of Incorporation of the Bristol Cove Townhouse Association, as the same may from time to time be amended.

Section 3. "Assessment" shall mean and refer to any assessment levied, charged or assessed against an Owner and/or his Lot in accordance with the Provisions of the Declaration.

Section 4. "Association" shall mean and refer to BRISTOL COVE TOWNHOUSE ASSOCIATION, INC., a Colorado corporation, not for profit, its successors and assigns.

Section 5. "Board" shall mean the Board of Directors of the Association. Any determination of action to be made or taken by a committee appointed by the Board pursuant to the By-Laws subject to any limitation imposed by Colorado law and provided that all determinations and action required under Article IV shall be made by the Board and not a committee appointed by it.




Section 6. "By-Laws" shall mean and refer to the duly adopted By-Laws of the Association, as the same may from time to time be amended.

Section 7. "Common Area" shall mean and refer to all of the Properties except the portions thereof within the boundaries of any Lot as shown on the Plat (Phase 1) such term shall include all improvements which are within the Common Area, including without limitation, all private streets, all pond and creek systems, exterior lighting, benches, walks and all recreational facilities. Said areas are intended to be devoted to the common use and enjoyment of Owners (subject to the provisions hereof) and are not dedicated for use by the general public.

Section 8. "Declaration" shall mean and refer to this Declaration as the same may be amended, changed or modified from time to time.

Section 9. "Improvements shall mean and refer to all improvements now or hereafter constructed on the Properties including without limitation all buildings, units, private streets, pond and creek systems, exterior lighting, benches, walks and all recreational facilities.

Section 10. "Institutional Mortgagee" shall mean and refer to a Mortgagee holding a first mortgage which is a federally or state chartered bank, a federal or state savings bank or savings and loan institution, a real estate investment trust, any corporation whose primary business is the making or placing of first mortgage loans, any similar lending institutions, or any other person approved by the Board.

Section 11. "Lot" shall mean and refer to that portion of the Properties shown as such on the Plat (Phase1) and shall include the Unit built thereon and the private driveway and patio appurtenant thereto as shown on the Plat. The boundaries of each lot are, subject to Articles VI and XIII hereof, shown on the Plat.

Section 12. "Member" shall mean and refer to the Person designated as such pursuant to Article III.

Section 13. "Mortgage" shall mean and refer to a first mortgage, first deed of trust or any similar first security instrument held or owned by a Mortgagee which encumbers any lot.

Section 14. "Mortgagee" shall mean and refer only to a first mortgagee under a Mortgage or a beneficiary under a first deed of trust or similar first security instrument.


Section 15. “Owner” shall mean and refer to the record owner, whether one or more persons or entities, of fee simple title to any Lot, but excluding those having such interest merely as security for the performance of any obligations, provided, that the purchaser at a foreclosure sale or trustee's sale shall be deemed an Owner following expiration of the redemption period, unless waived, if redemption has not occurred. The term Owner shall not include the Owner or Owners of any lesser estate or interest. At the time of transfer of any Lot, notice of such transfer shall be given to the Association by the transferor. Any transferor who fails to give such notice shall be personally liable for all assessments accruing after such failure and until such notice is given, but shall have none of the rights, or privileges accruing to Owners hereunder.

Section 16. "Patio" shall mean and refer to any private space appurtenant to a Unit which has been fenced off by builder from Persons other than the Owner of the Unit to which such Patio is appurtenant; the approximate location of each Patio is shown on the Plat.

Section 17. "Person" shall mean an individual, corporation, partnership, association, trust or other legal entity or any combination thereof.

Section 18. "Private Street" shall mean any street, lane, drive, boulevard, court, circle, road or place within the Common Area other than private driveways appurtenant to a Lot.

Section 19. "Project" shall mean and refer to all the Common Area and Lots within Properties and all Improvements, together with all of the appurtenances thereto.

Section 20. "Properties" shall mean and refer to that certain real property described in Exhibit"A" and such additions thereto as may hereafter be brought within the jurisdiction of the Association by amendment to this declaration pursuant to Article XI, Section 2.

Section 21. "Plat" shall mean and refer to that Plat of the Project attached hereto as Exhibit "A" on which boundaries of Properties and the location of the Lots and Common Area are shown.

Section 22. "Unit" shall mean and refer to the single-family residence constructed on each Lot and any replacement thereof.

Section 23. "Unit constructed" or "Constructed Unit" shall mean a fully completed dwelling unit which has received a certificate of occupancy issued by the Arapahoe County Building Department.


Section 24. "Single Family" shall be defined as persons related by blood, marriage, or adoption.

Section 25. Whenever the context so requires, the use of the singular shall include the plural, the plural the singular, and the use of any gender shall include all genders.


ARTICLE II

PROPERTY RIGHTS


Section 1. Owners' Easements of Enjoyment.

Every owner, his immediate family and guests, shall have a non-exclusive right and easement of enjoyment in and to the Common Area which shall be appurtenant to and shall pass with the title to the Lot of such Owners, subject to the following rights:

(a) The Association shall have a non-exclusive right and easement to make such use of Common Area, Improvements, Lots and Units as may be necessary or appropriate for the performance of the duties and functions which it is obligated or permitted to perform under this Declaration. The Association, in its sole discretion, may from time to time grant easements and rights of way on, across, under and over the Common Area to any district or other entity providing water, sewer, gas electricity, telephone, cable television, or other similar service to the Project.

(b) The right of the Association to make such reasonable rules and regulations regarding the use of the Common Area and facilities located thereon by the Members and other Persons entitled to such use.

(c) All rights reserved to the Owners, and Association in this Declaration.

(d) The exclusive right of the Owner of each Lot to use such portion, if any, of the private driveway appurtenant to such Owner's Lot and Unit, as shown on site Plan, which is located within the Common Area.


Section 2. Common Area.

The Common Area conveyed to the Association will be subject to the covenants, restrictions, easements and encumbrances set forth herein and the following covenant which shall be binding upon the Association, its successors and assigns: "In order to preserve and enhance the property value and amenities of Bristol Cove Planned Development, the Common Area shall at all times be maintained in good repair and condition and shall be operated in accordance with high standards". The Association shall be responsible for the maintenance and operation of the Common Area conveyed.


ARTICLE III

MEMBERSHIP AND VOTING RIGHTS


Section 1. Membership in Association.

Members shall be the owners of Lots within Project but, if any Owner of a Lot shall be more than one Person or shall be a corporation, then one of such Persons or an officer of such corporation, as the case may be, shall be designated the Member with respect to such Lot in a notice delivered to the Secretary / Treasurer of the Association subscribed to by all of such Persons, or by such corporation, as the case may be.

