Second Amended and Restated Declaration of
Covenants, Conditions & Restrictions
Of
Chinquapin Homeowners Association

(Adopted September 29, 2010, Recorded October 21, 2010)

[ Recitals, ARTICLE I - Definitions, ARTICLE II - Property Rights and Obligations of Owners, ARTICLE III - Homeowners Association, ARTICLE IV - Assessments, ARTICLE V - Architectural Control, ARTICLE VI - Association and Owner Maintenance Responsibilities, ARTICLE VII - Use of Properties and Restrictions, ARTICLE VIII - Easements, ARTICLE IX - Insurance, ARTICLE X - Damage or Destruction, ARTICLE XI - Condemnation, ARTICLE XII - Breach and Default, ARTICLE XIII - Protection of Mortgagees, ARTICLE XIV - Notices, ARTICLE XV - No Public Rights in the Properties, ARTICLE XVI - Amendment of Declaration, ARTICLE XVII - General Provisions ]

Recitals

The Amended and Restated Declaration of Covenants, Conditions and Restrictions of Chinquapin Homeowners Association, recorded on August 20, 2003 as Document No. 2003-0141877, of the Official Records of Placer County, California (“First Amended Declaration”), which affects all of the Properties described below, is hereby amended and restated in its entirety to read as follows:

WHEREAS, THE CHINQUAPIN HOMEOWNERS ASSOCIATION, a California non-profit mutual benefit corporation, hereinafter called “Association,” is the successor to the corporations called “Association” or “Homeowners Association” as such terms are defined or used in the following declarations:

Declaration of Covenants, Conditions and Restrictions – Chinquapin I recorded in the office of the Recorder of the County of Placer, State of California, on the 8th day of June 1971 at Book 1355, page 41 and following as amended by Amendment to Declaration of Covenants, Conditions and Restrictions – Chinquapin I recorded in the office of the Recorder of the County of Placer, State of California, on the 16th day of June, 1971 at Book 1356, page 443 and following;

Declaration of Covenants, Conditions and Restrictions - Chinquapin II recorded in the office of the Recorder of the County of Placer, State of California, on the 4th day of April, 1972 at Book 1410, page 671 and following;

Declaration of Covenants, Conditions and Restrictions - Chinquapin 3-A recorded in the office of the Recorder of the County of Placer, State of California, on the 30th day of May, 1973 at Book 1495, page 363 and following;

Declaration of Covenants, Conditions and Restrictions - Chinquapin 3-B recorded in the office of the Recorder of the County of Placer, State of California, on the 30th day of May, 1973 at Book 1495, page 387 and following;

Declaration of Covenants, Conditions and Restrictions - Chinquapin Recreational Area recorded in the office of the Recorder of the County of Placer, State of California, on the 30th day of May, 1973 at Book 1495, page 411 and following;

Declaration of Covenants, Conditions and Restrictions - Chinquapin Phase 4 recorded in the office of the Recorder of the County of Placer, State of California, on the 5th day of June, 1974 at Book 1571, page 408 and following;

Declaration of Covenants, Conditions and Restrictions - Chinquapin Common Area recorded in the office of the Recorder of the County of Placer, State of California, on the 5th day of June, 1974 at Book 1571, page 433 and following;

As used hereinafter, the phrase “Original Declaration” shall mean and include all of the above declarations; and

WHEREAS, the Members of Association are the separate Owners of the following described real property interests:

Lots 1 through 36 all as shown on that certain subdivision map entitled Dollar Cove Phase One filed in the office of the Recorder of the County of Placer, State of California on the 8th day of June 1971 in Book J of Maps at page 25 and following (hereinafter “Phase One Map”);

Lots 38 through 70 all as shown on that certain map entitled Chinquapin Phase 2 filed in the office of the Recorder of the County of Placer, State of California on the 4th day of April 1972 in Book J of Maps at page 48 and following (hereinafter “Phase 2 Map”);

Lots 72 through 93 all as shown on that certain subdivision map entitled Chinquapin Phase 3-A filed in the office of the Recorder of the County of Placer, State of California on the 30th day of May 1973 in Book J of Maps at page 79 and the following (hereinafter “Phase 3-A Map”);

Lots 94 through 115 all as shown on that certain subdivision map entitled Chinquapin Phase 3-B filed in the office of the Recorder of the County of Placer, State of California on the 30th day of May 1973 in Book J of Maps at page 86 and following (hereinafter “Phase 3-B Map”);

Lots 117 through 190, and the Common Area shown as lot 191, all as shown on that certain subdivision map entitled Chinquapin Phase 4 filed in the office of the Recorder of the County of Placer, State of California on the 5th day of June 1974 in Book K of Maps at page 24 and following, as amended by A Resubdivision of a Portion of Tract No. 292 Chinquapin Phase 4 filed in the office of the Recorder of the County of Placer, State of California on the 27th day of February 1975 in Book K of maps at page 37 and following (hereinafter as so amended “Phase 4 Map”), excepting therefrom that Lot designated “Management Office” located within Common Area Lot 191; and

WHEREAS, Association and the Members of Association are the successors in interest of the declarant named in that certain Declaration of Reciprocal Covenants and Easements - Chinquapin I (hereinafter the “Reciprocal Declaration”) recorded in the office of the County Recorder of the County of Placer, State of California, on the 8th day of June, 1971 at Book 1355, page 64 and following; and

WHEREAS, Association is the owner, subject to one or more of the above-described declarations, of the following real property interests:

Those common area parcels described in that certain Corporation Grant Deed recorded in the office of the Recorder of the County of Placer, State of California on the 17th day of January 1977 at Book 1800 page 692 and following;

Those real property interests referred to in that certain Quitclaim Deed recorded in the office of the Recorder of the County of Placer, State of California on the 6th day of March 1979 at Book 2092 page 267 and following;

Those common area parcels described in that certain Corporation Grant Deed recorded in the office of the Recorder of the County of Placer, State of California on the 27th day of August 1979 at Book 2162 page 312 and following; and

WHEREAS, the entire real property described above in these recitals is a “common interest development” within the meaning of California Civil Code section 1351(c), and

WHEREAS, on August 20, 2003, Association recorded a Certificate of, and The Amended and Restated Declaration of Covenants, Conditions and Restrictions (First Amended Declaration), which amended and restated in their entirety, the Original Declaration; and

WHEREAS, it is the intention of Association to amend and restate in its entirety, the First Amended Declaration and to maintain upon said real property mutually beneficial restrictions under a general plan of improvement for the benefit of all of said lots, the structures thereon and the owners thereof,

WHEREAS, Lots representing sixty-six and two-thirds percent (66-2/3 %) of the voting power of the member of the Association voted by written ballot to amend and restate the First Amended Declaration, all in accordance with the procedures for amendment set forth in said First Amended Declaration.

NOW, THEREFORE, pursuant to the provisions of the First Amended Declaration, Association amends the First Amended Declaration as set forth herein and by such amendment declares that the First Amended Declaration is entirely superseded by the within Second Amended and Restated Declaration (“Second Amended Declaration” or “Declaration”). The owners’ action to amend and restate the First Amended Declaration as set forth herein, and the fact that the requisite percentage of affirmative votes required in the First Amended Declaration was achieved, is attested to by the execution of this Declaration by duly authorized officers of the Association, as required by section 1355(a) of the California Civil Code.

Association hereby declares that all of the real property described above is held and shall be held, conveyed, hypothecated, encumbered, leased, rented, used, and occupied and improved subject to the following covenants, conditions, and restrictions, all of which are declared and agreed to be in furtherance of a plan for the subdivision, improvement and sale of said real property and are established and upon for the purpose of enhancing and perfecting the value, desirability and attractiveness of said real property and every part of thereof. All of the covenants, conditions and restrictions shall run with said real property and shall be binding on all parties having or acquiring any right, title or interest in said real property or any part thereof, and shall be for the benefit of each owner of any portion of said real property, or any interest therein, and shall inure to the benefit of and be binding upon each successor in interest of the owners thereof.

ARTICLE I
Definitions

Section 1.01. “Architectural Review Committee” or “ARC” means the committee created in accordance with Article V, below.

Section 1.02. “Articles” means the Articles of Incorporation of the Association, which are filed in the Office of the California Secretary of State, as such Articles may be amended from time to time.

Section 1.03. “Assessment” means any Regular, Special or Special Individual Assessment made or assessed by the Association against an Owner and his or her Lot in accordance with the provisions of Article IV, below.

Section 1.04. “Association” means the Chinquapin Homeowners Association, a California nonprofit mutual benefit corporation, its successors and assigns. The Association is an “association” as defined in section 1351(a) of the California Civil Code.

Section 1.05. “Association Rules” means the rules, regulations and policies adopted by the Board of Directors, pursuant to Section 3.07 , below, as the same may be in effect from time to time.

Section 1.06. “Association Internet Website” means the website currently maintained by the Association. Members are provided with an address and password to access the Governing Documents and other information about the Chinquapin Development. If the Board decides to discontinue maintenance of the Association Internet Website, all references to it in the Governing Documents shall be null and void.

Section 1.07. “Board of Directors” or “Board” means the Board of Directors of the Association.

Section 1.08. “Bylaws” means the Bylaws of the Association, as such Bylaws may be amended from time to time.

Section 1.09. “Chinquapin Development” or the “Development” or the “Project” or the “Properties”, mean all parcels of real property (Common Areas and Lots) described in the Recitals, together with all buildings, structures, utilities, common facilities, and other improvements located thereon, and all appurtenances thereto. As used in this Declaration, these terms are synonymous with “Properties”.

Section 1.10. “Common Areas”: There are two types of Common Area in the Chinquapin Development: 1) the Project Common Area, which includes all real property owned by the Association for the common use and enjoyment of the Owners; and 2) the Condominium Common Area. The Project Common Area consists primarily of open space areas, and the private roads and courts shown on the Subdivision Maps. The Condominium Common Area consists primarily of the exterior and structural building components of the Condominium Units described below. Specifically, the Common Areas include the following:

Project Common Area: Lots 36 and 37 as shown on the Phase One Map, Lots 70 and 71 as shown on the Phase 2 Map, Lot 93 and Lots A, B, and C as shown on the Phase 3-A Map, Lots 115 and 116 as shown on the Phase 3-B Map, and Lots 191, 192, 193, and 194 as shown on the Phase 4 Map.

Condominium Common Area: Real property consisting of Lots 117 through 126 inclusive, and Lots 139 through 162 inclusive*, all as shown on Phase 4 Map, together with all improvements located on said lots including the roofs, foundations, floors, pipes, ducts, flues, chutes, conduits, wires, and other utility installations to the outlets, bearing walls, columns, and girders to the unfinished surfaces thereof, regardless of location, within any structure containing condominium Units.

Unless the context clearly indicates a contrary intent, any reference herein to the “Project Common Area” shall also include any Common Facilities located thereon. As more particularly described in Section 1.19, below, portions of the Project Common Area are designated as Exclusive Use Common Areas whose use and enjoyment are restricted to the Owners and occupants of the Residences that such Exclusive Use Common Areas are physically attached to.

* Note: The description of the Condominium Common Area Lots and the Condominium Unit Lots are repeated from previously recorded documents. However, the Association understands that although Units 117 through 126 and 139 through 146 were originally designed and described as condominium units, they were sold by the original developer as Townhouse Units. The Association treats those Units as Townhouses for all purposes, and therefore recognizes 16 Condominium Units and 156 Townhouse Units.

Section 1.11. “Common Expense” means any use of Association funds authorized by Article IV, below, and Article IX of the Bylaws and includes, without limitation: (a) All expenses or charges incurred by or on behalf of the Association for the management, maintenance, administration, insurance, operation, repairs, additions, alterations or reconstruction of the Project or Condominium Common Areas, Common Facilities and any portions of the Lots that the Association is obligated to maintain or repair; (b) all expenses or charges reasonably incurred to procure insurance for the protection of the Association and its Board of Directors and insurance of Residences constructed or to be constructed on Lots to the extent required by Article X, below; (c) any amounts reasonably necessary for reserves for maintenance, repair and replacement of the Common Areas and Common Facilities and any portions of the Lots that the Association is obligated to maintain or replace, and for nonpayment of any Assessments; and (d) the use of such funds to defray the costs and expenses incurred by the Association in the performance of its functions or in the proper discharge of the responsibilities of the Board as provided in the Governing Documents.

Section 1.12. “Common Facilities” means the Dollar Estate Buildings and Carriage House Building, pool, bathroom and sauna areas, Association beach, two mooring piers, swim platform, 132 mooring buoys consisting of weights, lines, floats and associated equipment, tennis courts, volleyball court, NTPUD pump house observation deck, the lake access and hiking trails as shown on the Subdivision Maps and the trees, hedges, plantings, lawns, shrubs, landscaping, fences, utilities, pipes, lines, lighting fixtures, buildings, structures and other facilities constructed or installed, or to be constructed or installed, or currently located within the Project Common Area and owned by the Association.

Section 1.13. “Condominium” means an estate in real property as defined in California Civil Code section 1351(f), consisting of an undivided interest as a tenant-in-common in a portion of real property referred to herein as the Common Areas, together with a fee interest in space called a Unit, all as shown and described in the Condominium Plan.*

Section 1.14. “Condominium Plan”: Diagrammatic floor plans and elevations for the Condominium Units in the Chinquapin Development. The Condominium Plan is a part of the Phase 4 Map, referenced in the Recitals hereinabove.*

Section 1.15. “Condominium Unit”: The portion of a condominium as to which an owner is entitled to exclusive occupancy. The term “Condominium Unit” shall mean numbered Units 117 through 126 inclusive, and 139 through 162 inclusive, as shown on the Condominium Plan which is a part of the Phase 4 Map*. The boundaries of a Condominium Unit are (a) the interior unfinished surfaces (exclusive of paint, paper, wax, tile, enamel or other finishing) of its floors and ceilings at their respective elevations as shown on the Condominium Plan, and (b) the interior unfinished surfaces (exclusive of paint, paper, wax, tile, enamel, or other finishing) of its perimeter walls, windows and window frames, door and door frames, and trim. To the extent that the following are

*See Note page 5.
located inside its boundaries, the Condominium Unit includes space and water heating equipment, ducts, flues, pipes, conduits, wires and other utility installations, and excludes bearing walls and structural frame work to their unfinished surfaces. Each Condominium Unit includes both the portions of the building so described and the air space so encompassed.

In interpreting deeds and plans, the existing physical boundaries of a Condominium Unit, or of a Condominium Unit reconstructed in substantial accordance with the original plans, shall be conclusively presumed to be the Condominium Unit’s boundaries rather than the description expressed in the deed or plans, regardless of minor variances between the boundaries as shown on the plans or the deed and those of the building containing the Condominium Unit and regardless of settling or lateral movement of the building and regardless of minor variations between boundaries shown on the Condominium Plan or in the deed to a Condominium Unit and those of the building.

Whenever reference is made to a “Condominium Unit”, it shall be assumed that such reference is made to the Condominium Unit as a whole, including each of its component elements (including the airspace so encompassed), and to any and all Exclusive Use Common Areas, if any, appurtenant to the Condominium Unit. The term “Condominium Unit” does not include those areas of the Property that are defined herein as Common Areas or Common Facilities (other than Exclusive Use Common Areas).

Section 1.16. “County” means the County of Placer, State of California, and its various departments, divisions, employees and representatives. If any portion of the Properties becomes a portion of an incorporated city, then the term “County” shall be deemed to include the city in which that portion of the Properties is located.

Section 1.17. “Declaration” or “Second Amended Declaration” mean this instrument, i.e., the Second Amended and Restated Declaration of Covenants, Conditions and Restrictions, for the Chinquapin Homeowners Association. The “Original Declaration, and the First Amended Declaration” mean and refer to the documents referenced in the Recitals to this Declaration, together with all amendments and annexations thereto adopted prior to adoption of this Second Amended Declaration.

Section 1.18. “Deliver” or “Delivered,” or “Delivery”of documents or information to Association Members includes personal delivery, postal delivery by first-class or certified mail, express delivery by Federal Express or other express delivery services, and by electronic mail or other electronic means, if the recipient has signed a written consent that complies with Civil Code section 1350.7(3) or any successor statute thereto.

Section 1.19. “Exclusive Use Common Areas” or “Exclusive Use Areas” or “EUAs” , means those portions of the Project and Condominium Common Areas described below:

a. Townhouse Units - Exclusive Use Common Areas include the following improvements or facilities that are, or may be, set aside and allocated for the exclusive use of one of the Townhouse Residences, which are appurtenant to the Townhouse Residence owned by its Owners, and include parking spaces, storage spaces, carports, exterior decks, steps, and porches, or those portions thereof, that lie outside of the boundaries of any Townhouse Residence Lot, whether or not a portion of any improvement that extends beyond the boundaries of the Lot are above or in contact with the Project Common Area land below.

b. Condominium Units - Exclusive Use Common Areas include, without limitation, window boxes, door steps, stoops, porches, enclosed patio areas, decks, exterior doors, door frames, and hardware incidental thereto, screens, windows, parking spaces, and storage spaces, which are, or may be set aside and allocated for the exclusive use of one or more, but fewer than all of the Owners, and which are appurtenant to the Condominium Units owned by said Owners, all as may be more particularly designated on the Condominium Plan.