Membership shall be appurtenant to, and may not be separated from, record ownership of a Lot and such Membership shall automatically transfer to the new Owner upon any sale, transfer or other disposition of a Lot subject to the provisions hereof. There shall not be more than one Member for each lot within Project. Upon any such transfer, sale or other disposition of all or some of the fee interest in a Lot, the then Owner shall comply with the provisions set forth above for designation of the Member with respect to such Lot. Notwithstanding anything contained in this Declaration to the contrary, until (i) the Owner of a Lot shall deliver to the Secretary / Treasurer of the Association a certified copy of the recorded deed or other recorded instrument establishing record title to a Lot and (ii), if the owner shall be more than one Person or a corporation, the designation of the Member as hereinabove provided, there shall be no Member with respect to the Owner's Lot and such Owner shall have no right to vote, but all obligations of the Owner of such Lot hereunder, including without limitation to pay assessment, shall be unaffected and such Owner shall be fully liable therefor. Transfer of any Membership except together with the Ownership of a Lot and Unit thereon shall be null and void and of no effect and such transferee shall not be entitled to the benefits of being a Member, including without limitation the right to use and enjoy the Common Area.




Section 2. Voting.

Each Member shall be entitled to one vote for each Lot as to which he is the Member in accordance with and subject to the provisions of this Article III, Article V, Section 6, and the By-Laws.


Section 3. Notices.

Unless a greater period shall be specified in this Declaration, each Member shall be entitled to at least 15 days notice of any meeting at which such Member has the right to vote (except shorter notice may be given in the event of an emergency). Notices of meetings shall be in writing and shall state the date, time and place of the meeting and may indicate each matter to be voted on at the meeting and may indicate each matter to be voted on at the meeting which is known to the Association at the time notice of the meeting is given. Any notice shall be deemed given and any budget or other information or material shall be deemed furnished or delivered to any Member when such party actually receives that same by any means or when the same is mailed, addressed "To the Owner", at the address of the Lot of such Owner, or delivered, so addressed, to such Lot.


ARTICLE IV

ASSESSMENTS

Section 1. General.

The Association shall have the power to levy Assessments against the Lots and the Units and other Improvements thereon, and the Owners thereof, and each Owner, and, if more than one Person, all such Persons, jointly and severally, by acceptance of the deed to a Lot, whether or not it shall be expressed in any such deed, shall be deemed to covenant and agree to pay all such Assessments in the manner and for the purposes provided herein. Subject to the provisions hereof, the Board shall have the power and authority to determine all matters in connection with Assessments, including the power and authority to determine where, when, and how Assessments shall be paid to the Association, and each Owner shall comply with such determinations.



Section 2. Annual Assessments.

Annual Assessments may be made for the purposes of providing funds for the normal operations of the Association, including but not limited to, maintenance and repair of the Common Area and of the Lots and Units thereon (to the extent Association determines to do so in accordance with Article V), salaries, costs of operating the Association, insurance premiums, management fees, office costs, reasonable reserves, amounts necessary to pay deficits or debts incurred by the Association, water and sewer rents and fees, real estate taxes and betterment or other special assessments on the Common Area, if any, and funds for any other purpose or purposes of the Association provided for herein except for capital improvements with a cost in excess of $5,000.00. The total amount of money required to be raised by Annual Assessments for each fiscal year shall be the amount, as determined by the Board, necessary to satisfy the costs and expenses of fulfilling such functions and obligations of the Association in such fiscal years, including the payment of deficits from prior fiscal years, providing reasonable reserves, and providing a reasonable carry-over reserve for the following fiscal year. To determine the amount required to be raised by Annual Assessments for any fiscal year, the Board shall prepare an annual budget for such fiscal year showing, in reasonable detail, the various matters proposed to be covered by the budget, the estimated costs and expenses which will be payable, the estimated income and other funds which will be available in that fiscal year, and the estimated total amount of money required to be raised by Annual Assessments to cover such costs and expenses and to provide a reasonable reserve. The Board of Directors shall furnish a copy of such budget to any Owner and, upon request, to any Mortgagee. Based on such budget, the Board of Directors shall determine the amount of the annual Assessments per Constructed Unit for such fiscal period as provided in Section 6 of this Article IV.


Section 3. Supplementary Assessments.

In the event that the Board shall determine, at any time or from time to time, that the amount of the Annual Assessments is not adequate to pay for the costs and expenses of fulfilling the Association's obligations hereunder, one or more Supplementary Assessments may be made for the purpose of providing the additional funds required. To determine the amount required to be raised by each Supplementary Assessment, the Board shall revise the annual budget for such fiscal year provided in Article V, Section 2 or prepare a new budget, a copy of which shall be furnished to any Owner or on request, to any Mortgagee. Based on such revised or new budget, the Board may make a per Constructed unit Supplementary Assessment for such fiscal year, the amount of which shall be determined by the Board as provided in Section 6 of this Article IV.


Section 4. Extraordinary Assessments.

In the event the Association shall maintain or repair any Lot and/or the Unit thereon pursuant to Article V, Section 8 hereof, the Association may make an Extraordinary Assessment against such Lot and the Unit thereon, and the Owner thereof, to recover the actual amounts expended by the Association in making, or causing to be made, such repair and/or in maintaining such Lot, and/or unit plus an amount, to be determined '" by the Board not to exceed twenty-five (25%) percent of the total amount thereof to cover overhead and administrative costs of the Association. The Association may also make an Extraordinary Assessment against an Owner and his Lot and Unit to recover any amounts paid by Association for which an Extraordinary Assessment may be levied as provided in this Declaration or in By-Laws.


Section 5. Special Assessments.

Special Assessments may be made for the purposes of raising funds for capital improvements and for any other Association purpose for which Annual Assessments may not or have not been made. Whether to make a Special Assessment and the amount thereof per Unit shall be determined by the Board; provided that no Special Assessment shall be valid unless approved by a majority vote of the Members present and voting, in person or by proxy, at any annual meeting of the Members of the Association or any special meeting thereof called for the purpose of considering such Special Assessment.


Section 6. Assessments in Equal Amounts.

All Annual, Supplementary and Special Assessments shall be allocated equally among all of the units which have been constructed within the Project.


Section 7. Time for Payments.