Section 1.20. “Governing Documents” is a collective term that means and refers to this Second Amended Declaration and to the Articles, Bylaws and Association Rules.

Section 1.21. “Improvement” shall be defined as set forth in Section 5.01(b), below.

Section 1.22. “Lot” or “Residence Lot” means any parcel of real property designated by a number on the Subdivision Map, excluding the Project Common Area. When appropriate within the context of this Declaration, both terms shall also include the Townhouse Residences, Condominium Units and other Improvements constructed or to be constructed on a Lot.

Section 1.23. “Majority of a Quorum” means the vote of a majority of the votes cast at a meeting or by written ballot when the number of Members attending the meeting in person or casting written ballots equals or exceeds the minimum quorum requirement for Member action, as specified in the Bylaws at Section 5.2.

Section 1.24. “Member” means every person or entity who holds a membership in the Association and whose rights as a Member are not suspended pursuant to Section 12.06, below.

Section 1.25. “Mortgage” means any security device encumbering all or any portion of the Properties, including any deed of trust. “Mortgagee” shall refer to a beneficiary under a deed of trust as well as to a mortgagee in the conventional sense.

Section 1.26. “Owner” means any person, firm, corporation or other entity which owns a fee simple interest in any Lot. If a Lot is transferred or conveyed to a trust, the Owner is the trustee or the co-trustees of such trust.

Section 1.27. “Owner of Record” includes an Owner and means any person, firm, corporation or other entity in which title to a Lot is vested as shown by the Official Records of the Office of the County Recorder.

Section 1.28 “Pre-Lien Delinquency Notice” or “Pre-Lien Notice” means a written notice Delivered to an Owner before the Association may record a lien for delinquent assessments, that complies with the requirements of Civil Code Section 1367.1.

Section 1.29. “Properties” means all parcels of real property (Common Areas and Lots) described in the Recitals, together with all buildings, structures, utilities, Common Facilities, and other Improvements located thereon, and all appurtenances thereto.

Section 1.30. “Record” means, with respect to any document, the recordation or filing of such document in the Office of the County Recorder.

Section 1.31. “Regular Assessment” means an Assessment levied against an Owner and his or her Lot in accordance with Section 4.02, below.

Section 1.32. “Residence” means a private, single-family dwelling of townhouse or condominium design constructed on a Lot.

Section 1.33. “Single Family Residential Use” means occupancy and use of a Residence for single family dwelling purposes in conformity with this Declaration and the requirements imposed by applicable zoning or other applicable laws or governmental regulations limiting the number of persons who may occupy single family residential dwellings. ‘Time-share’ type of ownership or occupancy is prohibited per Section 2.02.

Section 1.34. “Special Assessment” means an Assessment levied against an Owner and his or her Lot in accordance with Section 4.03, below.

Section 1.35. “Special Individual Assessment” means an Assessment levied against an Owner and his or her Lot in accordance with Section 4.04, below.

Section 1.36. “Subdivision Map” refers to each of the subdivision maps referred to in the Recitals of this Declaration, individually or in combination as the context may require.

Section 1.37: “Townhouse Unit”

Townhouse Unit: Lots 1 through 35 inclusive as shown on the Phase One Map, including all structures and improvements thereon, Lots 38 through 69 inclusive as shown on the Phase 2 Map, including all structures and improvements thereon, Lots 72 through 92 inclusive as shown on the Phase 3-A Map, including all structures and improvements thereon, Lots 94 through 114 inclusive as shown on the Phase 3-B Map, including all structures and improvements thereon. Lots 127 through 138 inclusive, and Lots 163 through 190 inclusive, as shown on the Phase 4 Map*, including all structures and improvements thereon.

(a) The Association recognizes a total of 156 Townhouse Units in the Chinquapin Development.* The Owners of Townhouse Units own the land and all structures built within and above the boundaries of their Lot. Townhouse Unit Owners own all exterior and interior elements of their residences and all other improvements on their Lots. The Lot boundaries for Townhouse Units may be outside of the foundation and exterior walls of the Units, so that portions of some exterior improvements, such as decks and entry steps, may be partially located within or above the boundaries of a Townhouse Unit Lot, with other portions of such improvements located outside the boundaries of the Townhouse Lot, and on or over portions of the Project Common Area. The portions of such improvements that are located within or above the Townhouse Lot boundaries are owned by the Owner. The portions of such improvements that are located outside of the Lot boundaries and on or over the Project Common Area, are not owned by the Townhouse Unit Owner, but are considered the Lot Owners’ Exclusive Use Common Areas, as defined in Section 1.19(a). Although Townhouse Unit Owners own all interior and exterior elements of their residences, the Association has extensive architectural review and control authority, and extensive maintenance responsibilities for the Townhouse Units as set forth in Articles V and VI of this Declaration. Pursuant to Article VI, even though the Townhouse Unit Owners own all improvements on their Lots, the building exteriors, including roofs, walls, and decks, are generally maintained by the Association. Pursuant to Article V, if proposed improvements by a Townhouse Unit Owner can be seen or heard from outside their Lot, the proposed improvement is generally subject to architectural review and control by the Association.

Section 1.38 “Unit”: Includes townhouse and condominium Units.

Section 1.39 “Unit Ownership”: The entire interest conveyed by deed to an Owner, including the Residence Lot and the related interest in the Common Area and also including each and all of the non-exclusive easements and rights of use (1) created by or otherwise resulting from, (i) all components of the Original Declaration and the Reciprocal Declaration, and (ii) all use of each of such easements and rights by each and all of the Owners, as such easements and rights are restated and confirmed by the adoption and recording of this Second Amended Declaration; and (2) quit claimed to any Owner or Owners by the Moana 1979 Quitclaim.

Section 1.40: “Voting Power”. Voting Power means those Members who are eligible to vote for the election of directors or with respect to any other matter, issue or proposal properly presented to the Members for approval at the time any determination of Voting Power is made.

*See Note page 5.

ARTICLE II
Property Rights and Obligations of Owners

Section 2.01. Owners' Nonexclusive Easements of Enjoyment. Every Owner shall have a nonexclusive right and easement of enjoyment in and to the Project Common Areas within the Properties, including ingress and egress to and from his or her Lot, which shall be appurtenant to and shall pass with the title to every Lot, subject to the following provisions:

(a) The right of the Association: to assign, rent, license, lease, charge reasonable admission and other fees for, and to otherwise designate and control the use of any unassigned parking and storage spaces and to charge reasonable admission and other fees or to limit the number of guests of Members who may use any recreational Common Facilities.

(b) The right of the Association to adopt Association Rules as provided in Section 3.07, below, regulating the use and enjoyment of the Properties for the benefit and well-being of the Owners in common, and, in the event of the breach of such rules or any provision of any Governing Document by any Owner or tenant, to initiate disciplinary action against the violating owner or tenant in accordance with Section 12.06, below. Such action may include the levying of fines and/or the temporary suspension of the voting rights and/or right to use the Common Facilities, other than that portion of the roads necessary for ingress and egress for an Owner’s separate Unit.

(c) The right of the Association, in accordance with its Articles and Bylaws, to borrow money for the purpose of improving the Project and Condominium Common Areas and Common Facilities; provided, however, that any such indebtedness shall be considered an expense of the Association for purposes of the Special Assessment provisions of Section 4.03, below.

(d) The right of the Association to dedicate or transfer all or any part of the Project Common Area to any public agency, authority or utility for such purposes and subject to such conditions as may be agreed by the Owners; provided, however, that no such dedication or transfer shall be effective unless an instrument, approved by at least sixty-six and two-thirds (66-2/3%) of the voting power of the Members has been recorded. Furthermore, no dedication shall be permitted that impairs the ingress and egress to any Lot. The instrument approving the dedication may be executed in counterparts so long as each counterpart is in recordable form.

(e) The right of each Owner to the exclusive use and enjoyment of the Exclusive Use Common Areas, if any, appurtenant to the Owner’s Unit.

(f) All easements affecting the Project Common Area which are described in Article VIII, below.

(g) please see First Amendment to the Second Amended and Restated Declaration of Conenants, Conditions and Restrictions

Section 2.02. Single Family Residential Use Only. Each Residence Lot shall be used for single family residential use only and for no other purpose. In no event shall a Residence be occupied by more individuals than permitted by applicable zoning laws or governmental regulations. “Single Family” use shall include casual guests of such family and the domestic employees or servants of such family. No commercial use shall be permitted except that an Owner is permitted to lease or rent a Residence Lot. Any such lease or rental agreement shall be in writing and shall require any tenant to abide by this Declaration, the Articles, Bylaws and Association rules. No Residence Lot may be used as a “time-share project”, whether organized as a tenancy-in-common, co-ownership, trust, partnership, limited liability company, corporation, co-operative or any other type of multiple ownership entity, wherein a co-owner receives the right in perpetuity, for life, or for a term of years, to the recurrent exclusive use or occupancy of a Residence Lot annually or on some other periodic basis, for a period of time that has been or will be allotted from the use or occupancy periods into which the project has been divided.”

Section 2 03. Persons Subject to Governing Documents. All present and future Owners, tenants and occupants of Lots within the Properties shall be subject to, and shall comply with, each and every provision of the Governing Documents, as the same or any of them shall be amended from time to time, unless a particular provision is specifically restricted in its application to one (1) or more of such classes of persons (i.e., Owners, tenants, invitees, etc.). The acceptance of a deed to any Lot, the entering into a lease, sublease or contract of sale with respect to any Lot, or the occupancy of any Lot shall constitute the consent and agreement of such Owner, tenant or occupant that each and all of the provisions of this Declaration, as the same or any of them may be amended from time to time, shall be binding upon him or her and that he or she will observe and comply with the Governing Documents.

Section 2.04. Delegation of Use.

(a) Delegation of Use and Leasing of Residences. Any Owner may delegate his or her rights to use and enjoy the Project Common Area and Common Facilities to his or her family members, tenants, lessees or contract purchasers who reside in the Residence; provided, however, that any rental or lease may only be to a single family for Single Family Residential Use (see Section 2.02).

During any period when a Residence has been rented or leased, the Owner-lessor, his or her family, guests and invitees shall not be entitled to use and enjoy any recreational Common Facilities within the Properties, unless they are an accompanied guest of another Owner. In other respects, non-resident Owners who are leasing their Residences shall have full rights to access the Residence to perform the Owner's responsibilities as a lessor. The restriction on recreational facility usage by Owner-lessors shall not apply to any Owner-lessor who is contemporaneously residing in another Residence within the Properties.

Any rental or lease of a Residence shall be subject to the provisions of the Governing Documents all of which shall be deemed incorporated by reference in the lease or rental agreement. Each Owner-lessor shall provide any tenant or lessee with a current copy of all Governing Documents and shall be responsible for compliance by the tenant or lessee with all of the provisions of the Governing Documents during the tenant's/lessee's occupancy and use of the Residence.

(b) Discipline of Lessees. Subject to subparagraph (c) below, in the event that any tenant or lessee fails to honor the provisions of any Governing Document, the Association shall be entitled to take such corrective action as it deems necessary or appropriate under the circumstances which may include initiation of an eviction proceeding in accordance with the following paragraph, suspension of the tenant's privileges to use any recreational Common Facilities or the imposition of fines and penalties against the Owner or tenant.

Whether or not such right is stated in any lease or rental agreement, every Owner who rents his or her Residence automatically grants to the Association the right to determine a tenant's default under the Governing Documents and of terminating the tenancy and evicting the tenant for such default in accordance with the procedures specified in this subparagraph (b). The Board may, in its discretion, but is not obligated to, institute eviction proceedings pursuant to applicable law after compliance with the Due Process Requirements of subparagraph (c) below. If the Board elects to take such eviction action, either in its own name or in the Owner's name, the Owner shall be responsible for all costs thereof, including reasonable attorneys' fees, and shall reimburse the Association upon demand for the entire amount of such costs. If the Owner refuses to make such reimbursement, the sums shall constitute a Special Individual Assessment (Section 4.04, below) for which a lien may be imposed against the Owner's Lot. The Association's right to maintain an eviction action hereunder is derived from Section 1161, et seq. of the California Code of Civil Procedure and shall only arise if the tenant's or lessee's conduct involves damage to or destruction of Common Areas or Common Facilities, or constitutes a danger to persons on the Properties or nuisance or unreasonable interference with the quiet enjoyment of other residents.

(c) Due Process Requirements for Disciplinary Action. Except for circumstances in which immediate corrective action is necessary to prevent damage or destruction to the Properties, to prevent injuries to persons on the Properties, or to preserve the rights of quiet enjoyment of other Owners, the Association shall have no right to initiate disciplinary action against an Owner-lessor (or the Owner's lessee or tenant) on account of the misconduct of the Owner's lessee or tenant unless and until the following conditions have been satisfied: (i) the Owner has received written notice from the Board, the Association's property manager or an authorized committee of the Board detailing the nature of the lessee's/tenant's alleged infraction or misconduct and advising the Owner of his or her right to a hearing on the matter in the event the Owner believes that remedial or disciplinary action is unwarranted or unnecessary; (ii) the Owner has been given a reasonable opportunity to take corrective action on a voluntary basis and to appear at a hearing, and (iii) the Owner has failed to prevent or correct the tenant's objectionable actions or misconduct. Any hearing requested hereunder shall be conducted in accordance with Section 12.06, below.

Section 2 05. Obligations of Owners. Owners of Lots within the Properties shall be subject to the following:

(a) Contract Purchasers. A contract seller of a Lot (i.e., an Owner who contracts to sell his or her Lot pursuant to an Agreement where title transfers to the buyer only upon payment in full) must delegate his or her voting rights as a Member and his or her right to use and enjoy the Common Area and Common Facilities to any contract purchaser in possession of the property subject to the contract of sale. Notwithstanding the foregoing, the contract seller shall remain liable for any default in the payment of Assessments by the contract purchaser until title to the property sold has been transferred to the purchaser. As soon as practicable before transfer of title or the execution of a real property sales contract with respect to any Lot, the Owner thereof must give the prospective purchaser a copy of the Governing Documents, and other information that is more particularly described in section 1368 of the California Civil Code.

(b) Payment of Assessments and Compliance With Rules. Each Owner shall pay, when due, each Regular, Special and Special Individual Assessment levied against the Owner and his or her Lot and shall observe, comply with and abide by any and all rules and regulations set forth in, or promulgated by the Association pursuant to, any Governing Document for the purpose of protecting the interests of all Owners or protecting the Common Area and Common Facilities.

(c) Discharge of Assessment Liens. Each Owner shall promptly discharge any Assessment lien that may hereafter become a charge against his or her Lot.

(d) Joint Ownership of Lots. In the event of joint ownership of any Lot, the obligations and liabilities of the multiple Owners under the Governing Documents shall be joint and several. Without limiting the foregoing, this subparagraph (e) shall apply to all obligations, duties and responsibilities of Owners as set forth in this Declaration, including the payment of all Assessments.

(e) Termination of Obligations. Upon the conveyance, sale, assignment or other transfer of a Lot to a new Owner, the transferor-Owner shall not be liable for any Assessments levied with respect to such Lot which become due after the date of Recording of the deed evidencing the transfer and, upon such Recording, all Association membership rights possessed by the transferor by virtue of the ownership of the Lot shall automatically cease.

ARTICLE III
Homeowners Association

Section 3.01. Association Membership. Every Owner of a Lot shall be a Member of the Association. Each Owner shall hold one membership in the Association for each Lot owned and the membership shall be appurtenant to such Lot. Sole or joint ownership of a Lot shall be the sole qualification for membership in the Association. Each Owner shall remain a Member until his or her ownership in all Lots in the Properties ceases, at which time his or her membership in the Association shall automatically cease. Persons or entities who hold an interest in a Lot merely as security for performance of an obligation are not Members until such time as the security holder comes into title to the Lot through foreclosure or receipt of a deed in lieu thereof.

Section 3.02. One Class of Membership. The Association shall have one class of membership and the rights, duties, obligations and privileges of the Members shall be as set forth in the Governing Documents.

Section 3.03. Voting Rights of Members. Each Member shall be entitled to one vote for each Lot owned by that Member. When more than one person holds an interest in any Lot, all such persons shall be Members, although in no event shall more than one vote be cast with respect to any Lot. Voting rights may be temporarily suspended under those circumstances described in Section 12.06, below.

Section 3.04. Assessments. The Association shall have the power to establish, fix and levy Assessments against the Owners of Lots within the Properties and to enforce payment of such Assessments in accordance with Article IV, below. Any Assessments levied by the Association against its Members shall be levied in accordance with and pursuant to the provisions of this Declaration.

Section 3.05. Transfer of Memberships. Membership in the Association shall not be transferred, encumbered, pledged or alienated in any way, except upon the sale of the Lot to which it is appurtenant and then, only to the purchaser. In the case of a sale, the membership appurtenant to the transferred Lot shall pass automatically to the purchaser upon Recording of a deed evidencing the transfer of title. In the case of an encumbrance of such Lot, a Mortgagee does not have membership rights until he or she becomes an Owner by foreclosure or deed in lieu thereof. Tenants who are delegated rights of use pursuant to Section 2.03, above, do not thereby become Members, although the tenant and his or her family and guests shall, at all times, be subject to the provisions of all Governing Documents.

Section 3.06. Powers and Authority of the Association.

(a) Powers, Generally. The Association shall have the responsibility of owning, managing and maintaining the Project and Condominium Common Areas and Common Facilities and discharging the other duties and responsibilities imposed on the Association by the Governing Documents. In the discharge of such responsibilities and duties, the Association shall have all of the powers of a nonprofit mutual benefit corporation organized under the laws of the State of California in the ownership and management of its Properties and the discharge of its responsibilities hereunder for the benefit of its Members, subject only to such limitations upon the exercise of such powers as are expressly set forth in the Governing Documents. The Association and its Board of Directors shall have the power to do any and all lawful things which may be authorized, required or permitted to be done under and by virtue of the Governing Documents, and to do and perform any and all acts which may be necessary or proper for, or incidental to, the exercise of any of the express powers of the Association for the peace, health, comfort, safety or general welfare of the Owners. The specific powers of the Association and the limitations thereon shall be as set forth in Article IX of the Bylaws.

(b) Association's Limited Right of Entry on Lots.

(i) Right of Entry, Generally. Without limiting the foregoing description of the Association’s powers, but in addition thereto, the Association and its agents shall have the right and power to enter any Lot to perform the Association's obligations under this Declaration, including:

(A) Exterior maintenance obligations with respect to individual Residences;

(B) Obligations to enforce the architectural and land use restrictions of Articles V and VII, below;

(C) Any obligations with respect to construction, maintenance and repair of adjacent Common Facilities; or

(D) To make necessary repairs that an Owner has responsibility for but has failed to perform which, if left undone, will pose a threat to, or cause an unreasonable interference with, any portion of the Properties or the Owners in common.

(ii) Limitations on Exercise of Right. The Association's right of entry pursuant to this subparagraph (b) shall be subject to the following:

(A) The right of entry onto Lots may be exercised immediately and without prior notice to the Owner or resident in case of an emergency originating in or threatening the Lot or any adjoining Lots or Common Areas where entry is required. The Association's work may be performed under such circumstances whether or not the Owner or his or her lessee is present.

(B) In all non-emergency situations involving routine repair and/or maintenance activities, the Association, or its agents, shall furnish the Owner or his or her lessee with at least twenty-four (24) hours prior written notice of its intent to enter the Lot, specifying the purpose and scheduled time of such entry, and shall make every reasonable effort to perform its work and schedule its entry in a manner that respects the privacy of the persons residing on the Lot. For general maintenance projects by the Association, such as deck maintenance or building painting, this notice requirement can be satisfied by the Association Delivering a general notice to the Association membership by posting on the Association’s Internet Website and/or a publication of general circulation such as a newsletter.

(C) In all non-emergency situations involving access by the Association for purposes of enforcing the Governing Documents against an Owner in default, the Association's entry shall be subject to observance of the notice and hearing requirements imposed by Section 12.06, below.

(D) In no event shall the Association's right of entry hereunder be construed to permit the Association or its agents to enter the interior of any Residence without the Owner's express permission. However, the Association may request Owners to provide the Association with keys or similar means to provide access to their Units to enable entry during emergencies. In the event Owners do not provide the Association with emergency access ability, the Association may, after notice and hearing, find Owners responsible for the cost of repair of any and all damages caused by an emergency entry into a Unit, plus consequential damages that may result from delays in correcting an emergency situation because access to the Unit was not provided by the Owner.

Section 3.07. Association Rules.

(a) Rule Making Power. The Board may, from time to time and subject to the provisions of this Declaration, propose, enact and amend rules and regulations of general application to the Owners (“Association Rules”). The Association Rules may concern, but need not be limited to: (i) matters pertaining to the maintenance, repair, management and use of the Project and Condominium Common Areas and Common Facilities by Owners, their tenants, guests and invitees, or any other person(s) who have rights of use and enjoyment of such Common Areas and Common Facilities; (ii) architectural control and the rules of the Architectural Review Committee under Section 5.05, below; (iii) the conduct of disciplinary proceedings in accordance with Section 12.06, below, (iv) regulation of parking, pet ownership and other matters subject to regulation and restriction under Article VII, below; (v) collection and disposal of refuse; (vi) minimum standards for the maintenance of landscaping or other Improvements on any Lot; and (vii) any other subject or matter within the jurisdiction of the Association as provided in the Governing Documents.

Notwithstanding the foregoing grant of authority, the Association Rules shall not be inconsistent with or materially alter any provision of the other Governing Documents or the rights, preferences and privileges of Members thereunder. In the event of any material conflict between any Association Rule and any provision of the other Governing Documents, the conflicting provisions contained in the other Governing Documents shall be deemed to prevail.

(b) Distribution of Rules. A copy of the Association Rules, as they may from time to time be adopted, amended or repealed, shall be posted on the Association Internet Website and mailed or otherwise Delivered to each Owner. A copy of the Association Rules shall also be available and open for inspection during normal business hours at the principal office of the Association and/or its property management firm.

(c) Adoption and Amendment of Rules. Association Rules may be adopted or amended from time to time by majority vote of the Board after compliance with Member notice and comment rights and other requirements of Civil Code section 1357.100 - 1357.150 and as set forth at Section 13.11 of the Bylaws. Any duly adopted rule or amendment to the Association Rules shall become effective immediately following the date of adoption thereof by the Board, or at such later date as the Board may deem appropriate.

Section 3.08. Breach of Rules or Restrictions. Any breach of the Association Rules or of any other Governing Document provisions shall give rise to the rights and remedies set forth in Article XIII, below.

Section 3.09. Limitation on Liability of the Association's Directors and Officers.

(a) Claims Regarding Breach of Duty. No director or officer of the Association (collectively and individually referred to as the “Released Party”) shall be personally liable to any of the Members or to any other person, for any error or omission in the discharge of his or her duties and responsibilities or for his or her failure to provide any service required under the Governing Documents; provided that such Released Party has, upon the basis of such information as he or she possessed, acted in good faith, in a manner that such person believes to be in the best interests of the Association and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances.

Without limiting the generality of the foregoing, this standard of care and limitation of liability shall extend to such matters as the establishment of the Association's annual financial budget, the funding of Association capital replacement and reserve accounts, repair and maintenance of the Project and Condominium Common Areas and Common Facilities and enforcement of the Governing Documents.

(b) Other Claims Involving Tortious Acts and Property Damage. No person who suffers bodily injury (including, without limitation, emotional distress or wrongful death) as a result of the tortious act or omission of a volunteer member of the Board or volunteer officer of the Association shall recover damages from such Board member or officer if the requirements of Civil Code section 1365.7 are satisfied, which include:

(i) The Board member or officer resides within the Properties as a tenant or is an Owner of no more than two (2) Lots;

(ii) The act or omission was performed within the scope of the volunteer Board member's or officer's Association duties;

(iii) The act or omission was performed in good faith;

(iv) The act or omission was not willful, wanton, or grossly negligent;

(v) The Association maintained and had in effect at the time the act or omission occurred and at the time a claim is made general liability insurance with coverage of at least One Million Dollars ($1,000,000).

The payment of actual expenses incurred by a Board member or officer in the execution of such person's Association duties shall not affect such person's status as a volunteer Board member or officer for the purposes of this section. The provisions of this subparagraph (b) are intended to reflect the protections currently accorded to volunteer directors and officers of community associations pursuant to California Civil Code section 1365.7 and should not be construed to expand or limit the fiduciary duties owed by a Board member or officer. In the event said Civil Code section is amended or superseded by another, similar provision of the California statutes, this subparagraph (b) shall be deemed amended, without the necessity of further Member approval, to correspond to the amended or successor Civil Code provision.

ARTICLE IV
Assessments

Section 4.01. Assessments Generally.

(a) Covenant to Pay Assessments. Each Owner of one (1) or more Lots, by acceptance of a deed or other conveyance therefor (whether or not it shall be so expressed in such deed or conveyance), covenants and agrees to pay to the Association: (i) Regular Assessments; (ii) Special Assessments; and (iii) Special Individual Assessments. Each such Assessment shall be established and collected as hereinafter provided.

(b) Extent of Owner's Personal Obligation for Assessments. All Assessments, together with late charges, interest, and reasonable costs (including reasonable attorneys' fees) for the collection thereof, shall be a debt and a personal obligation of each person who was an Owner of the Lot at the time the Assessment was levied. Each Owner who acquires title to a Lot (whether at judicial sale, trustee's sale or otherwise) shall be personally liable only for Assessments attributable to the Lot which become due and payable after the date of such sale, and shall not be personally liable for delinquent Assessments of prior Owners unless the new Owner expressly assumes the personal liability of his or her predecessor in interest. Any unpaid Assessment of a previous Owner shall remain the debt of such previous Owner against whom assessed.

(c) Creation of Assessment Lien. All Assessments, together with late charges, interest, and reasonable costs (including reasonable attorneys' fees) for the collection thereof, shall become a lien against the Lot to which the Assessment is appurtenant upon recordation by the Association of a Notice of Delinquent Assessment in accordance with Civil Code section 1367(b) and Section 4.10, below. Any lien for unpaid Assessments created pursuant to the provisions of this Article may be subject to foreclosure as provided in Section 4.10(b), below.

(d) No Avoidance of Assessment Obligations. No Owner may exempt himself/herself from personal liability for Assessments duly levied by the Association, nor release the Lot or other property owned by him/her from the liens and charges hereof, by waiver of the use and enjoyment of the Common Area or any facilities thereon or by abandonment or non-use of his/her Lot or any other portion of the Properties.

Section 4.02. Regular Assessments.

(a) Preparation of Annual Budget; Establishment of Regular Assessments. As required by Civil Code sections 1365 and 1366, not less than thirty (30) days nor more than ninety (90) days prior to the beginning of the Association's next fiscal year, the Board shall estimate the total amount required to fund the Association's anticipated Common Expenses for the next succeeding fiscal year (including additions to any reserve fund established to defray the costs of future repairs, replacement or additions to the Common Facilities or portions of the Lots which the Association is obligated to maintain) by preparing and distributing to all Members a budget satisfying the requirements of Section 12.5 of the Bylaws. If the Board fails to distribute the budget for any fiscal year within the time period provided for in this section, the Board shall not be permitted to increase Regular Assessments for that fiscal year unless the Board first obtains the Members' approval in accordance with Section 4.08, below.

(b) Establishment of Regular Assessment by Board/Membership Approval Requirements. The total annual expenses estimated in the Association's budget (less projected income from sources other than Assessments) shall become the aggregate Regular Assessment for the next fiscal year; provided, however, that, except as provided in Section 4.05, below (emergency assessment authority), the Board of Directors may not impose a Regular Assessment that is more than twenty (20%) percent greater than the Regular Assessment for the Association's immediately preceding fiscal year without the Members' prior approval in accordance with Section 4.08, below.

(c) Allocation of Regular Assessment. The total estimated Common Expenses, determined in accordance with subparagraph (a), shall be allocated among, assessed against, and charged to each Owner according to the ratio of the number of Lots within the Properties owned by the assessed Owner to the total number of Lots subject to Assessments so that each Lot bears an equal share of the total Regular Assessment.

(d) Delivery of Notice of Assessment. Within the time requirements specified in subparagraph (a), above, the Board of Directors shall post on the Association Internet Website and deliver to each Owner at such electronic or postal address of the Owner's Lot, or at such other address as the Owner may from time to time designate in writing to the Association, a statement of the amount of the Regular Assessment for the next succeeding fiscal year.

(e) Failure to Make Estimate. If, for any reason, the Board of Directors fails to make an estimate of the Common Expenses for any fiscal year, then the Regular Assessment made for the preceding fiscal year, together with any Special Assessment made pursuant to Section 4.03(a)(i), below, for that year, shall be assessed against each Owner and his or her Lot on account of the then current fiscal year, and installment payments (as hereinafter provided) based upon such automatic Assessment shall be payable on the regular payment dates established by the Board.

(f) Installment Payment. The Regular Assessment levied against each Owner and his or her Lot shall be due and payable in advance to the Association in equal quarterly installments on the first day of January, April, July and October, or on such other date or dates as may be established from time to time by the Board of Directors. Installments of Regular Assessments shall be delinquent if not paid within fifteen (15) days following the due date, or such other date as may be established by the Board.

Section 4.03. Special Assessments.

(a) Purposes for Which Special Assessments May Be Levied. Subject to the membership approval requirements set forth in subparagraph (b), below, the Board of Directors shall have the authority to levy Special Assessments against the Owners and their Lots for the following purposes:

(i) Regular Assessment Insufficient in Amount. If, at any time, the Regular Assessment for any fiscal year is insufficient in amount due to extraordinary expenses not contemplated in the budget prepared for that fiscal year, then, except as prohibited by Section 4.02(a), above, the Board of Directors shall levy and collect a Special Assessment, applicable to the remainder of such year only, for the purpose of defraying, in whole or in part, any deficit which the Association may incur in the performance of its duties and the discharge of its obligations hereunder.

(ii) Capital Improvements. The Board may also levy Special Assessments for additional capital Improvements within the Project or Condominium Common Areas (i.e., Improvements not in existence on the date of this Declaration that are unrelated to repairs for damage to, or destruction of, the existing Common Areas or Facilities). The Special Assessment power conferred hereunder is not intended to diminish the Board's obligation to plan and budget for normal maintenance, and replacement repair of the Common Areas or existing Common Facilities through Regular Assessments (including the funding of reasonable reserves) and to maintain adequate insurance on the Common Areas and existing Common Facilities in accordance with Article X, below.

(b) Special Assessments Requiring Membership Approval. The following Special Assessments require prior membership approval in accordance with Section 4.08, below: (i) any Special Assessments which, in the aggregate, exceed five (5%) percent of the Association's budgeted gross expenses for the fiscal year in which the Special Assessment(s) is/are levied; and (ii) any Special Assessments imposed pursuant to subparagraph (a)(i) of this section when the Board has failed to distribute a budget to the Members within the time specified in Section 4.02(a), above. The foregoing Member approval requirements shall not apply, however, to any Special Assessment imposed to address any “emergency situation” as defined in Section 4.05, below.

(c) Allocation and Payment of Special Assessments. When levied by the Board or approved by the Members as provided above, the Special Assessment shall be divided among, assessed against and charged to each Owner and his or her Lot in the same manner prescribed for the allocation of Regular Assessments pursuant to subparagraph 4.02(d), above. The Special Assessment so levied shall be recorded on an Association Assessment roll.

Special Assessments for purposes described in subparagraph (a)(i) of this section shall be due as a separate debt of the Owner and a lien against his or her Lot, and shall be payable to the Association in equal quarterly installments during the remainder of the then current fiscal year, or as otherwise determined by the Board. Special Assessments for purposes described in subparagraph (a)(ii) shall be due as a separate debt of the Owner and a lien against his or her Lot, and shall be payable in full to the Association within thirty (30) days after the mailing of such notice or within such extended period as the Board shall determine to be appropriate under the circumstances giving rise to the Special Assessment.

Section 4.04. Special Individual Assessments.

(a) Circumstances Giving Rise to Special Individual Assessments. In addition to the Special Assessments levied against all Owners in accordance with Section 4.03, above, the Board of Directors may impose Special Individual Assessments against an Owner in any of the circumstances described in subparagraphs (i) through (iii) below; provided, however, that no Special Individual Assessments may be imposed against an Owner pursuant to this section until the Owner has been afforded the notice and hearing rights to which the Owner is entitled pursuant to Section 12.06. below, and, if appropriate, has been given a reasonable opportunity to comply voluntarily with the Governing Documents. Subject to the foregoing, the acts and circumstances giving rise to liability for Special Individual Assessments include the following:

(i) Damage to Project or Condominium Common Areas or Common Facilities. In the event that any damage to, or destruction of, any portion of the Common Areas or the Common Facilities, or any portions of the Lots which the Association is obligated to repair and maintain, including Exclusive Use Common Areas, is caused by the willful misconduct or negligent act or omission of any Owner, any member of his or her family, or any of his or her tenants, guests, servants, employees, licensees or invitees, the Board shall cause the same to be repaired or replaced, and all costs and expenses incurred in connection therewith (to the extent not compensated by insurance proceeds) shall be assessed and charged solely to and against such Owner as a Special Individual Assessment.