The Annual Assessment for each Constructed Unit shall be payable, subject to Section 6 of this Article IV, in twelve (12) equal monthly installments due on the first day of each month, unless the Board shall adopt some other payment schedule. Special and Supplementary Assessments shall be payable as provided in the resolutions authorizing the same. Extraordinary Assessments shall be due upon demand by Association therefore. All installments of Annual, Supplementary and Special Assessments shall be due and payable without notice or demand and all Assessments shall be paid without any setoff or diminution of any kind. Any assessment or installment thereof or other amount payable pursuant to this Section or under the By-Laws which is not paid when due shall bear interest at 12% per annum from the due date until paid as adopted by the Board on 4/27/81 and/or may be subject to a late charge as may be set and uniformly applied by the Board. All payments on account shall be first applied to interest and late charges and then to the Assessment payment first due.


Section 8. Lien or Assessments and Other Amounts.

The Association shall have a lien against each Lot and the Unit and other Improvements thereon to secure payment of any Assessment or other amount due and owing to the Association with respect to that Lot and Unit plus interest and/or any late charges as provided in Section 7 of this Article IV plus all costs and expenses of collecting the unpaid amount, including reasonable attorney's fees. The lien may be foreclosed in any manner for foreclosure of mortgages in the State of Colorado. The obligations being part of the purchase price of each lot, such lien shall be superior and paramount to any homestead or other exemption provided by law, and each Owner hereby specifically waives his homestead exemption, but only with respect to such lien.


Section 9. Liability of Owners, Purchasers and Mortgagees.

The amount of any Assessment payable with respect to any Lot and Unit together with all other sums and amounts referred to in Section 8 of this Article IV shall be a joint and several personal obligation to the Association of such owner and binds Owner's heirs, personal representatives, successors and assigns. Except as provided below in this Section 9, each party becoming an owner of a Lot and/or Unit shall be jointly and severally personally liable with the former Owner for all such sums and amounts which had accrued and were payable at the time of the acquisition of fee simple title to the Lot and/or Unit by such party without prejudice to such party's right to recover from the former Owner any of said sums and amounts paid. All such sums and amounts may be recovered by suit for a money judgment by the Association without foreclosing or waiving any lien securing the same. Notwithstanding the foregoing, Institutional Mortgagees of Lots and Units and purchasers (at foreclosure sale) of Lots and the Units thereon foreclosed pursuant to any Mortgage the Owner of which is an Institutional Mortgagee shall not be liable for any such Assessment, unless accruing during the period when such Mortgagee or purchaser is the owner of said lot and/or Unit, and the lien for any such Assessments shall be junior to any lien or encumbrance on a Lot and Unit taken in good faith and for value and perfected by recording in the office of the County Clerk and Recorder of the County of Arapahoe, State of Colorado, prior to the time a notice of failure to pay any such amount is recorded in said office, describing the Lot and naming the Owner thereof.


Section 10 Estoppel Certificate.

Upon payment of a reasonable fee and upon written request of any Owner or any person with any right, title or interest in a Constructed Unit or intending to acquire any right, title or interest in a Constructed Unit, the Association shall furnish a written statement setting forth the amount of any Assessments, if any, due or accrued and then unpaid with respect to such Constructed Unit and the amount of the Assessments for the current fiscal period of the Association payable with respect to the Constructed Unit, which statement shall, with respect to the party to whom it is issued, be conclusive against the Association, for all purposes, that no greater or other amounts were then due or accrued and unpaid.


Section 11. No Abatement.

No diminution or abatement of Assessments shall be allowed or claimed for any reason including without limitation from the making of repairs or improvements to the Common Area or Lots or from any action taken to comply with any law, ordinance or order of a governmental authority.




ARTICLE V

MAINTENANCE



Section 1. Powers of the Association Generally .

In addition to the powers of assessment, collection and enforcement set forth in Article IV, the Association may exercise any and all rights and powers set forth in articles of Incorporation or hereinafter enumerated together with any and all additional rights and powers which are necessary, useful or desirable in connection with the management and/or operation of Project and the maintenance of Project in a first class condition, or in connection with the enforcement and effectuation of any of the provisions of this Declaration, the By-Laws or the rules and regulations adopted by the Board.


Section 2. Common Area and Maintenance.

The Association shall provide and pay for the care, operation, management, and repair of the Common Area and the three center traffic islands constructed at the entrance to Bristol Cove Townhouses Plat, Phase I. Without limiting the generality of the foregoing and by way of illustration, said obligations shall include the keeping of the Common Area and said traffic islands in good, clean, attractive and sanitary order and repair; arranging to be furnished to Common Area and said traffic islands and each of the Lots and Units within Project, water, sewer, electric, gas and all other necessary utility services (Lots may be separately metered for any or all of such services in which event the obligation to pay for such services shall be that of the individual Owners with respect to their Lots); maintaining, renewing and replacing all or any portion of the landscaping, gardens, green area, ponds and recreational facilities within the Common Area, said traffic islands and the Lots (exclusive of Patios) , providing for trash and rubbish collection; removing snow, ice and other materials from the Private Streets and any other area which might impair access to the Project or to the Lots; keeping the Project attractive and desirable; making necessary or desirable alterations, additions, betterments or improvements to or on the Common Area. Nothing herein shall be construed as in waiving any right of the Association to recover for any damage or expense incurred by the Association as the result of the willful or negligent action or lack or action of any Person.


Section 3. Maintenance of Exterior of Improvements.

The Association shall have the right, but not the obligation, to maintain, repair, paint, replace and otherwise care for all or any of the exterior portions of Improvements located on Lots including without limitation exterior walls, roofs, fences, gutters, downspouts and foundations. By Board resolution 8/29/81 the Association assumes the maintenance of the roofs and to schedule and conduct exterior painting of living units and garages located on Lots.


Section 4. Other Association Functions.

The Association may undertake any activity, function or service for the benefit or to further the interests of all, some or any Owners on a self-supporting, special assessment or common assessment basis. Without limiting the generality of the foregoing, such activities, functions or service may include the providing of police or some other security service, maintenance of Lots and Units, or the providing of firewood. Association may make an Extraordinary Assessment to obtain payment therefore.


Section 5. Labor and Service.

The Association shall obtain and pay for the services of a professional manager or a real estate management firm to manage Project as well as all such other personnel as the Association may determine necessary or desirable for the proper operation of the Project, whether such personnel are furnished or employed directly by the Association or by any person or entity with whom or which it contracts. The Association may obtain and pay for legal and accounting services necessary or desirable in connection with the operation of the Project or the enforcement of this Declaration. The Association may arrange with others to furnish lighting, heating, water, trash and rubbish collection, sewer service and other common services and to perform all of its other obligations hereunder to the extent that such obligations are delegable under the terms hereof, of the By-Laws, and under the applicable provisions of Colorado law. Any agreement for professional management of the Project, or any other contract providing for services must provide for termination by either party without cause or payment of a termination fee on thirty 30 days or less written notice and with a maximum contract term of one year.


Section 6. Rules and Regulations.

The Board may make and enforce reasonable and uniformly applied rules and regulations governing the use, occupancy and maintenance of all Lots, Units, Improvements, and Common Area within Project. Such rules and regulations may without limitation (a) regulate use of Common Area to assure equitable use and enjoyment by all Persons entitled thereto; (b) require that draperies, shades or other window coverings present a uniform and attractive appearance from the exterior of the Units; (c) assign particular portions of storage or other service area within the Common Area for exclusive use by particular Owners; and (d) restrict or limit the Owners' rights to use portions of the Common area used by the Association for the conduct of the business and affairs of the Association.

The Association shall furnish to each Owner and Mortgagee a copy of the Association's Rules and Regulations upon written request therefore and shall furnish a copy of all proposed changes in such Rules and Regulations prior to the adoption of such changes. A written copy of such Rules and Regulations shall be available for inspection by the Owners and Mortgagees at reasonable hours. The Association may suspend any Owner's voting rights in the Association during any period or periods that such Owner fails to comply with such Rules and Regulations or with any other obligations of such Owner under this Declaration or the By-Laws. Such Rules and Regulations shall be binding upon each and every Owner and the members of his family, his tenants, guests, employees, servants, invitees, and all other persons having access to any part of Project. The Association may also take judicial action against any Owner to enforce compliance with such Rules and Regulations or other obligations or to obtain damage for non-compliance to the fullest extent permitted by law.



Section 7. Implied Rights.

The Association shall have and may exercise any right or privilege granted to it expressly by this Declaration or By-Laws or reasonably to be implied from this Declaration or By-Laws or given or implied by law.



Section 8. Right of Maintenance.

In the event any Owner shall fail to keep and maintain his Lot and the Unit thereon as provided in this Declaration, the Association shall have the right and power to enter (forcibly if necessary) onto such Lot or into the Unit thereon and to place the same in the condition required pursuant to this Declaration. The cost of so doing together with overhead and administrative costs shall be paid for by the Owner of such Lot and may be assessed by the Association as an Extraordinary Assessment as herein provided.





Section 9. Willful or Negligent Acts.

In the event that any maintenance repair or other work is required because of the willful or negligent action or lack of action of any Owner, his family, guests, tenants, or invitee, the Association may perform such work or cause the same to be performed at such Owner's cost and expense and may make an Extraordinary Assessment to recover payment thereof, provided, except in the event of an emergency, such Owner shall be given ten days prior notice within which to perform the required maintenance, repair or work.





ARTICLE VI

PARTY WALLS


Section 1. General Rules of Law to Apply.

The term "Party Wall" as used herein shall mean and refer to the entire wall, from front to rear, including fences between patios and common walls between garages, all or a portion of which is used for support or fire wall protection between each adjoining Unit, situated or intended to be situated on the boundary line between adjoining Units and patios and garages and mutual reciprocal easements are hereby granted and established therefore.

To the extent not inconsistent with the provisions of this Article VI, the general rule of law regarding party walls and liability for property damage due to negligence or willful acts or omissions, shall apply to each party wall which is built as part of the original construction of the Units located on the Properties and any replacement thereof.

In the event that any portion of any structures, originally constructed by the builder, including any party wall, shall protrude over an adjoining Lot or Unit, such structure shall not be deemed to be an encroachment upon the adjoining Lot or Unit. No Owner shall either maintain any action for the removal of a party wall or projection or any action for damage because of any such protrusion. In the event there is such a protrusion, it shall be deemed that said Owner has granted perpetual easements to the adjoining Owner for continuing maintenance and use of the projection or party wall. The foregoing shall also apply to any replacements of any party walls if same are constructed substantially in conformity with the original party wall constructed by the builder.


Section 2. Sharing of Re air and Maintenance. :

The cost of reasonable repair and maintenance of a party wall shall be shared equally by the Owners of the Lots abutting such wall.



Section 3. Destruction by fire or Other Casualty.

If a party wall is destroyed or damaged by fire or other casualty, the Owners of Lots abutting such wall shall jointly restore it, and they shall contribute equally to the cost of restoration thereof without prejudice, however, to the right of any such Owner to call for a larger contribution from the other under any rules of law regarding liability for negligent or willful acts or omissions.



Section 4. Damage and Repair.

Notwithstanding any other provisions of this Article, an Owner who by his negligent or willful act causes the party wall to be damaged, shall bear the whole cost of repairing such damage. The Owner causing such damage shall immediately commence to repair or reconstruct the damaged party wall to its original condition and shall diligently prosecute all such repairs and reconstruction. If such Owner shall fail to do so, then the other Owner of a Lot abutting such wall may do so at the sole cost and expense of the Owner causing such damage.



Section 5. Right to Contribution Runs with Land.

The right of any Owner to contribution from any other Owner under this Article shall be appurtenant to the Land and shall pass to such Owner's successors in title.



Section 6. Arbitration.

In the event of any dispute or disagreement concerning a party wall, or under the provisions of this Article, such dispute or disagreement shall, at the request of any affected Owner, be arbitrated by the Board, or a Committee thereof and its determination shall be binding upon the parties. In the event of any damage to a party wall, the Association may (but shall not be obligated to) repair or reconstruct the same at the expense of the Owners, allocated between them as above provided, and may make an Extraordinary Assessment therefore.


ARTICLE VII

USE AND OTHER RESTRICTIONS



Section 1. Single-Family Residences.

No Lot or Unit shall be used for any purpose other than as a single-family residence and no business or commercial activity shall be carried on or within Project. No Lot or Unit may be divided or subdivided into a smaller area nor any portion thereof sold or otherwise transferred.


Section 2. Common Area Restriction.

All use and occupancy of the Common Area shall be subject to and governed by the rules and regulations adopted by the Association. No damage or waste shall be committed to any Lot, Unit, Improvement or to the Common Area. No Owner shall change or alter any of the Common Area or any exterior portion of an Improvement of a Lot without the prior written consent of the Association which shall not be unreasonably withheld or delayed. Notwithstanding anything contained herein to the contrary, the Association, and the Unit Owners shall have no right or power to change or alter the Common Area by the installation of any permanent improvements within the Common Area which would in any manner impair free and complete access to all sewer lines and sewer line equipment located within the Common Area for purposes of repair and replacement of said sewer line and sewer line equipment.