(ii) Expenses Incurred in Gaining Member Compliance. In the event that the Association incurs any costs or expenses to: (A) collect the payment of delinquent Assessments; (B) perform any repair, maintenance or replacement to any portion of the Properties that the Owner is responsible to maintain under the Governing Documents but has failed to undertake or complete in a timely fashion; or (C) otherwise bring the Owner and/or his or her Lot into compliance with any provision of the Governing Documents, the amount incurred by the Association (including, but not limited to, reasonable fines and penalties duly imposed hereunder, title company fees, accounting fees, court costs and reasonable attorneys fees) shall be assessed and charged solely to and against such Owner as a Special Individual Assessment.

(iii) Required Maintenance on Lots. If the portion of any Lot or Exclusive Use Area of Owner is required to maintain becomes a nuisance, fire or safety hazard for any reason the Association shall have the right to enter the Lot, correct the offensive or hazardous condition and recover the cost of such action through imposition of a Special Individual Assessment against the offending Owner. Any entry on the property of any Owner by the Association shall be effected in accordance with Section 3.06(b), above.

(b) Levy of Special Individual Assessment and Payment. Once a Special Individual Assessment has been levied against an Owner for any reason described, and subject to the conditions imposed in subparagraph (a) of this section, such Special Individual Assessment shall be recorded on an Association Assessment roll and notice thereof shall be delivered to the affected Owner. The Special Individual Assessment shall thereafter be due as a separate debt of the Owner and shall be payable in full to the Association within thirty (30) days after the actual or deemed delivery of notice of the Assessment, or as otherwise determined by the Board.

Section 4.05. Assessments to Address Emergency Situations. The requirement of a membership vote to approve: (a) Regular Assessment increases in excess of twenty (20%) percent of the previous year's Regular Assessment; or (b) Special Assessments which, in the aggregate, exceed five (5%) percent of the Association's budgeted gross expenses for the fiscal year in which the Special Assessment(s) is/are levied shall not apply to Assessments which are necessary to address emergency situations. For purposes of this section, an emergency situation is any of the following:

(i) An extraordinary expense required by an order of a court.

(ii) An extraordinary expense necessary to repair or maintain the Project or Condominium Common Areas, Common Facilities or any portion of the Lots which the Association is obligated to maintain where a threat to personal safety is discovered.

(iii) An extraordinary expense necessary to repair or maintain the Common Areas, Common Facilities or any portion of the Lots which the Association is obligated to maintain that could not have been reasonably foreseen by the Board in preparing and distributing the budget pursuant to Section 4.02(a), above; provided, however, that prior to the imposition or collection of an assessment under this subparagraph (iii), the Board shall pass a resolution containing written findings as to the necessity of the extraordinary expense involved and why the expense was not or could not have been reasonably foreseen in the budgeting process. The Board's resolution shall be delivered to the Members together with the notice of assessment.

Section 4.06. Purpose and Reasonableness of Assessments. Each Assessment made in accordance with the provisions of this Declaration is hereby declared and agreed to be for use exclusively: (a) to promote the recreation, health, safety and welfare of individuals residing within the Properties; (b) to promote the enjoyment and use of the Properties by the Owners and their families, tenants, invitees, licensees, guests and employees; and (c) to provide for the repair, maintenance, replacement and protection of the Project and Condominium Common Areas and Common Facilities and those portions of the Lots which the Association is obligated to maintain.

Section 4.07. Exemption of Certain of the Properties From Assessments. The following real property subject to this Declaration shall, unless devoted to the use as a residential dwelling, be exempt from the Assessments and the lien thereof provided herein:

(a) Any portion of the Properties dedicated and accepted by a local public authority;

(b) The Project Common Areas and Common Facilities; and

(c) Any Lot owned by the Association (unless the Residence on the Lot is being rented during the term of the Association’s Ownership).

Section 4.08. Notice and Procedure for Member Approval Pursuant to Sections 4.02 and 4.03. If Member approval is required in connection with any increase or imposition of Assessments pursuant to Sections 4.02 and 4.03, above, the affirmative vote required to approve the increase shall be a Majority of a Quorum of the Members. The quorum required for such membership action shall be a majority of the Members.

Section 4.09. Maintenance of Assessment Funds.

(a) Bank Accounts. All sums received or collected by the Association from Assessments, together with any interest or late charges thereon, shall be promptly deposited in one or more federally insured checking, savings or money market accounts in a bank or other financial institution selected by the Board of Directors. In addition, the Board shall be entitled to make prudent investment of reserve funds in insured certificates of deposit, money market funds or similar investments consistent with the investment standards normally observed by trustees. The Board and such officers or agents of the Association as the Board shall designate shall have exclusive control of said account(s) and investments and shall be responsible to the Owners for the maintenance at all times of accurate records thereof. The withdrawal of funds from Association reserve accounts shall be subject to the minimum two signature requirements imposed by California Civil Code Section 1365.5 and Section 12.02 of the Bylaws. Any interest received on deposits shall be credited proportionately to the balances of the various Assessment fund accounts maintained on the books of the Association as provided in subparagraph (b), below.

(b) Expenditure of Assessment Funds. Except as provided below, the proceeds of each Assessment shall be used only for the purpose for which such Assessment was made, and such funds shall be received and held in trust by the Association for such purpose. Notwithstanding the foregoing, the Board, in its discretion, may make appropriate adjustments among the various line items in the Board's approved general operating budget if the Board determines that it is prudent and in the best interest of the Association and its Members to make such adjustments. If the proceeds of any Special Assessment exceed the requirement of which such Assessment was levied, such surplus may, in the Board's discretion, be: (i) returned proportionately to the contributors thereof; (ii) reallocated among the Association's reserve accounts if any such account is, in the Board's opinion, underfunded; or (iii) credited proportionately on account of the Owners' future Regular Assessment obligations.

(c) Separate Accounts; Commingling of Funds. To preclude a multiplicity of bank accounts, the proceeds of all Assessments may be commingled in one or more accounts and need not be deposited in separate accounts so long as the separate accounting records described herein are maintained, except that reserve assessment funds shall be deposited and maintained in one or more separate reserve accounts. For purposes of accounting, but without requiring any physical segregation of assets, the Association shall keep a separate accounting of all funds received by it in payment of each Assessment and of all disbursements made therefrom; provided, however, that receipts and disbursements of Special Assessments made pursuant to Section 4.03(a)(i), above, shall be accounted for together with the receipts and disbursements of Regular Assessments, and a separate accounting shall be maintained for each capital improvement for which reserve funds for replacement are required to be maintained by the Association.

Unless the Association is exempt from federal or state taxes, all sums allocated to capital replacement funds shall be accounted for as contributions to the capital of the Association and as trust funds segregated from the regular income of the Association or in any other manner authorized by law or regulations of the Internal Revenue Service and the California Franchise Tax Board that will prevent such funds from being taxed as income of the Association.

(d) Reserve Funds. The Board shall not expend funds designated as reserve funds for any purpose other than the repair, restoration, replacement, or maintenance of, or litigation involving the repair, restoration, replacement, or maintenance of, major components of the Properties which the Association is obligated to repair, restore, replace, or maintain and for which the reserve fund was established. However, the Board may authorize the temporary transfer of money from a reserve fund to the Association's general operating fund to meet short-term cash-flow requirements or other expenses, provided the Board has made a written finding, recorded in the Board's minutes, explaining the reasons that the transfer is needed, and describing when and how the money will be repaid to the reserve fund.

The transferred funds shall be restored to the reserve fund within one year of the date of the initial transfer, except that the Board may, upon making a finding supported by documentation that a temporary delay would be in the best interests of the Properties, temporarily delay the restoration. The Board shall exercise prudent fiscal management in delaying restoration of these funds and in restoring the expended funds to the reserve account, and shall, if necessary, levy a Special Assessment to recover the full amount of the expended funds within the time limits required by this subparagraph (d). This Special Assessment is subject to the Member approval requirements of California Civil Code section 1366 and Section 4.03(b), above, if the aggregate amount of the Special Assessment exceeds five percent (5%) of the budgeted gross expenses of the Association for the year in which the Special Assessment is imposed. The Board may, at its discretion, extend the date the payment on the Special Assessment is due. Any extension shall not prevent the Board from pursuing any legal remedy to enforce the collection of an unpaid Special Assessment.

When the decision is made to use reserve funds or to temporarily transfer money from the reserve fund to pay for litigation, the Association shall notify the Members of that decision by posting on the Association Internet Website, and in the next available mailing or document delivery to all Members pursuant to California Corporations Code Section 5016, and of the availability of an accounting of those expenses. The Association shall make an accounting of expenses related to the litigation on at least a quarterly basis. The accounting shall be made available for inspection by Members at the Association's principal office.

Section 4.10. Collection of Assessments; Enforcement of Liens. The Association may elect to pursue one or both of the following remedies in the event of a delinquent assessment. Regardless of whether one or both of the following remedies are pursued by the Association, delinquent Owners shall be given the Notice re Assessments and Foreclosure required by Civil Code section 1365.1, and notice of their Informal Dispute Resolution Rights (IDR) under Civil Code sections 1363.810 - 1363.850, and the Alternative Dispute Resolution Rights (ADR) that may apply under Civil Code sections 1369.510 - 1369.590. Delivery of such notices shall be by personal delivery, or first-class and certified mail. Delivery may be made by electronic means in addition to, but not in lieu of, personal or postal delivery, even if consent to electronic delivery has been given by the delinquent Owner.

(a) Personal Obligation. The Association may bring a legal action directly against the Owner for breach of the Owner’s personal obligation to pay the assessment and in such action shall be entitled to recover the delinquent assessment or assessments, accompanying late charges, interest, costs and reasonable attorneys’ fees. Commencement of a legal action shall not constitute a waiver of any lien rights as described in subparagraph (b), below.

(b) Assessment Lien. Except as otherwise provided in Section 4.04, above, with respect to the limitation on the imposition of liens for Special Individual Assessments, the Association may impose a lien against the Owner’s Lot for the amount of the delinquent assessment or assessments, plus any reasonable costs of collection (including reasonable attorneys fees), late charges and interest after Delivery of a Pre-Lien Delinquency Notice and following the procedures required by Civil Code section 1367.1 - 1367.6.

(i) The amount of the Assessment, plus any costs of collection, late charges, and interest assessed in accordance with Civil Code section 1366 shall be a lien on the Owner’s Lot from and after the time the Association causes to be recorded with the County Recorder a Notice of Delinquent Assessment, which shall state the amount of the Assessment and other sums imposed in accordance with Civil Code section 1366, a legal description of the Owner’s Lot against which the Assessment and other sums are levied, the name of the record owner of the Owner’s Lot against which the lien is imposed. In order for the lien to be foreclosed by non-judicial foreclosure, the Notice of Delinquent Assessment shall state the name and address of the trustee authorized by the Association to enforce the lien by sale. The Notice of Delinquent Assessment shall be signed by any officer of the Association or by any person designated by the Association for that purpose and mailed in the manner set forth in Civil Code section 2924b to all record owners of the Owner’s Lot no later than ten (10) calendar days after recordation. Within twenty-one (21) days of the payment of the sums specified in the Notice of Delinquent Assessment, the Association shall record or cause to be recorded in the Office of the County Recorder a lien release or notice of rescission and provide the Lot Owner a copy of the lien release or notice that the delinquent assessment has been satisfied.

(ii) A lien created pursuant to this section, above, be prior to all other liens recorded against the Owner’s Lot subsequent to the Notice of Delinquent Assessment, except as described in Section 4.12, below.

(iii) Subject to the limitations of this Section 4.10(b), after the expiration of thirty (30) days following the recording of a Notice of Delinquent Assessment, the lien may be enforced in any manner permitted by law, including sale by the court, sale by the trustee designated in the notice of delinquent assessment, or sale by a trustee substituted pursuant to Civil Code section 2934a. Any sale by the trustee shall be conducted in accordance with Civil Code sections 2924, 2924b and 2924c applicable to the exercise of powers of sale in mortgages and deeds of trusts. The fees of a trustee may not exceed the amounts prescribed in Civil Code sections 2924c and 2924d.

(iv) The provisions of this Section 4.10(b) are intended to comply with the requirements of Civil Code section 1367.1 in effect as of January 1, 2003, and sections 1367.4, 1367.5, and 1367.6 in effect as of the date of recording of this Second Amended Declaration. If those sections are amended or rescinded in any manner, the provisions of this Section 4.10(b) shall be automatically amended or rescinded in the same manner.

Section 4.11. Transfer of Lot by Sale or Foreclosure. The following rules shall govern the right of the Association to enforce its Assessment collection remedies following the sale or foreclosure of a Lot:

(a) Except as provided in subparagraph (b), below, the sale or transfer of any Lot shall not affect any Assessment lien which has been duly recorded against the Lot prior to the sale or transfer, and the Association can continue to foreclose its lien in spite of the change in ownership.

(b) The Association's Assessment lien shall be extinguished as to all delinquent sums, late charges, interest and costs of collection incurred prior to the sale or transfer of a Lot pursuant to a foreclosure or exercise of a power of sale by the holder of a prior encumbrance (but not pursuant to a deed-in-lieu of foreclosure). A “prior encumbrance” means any first Mortgage or other Mortgage or lien recorded against the Lot at any time prior to Recordation of the Association's Assessment lien (see Section 4.12, below).

(c) No sale or transfer of a Lot as the result of foreclosure, exercise of a power of sale, or otherwise, shall relieve the new Owner of such Lot (whether it be the former beneficiary of the first Mortgage or other prior encumbrance or a third party acquiring an interest in the Lot) from liability for any Assessments which thereafter become due with respect to the Lot or from the lien thereof.

(d) No sale or transfer of a Lot as the result of foreclosure, exercise of a power of sale, or otherwise, shall affect the Association's right to maintain an action against the foreclosed previous Owner personally to collect the delinquent Assessments, late charges, interest and associated costs of collection incurred prior to and/or in connection with the sale or transfer.

Section 4.12. Priorities. When a Notice of Delinquent Assessment has been recorded, such notice shall constitute a lien on the Lot prior and superior to all other liens or encumbrances recorded subsequent thereto, except: (a) all taxes, bonds, assessments and other levies which, by law, would be superior thereto; and (b) the lien or charge of any first Mortgage of Record (meaning any recorded Mortgage with first priority over other Mortgages) made in good faith and for value; provided, however, that such subordination shall apply only to the Assessments which have become due and payable prior to the transfer of such property pursuant to the exercise of a power of sale or a judicial foreclosure involving a default under such first Mortgage or other prior encumbrance.

Section 4.13. Unallocated Taxes. In the event that any taxes are assessed against the Common Area, or the personal property of the Association, rather than being assessed to the Lots, such taxes shall be included in the Regular Assessments imposed pursuant to Section 4.02, above, and, if necessary, a Special Assessment may be levied against the Lots in an amount equal to such taxes to be paid in two (2) installments, thirty (30) days prior to the due date of each tax installment.

ARTICLE V
Architectural Control

Section 5.01. Approval of Improvements by Board.

(a) Approval Generally. Before commencing construction or installation of any Improvement within the Properties, the Owner planning such Improvement must submit a written request for approval to the Architectural Review Committee. The Owner's request shall include plans and specifications that comply with the requirements of Architectural Rules adopted by the ARC and approved by the Board. The ARC may hold hearings and otherwise review proposed improvement projects and make recommendations to the Board on the proposed improvement projects. The ARC’s decision shall be deemed to be recommendations to the Board, which shall be placed on the agenda for confirmation, modification, or denial at the next regular or specially scheduled Board meeting. The Board shall maintain final authority to approve, deny, or require modifications to any proposed projects. Unless the Board's approval of the proposal is first obtained, no work on the Improvement shall be undertaken. The Board shall base its decision to approve, disapprove or conditionally approve the proposed Improvement on the criteria described in Section 5.05, below.

(b) ARC Jurisdiction, Definition of “Improvement”. In general, the Association has architectural review and control authority over remodeling or construction work that can be seen or heard from outside an Owner’s Lot. More specifically, the term “Improvement” as used herein includes, without limitation, the construction, installation, alteration or remodeling of any buildings, walls, fences, landscaping, skylights, television satellite reception dishes, utility lines, elevators or other structures of any kind. However, changes to the interior of a Residence shall not be considered an Improvement, as defined herein, unless they involve any structural alteration of a load bearing wall or feature within a Residence, any portion of a Condominium Common Area, plumbing, electrical, gas or other utilities, or the penetration of an exterior wall or roof, including but not limited to venting of appliances or mechanical equipment through exterior walls, foundations, or roofs, whether or not an existing or new vent is utilized or installed.

Section 5.02. Composition of the Architectural Review Committee. The Committee shall be composed of not less than three (3) nor more than seven (7) Members appointed by the Board. In selecting Members for the Committee, the Board shall endeavor to select individuals whose occupations, experience, or education will provide technical knowledge and expertise relevant to matters within the Committee's jurisdiction. The Committee must include at least one (1) licensed architect who is either an Association member and volunteer, or a paid architect to act as a consultant for the Association at the expense of the applicant, if no volunteer architect has been serving on the Committee. The Architectural Rules may exempt projects that are eligible for expedited review procedures from the requirements of an applicant paying for an architectural consultant for the Association. Committee members shall serve two-year terms subject to the Board's power to remove any Committee member and to appoint his or her successor. Neither the members of the Committee nor its designated representatives (except a paid architectural consultant) shall be entitled to any compensation for services performed pursuant hereto. The Committee shall have those powers which are specifically designated by the Board in the resolution establishing the Committee or the Architectural Rules.

Section 5.03. Abatement of Unauthorized Work. If it comes to the knowledge and attention of the Board that a work of Improvement, or any modification thereof, is proceeding without proper approval, the Association shall be entitled to exercise the enforcement remedies specified in Section 5.06, below, including, without limitation, ordering an immediate cessation and abatement of all aspects of the work of Improvement until such time as proper architectural review and approval is obtained.

Section 5.04. Architectural Rules. The ARC may from time to time recommend, and the Board of Directors may adopt, amend and repeal rules and regulations to be known as “Architectural Rules.” The Architectural Rules shall interpret and implement the provisions hereof and may address any subjects related to construction and modifications of improvements within the Development including, but not limited to: (a) the standards and procedures for architectural review, including, but not limited to, the required content of Improvement plans and specifications, neighbor notification requirements, timelines and hearing and appeal procedures; (b) guidelines for architectural design, placement of any work of Improvement or color schemes, exterior finishes and materials and similar features which are recommended or required for use in connection with particular Improvement projects within the Properties; and (c) the criteria and procedures for requesting variances from any property use restrictions that would otherwise apply to the proposed Improvement under the Governing Documents. Notwithstanding the foregoing, no Architectural Rule shall be in derogation of the minimum standards required by this Declaration. In the event of any conflict between the Architectural Rules and this Declaration, the provisions of the Declaration shall prevail. If the right to adopt Architectural Rules is delegated to the Committee, any such rule shall not become effective until it has been approved by the Board consistent with the Member notice and comment rights and other requirements of Civil Code section 1357.100-1357.150.

Section 5.05. Basis for Approval of Improvements. When a proposed work of Improvement is submitted to the ARC and Board of Directors for review, the ARC shall recommend, and the Board shall grant, the requested approval only if, in its sole discretion, the Board finds that all of the following provisions have been satisfied:

(a) The Owner's plans and specifications: (i) conform to this Declaration and to the Architectural Rules in effect at the time such plans are submitted to the Board; (ii) will result in the construction of an Improvement that is in harmony with the external design of other structures and/or landscaping within the Properties; and (iii) will not interfere with the reasonable enjoyment of any other Owner of his or her property, including, without limitation, the other Owner's rights: 1) to enjoy scenic and solar access free of unreasonable obstructions; 2) to be free of unreasonable noise and/or vibration from appliances, mechanical equipment, audio and/or video equipment, and similar noise sources; and

(b) The proposed Improvement(s), if approved, will otherwise be consistent with the architectural and aesthetic standards prevailing within the Properties and with the overall plan and scheme of development and the purposes of this Declaration.

In approving a request for construction of an Improvement, the ARC may recommend, and the Board may condition, approval upon the adoption of modifications in the plans and specifications or observance of restrictions as to location, noise abatement or similar mitigating conditions.

Section 5.06. Enforcement of Architectural Compliance Matters.

(a) In addition to other enforcement remedies set forth in this Declaration, the Board shall have enforcement rights with respect to any matters required to be submitted to and approved by it, and may enforce such architectural control by any proceeding at law or in equity. In addition, the Board may, in its sole discretion, and subject to the notice and hearing requirements of the Governing Documents, order an abatement of any construction, alteration or other matter for which approval is required, to the extent that it has not been approved by the Board or if it does not conform to the plans and specifications submitted to and approved by the Board. No Improvement Project for which approval is required pursuant to this Article V shall be deemed to be approved simply because it has been completed without a complaint, notice of violation, or commencement of a suit to enjoin such work. If any legal proceeding is initiated to enforce any of the provisions hereof, the prevailing party shall be entitled to recover reasonable attorneys' fees in addition to the costs of such proceeding.

(b) The approval by the Board of any plans, drawings or specifications for any work of Improvement done or proposed, or for any other matter requiring the Board's approval under this Article, or any waiver thereof, shall not be deemed to constitute a waiver of any right to withhold approval of any similar plan, drawing, specification or matter subsequently submitted for approval by the same or some other Owner. The Board shall be entitled to determine that a proposed Improvement or component thereof is unacceptable when proposed on a particular Lot, even if the same or a similar Improvement/component has previously been approved for use at another location within the Properties, if factors such as drainage, topography, unreasonable noise or vibration, or visibility from roads, Common Areas or other Lots, or prior adverse experience with the product or components used in construction of the Improvement, design of the Improvement or its use at other locations within the Properties, militate against erection of the Improvement or use of a particular component thereof on the Lot involved in the Owner's submittal.

Section 5.07. Variances. The ARC may recommend, and the Board may, in its sole discretion, allow reasonable variances in any procedures specified in this Article, or in any land use restrictions specified in Article VII to overcome practical difficulties, avoid unnecessary expense or prevent unnecessary hardship to any Owner-applicant, as more particularly provided in the ARC Rules.

Section 5.08. Limitation on Liability. Neither the Association nor the Board or the ARC or any member thereof, shall be liable to any Owner for any damage, loss or prejudice suffered or claimed on account of any mistakes in judgment, negligence or nonfeasance arising out of: (a) the approval or disapproval of any plans, drawings and specifications, whether or not defective; (b) the construction or performance of any work, whether or not pursuant to approved plans, drawings or specifications; provided, however, that such member has acted in good faith on the basis of such information as he or she possessed.

Section 5.09. Procedures for Expansion of Exclusive Use Areas

(a) The Board may grant an Owner, without a Member vote, the right to expand the Owner’s deck or patio that is appurtenant to the Owner’s Residence Lot into the Project Common Area and use such area as Exclusive Use Common Area, so long as the proposed deck expansion complies with all of the following terms and conditions: (a) the proposed expansion shall be subject to the ARC approval process specified in this Article; (b) any proposed expansion must conform to design guidelines specified in the Architectural Rules; (c) no deck expansion shall exceed twelve (12) feet in depth from the exterior wall of the subject building; (d) any proposed expansion must include permissible building materials, required permits, and the design of the decks including railings and railing heights must be in accordance with the specifications and requirements of the Architectural Rules; (e) if the Residence Lot for which the expansion is sought shares a party wall with another Residence Lot, then the Owner of such contiguous Residence Lot (or Lots if party walls exist on both sides of the subject Residence Lot) shall have agreed to the proposed expansion; (f) all costs of the expansion including any costs incurred by the ARC or the Association in approving or inspecting the deck expansion and in the enforcement of provisions of this Section shall be borne by the Owner of the Unit undertaking such expansion; (g) although the Owner must pay the cost of construction of the expanded deck, no monetary consideration from the Owner to the Association will be required for the grant of the right to use of the Exclusive Use Common Area; and (h) for insurance purposes, the expanded deck will be treated as a Project Common Area Improvement, and covered by the Association’s master policies.

(b) Any other proposed expansion of an existing Exclusive Use Area, or other grant of new exclusive use of any portion of the any Common Area, is subject to the requirements of Civil Code section 1363.07, except that the required Member vote percentage shall be a majority of the voting power of the Members, rather than sixty-seven percent (67%) of the Members. The Architectural Rules developed by the Board may further clarify the requirements for expansion of existing or the grant of new Exclusive Use Areas, including specifying a different or lower member vote requirement for such new or expanded EUAs, subject to the Member notice and comment rights and other requirements of Civil Code section 1357.100-1357.150.

Section 5.10. Compliance With Governmental Regulations. Review and approval by the Board of any proposals, plans or other submittals pertaining to Improvements shall in no way be deemed to constitute satisfaction of, or compliance with, any building permit process or any other governmental requirements, the responsibility for which shall lie solely with the Owner who desires to construct, install or modify the Improvement.

ARTICLE VI
Association and Owner Maintenance Responsibilities

Section 6.01. Project Common Area and Common Facilities. The Association shall be solely responsible for all maintenance, repair, upkeep and replacement of all portions of the Project Common Area and all Common Facilities. No person other than the Association or its duly authorized agents shall construct, reconstruct, refinish, alter or maintain any Improvement upon, or shall create any excavation or fill or change the natural or existing drainage of any portion of the Project Common Area. In addition, no person shall remove any tree, shrub or other vegetation from, or plant any tree, shrub, or other vegetation upon the Project Common Area without express approval of the Association.

Section 6.02. Association Maintenance Responsibility With Respect to Townhouse Lot Improvements. Except as expressly set forth herein or in the Architectural Rules, the Association shall provide exterior maintenance upon each Townhouse Residence and Lot which is subject to Assessment hereunder, as follows:

(a) Paint, stain, repair, replace and care for the exterior building surfaces of all Townhouse Residences, including roofs, gutters, fences, down spouts, scuppers, exterior walls, foundations, decks and carports, including the Exclusive Use Areas of decks and carports; provided, however, that the Association shall not be responsible for the repair and replacement of exterior doors, screen doors, or hardware and glass surfaces, and other items listed at Section 6.04;

(b) Replace and care for trees, shrubs, grass, walks, and other landscaping Improvements, including those Exclusive Use Areas located within fenced yards; and

(c) Maintain the underground utilities, including sewer, water and electrical lines, whether located within the boundaries of the Owner's Lot or under the Project Common Area, to the point where they enter the exterior of the Townhouse Residence.

(d) Owners may take on additional maintenance responsibilities for exterior improvements, such as windows or skylights, when they or their contractors perform exterior repairs or remodeling, as may be more particularly set forth in the Architectural Rules.

Section 6.03. Association Maintenance Responsibility with Respect to Condominium Units. The Association shall be responsible for all maintenance, repair, upkeep and replacement of all portions of the Condominium Common Area as defined at Section1.10 of this Declaration, including Condominium Exclusive Use Areas as defined at Section 1.19b. hereof, except for internal or external telephone or television wiring designed to serve the Owner’s single separate Unit, and as specifically set forth in Section 6.04 below (Owner Maintenance Responsibilities).

Section 6.04. Owner Maintenance Responsibilities.

(a) Townhouse Owners shall be responsible for the maintenance and repair of the glass surfaces, glass doors, windows, screens and screen doors, other exterior doors, window fixtures and hardware, and the interior of his or her Residence, and the plumbing, electrical, heating, air conditioning systems, and other utilities servicing his or her Residence from the point where the systems and/or utilities enter the exterior wall of the Owner's Residence. Owners with carports are also responsible for interior maintenance and repair of cabinets and other interior improvements, from the surface of the interior walls in.

(i) Except in the enclosed patio areas appurtenant to a Residence, no planting or gardening shall be done on any Lot, and there shall be no exterior painting of Residences, nor repair or replacing of roofs or utility laterals, by or on behalf of the Owners thereof, it being the intention hereunder that such items be maintained and replaced by the Association in conjunction with the latter's maintenance responsibilities in order to preserve the external harmony and uniformity of appearance of Residence structures within the Properties.

(b) Condominium Unit Owners shall be responsible for maintenance and repair of all elements that are defined as a part of their Condominium Unit, at Section 1.15, and underground utilities, including sewer, water and electrical lines, from the point where they enter their Condominium Unit.

Section 6.05. Snow Removal Responsibilities. The Association is responsible for snow removal on all portions of the Project Common Area and all Common Facilities. On the Residence Lots, the Association is responsible for snow removal of the uncovered portion of the main entry into the units, i.e., the front steps or landing area, to provide access to the units. The Owner is responsible for snow and ice removal from rear decks or entry steps.

Section 6.06. Maintenance Responsibility Rules. The Board may enact rules that more specifically define the maintenance responsibility of the Association and the Owners, consistent with the Member notice and comment rights and other requirements of Civil Code section 1357.100-1357.150.

Section 6.07. Association Recovery of Costs of Certain Repairs and Maintenance.

(a) Association Maintenance Necessitated by Owner Negligence. If the need for maintenance or repair, which would otherwise be the Association's responsibility hereunder, is caused through the willful or negligent acts of an Owner, his or her family, guests, tenants, or invitees, and is not covered or paid for by insurance policies maintained by the Association, the cost of such maintenance or repairs shall be subject to recovery by the Association through the imposition of a Special Individual Assessment against the offending Owner in accordance with Section 4.04, above.

(b) Owner Defaults in Maintenance Responsibilities. If an Owner fails to perform maintenance or repair functions for which he or she is responsible, the Association may give written notice to the offending Owner with a request to correct the failure within fifteen (15) days after receipt of the Association’s notice. If the Owner refuses or fails to perform any necessary repair or maintenance, the Association may exercise its rights under Section 3.06(b), above, to enter the Owner's Lot and perform the repair or maintenance so long as the Owner has been given notice and the opportunity for a hearing in accordance with Section 12.06, below.

Section 6.08. Cooperative Maintenance Obligations. To the extent necessary or desirable to accomplish the Association's maintenance and repair obligations hereunder, individual Owners shall cooperate with the Association and its agents and maintenance personnel in the prosecution of the Association’s work.

ARTICLE VII
Use of Properties and Restrictions

In addition to the restrictions established by law or Association Rules promulgated by the Board of Directors pursuant to Section 3.07, above, the following restrictions are hereby imposed upon the use of Lots, Common Areas and other parcels within the Properties.

Section 7.01. Lots. Each Residence Lot shall be conveyed as a separately designated and legally described fee simple estate subject to this Declaration.

Section 7.02. Project Common Area. The Project Common Area shall be used only for recreational purposes and other purposes incidental and ancillary to the use of Residence Lots.
please see First Amendment to the Second Amended and Restated Declaration of Conenants, Conditions and Restrictions

Section 7.03. No Individual Piers. No individual piers, beach houses, boat houses, or similar improvements shall be constructed on any Residence Lot or the Project Common Area, unless approved by Member vote under Civil Code section 1363.07, and all applicable public entities.

Section 7.04. Prohibition of Nuisance or Noxious Activities. No illegal, noxious or offensive activities shall be carried out or conducted upon any Lot or Project Common Area nor shall anything be done within the Properties which is or could become an unreasonable annoyance or nuisance to neighboring property Owners. Without limiting the foregoing, no Owner shall permit noise, including, but not limited to barking dogs, unreasonable noise from temporary or permanently installed mechanical devices, such as furnaces, air conditioner units, and fans, stereo amplifier systems, television systems, motor vehicles or power tools, to emanate from an Owner's Lot or from activities within the Project Common Area, which would unreasonably disturb any other Owner's or tenant's enjoyment of his or her Lot or the Project Common Area. The Board may enact reasonable noise standards by Rule, in compliance with the Member notice and comment rights and other requirements of Civil Code section 1357.100-1357.150.

Section 7.05. Temporary Structures. No structure of a temporary character, trailer, mobile home, camper, tent, shack, garage or other outbuilding shall be used on any Lot at any time as a Residence, either temporarily or permanently.

Section 7.06. Household Pets. No animal of any kind shall be raised, bred, kept, used for commercial purposes, or allowed to pass over or upon any Lot within Chinquapin except as hereinafter set forth:

(a) Owners in residence may keep household pets (household variety birds, cats or dogs) when accompanied by the Owner. The Owner, or owners collectively, of each Residence Lot shall not keep or maintain more than two (2) pets within Chinquapin.

(b) At all times when outside Residence Lots, dog(s) must be on a leash, one end of which must be attached to an Owner and the other to a dog(s); dogs must always be under the Owner’s control and not disturbing others.

(c) Owners shall be responsible for the prompt pick-up and disposal of, in a sanitary manner, solid pet wastes left by their pets within Chinquapin.

(d) No guests, tenants, invitees, employees, independent contractors, vendors, renters or others shall bring pets to or within Chinquapin.

(e) No dog may be tethered or left on any porch, patio or deck or contiguous lawn area unless the Owner is present and capable of controlling the pet.

(f) Cats must be kept within the Residence Lot unless they are on a leash.