Section 3. No Imperiling of Insurance.

Nothing shall be done or kept in or within the Project which might result in an increase in the premiums with respect to insurance obtained for all or any portion of the Project or which might cause cancellation of such insurance except with the prior written consent of the Board.


Section 4. No Violation of Law.

Nothing shall be done or kept in or on any portion of the Project which would be in violation of any statue, rule, ordinance, regulation, permit or validly imposed requirement of any governmental body.



Section 5. No Noxious, Offensive, Hazardous or Annoying Activities.

No noxious or offensive activity shall be carried on upon any part of the Project nor shall anything be done or placed on or in any part of the Project which is or may become a nuisance or cause embarrassment, disturbance or annoyance to others. No activity shall be conducted on any part of the Project which is or might be unsafe or hazardous to any person or persons. No sound shall be emitted on any part of the Project which is unreasonably loud or annoying nor shall any odor be emitted which is noxious or offensive to others nor shall any light be emitted which is unreasonably bright or which causes unreasonable glare.


Section 6. Appearance.

All parts of the Project shall be kept in a clean, attractive condition and no rubbish, refuse or garbage shall be allowed to accumulate.


Section 7. Restrictions on Signs.

No signs or advertising devices of any nature shall be erected or maintained on any part of the Project (including without limitation any Lot) without the prior written consent of the Association except for a sign or signs identifying the Project which may be maintained by the Association and such other signs as the Association shall allow.


Section 8. Maintenance of Lots.

Each Lot, Unit and all other Improvements on each Lot and all Improvements, fixtures and furniture and equipment therein and the driveway and patio appurtenant to a Lot (whether located within the Lot or in the Common Area) shall be kept and maintained by the Owner thereof in a clean, attractive condition and in good order and repair. The areas to be maintained by each Owner shall include but not be limited to the floor and walls of his Unit, the heating and air-conditioning equipment within his Lot, the ducts, pipes, wiring, controls and other apparatus serving his Lot, kitchen and bathroom fixtures, apparatus and equipment and all electrical, plumbing, telephone and television fixtures, apparatus, equipment, outlets, wires, pipes and conduits within his Lot, and, unless and to the extent that any of such maintenance shall be assumed by the Association as provided in Article V, Section 3, the exterior walls of any Unit.

The exterior surfaces of each Unit shall be maintained by the Association as described in Article V, Section 3 in accordance with the rules and regulations established by the Association and all such surfaces shall be painted regularly and in Project standard color or colors, with Project standard paint or paints as Association shall determine. No Owner shall paint or decorate any exterior surface.

Nothing herein contained shall be construed as waiving any right of any Owner to recover for any damage or expense incurred by such Owner as the result of the willful or negligent act of any person. No structural or exterior alterations, additions or remodelings within any Lot or Unit or its appurtenances shall be made without the prior written consent of the Association and the approval in writing of all other Owners of Units within the same building and or the Mortgagees of all such Owners. Any person desiring to undertake any such alteration, addition or remodeling shall notify the Association in writing of such intention, requesting approval thereof and shall furnish to the Association such information and materials regarding such proposed change, as the Association shall reasonably request including plans and specifications therefore.



Section 9. Restrictions on Leasing.

Entire Lots and Units (but not rooms within a Unit) may be rented, provided the occupancy thereof is only by the lessee and his family, servants and temporary guests. No transient tenant may be accommodated. Any lease of a Lot and/or the Unit thereon by an Owner shall provide that the terms of said lease shall be subject in all respects to the provisions of this Declaration, Articles of Incorporation, By-Laws and rules and regulation promulgated pursuant thereto and that any failure by the lessee to comply with all of the terms of such documents and of such rules and regulations shall be a default under the lease. All leases shall be in writing.



Section 10. Rules and Regulations.

Every Owner, his guests, members of his family, servants and employees shall strictly adhere to the rules and regulations adopted from time to time by the Association.



Section 11. Owners' Caused Damage.

If due to the act or neglect of an Owner, loss or damage shall be caused to any person or property, such Owner shall be liable and responsible to make good such loss or damage except to the extent that such damage or loss is covered by insurance and the carrier of such insurance has waived its right of subrogation against such Owner. The amount of such loss or damage to the Common Area may be collected by the Association from such Owner as an Extraordinary Assessment.


Section 12. Mineral Exploration.

No portion of the Project including without limitation any area within a Lot shall be used to explore for or to remove any water, soil, hydrocarbons, or other minerals of any kind.


Section 13. Watering of Land.

The Association, its agents, employees and representatives shall have the sole and exclusive right to water all trees, plants, lawns and shrubs located anywhere within Project (except within the Patios) and no other person shall permit water to be introduced or placed into or on the soil within Project.


Section 14. Mechanic's Lien.

No labor performed or materials furnished for use in connection with any Lot or the Unit and other Improvements thereon with the consent or at the request of the Owner thereof (Contracting Owner) or his agent, contractor, subcontractor shall create any right to file a statement of mechanic's lien against the Lot and Improvements thereon of any other Owner not expressly consenting to or requesting the same or against any interest in the Common Area. Each Owner shall indemnify, defend and hold harmless Association and each of the other Owners from and against liability arising from the claim of any lien against the Lot, Improvements and Unit of the Association and such other Owners or any part thereof for labor performed or for materials furnished at the request of Contracting Owner. At the written request of any Owner, the
Association shall enforce such indemnity by collecting from the Contracting Owner the amount necessary to discharge any such lien and all costs incidental thereto including attorney's fees and expenses. The Association may collect the same as an Extraordinary Assessment.


Section 15. Vehicle Parking.

No campers, trailers, boats, or similar vehicles shall be parked or stored in the Project except inside closed garages.


Section 16. Pets.

No animals shall be kept or harbored within the Project except that any Owner may keep a reasonable number of household pets subject to the rules and regulations of the Association. Any such household pets shall be kept on leashes at all times that they are within the Project and outside the Units. It shall be the obligation of each Owner owning a pet to control it in accordance with the rules and regulations of the Association.




Section 17. Board to Determine Violations.
Determinations with respect to whether an Owner shall have violated any of the provisions of this Declaration including the provisions of this Article VII shall be made by the Board pursuant to Article XIII, Section 4 and shall be final, binding and conclusive upon all parties.


ARTICLE VIII

INSURANCE

Section 1. Insurance.
All insurance, other than title insurance, carried in connection with the Common Area, Lots, Units, Improvements and Project shall be governed by the provisions of this Article VIII.