(g) Each person bringing or keeping a pet on the Properties shall be solely responsible for the conduct of the owner's pets. The Association, its Board, officers, employees and agents shall have no liability (whether by virtue of this Declaration or otherwise) to any Owners, their family members, guests, invitees, tenants and contract purchasers for any damage or injury to persons or property caused by any pet.

(h) The Board of Directors shall have the right to establish and enforce additional rules and regulations imposing additional standards for the reasonable control and keeping of household pets in, upon and around the Properties to ensure that the same do not interfere with the quiet and peaceful enjoyment of the Properties by the other Owners and residents.

Section 7.07 Signs. No advertising signs or billboards shall be displayed on any Lot or posted within or upon any portion of the Common Area except that Owners may post on their Lots any signs required by legal proceedings and a single “For Rent,” “For Lease” or “For Sale” sign of reasonable dimensions. Signs permitted hereunder shall not be nailed to the exterior of any Residence or staked in any lawn or green area in front of any Residence. Directional signs of real estate brokers advertising Lots for sale or lease shall only be allowed within the Common Area or roadways within the Properties in strict compliance with applicable Association Rules.

Section 7.08. Business Activities. No business or commercial activities of any kind whatsoever shall be conducted in any Residence, or in any portion of any Lot without the prior written approval of the Board; provided, however, the foregoing restriction shall not apply to the activities, signs or activities of the Association in the discharge of its responsibilities under the Governing Documents. Furthermore, no restrictions contained in this section shall be construed in such a manner so as to prohibit any Owner from: (a) maintaining his or her personal library in his or her Residence; (b) keeping his or her personal business records or accounts therein; (c) handling his or her personal or professional telephone calls or correspondence therefrom; (d) leasing or renting his or her Residence in accordance with Section 2.04, above, (e) conducting a home business through the use of computers, facsimile transmissions and other electronic media, so long as the business involves no signage, unusual noise or customer traffic; or (f) conducting any other activities on the Owner's Lot otherwise compatible with residential use and the provisions of this Declaration which are permitted under applicable zoning laws or regulations without the necessity of first obtaining a special use permit or specific governmental authorization so long as any such activity does not involve exterior signage or create customer traffic within the Properties. The uses described in (a) through (f), above, are expressly declared to be customarily incidental to the principal residential use and not in violation of this section.

Section 7.9. Garbage. No rubbish, trash, or garbage shall be allowed to accumulate outside of the exterior of any Residence on any Lots. At various locations within the Properties, the Association maintains, and shall continue to maintain, bear-proof garbage can enclosures. Residents shall deposit any garbage which is not retained within a Residence in these enclosures or take such garbage to a location outside of the Properties. Any extraordinary accumulation of rubbish, trash, garbage or debris (such as debris generated upon vacating of premises or during the construction of modifications and Improvements) shall be removed from the Properties to a public dump or trash collection area by the Owner or tenant at his or her expense. The Association shall be entitled to impose reasonable fines and penalties for the collection of garbage and refuse disposed in a manner inconsistent with this section.

Section 7.10. Storage. Storage of personal property on any Lot shall be entirely within enclosed storage areas. There shall be no woodpiles nor storage piles accumulated on top, or outside, of any enclosed storage area, although residents shall be entitled to stack fire wood on the porches and patio areas of the Owner's Residence in compliance with Association Rules. The Association shall have the right to establish and maintain on the premises appropriate storage yards and storage buildings for the maintenance of materials and equipment used by the Association in connection with its planting, building, repair, maintenance and preservation of the structures, gardens and other Improvements within the Common Areas and any portion of the Lots which the Association is obligated to repair and maintain.

Section 7.11. Clotheslines. No exterior clothesline shall be erected or maintained and there shall be no drying or laundering of clothes on any Lot in a manner which is visible from any neighboring Lot or the Common Area.

Section 7.12. Radio and Television Antennas. No outside television antenna, aerial, or other similar device (collectively “video antennas”) with a diameter or diagonal measurement in excess of 36 inches shall be erected, constructed or placed on any Common Area or Lot. Video antennas with a diameter or diagonal measurement of 36 inches or less may be installed only if approved by the Board in accordance with Article V, above. Reasonable restrictions which do not significantly increase the cost of any authorized video antenna system or significantly decrease its efficiency or performance may be included in the Architectural Rules.

Section 7.13. Burning. There shall be no exterior fires whatsoever except gas barbecue fires located only upon Lots and contained within receptacles designed for such purpose, unless specifically allowed by Association Rules.

Section 7.14. Sports Apparatus. The erection of basketball standards or other fixed sports apparatus is prohibited.

Section 7.15. Machinery and Equipment. No machinery or equipment of any kind shall be placed, operated or maintained upon or adjacent to any Lot except such machinery or equipment as is usual or customary in connection with the use, maintenance or repair of a private Residence or appurtenant structures within the Properties. All such machinery or equipment must comply with noise and other Rules or standards established by the Association.

Section 7.16. Diseases and Pests. No Owner shall permit any thing or condition to exist upon his or her Lot which shall induce, breed, or harbor infectious plant diseases, rodents or noxious insects.

Section 7.17. Parking and Vehicle Restrictions. The following parking and vehicle restrictions shall apply within the Properties:

(a) All driveways and carports shall be maintained in a neat and orderly condition.

(b) Carports are considered Exclusive Use Common Areas of the Residence they are attached to. They are to be used solely for the parking of standard passenger vehicles and pickup trucks and shall not be converted to living quarters or work shops or used for the storage of any recreational vehicles or trailers, except as specifically allowed by Association Rules.

(c) No motor vehicle shall be constructed, reconstructed or repaired within the Properties and no dilapidated or inoperable vehicle, including vehicles without wheel(s) or an engine, shall be stored on the Properties; provided, however, that the provisions of this section shall not apply to emergency vehicle repairs.

(d) Campers, boats, trailers, motorcycles, commercial vehicles and trucks in excess of three-quarter tons are not to be parked within the Properties, unless specifically allowed by Association Rules.

(e) The Board shall have the authority to tow, at the Owner's expense, any vehicle parked or stored in violation of this section. The Board shall post such notices or signs within the Common Area as may be required by law to effectuate this towing provision.

(f) These parking and vehicle restrictions do not apply to vehicles or equipment owned by the Association or contractors employed by it.

(g) The Board shall have the authority to promulgate further reasonable rules and restrictions of uniform application regarding parking and use of vehicles within the Properties.

Section 7.19. Use of Private Streets in Common Area. Private streets within the Properties shall not be used for recreational purposes, including “joy riding” or racing. The Rules developed by the Board may include reasonable speed limits and other facilities or improvements intended to control vehicle speeds within Chinquapin.

Section 7.20. Children. Each Owner and resident shall be accountable to the remaining Owners and residents, their families, visitors, guests and invitees, for the conduct and behavior of their children and any children temporarily residing in or visiting the Owner's/resident and for any property damage caused by such children.

Section 7.21. Activities Affecting Insurance. Nothing shall be done or kept on any Lot or within any Residence or the Common Areas which will increase the rate of insurance relating thereto on any policy maintained by the Association (see Article X, below) without the prior written consent of the Association and no Owner shall permit anything to be done or kept on his or her Lot or within his or her Residence or the Common Area which would cause any Improvements to be uninsurable against loss by fire or casualty or result in the cancellation of insurance on any Residence or any part of the Common Area. In the event an Owner does or permits anything on his or her lot that causes an increase in the cost of the Association’s insurance premiums, the Board may, after notice and hearing as required by Section 12.06, require the Owner to pay any such increase in cost as a “Special Individual Assessment”.

Section 7.22. Variances. Upon application by any Owner, the Board of Directors shall be authorized and empowered to grant reasonable variances from the property use restrictions set forth in this Article, if specific application of the restriction will, in the sole discretion of the Board, either cause an undue hardship to the affected Owner or fail to further or preserve the common plan and scheme of development contemplated by this Declaration. In considering and acting upon any request for a variance, the Board shall follow the procedures for the granting of architectural variances.

Section 7.23. Enforcement of Property Use Restrictions. The objective of this Declaration shall be to promote and seek voluntary compliance by Owners and tenants with the environmental standards and property use restrictions contained herein. Accordingly, in the event that the Association becomes aware of an architectural or property use infraction that does not necessitate immediate corrective action under Section 12.06, below, and any Rules adopted consistent therewith, the Owner or Tenant responsible for the violation will generally receive written notice thereof and shall be given a reasonable opportunity to comply voluntarily with the pertinent Governing Document provision(s). Any such notice shall describe the noncomplying condition, request that the Owner or tenant correct the condition within a reasonable time specified in the notice, and advise the Owner or tenant of his or her appeal rights.

ARTICLE VIII
Easements

Section 8.01. Encroachment Easements. Each Lot is hereby declared to have an easement over adjoining Lots and the Project Common Area for the purpose of accommodating any encroachment due to roof overhang and fences or walls which are built in accordance with the original design, plans and specifications of Declarant, and due to engineering errors, errors in original construction, settlement or shifting of the building, or similar causes. There shall be valid easements for the maintenance of these encroachments as long as they shall exist, and the rights and obligations of the Owner shall not be altered in any way by the encroachment, settlement or shifting; provided, however, that in no event shall a valid easement for encroachment be created in favor of an Owner or Owners if the encroachment occurs due to the willful misconduct of the Owner or Owners. In the event a structure is partially or totally destroyed, and is repaired or rebuilt, the Owners of each adjoining Lot agree that minor encroachments over adjoining Lots shall be permitted and that there shall be valid easements for the maintenance of the encroachments so long as they shall exist.

Section 8.02. Street Easements. Each Owner and the Association shall have and is hereby granted a nonexclusive easement for street, roadway and vehicular traffic purposes over and along the private streets and paved parking areas within the Properties.

Section 8.03. Blanket Utility Easement. There is hereby created a blanket easement upon, across, over and under all of the Properties for ingress, egress, installation, replacing, repairing and maintaining all utilities, including but not limited to water, sewers, gas, telephones, drainage and electricity and any master television antenna or cable television system. By virtue of this easement, it shall be expressly permissible for the providing utility company to erect and maintain the necessary equipment and underground facilities on the Project Common Area. Notwithstanding the foregoing, no sewer, electrical lines, water lines, or other utilities may be installed or relocated on the Properties except as initially designed and approved by the ARC and the Board of Directors. The easements provided for in this section shall in no way affect any other recorded easement on the Properties.

Section 8.04. Maintenance Easements. An easement is hereby granted to the Association, its officers, agents, employees, and to any management company or contractor selected by the Association to enter in or to cross over the Project Common Area and any Lot to perform the Association's duties of maintenance and repair of the Lots, Common Areas, or Common Facilities.

Section 8.05. Boundary Changes. An easement shall exist for use and maintenance as Project Common Area over any portion of a Lot which, because of a change in the boundary of a private structure, including a fence, wall or patio, at the time of original construction lies between that boundary and a Lot line abutting the Project Common Area.

Section 8.06. Other Easements. Each Lot and its Owner, and the Association as to the Common Areas, are hereby declared to be subject to all the easements, dedications and rights-of-way granted or reserved in, on, over and under the Properties and each Lot and Common Area as shown on the Subdivision Map.

ARTICLE IX
Insurance

Section 9.01. Types of Insurance Coverage. The Association shall purchase, obtain and maintain, with the premiums therefor being paid out of Common Funds, the following types of insurance, if and to the extent, in the opinion of the Board, such insurance, with the coverages described below, is available at a reasonable premium cost:

(a) Property Insurance. The Association shall obtain and maintain a master or blanket policy written on an all risk, replacement cost basis, covering all Residence Lots, Common Areas and Common Facilities. The insurance shall be kept in full force and effect at all times and the full replacement value of the insured property shall be redetermined on an annual basis. The policies maintained by the Association pursuant to this section shall contain an agreed amount endorsement or no co-insurance clause, and a contingent liability from operation of building laws endorsement or the equivalent. The policies required hereunder shall name as insured the Association, all Owners and all Mortgagees as their respective interests may appear, and include a waiver of subrogation as set forth at Section 9.02 below. The policies may contain a loss payable endorsement in favor of the trustee described in Section 9.08 below.

(i) “Point of Origin” Determines Responsibility for Damage Repairs and Related Costs Not Covered by Insurance

For normal repair and maintenance, the allocation of responsibility for repairs and maintenance in the Governing Documents, determines whether the Association or the Unit Owner is responsible for performing and paying for such normal maintenance or repairs. However, in cases involving repair or restoration resulting from damage, such as water damage, that is not covered by insurance, the maintenance responsibility for the ‘point of origin’ of the cause of the damage, determines responsibility for the cost of the uninsured repairs. All uninsured costs of any investigation that may be necessary to determine the actual ‘point of origin’ of the damage, along with uninsured remediation work or testing that is appropriate in the opinion of the Board, will also be the responsibility of the party that has maintenance responsibility for the ‘point of origin’.

(b) General Liability Insurance. To the extent such insurance is reasonably obtainable, a “full occurrence” type policy of comprehensive public liability and property damage insurance naming as parties insured the Association, each member of the Board of Directors, any manager, the Owners and occupants of Lots, and such other persons as the Board may determine. The policy will insure each named party against any liability incident to the ownership and use of the Common Areas and include a waiver of subrogation as set forth at Section 9.02 below. The limits of such insurance shall not be less than the minimum amounts required by California Civil Code Sections 1365.7 and 1365.9 (currently One Million Dollars ($1,000,000)), covering all claims for death, personal injury and property damage arising out of a single occurrence. Such insurance shall include, if reasonably obtainable in the Board’s discretion, liability for non-owned and hired automobiles, liability for property of others and any other liability or risk customarily covered with respect to projects similar in construction, location and use.

(c) Directors' and Officers' Liability Insurance. To the extent such insurance is reasonably obtainable, the Association shall purchase a policy or policies of insurance providing individual liability protection to persons serving as directors, officers or committee members of the Association from claims arising out of or pertaining to negligent acts or omissions of such persons in their official capacities. The limits of such insurance shall be not less than One Million Dollars ($1,000,000).

(d) If the Association has any “employees,” workers’ compensation insurance as required by law.

(e) Additional Insurance and Bonds. To the extent such insurance is reasonably obtainable, the Association may also purchase with Common Funds such additional insurance and bonds as it may, from time to time, determine to be necessary or desirable, including, without limiting the generality of this section, earthquake insurance, flood insurance, and ‘umbrella’ insurance. The Board may also purchase and maintain fidelity bonds or insurance in amounts the Board believes to be sufficient to protect the Association’s interests.

Section 9.02 Waiver of Subrogation. To the extent it does not impair the coverage provided by the policy, any insurance maintained by the Association shall contain a “waiver of subrogation” as to the Association and its officers, Directors and Members, the Owners and Occupants of the Units, and Mortagees, and, if obtainable, a cross-liability or severability of interest endorsement insuring each insured against liability to each other insured.

All individually owned insurance shall contain a waiver of subrogation as to the Association and its officers, directors and Members, the Owners and Occupants of the Units, and Mortagees. All Members are deemed to have waived subrogation rights as to the Association and other Members, whether or not their policies so provide.

Section 9.03 Independent Contractor Insurance. Unless exempted by the Board, all independent contractors who contract with the Association shall be required to carry general liability insurance written on a “full occurrence” basis, automobile liability coverage and workers’ compensation coverage, and shall indemnify the Association for any claims from such independent contractor or independent contractor’s employees, with regard to claims for liability and workers’ compensation claims arising from any services performed for or on behalf of the Association by such independent contractors. Unless exempted by the Board, independent contractors shall be required to carry a minimum of One Million Dollars ($1,000,000) per occurrence, Two Million Dollars ($2,000,000) general aggregate, and Two Million Dollars ($2,000,000) products completed operations aggregate under the general liability requirements, and to name the Association as an additional insured for their work. Independent contractors shall also carry a minimum of One Million Dollars ($1,000,000) combined single limit for auto liability covering all owned, hired, and non-owned automobiles.

Section 9.04. Limitation on Liability. The Association, and its Directors and officers, shall have no liability to any Owner or Mortgagee if, after a good faith effort, it is unable to obtain the insurance required hereunder, because the insurance is no longer available or, if available, can be obtained only at a cost that the Board in its sole discretion determines is unreasonable under the circumstances, or the Members fail to approve any Assessment increase needed to fund the insurance premiums. In such event, the Board shall immediately notify each Member that the insurance will not be obtained or renewed. At the request in writing of five percent (5%) or more of the Members, the Board shall make provisions for a vote of the members of the Association to uphold or reverse the decision of the Board to cancel or to not renew any insurance the Association is required to carry by this Declaration.

Section 9.05. Copies of Policies. Copies of all insurance policies (or certificates thereof), shall be retained by the Association and shall be available for inspection by Owners at any reasonable time.