Section 2. Insurance to be Carried by Association.

The Association shall be required to obtain and maintain, to the extent obtainable, the following insurance: fire insurance with extended coverage, and with water damage, vandalism and malicious mischief endorsements insuring all Improvements located on Properties including all of the Units and fixtures initially installed therein by Builder (but not including furniture, furnishings or other personal property supplied or installed by Owners), together with all air conditioners and other service machinery installed by builder or the Association contained therein, covering the interest of the Association and all owners within Project and their Mortgagees, as their interests may appear, in an amount equal to the full replacement value of such Improvements excluding foundation and excavation costs. Each of such policies shall contain a standard mortgagee clause in favor of each Mortgagee of a Unit which shall provide that the loss, if any, thereunder, shall be payable to such Mortgagee as its interest may appear, subject, however, to the loss payment provisions in favor of Association hereinafter set forth. With respect to Improvements within the Common Area, such policies shall contain an "agreed amount endorsement" or its equivalent and, if necessary, an "increase cost of construction endorsement" or "contingent liability from operation of building laws endorsement" or the equivalent. The Association shall obtain and maintain workmen's compensation and employer's liability insurance as may be necessary to comply with all applicable laws and, in addition, comprehensive public liability and property damage insurance insuring Association, its officers, directors, employees and agents and all Owners and their employees, agents, family and guests against liability for personal injury or property damage. Said policies shall have a limit of not less than $1,000,000 for each person and not less than $3,000,000 for each occurrence with respect to property damage. All such policies of insurance shall contain a cross liability endorsement so as not to prejudice the rights of a named insured against another named insured, and "hired automobile protection". Association shall also obtain and maintain such other insurance as shall be customarily obtained with respect to Improvements similar in construction, location and use as those contained in Project and such other insurance as the Board of Directors in Association shall determine to be advisable from time to time. All such policies shall provide that adjustment of loss shall be made by Association and the net proceeds thereof shall be payable to Association, as trustee for all Owners and their Mortgagees.

Each Owner and each owner of any interest in Project (except Institutional Mortgagees) hereby appoints the Association as its agent and attorney-in-fact to adjust all claims arising under insurance policies purchased by Association; and each Owner and each Owner of any other interest in Project including Institutional Mortgagees hereby appoints the Association as its attorney-in-fact and agent to collect all proceeds under insurance policies purchased by Association. Such appointment is coupled with an interest and shall be irrevocable. As agent and attorney-in-fact Association shall have the right to execute and deliver any releases, acquittances, discharges and other documents as maybe necessary to effect the foregoing and shall have the further right to institute such actions at law as it deems necessary to collect the proceeds of said policies.

All policies of physical damage insurance shall contain waivers of subrogation, of any reduction of pro-rata liability of the insurer as a result of any insurance carried by Owners, and of any invalidity arising from any acts of the insureds including any Owners, and shall provide that such policies may not be cancelled or substantially modified without at least ten (10) days' prior written notice to all of the insured, including all Mortgagees of Units. Duplicate originals of all applicable policies of physical damage insurance and of all renewals thereof, together with proof of payment of premiums, shall be delivered to all Mortgagees of Units at least ten (10) days prior to expiration of then current policies. Prior to obtaining any policy of fire insurance or any renewal thereof, the Association shall obtain an appraisal from a fire insurance company or otherwise of the full replacement value of all Improvements for the purpose of determining the amount of fire insurance to be effected pursuant to this Section. The original policies of insurance and copies of all endorsements shall be held by the Association. Premiums for insurance policies purchased by Association shall be paid for by Association out of the Assessments. Any increase in premiums or additional insurance required by improper use, occupancy or abandonment of a Lot or the Common Area or of any Unit shall be assessed against the responsible Owner or Owners as an Extraordinary Assessment.

Except to the extent coverage shall be obtained by the Association and be satisfactory to an Owner, each Owner shall be responsible for obtaining such insurance as he deems desirable, including insurance covering his furnishings and personal property and covering personal liability of such Owner and his employees, agents and guests. Any insurance policy obtained by an Owner shall be such that it will not diminish or adversely affect or invalidate any insurance or recovery under policies carried by the Association and shall contain waivers of subrogation by the insurer as to any claim against the Association, its officers, directors, agents and employees and against other Owners, members of their families and their employees, agents and guests.



ARTICLE IX

RECONSTRUCTION OR REPAIR AFTER CASUALTY, CONDEMNATION

Section 1. Restoration and Repair.

In the event of any fire or other casualty covered under any policy required to be obtained by the Association, the Association shall, as trustee for all of the insureds, including institutional mortgagees, collect all insurance proceeds and, to the extent of such proceeds, repair, restore and replace any damaged or destroyed structures.

Any reconstruction or repair must be either substantially in accordance with the plans and specifications for the original Improvements or according to plans and specifications approved by the Board of Directors of Association and, if the damage is to a building, by the Owners and Institutional Mortgagees of all damaged Units therein, which approvals shall not be unreasonably withheld. If the damage is only to those parts of one Unit for which the responsibility of maintenance and repair, under this Declaration, is that of the Owner thereof; then such Owner shall be responsible for reconstruction and repair after casualty. In all other instances the responsibility of reconstruction and repair after casualty shall be that of Association.

Promptly after damage to property for which Association has the responsibility of reconstruction and repair, the Association shall obtain reliable and detailed estimates of the cost to rebuild or repair.

If the proceeds of insurance are not sufficient to defray the estimated costs of reconstruction and repair by Association, or, if at any time during reconstruction and repair, or upon completion of reconstruction and repair, the funds for the payment of the costs thereof are insufficient, either Extraordinary Assessments shall be made against the Owners who own the damaged Units or in the case of damage to the Common Area, Special Assessments shall be made against all Owners in Project. Such Assessments shall be insufficient amounts to provide funds for the payment of such costs. Such Assessments against owners for damage to Units shall be in proportion the cost of reconstruction and repair of their respective Units. Such Assessments on account of damage to Common Area shall be in equal proportions among all Owners of Constructed Units.

The proceeds of insurance collected on account of a casualty, and the sums received from collections of Assessments against Owners on account of such casualty, shall constitute a construction trust fund which shall be deposited in a separate bank account and not commingled with any other funds of the Association and shall be disbursed in payment of the costs of reconstruction and repair in the following manner:

1. If the responsibility of reconstruction and repair lies with an Owner as above provided, such proceeds shall be paid by the Association to the Owner, or, if there shall be a Mortgagee endorsement as to such Unit, then to the Owner and Mortgagee, jointly, and such proceeds shall be used to reconstruct and repair the damaged Unit.