Section 9 06. Owners Separate Insurance. The insurance maintained by the Association generally will not cover the personal property in the Residences, may not cover some interior improvements, and will not cover personal liability for damages or injuries occurring in the Units. Each Owner shall insure his personal property and any improvements within the Residence that are not covered by the Association’s Property Insurance Policy referenced at Section 9.01(a). Owners should also obtain personal liability insurance in amounts as they desire. Any diminution in insurance proceeds otherwise payable under any Association policy that results from the existence of insurance carried by an Owner, will be chargeable to the insurance policy of the Owner who acquired such insurance. Notwithstanding anything to the contrary herein, any liability or property insurance carried by Owners to cover damages or injuries occurring in the Owner’s Unit or on their Lot, shall pay for any deductibles payable under any Association insurance policies, regardless of the cause of the loss. The Association will advise all Owners at least annually of the insurance carried by the Association consistent with Civil Code Section 1365(f). It is the Owner’s responsibility to ensure that all individual insurance policies carried by them are consistent with the requirements of this Article.

Section 9.07 Owner Responsibility for Premium Increase. In the event an Owner’s act or omission causes an increase in the Association’s insurance policy premiums, the Board may, after notice and hearing as required by Section 12.06, require the Owner to pay such increase in cost as a Special Individual Assessment under Section 4.04(a)(ii).

Section 9.08. Trustee. All insurance proceeds payable under Section 9.01, above, and subject to the rights of the Mortgagees under Section 9.10, below, may, in the discretion of the Board of Directors, be paid to a trustee to be held and expended for the benefit of the Owners, Mortgagees and others, as their respective interests shall appear. The trustee shall be a commercial bank in the County that agrees in writing to accept such trust.

Section 9.09. Adjustment of Losses. The Board is appointed attorney-in-fact by each Owner to negotiate and agree on the value and extent of any loss under any policy carried pursuant to Section 9.01, above. The Board is granted full right and authority to compromise and settle any claims or enforce any claim by legal action or otherwise and to execute releases in favor of any insured.

Section 9.10. Distribution to Mortgagees. Subject to the provisions of Article XIII, any Mortgagee has the option to apply insurance proceeds payable on account of a Lot in reduction of the obligation secured by the Mortgage of such Mortgagee.

ARTICLE X
Damage or Destruction

Section 10.01. Destruction; Proceeds Exceed Eighty-Five (85%) Percent of the Reconstruction Costs. If there is a total or partial destruction of any Residence or Common Facility Improvements within the Properties, and if the available proceeds of the insurance maintained pursuant to Article X are sufficient to cover not less than eighty-five (85%) percent of the costs of repair and reconstruction, the Improvements shall be promptly rebuilt unless, within ninety (90) days from the date of destruction, seventy-five (75%) percent of the “eligible Members” (as defined in Section 10.04, below), determine that such repair and reconstruction shall not take place. If repair and reconstruction is to take place, the Board shall be required to execute, acknowledge and Record, not later than one hundred twenty (120) days from the date of such destruction, a certificate declaring the intention of the Members to rebuild.

Section 10.02. Destruction; Proceeds Less Than Eighty-Five (85%) Percent of Reconstruction Costs. If the proceeds of insurance are less than eighty-five (85%) percent of the cost of repair and reconstruction, repair and reconstruction may nevertheless take place, if, within ninety (90) days from the date of destruction, eligible Members then holding at least fifty-one (51%) percent of the total voting power, determine that such repair and reconstruction shall take place, the Board shall be required to execute, acknowledge and Record, not later than one hundred twenty (120) days from the date of such destruction, a certificate declaring the intention of the Members to rebuild.

Section 10.03. Rebuilding Procedures. If the eligible Members determine to rebuild, pursuant to Section 10.01 or 10.02, above, the Owner of each Lot located within a structure that has been totally or partially destroyed shall be obligated to contribute his or her proportionate share of the cost of reconstruction or restoration of the structure containing his or her Lot, over and above the available insurance proceeds. Owners shall contribute their proportionate share of the cost of reconstruction or restoration of any portion of the Common Area based upon the ratio the square footage of the floor area of his or her Lot bears to the total square footage of the floor area of all Lots. If any Owner fails or refuses to pay his or her proportionate share, the Board may levy a Special Individual Assessment against the Lot of such Owner which may be enforced under the lien provisions contained in Article IV or in any other manner provided in this Declaration.

If any Owner disputes the amount of his or her proportionate liability under this section, such Owner may contest the amount of his or her liability by submitting to the Board within ten (10) days after notice to the Owner of his or her share of the liability, written objections supported by cost estimates or other information that the Owner deems to be material and may request a hearing before the Board at which the Owner may be represented by counsel. Following such hearing, the Board shall give written notice of its decision to all Owners, including any recommendation that adjustments be made with respect to the liability of any Owners. If such adjustments are recommended, the notice shall schedule a special meeting of Members for the purpose of acting on the Board's recommendation, including making further adjustments, if deemed by the Members to be necessary or appropriate. All adjustments shall be affirmed or modified by fifty-one (51%) percent of the total voting power of the eligible Members. If no adjustments are recommended by the Board, the decision of the Board shall be final and binding on all Owners, including any Owner filing objections.

Section 10.04. Definition of “Eligible Members” Entitled to Vote. For purposes of any vote pursuant to this Article, the Members eligible to vote shall be: (a) the requisite percentage of the total voting power of the Association in the case of any damage or destruction of Common Facilities; and (b) in the case of any damage to, or destruction of, any Residence or Residences, the requisite percentage shall be of those members whose Residences are located in the damaged or destroyed structure(s). Any membership vote required hereunder shall be conducted either at a duly convened meeting at which a quorum is present or by written ballot conducted in accordance with Section 4.06 of the Bylaws, and the Association’s Election Rules.

Section 10.05. Rebuilding Contract. If the Members who are eligible to vote on the matter determine to rebuild, the Board shall reconstruct the damaged or destroyed portions of the Properties substantially in accordance with the original plan. The Board or its authorized representative shall obtain bids from at least two (2) reputable contractors and shall award the repair and reconstruction work to the Contractor the Board finds to be, in its discretion, the lowest responsible bidder. The Board shall have the authority to enter into a written contract with the contractor for such repair and reconstruction, and the insurance proceeds held by the trustee shall be disbursed to the contractor according to the terms and conditions of the agreement. It shall be the obligation of the Board to take all steps which are necessary or appropriate to assure the commencement and completion of authorized repair and reconstruction at the earliest possible date.

Section 10.06. Rebuilding Not Authorized. If the Members who are eligible to vote on the matter determine not to rebuild, then any insurance proceeds then available for rebuilding shall be used or distributed as follows:

(a) If, prior to the expiration of one hundred twenty (120) days from the date of destruction, seventy-five (75%) percent of all Owners and institutional first Mortgagees with Mortgages encumbering the affected Lots within the Properties consent by vote or in writing, the Board acting on behalf of the Association shall have the right to purchase the Lots which were rendered uninhabitable by such damage or destruction at the fair market value thereof immediately prior to the damage or destruction (as determined by an appraiser), using the available proceeds of insurance for such purpose. “Fair market value” for purposes of this subsection is defined as the cost to rebuild the improvements as they existed immediately prior to the damage or destruction, plus the land value after such damage or destruction. The Board's decision as to whether or not a Lot is uninhabitable shall be final and binding on all parties. Any payment of the purchase price shall be made jointly to the selling Owner and all Mortgagees of his or her Lot and each Owner by accepting a deed to a Lot agrees to be bound by these provisions and to sell his or her Lot by grant deed to the Association as provided herein. Concurrently with such purchase, the Board or individuals authorized by the Board, acting as attorney-in-fact of all Owners shall amend the Subdivision Map and this Declaration to eliminate from the Properties the Lots so purchased.

(b) Notwithstanding the determination of eligible Members not to rebuild pursuant to Section 10.01 or 10.02, above, any Lots which are not rendered uninhabitable shall be repaired and restored to a condition as near as possible to their condition immediately before such damage or destruction. Such repair and restoration shall be paid first, from the insurance proceeds remaining after the purchase of Lots pursuant to subparagraph (a), of this section, if any, and second, from a Special Individual Assessment levied against all remaining Owners in the manner described in Section 10.04, above.

(c) If the required seventy-five (75%) percent of all Owners and institutional first Mortgagees do not consent to purchase the Lots which were rendered uninhabitable, an appraiser shall determine the relative fair market values of all Lots in the Properties, as of a date prior to any damage or destruction and the proceeds of insurance shall be apportioned among all Owners, and their respective Mortgagees, in proportion to such relative values. The Board shall have the duty, within one hundred twenty (120) days from the date of destruction, to execute, acknowledge and Record a certificate declaring the intention of the Members not to rebuild.

Section 10.07. Minor Repair and Reconstruction. In any case, the Board shall have the duty to repair and reconstruct Improvements, without the consent of Members and irrespective of the amount of available insurance proceeds, in all cases of partial destruction when the estimated cost of repair and reconstruction does not exceed an amount which does not exceed five (5%) percent of the Association’s budgeted gross expenses (computed for the year when the uninsured funds must be collected as a Special Assessment). Any amounts paid by the Board up to and including the limit stated in the preceding sentence (the “5% cap”) shall be assessed to the Lots which are damaged upon the basis of the ratio of the square footage of the floor area of the Lot to be assessed to the total square footage of the floor area of all Lots to be assessed. In the case of damage to Common Facilities which does not exceed the 5% cap all Lots shall be assessed for an equal portion of any uninsured expense.

Section 10.08. Appraiser. Wherever in this Article or Article XI (Condemnation) reference is made to a determination of the value or fair market value of one (1) or more Lots by an appraiser, this shall mean an appraisal by an independent appraiser selected by the Board, who shall be a member of the Society of Real Estate Appraisers (SREA) or other nationally recognized appraiser organization and who shall apply its or such other organization's standards in determining the value or fair market value of each Lot. The costs of such appraisals shall be paid from the sale or insurance proceeds, as the case may be.

ARTICLE XI
Condemnation

Section 11.01. Sale by Unanimous Consent or Taking. If an action for condemnation of all or a portion of the Properties is proposed or threatened by any governmental agency having the right of eminent domain, then, on unanimous written consent of all of the Owners and all institutional Mortgagees, the Properties, or a portion thereof may be sold and conveyed to the condemning authority by the Board or its designees acting as the attorney-in-fact of all Owners under an irrevocable power of attorney, which each Owner by accepting a deed to a Lot in the Properties hereby grants and which shall be coupled with the interest of all other Owners, for a price deemed fair and equitable by the Board. If the requisite number of Owners or institutional Mortgagees do not consent to a sale of all or a portion of the Properties, and the condemning authority institutes condemnation proceedings, the court shall fix and determine the condemnation award.

Section 11.02. Distribution and Sale Proceeds of Condemnation Award.

(a) Total Sale or Taking. A total sale or taking of the Properties means a sale or taking: (i) that renders more than fifty (50%) percent of the Lots uninhabitable (such determination to be made by the Board in the case of a sale and by the court in the case of a taking); or (ii) that renders the Properties as a whole uneconomical as determined by the vote or written consent of sixty-six and two-thirds (66-2/3%) percent of those Owners and their respective institutional Mortgagees whose Lots will remain habitable after the taking. However, any determination that a sale or taking is total must be made before the proceeds from any sale or award are distributed. The proceeds of any such total sale or taking of the Properties, after payment of all expenses relating to the sale or taking, shall be paid to all Owners and to their respective Mortgagees in the proportion that the fair market value of each Lot bears to the fair market value of all Lots on the Properties. The fair market value of Lots shall be determined in the condemnation action, if such be instituted, or by an appraiser.

(b) Partial Sale or Taking. In the event of a partial sale or taking of the Properties, meaning a sale or taking that is not a total taking as determined in Section 11.02(a), above, the proceeds from the sale or taking shall be paid or applied in the following order of priority and any judgment of condemnation shall include the following provisions as part of its terms:

(i) To the payment of expenses of the Association in effecting the sale or to any prevailing party in any condemnation action to whom such expenses are awarded by the Court to be paid from the amount awarded; then

(ii) To Owners and to their respective Mortgagees, as their interests may appear, of Lots on the Properties whose Lots have been sold or taken, an amount up to the fair market value of such Lots as determined by the court in the condemnation proceeding or by an appraiser, less such Owners' share of expenses paid pursuant to Section 11.02(b)(i) (which share shall be in proportion to the ratio that the fair market value of each Owner's Lot bears to the fair market value of all Lots). After such payment, the recipient shall no longer be deemed an Owner and the Board or individuals authorized by the Board, acting as attorney-in-fact of all Owners shall amend the Subdivision Map and this Declaration to eliminate from the Properties the Lots so sold or taken; then

(iii) To any remaining Owner and to his or her Mortgagees, as their interest may appear, whose Lot has been diminished in value as a result of the sale or taking disproportionate to any diminution in value of all Lots, as determined by the Court in the condemnation proceeding or by an appraiser, an amount up to the total diminution in value; then

(iv) To all remaining Owners and to their respective Mortgagees, as their interest may appear, the balance of the sale proceeds or award in proportion to the ratio that the fair market value of each remaining Owner's Lot bears to the fair market value of all remaining Owners' Lots as of a date immediately prior to commencement of condemnation proceedings, as determined by the Court in the condemnation proceeding or by an appraiser.

ARTICLE XII
Breach and Default

Section 12.01. Remedy at Law Inadequate. Except for the nonpayment of any Assessment, it is hereby expressly declared and agreed that the remedy at law to recover damages for the breach, default or violation of any of the covenants, conditions, restrictions, limitations, reservations, grants of easements, rights, rights-of-way, liens, charges or equitable servitudes contained in this Declaration are inadequate and that the failure of any Owner, tenant, occupant or user of any Lot, or any portion of the Common Area or Common Facilities, to comply with any provision of the Governing Documents may be enjoined by appropriate legal proceedings instituted by any Owner, the Association, its officers or Board of Directors, or by their respective successors in interest.

Section 12.02. Nuisance. Without limiting the generality of the foregoing Section 12.01, the result of every act or omission whereby any covenant contained in this Declaration is violated in whole or in part is hereby declared to be a nuisance, and every remedy against nuisance, either public or private, shall be applicable against every such act or omission.

Section 12.03. Attorneys' Fees. So long as the prevailing party substantially complies with the Informal Dispute Resolution (IDR), and/or Alternative Dispute Resolution (ADR) procedures required by the Governing Documents and/or applicable law, reasonable attorneys' fees and costs, including expert witness fees and attorneys’ fees and costs incurred in enforcing any arbitration award or judgment, shall be awarded to the prevailing party in any procedure to enforce the Governing Documents or a party's rights arising under the Governing Documents.

Section 12.04. Cumulative Remedies. The respective rights and remedies provided by this Declaration or by law shall be cumulative, and the exercise of any one (1) or more of such rights or remedies shall not preclude or affect the exercise, at the same or at different times, of any other such rights or remedies for the same or any different default or breach or for the same or any different failure of any Owner or others to perform or observe any provision of this Declaration.

Section 12.05. Failure Not a Waiver. The failure of any Owner, the Board of Directors, the Association or its officers or agents to enforce any of the covenants, conditions, restrictions, limitations, reservations, grants or easements, rights, rights-of-way, liens, charges or equitable servitudes contained in this Declaration shall not constitute a waiver of the right to enforce the same thereafter, nor shall such failure result in or impose any liability upon the Association or the Board, or any of its officers or agents.

Section 12.06. Rights and Remedies of the Association.

(a) Rights Generally. In the event of a breach or violation of any Association Rule or of any of the restrictions contained in any Governing Document by an Owner, his or her family, or the Owner's guests, employees, invitees, licensees, or tenants, the Board, for and on behalf of all other Owners, may enforce the obligations of each Owner to obey such Rules, covenants, or restrictions through the use of such remedies as are deemed appropriate by the Board and available in law or in equity, including but not limited to the hiring of legal counsel, the imposition of fines and monetary penalties, the pursuit of legal action, or the suspension of the Owner's right to use the Project Common Area and/or Common Facilities or suspension of the Owner's voting rights as a Member; provided, however, the Association's right to undertake disciplinary action against its Members shall be subject to the conditions set forth in this section.

The decision of whether it is appropriate or necessary for the Association to take enforcement or disciplinary action in any particular instance shall be within the sole discretion of the Board or its duly authorized enforcement committee.

(b) Enforcement by Individual Owners. Civil Code section 1354 authorizes enforcement of the Governing Documents by individual Owners. However, an Owner must first file a complaint with the Board, or any committee designated by it to review such complaints, and may not file litigation or arbitration to enforce the Governing Documents, until the Owner’s complaint has been considered and approved or rejected by the Board or such committee, or until sixty (60) days after the filing of such written complaint with the Board or committee, whichever occurs first. Any litigation or arbitration filed by an Owner to enforce the Governing Documents is subject to the Alternative Dispute Resolution (ADR) requirements of Civil Code section 1369.510, et seq.