2. Payments of all costs and expenses in connection with the reconstruction and repair for which the Association is responsible shall be disbursed to pay for such costs and expenses, provided that is the cost of such reconstruction and repair shall exceed $25,000, such funds shall not be paid except upon approval of an architect qualified to practice in Colorado and employed by Association to supervise the work.

3. If there is a balance in a construction fund after payment of all costs of the reconstruction and repair for which the fund is established, such balance shall be distributed to Owners of affected Lots equally or if there shall be an Institutional Mortgagee, to such Mortgagee and Owner jointly; except however, that to the extent any such distribution shall be in an amount less than the assessments paid by such Owner into the construction fund, such distribution shall be made payable to such Owner only.


Section 2. Taking by Eminent Domain.

The taking of a portion of a Unit or of the Common Area by eminent domain or the sale thereof in lieu of such taking shall be deemed to be a casualty and any awards payable due to such taking shall be paid to the Association and deemed to be proceeds from insurance on account of casualty to be used or distributed as therein provided, except if the taking destroys or so reduces the size of a Unit that in the judgment of the Board it cannot be made tenantable, the award attributable to that Unit shall be paid entirely to the Owner and the Mortgagee jointly. Upon payment of such proceeds, such Owner shall convey his entire interest in said Unit and all appurtenances thereto to Association and the remaining portion of the Unit, if any, shall become a part of the Common Area.

The changes in Units in the Common Area which result from or are necessitated by such taking or sale in lieu thereof shall be evidenced by an amendment of this Declaration which must be approved by 75% of the Institutional Mortgagees (based upon one vote for each mortgage owned) or 75% of the Owners. The amendment shall be recorded at the expense of the Association in the public records of the county in which the Properties are located.


ARTICLE X

EASEMENTS

Section 1. Driveways,

Each Owner shall have an exclusive right to use and enjoy the private driveway appurtenant to his Lot as shown on the Site Plan.



Section 2. Owner's Rights in Lot Subject to the Provisions of this Declaration.

Each Owner shall own his Lot in fee simple and shall have full and complete dominion thereof subject to the provisions of this Declaration.


Section 3. Owner's Easement for Access, Support and Utilities.

Each Owner shall have a non-exclusive easement over the Common Area for access to his Lot, provided that access by vehicle shall be only across drives and ways provided for that purpose. Each Owner shall have a non-exclusive easement in and over adjacent Lots and Units for horizontal and lateral support of the Unit which is located on such Owner's Lot and over other Owner's Lots and Units as may be required for utility services, including water, sewer, gas, electricity, telephone, television, and other similar services.


Section 4. Easements or Encroachments.

If any part of the Common Area encroaches or shall hereafter encroach upon a Lot or the Patio or private driveway appurtenant thereto, an easement for such encroachment and for the maintenance of the same shall and does exist. If any part of a Unit encroaches or shall hereafter (whether because of reconstruction or otherwise) encroach upon the Common Area, or upon another Lot, the Owner of that Unit) shall and does have an easement for such encroachment and for the maintenance of the same. Encroachments referred to herein include, but are not limited to, encroachments caused by error in the original construction of any of the Improvements, by settling, rising or shifting of the earth, or by changes in position caused by repair or reconstruction of the Project or any part thereof. An overhang easement is granted to any Owner whose roof, eaves, gutters, chimneys, bay windows or similar items overhang the Lot of another Owner or the Common Area.



Section 5. Easements in Lots or Repair, Maintenance and Emergencies.

Some of the Common Area may be conveniently accessible only through a Lot, and in such event, the Association shall have an easement for access through each Lot from time to time during such reasonable hours as may be necessary for the maintenance, repair or replacement of any of the Common Area accessible therefrom or for making emergency repairs therein necessary to prevent damage to the Common Area or to another Unit. To make reasonable repairs or improvements to a Unit conveniently, or to reconstruct such Unit in the event of a casualty, it may be desirable to do so through another Owner's Lot or Unit and all Owners hereby grant to all other Owners an easement for such purpose. If any damage shall be done to another's Lot or Unit or to the Common Area in exercising the rights granted in this Section 5, such damage shall be restored by the Association or the Owner creating such damage.

Section 6. Easements Deemed Appurtenant.

The easements and rights herein created for an Owner shall be appurtenant to the Lot of that Owner and all conveyances of and other instruments affecting title to a Lot shall be deemed to grant and reserve the easements and rights as are provided for herein, even though no specific reference to such easements appears in any such conveyance.

ARTICLE XI
TERMINATION AND AMENDMENT OF DECLARATION

Section 1. Termination.

This Declaration shall continue in effect until and unless terminated as in this Section provided. This Declaration may be terminated at any time only upon the approval in writing of at least 75% of all Members and 100% of the Institutional Mortgagees.

The termination of this Declaration shall be evidenced by a Certificate of Association executed by its President and Secretary Treasurer certifying as to facts effecting the termination, which certificate shall become effective upon being recorded in the public records of Arapahoe County, Colorado.

This Section concerning termination may not be amended without consent of all Owners and of all Mortgagees required to approve termination of this Declaration, anything to the contrary notwithstanding.


Section 2. Amendments.

This Declaration and the By-Laws of Association may be amended as elsewhere provided in this Declaration and in the following manner:

An amendment to this Declaration may be proposed by a majority of either the Board or the Members of Association and such amendment shall be considered at either the next annual meeting of the Association or at a special meeting called for such purpose. Notice of the subject matter of such amendment shall be included in the notice of any such meeting. The Directors and Members not present at the meeting may express their approval in writing within a period of sixty (60) days from the date of such meeting. Any such amendment must be approved in writing by Members representing the Owners of and aggregate of not less than 2/3rds of the Lots then included within the Project.

Nothing herein contained shall authorize any amendment which shall discriminate against any Owner unless the Owner so affected shall consent; and no amendment shall change any Lot nor increase an Owner's proportionate share of the total Assessments, unless the record Owner of the Lot concerned and all Mortgagees thereon shall join in the execution of the amendment. Neither shall an amendment of this Declaration make any change in Article VIII and IX hereof or materially affect the rights of Mortgagees hereunder unless all Institutional Mortgages upon Lots shall join in the execution of the amendment.

A copy of each amendment shall be attached to a certificate certifying that the amendment was duly adopted, which certificate shall be executed by the officers of Association with the formalities of a deed. The amendment shall be effective when said certificate and a copy of such amendment are recorded in the public records of the County in which Properties are located.