(c) Schedule of Fines. The Board may implement a schedule of reasonable fines and penalties for violations of the Governing Documents. Once imposed, a fine or penalty may be collected as a Special Individual Assessment.

(d) Definition of “Violation”. A violation of the Governing Documents shall be defined as a single act or omission occurring on a single day. If the detrimental effect of a violation continues for additional days, discipline imposed by the Board may include one component for the violation and, according to the Board's discretion, a per diem component for so long as the detrimental effect continues. Similar violations on different days shall justify cumulative imposition of disciplinary measures. The Association shall take reasonable and prompt action to repair or avoid the continuing damaging effects of a violation or nuisance occurring within the Common Area at the cost of the responsible Owner.

(e) Limitations of Disciplinary Rights.

(i) The Association shall have no power to cause a forfeiture or abridgment of an Owner's right to the full use and enjoyment of his or her Residence Lot due to the failure by the Owner (or his or her family members, tenants, guests or invitees) to comply with any provision of the Governing Documents or of any duly enacted Association Rule, except where the loss or forfeiture is the result of the judgment of a court of competent jurisdiction, a decision arising out of arbitration or a foreclosure or sale under a power of sale for failure of the Owner to pay Assessments levied by the Association, or where the loss or forfeiture is limited to a temporary suspension of an Owner's rights as a Member of the Association or the imposition of monetary penalties for failure to pay Assessments or otherwise comply with any Governing Documents so long as the Association's actions satisfy the due process requirements of subparagraph (iii), below.

(ii) Although the Association may record a lien for monetary penalties imposed by the Association: (A) for failure of a Member to comply with the Governing Documents; (B) as a means of reimbursing the Association for costs incurred by the Association in the repair of damage to the Common Area or Common Facilities allegedly caused by a Member; or (C) in bringing the Member and his or her Lot into compliance with the Governing Documents, the lien against a Member's Lot cannot be enforced by a sale of the Lot by a nonjudicial foreclosure; provided, however, that this limitation on the Association's lien rights shall not apply to charges imposed against an Owner consisting of reasonable late payment penalties to reimburse the Association for the loss of interest and for costs reasonably incurred (including attorneys' fees) in the Association's efforts to collect delinquent Assessments.

(iii) No disciplinary action, penalty or temporary suspension of rights shall be imposed pursuant to this Article unless the Owner alleged to be in violation is given at least ten (10) days prior notices by personal delivery or first-class mail, that the Board of Directors will be meeting to consider imposing such discipline. The notice shall contain at a minimum, the date, time, and place of the meeting, the nature of the alleged violations for which the Owner may be disciplined, and a statement that the Owner has a right to attend and address the Board at the hearing. Hearings may be conducted by telephone or other electronic means as provided in the Association’s Bylaws and/or Rules. The Board shall meet in executive session if requested by the Owner.

If disciplinary action is taken, the Board shall notify the accused Owner, in writing, either by personal delivery or first-class mail, of the Board's decision within fifteen (15) days following conclusion of the hearing.

In accordance with Civil Code section 1363(h), disciplinary action shall not be effective against an Owner unless the Board fulfills the requirements of this section.

Notwithstanding the foregoing, under circumstances involving conduct that constitutes: (A) an immediate and unreasonable infringement of, or threat to, the safety of any persons or the quiet enjoyment of neighboring Owners; (B) a traffic or fire hazard; (C) a threat of material damage to, or destruction of, the Project or Condominium Common Areas or any Common Facilities; or (D) a violation of the Governing Documents that is of such a nature that there is no material question regarding the identity of the violator or whether a violation has occurred (such as parking a boat at the Association pier in violation of Association Rules or parking violations, glass beverage containers in the pool, sauna, or other restricted areas, or unreasonably loud, offensive, or threatening behavior by identified individuals), the Board of Directors, or its duly authorized agents, may undertake immediate corrective or disciplinary action, by among other things, evicting identified persons from the Project Common Area or Common Facilities or towing vehicles or moving such boats in conformance with this Declaration or any Rules enacted pursuant to it. After such immediate corrective or disciplinary action upon request of the offending Owner (which request must be received by the Association, in writing, within five (5) days following the Association's disciplinary action), or on its own initiative, conduct a hearing as soon thereafter as reasonably possible.

If the Association acts on its own initiative to schedule a hearing, notice of the date, time and location of the hearing shall accompany the notice of disciplinary action. If the accused Owner desires a hearing, a written request therefor shall be delivered to the Association no later than five (5) days following the date when the fine is levied.

The hearing shall be held no more than fifteen (15) days following the date of the disciplinary action or fifteen (15) days following receipt of the accused Owner's request for a hearing, whichever is later. Under such circumstances, any fine or other disciplinary action shall be held in abeyance and shall only become effective if affirmed at the hearing.

Hearings may be conducted by telephone or other electronic means as provided in the Association’s Bylaws and/or Rules. At the hearing, the accused shall be given the opportunity to be heard, including the right to present evidence and to present or question witnesses. The Board shall notify the accused Owner, in writing, of the Board's decision within five business days following conclusion of the hearing. In no event shall the effective date of any disciplinary action commence sooner than five (5) days following conclusion of the hearing unless: (i) the hearing merely affirms summary disciplinary action initiated pursuant to the immediately preceding paragraph; or (ii) earlier commencement is necessary to preserve the quiet enjoyment of other residents or to prevent further damage to, or destruction of, the Properties or any portion thereof.

(iv) The notice and hearing procedures set forth in this Section 12.06 shall not apply to any actions by the Association or its duly authorized agents to collect delinquent assessments. Assessment collections shall be subject to Section 4.10, above, and any other notice, hearing and/or dispute resolution requirements or procedures as may be specifically applicable by law to Association assessment collection.

(f) Notices. Any notice required by this Article shall, at a minimum, set forth the date and time for the hearing, a brief description of the action or inaction constituting the alleged violation of the Governing Documents and a reference to the Governing Document provision(s) alleged to have been violated. The notice shall be in writing and may be given by personal delivery or mail. If notice is given by mail it shall be sent by first-class or certified mail sent to the last address of the Member shown on the records of the Association and shall be deemed received five (5) days after the date of such mailing.

(g) Rules Regarding Disciplinary Proceedings. The Board shall be entitled to adopt rules that further elaborate and refine the procedures for conducting disciplinary proceedings. Such rules, when approved and adopted by the Board, shall become a part of the Association Rules.

ARTICLE XIII
Protection of Mortgagees

Section 13.01. Assessment Lien Subordinated. Any lien created or claimed under the provisions of Section 4.10, above, shall be subject and subordinate to the lien of any first Mortgage given in good faith and for value. No such Mortgagee who acquires title to any Lot by judicial foreclosure or by exercise of power of sale contained in the Mortgage shall be obligated to cure any breach of this Declaration by a former Owner of such Lot or shall be liable for any unpaid Assessments made against the Lot which accrued prior to the date the Mortgagee acquired such title. No lien created or claimed under the provisions of Section 4.10, above, shall in any way defeat, invalidate or impair the rights of any Mortgagee under any such recorded Mortgage.

Section 13.02. Default by Owner; Mortgagee's Right to Vote. In the event of a default by any Owner under a Mortgage encumbering such Owner's Lot, the Mortgagee under such Mortgage shall, upon: (a) giving written notice to the defaulting Owner; (b) Recording a Notice of Default in accordance with section 2924 of the California Civil Code; and (c) delivering a copy of such recorded Notice of Default to the Association, have the right to exercise the vote of the Owner at any regular or special meeting of the Association held only during such period as such default continues.

Section 13.03. Breach; Obligation After Foreclosure. No breach of any provision of this Declaration by the Association or any Owner shall impair or invalidate the lien of any recorded Mortgage made in good faith and for value and encumbering any Lot. The Association or its successors and assigns shall be obligated to abide by all of the covenants, conditions, restrictions, limitations, reservations, grants of easements, rights, rights-of-way, liens, charges and equitable servitudes provided for in this Declaration as it may be amended from time to time with respect to any person who acquires title to or any beneficial interest in any Lot through foreclosure, trustee's sale or otherwise.

Section 13.04. Superiority of Mortgage to Condemnation Proceeds. If any Lot, or portion thereof, or the Common Area, or any portion thereof, is made the subject of any condemnation or eminent domain proceeding, the lien of any first Mortgage shall be prior and superior to the claims of the Owners of the Lots or Common Area with respect to any distribution of the proceeds of any condemnation award or settlement.

Section 13.05. Superiority of Mortgage to Insurance Proceeds. In the event of any substantial damage to or destruction of the Improvements on any Lot, or on any part of the Common Area, the lien of any first Mortgage shall be prior and superior to the claims of the Owners of the Improvements with respect to any distribution of any insurance proceeds relating to such damage or destruction.

Section 13.06. Declaration to Conform With Mortgagee Requirements. It is the intent of this Article that this Declaration, the Articles of Incorporation, the Bylaws and the Properties in general, shall now and in the future meet all requirements of any institutional Mortgagee intending to secure its Mortgage by a Lot or necessary to purchase, guarantee, insure or subsidize any Mortgage of a Lot by the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association or the Veterans' Administration.

ARTICLE XIV
Notices

Section 14.01. Addresses for Notice. Any communication or notice of any kind permitted or required herein shall be in writing and may be served, as an alternative to personal service, by mailing the same as follows:

If to any Owner: To the address of his or her Lot or to such other address as he or she may from time to time designate in writing to the Association.

If to the Association: To the principal office of the Association, and any management company employed by it, (or to such other address as the Association may from time to time designate in writing to the Owners.

All official communications by the Association to Members, except communications regarding discipline or delinquent assessments, may be given by electronic forms of communication if the Owner has signed a consent to receive electronic communications. All notices and demands served by electronic communication shall be deemed delivered the day of transmission of the electronic communication.

Section 14.02. Personal Service Upon Co-Owners and Others. Service of a notice or demand to one of the Co-Owners of any Lot, to any general partner of a partnership which is the Owner of Record of the Lot, or to any officer or agent for service of process of a corporation which is the Owner of Record of the Lot, shall be deemed delivered to all such co-owners, to such partnership, or to such corporation, as the case may be.

Section 14.03. Deposit in United States Mails. All notices and demands served by mail shall be by first-class or certified mail, with postage prepaid, and shall be deemed delivered five (5) days after deposit in the United States mail.

ARTICLE XV
No Public Rights in the Properties

Nothing contained in this Declaration shall be deemed to be gift or dedication of all or any portion of the Properties to the general public or for any public use or purpose whatsoever.

ARTICLE XVI
Amendment of Declaration

Section 16.01. Restatements. This section describes the methods for restating the Declaration after an amendment.

(a) General. The Board has the right, by resolution without the necessity of consent by the Owners, to restate this Declaration when it has been properly amended pursuant to its requirements for amendment. Such restatement shall be effective upon execution of the restatement by any two (2) officers of the Association and its Recordation. Upon Recordation of the restatement, the restatement shall supersede the prior declaration and its amendments in their entirety, without, however, affecting the priority of the declaration in the chain of title to all Properties that are subject to it.

(b) Form of Restatement. The restatement shall restate the entire text of the original document, with these exceptions: (i) changes incorporating all amendments approved by the Owners;

(ii) changes made to rearrange or delete the text for consistency with the approved amendments; (iii) changes made to delete material no longer legally effective or legally required; (iv) the addition of a statement that the Board has authorized the restatement pursuant to this section; (v) changes made to delete any provision declared illegal by constitutional or statutory enactment, by regulation, or by controlling judicial opinion; and (vi) changes needed to distinguish the restatement from the original document, such as title, section, or subsection numbering changes.

Section 16.02. Amendment of the Declaration, Generally. This Declaration may be amended or revoked in any respect upon compliance with the following provisions:

(a) Member Approval Requirements. Except as allowed by subsections (b) and (c) hereafter, any amendment shall be approved by the vote or assent by written ballot of the holders of not less than sixty-six and two-thirds percent (66-2/3%) of the Voting Power of the Members. Notwithstanding the foregoing, the percentage of the voting power necessary to amend a specific clause or provision of this Declaration shall not be less than the percentage of affirmative votes prescribed for action to be taken under that clause.

(b) Amendments to Conform to Law. The Board may, on advice of counsel, and by a majority vote of the Board, without the requirement of a member vote to approve the amendments, make changes or amendments to the provisions of this Declaration that result from, and are consistent with, changes or amendments to any statutes that are referenced in this Declaration or are otherwise applicable to the Association by operation of law. The Board shall, within 30 days after any such amendment(s), Deliver notice of them to the Members, and may, in its discretion, restate this Declaration in its entirety, pursuant to the procedures for restatement of the Declaration at Section 16.01 hereof. The Board may also use this procedure to correct typographical or other minor errors in spelling, grammar or numbering.

(c) Right of Amendment if Requested by Governmental Mortgage Agency or Federally Chartered Lending Institutions. Anything in this Article to the contrary notwithstanding, Association reserves the right to amend all or any part of this Declaration to such an extent and with such language as may be requested by Governmental Mortgage Agencies which require such an amendment as a condition precedent to such agency's approval of this Declaration, or by any federally chartered lending institution as a condition precedent to lending funds upon the security of any Lot(s) or Parcel(s) or any portions thereof. Any such amendment shall be effectuated by the recordation, by Association, of a Certificate of Amendment duly signed by or on behalf of the authorized agents, or authorized officers of Association, as applicable, with their signatures acknowledged, specifying the Governmental Mortgage Agency, or the federally chartered lending institution requesting the amendment and setting forth the amendatory language requested by such agency or institution. Recordation of such a Certificate shall be deemed conclusive proof of the agency's or institution's request for such an amendment, and such Certificate, when recorded, shall be binding upon all of the Properties and all persons having an interest therein.

ARTICLE XVII
General Provisions

Section 17.01. Term. The covenants, conditions, restrictions, limitations, reservations, grants of easement, rights, rights-of-way, liens, charges and equitable servitudes contained in this Declaration shall run with, and shall benefit and burden the Lots and the Project and Condominium Common Areas as herein provided, and shall inure to the benefit of and be binding upon the Owners, the Association, its Board of Directors, and its officers and agents, and their respective successors in interest, for the term of sixty (60) years from the date of the Recording of this Declaration. After the expiration of the initial term, the term of this Declaration shall be automatically extended for successive periods of ten (10) years each unless, within six (6) months prior to the expiration of the initial 60-year term or any such 10-year extension period, a recordable written instrument, approved by Owners entitled to vote and holding at least a majority of the voting power of the Association terminating the effectiveness of this Declaration, is recorded.

Section 17.02. References to State Statutes. Any references in this Declaration to State Statutes shall be to the referenced statute as in effect on the date that this Declaration is recorded in the Official Records of the County. In the event that any referenced statute is subsequently amended or superseded, all such references shall thereupon mean and refer to the referenced statute as so amended, modified or superseded, so long as the amended statute continues to regulate or pertain to the same subject matter.

Section 17.03. Construction.

(a) Restrictions Construed Together. All of the covenants, conditions and restrictions of this Declaration shall be liberally construed together to promote and effectuate the fundamental concepts of the development of the Properties as set forth in this Declaration. Failure to enforce any provision hereof shall not constitute a waiver of the right to enforce that provision in a subsequent application or any other provision hereof.

(b) Restrictions Severable. Notwithstanding the provisions of subparagraph (a) above, the covenants, conditions and restrictions of this Declaration shall be deemed independent and severable, and the invalidity or partial invalidity of any provision or portion thereof shall not affect the validity or enforceability of any other provision.

(c) Singular Includes Plural. The singular shall include the plural and the plural the singular unless the context requires the contrary, and the masculine, feminine or neuter shall each include the masculine, feminine and neuter, as the context requires.

(d) Captions. All captions or titles used in this Declaration are intended solely for convenience of reference and shall not affect the interpretation or application of that which is set forth in any of the terms or provisions of the Declaration.

(e) Exhibits. All exhibits to which reference is made herein are deemed to be incorporated herein by reference, whether or not actually attached.

DATED: October 21, 2010.

CHINQUAPIN HOMEOWNERS ASSOCIATION, a California nonprofit mutual benefit corporation

By:
Kathy Payne, President

By:
Penelope V. Bauche, Secretary

First Amendment to the Second Amended and Restated Declaration of Covenants, Conditions and Restrictions
for Chinquapin Homeowners Association
(Effective December 26, 2011 - Recorded on January 19, 2012)

For inquiries please contact the appropriate Board Member or Committee Chairperson.

"Keeping Chinquapin Homeowners Informed"

URL: http://chinquapinhoa.com/ccrs.htm
Last modified: 01/27/12