Section 3. Special Amendments Requiring Specific Approval.

Anything to the contrary herein notwithstanding, unless at least seventy-five percent (75%) of the first mortgagees (based upon one vote for each first mortgage owned) or owners of the individual Units in the Project have given their prior written approval the Association shall not be entitled to:

(a) By act or omission seek to abandon, partition, subdivide, encumber, sell or transfer the common property owned, directly or indirectly, by such homeowners association.

(b) Change the method of determining the obligations, assessments, dues or other charges which may be levied against a Constructed Unit.

(c) By act or omission change, waive or abandon any scheme or regulations, or enforcement thereof, pertaining to the architectural design or the exterior appearance of Units, the exterior maintenance of Units, the maintenance of the common property party walks or common fences and driveways, or the upkeep of lawns and plantings in the Project.


ARTICLE XII

ADDITIONAL RIGHTS OF FIRST MORTGAGEES

Without diminishing any rights of the first mortgagees as otherwise herein provided, the first mortgagees shall have the following additional specific rights:

(a) First mortgagees shall have the right to examine the books and records of the Association or any entity which owns the common property of the Project.

(b) First mortgagees of Units may, jointly or singly, pay taxes or other charges which are in default and which mayor have become a charge against any common property and pay over due premiums on hazard insurance policies, or secure new hazard insurance coverage on the lapse of the policy, for such common property and first mortgagees making such payment shall be owed immediate reimbursement therefrom from the Association. The fact of the entitlement to such reimbursement shall be reflected in an agreement in favor of all first mortgagees of Units in the Project duly executed by the Association, and an original and a certified copy of such agreement shall be furnished to the Owner of each Unit; and the original or a certified copy of said agreement shall be maintained and kept in the records of the Association and shall be available for inspection by first mortgagees.

(c) No provision of this Declaration or any exhibits thereto constituting constituent documents shall give a Unit owner or any other party, priority over any rights of fIrst mortgagees of Units in the Project pursuant to their mortgages in the case of a distribution to Unit Owners of insurance proceeds or condemnation awards for losses to or the taking of common property.

(d) Homeowners Association dues or charges shall include an adequate reserve fund for maintenance, repairs and replacement of those elements of the common property that must be replaced on a periodic basis and are payable in regular installments rather than by specific assessments.

(e) A first mortgagee, upon request, is entitled to written notification from the Homeowners Association of any default in the performance by the individual unit borrower of any obligation under the constituent documents which is not cured within sixty (60) days.


ARTICLE XIII

MISCELLANEOUS


Section 1. Enforcement and Remedies.

Each provision of this Declaration shall be enforceable by the Association, or subject to Section 4 of this Article XIII, any individual Owner by a proceeding for a prohibitive or mandatory injunction or by a suit or action to recover damages. If court proceedings are instituted in connection with the rights of enforcement and remedies provided in this Declaration, the prevailing party shall be entitled to recover its costs and expenses in connection therewith, including reasonable attorney fees.

Section 2. Protection of Mortgagees.

No violation or breach of, or failure to comply with, any provision of this Declaration and no action to enforce any such provision shall affect, defeat, render invalid or impair the lien of any Mortgage taken in good faith and for value and perfected by recording in the office of the Clerk and Recorder of the County of Arapahoe, Colorado, prior to the time of recording in said office of an instrument describing the Lot and listing the name or names of the Owner thereof and giving notice of such violation, breach or failure to comply; nor shall such violation, breach, failure to comply, or action to enforce, affect, defeat, render invalid or impair the title or interest of any purchaser upon foreclosure of any such Mortgage or delivery of a deed in lieu thereof result in any liability, personal or otherwise, of any Institutional Mortgagee except for Assessments coming due after the date of such foreclosure or delivery. Any such purchaser on foreclosure or person accepting a deed in lieu thereof shall, however, take subject to this Declaration; provided, however, that violations or breach of, or failure to comply with, any provisions of this Declaration which occurred prior to the vesting of fee simple title in such purchaser shall not be deemed breaches or violations hereof or failures to comply herewith with respect to such purchaser, or person, or his heirs, personal representatives, successors or assigns.

Section 3. Limited Liability; Indemnification.

Neither the Association, the Board nor any officer, agent or employee of any of the same shall be liable to the Association or any Owner for any action or for any failure to act with respect to any matter so long as such person or entity acted in good faith and was not guilty of fraud or misconduct in taking such action or failing to act.

The Association shall indemnify each member of the Board, and any employee or agent of the Association, against any loss or threat of loss as a result of any claim or legal proceeding relating to the performance or nonperformance of any act concerning the activities of the Association to the fullest extent allowed by law.

The indemnification authorized by this Article XIII, Section 3 shall include payment of (i) reasonable attorneys' fees or other expenses incurred in settling any action or proceeding or threatened action or proceeding or incurred in any finally adjudicated legal action or proceeding; and (ii) expenses incurred in the removal of any liens affecting any property of the indemnitee. Indemnification shall be made from assets of the Association, and no Owner shall be personally liable to any indemnitee.

This Section shall inure to the benefit of the Association, the members of the Board, the employees and agents executors, administrators, successors and assigns.



Section 4. Complaints; Procedure.

All unresolved disputes, and disagreements regarding the interpretation or application of this Declaration and By-Laws shall be determined by the Board. Any Owner may submit such dispute or disagreement in writing to the Board which it, or a committee thereof, shall act on at its first meeting following the expiration of ten days after the receipt of such complaint, provided no action shall be taken against any Owner without affording him a reasonable opportunity to be heard. The Board may also make interpretations of the Declaration and the By-Laws sua sponte. The determinations of and interpretations by the Board shall in all instances be final, binding and conclusive.

Section 5. Successors and Assigns.

This Declaration shall be binding upon and shall inure to the benefit of the Association and each Owner, and the heirs, personal representatives, successors and assigns of each of them.


Section 6. Severability.

Invalidity or unenforceability of any provision of this Declaration in whole or in part shall not affect the validity or enforceability of any other provision or any valid and enforceable part of a provisions of this Declaration.


Section 7. Captions.

The captions and headings in this instrument are for convenience only and shall not be considered in construing any provision of this Declaration.


Section 8. No Waiver.

Failure to enforce any provisions of this Declaration shall not operate as a waiver of any such provision or of any other provision of this Declaration.


Section 9. Interpretation

In the event of any conflict between this Declaration and the By-Laws, this Declaration shall govern and be controlling.