BYLAWS OF FALLS SUBDIVISION HOMEOWNERS ASSOCIATION, INC.

Transcription

1 BYLAWS OF FALLS SUBDIVISION HOMEOWNERS ASSOCIATION, INC. The name of the corporation is Falls Subdivision Homeowners Association, Inc. (the Association ). SECTION 1 OBJECT 1.1 The purpose for which this Association is formed is to govern the property situated in San Miguel County, State of Colorado, known as the Falls Subdivision, a Subdivision according the recorded plat thereof at Plat Book at Pages and according to the Falls Subdivision Protective Covenants (hereinafter referred to as the Covenants ) recorded at Book at Pages of the records of San Miguel County, Colorado. 1.2 All present or future owners, tenants, future tenants or any other person owning or using the facilities of the project in any manner are subject to the regulations set forth in these Bylaws. The mere acquisition or rental of any lots or residences located thereon (hereinafter referred to as Residential Lots ) of the project or the mere act of occupancy of any of the lots will signify that these Bylaws are accepted and ratified and will be complied with. SECTION 2 MEMBERSHIP, VOTING, MAJORITY OF OWNERS, QUORUM, PROXIES 2.1. Members. Membership in the Association shall consist of the following: (a) (b) Any person acquiring an interest in the real property other than a mortgagee, beneficiary under trust deeds or as a lien claimant shall automatically become a member of this Association. On the sale or transfer of a Residential Lot by an owner, his membership shall terminate. The Declarant under the Covenants or its successors or assigns, for so long as it is an owner of any Residential Lot(s) in the project. 2.2 Voting. The voting shall be as provided for in the Covenants and in the Articles of Incorporation of the Association. 2.3 Majority of Residential Lot Owners. As used in these Bylaws, the term majority of Residential Lot owners shall mean more than fifty percent (50%) of the owners of the Residential Lots. As used in this paragraph, each Residential Lot shall be deemed to have one (1) owner Quorum. Except as otherwise provided in these bylaws, the presence in person or by proxy of more than one-half (1/2) of the votes of the membership of the Falls Subdivision Bylaws 1

2 Association shall constitute a quorum. An affirmative vote of a majority of the votes entitled to be cast at a meeting, determined by the presence of the voters or by proxy, shall be required to transact business Proxies. Votes may be cast in person or by proxy. Proxies shall be in writing and the signatures must be witnessed and acknowledged. Proxies must be filed with the secretary before the appointed time of each meeting. SECTION 3 ADMINISTRATION, MEETINGS OF MEMBERS 3.1 Association Responsibilities. The owners of the Residential Lots will constitute the Association, which will have the responsibility of administering the project through its Board of Trustees. 3.2 Place of Meetings. Meetings of the Association shall be held at such place as the Board of Trustees may determine. 3.3 Annual Meetings. The annual meeting of the Association shall be held on the first day of July of each year. At such meetings there shall be elected by ballot of the owners a Board of Trustees in accordance with the requirements of Section 4.5 of these Bylaws subject to Declarant s right to appoint the Board as set forth in the covenants. 3.4 Special Meetings. Special meetings of the Association may be called by the president, by a majority of the Board of Trustees, or by Residential Lot owners having twenty percent (20%) of the votes in the Association. No business shall be transacted at a special meeting except as stated in the notice unless by consent of threefourths (3/4) of the Residential Lot owners either in person or by proxy. 3.5 Notices. Notices of annual and special meetings shall be given by the president or secretary of the Association by regular mail addressed to the registered addresses of the owners of the Residential Lots at least fourteen (14) days but not more than sixty (60) days prior to the date set for such meeting. Any such notice shall state the date, time and place of the meeting and the items on the agenda, including the general nature of any proposed amendment to the Declaration or the Bylaws, any budget changes, and any proposal to remove an officer or member of the executive board. Waiver of notice, either in person or by proxy and signed either before, at or after the meeting, shall be a valid substitute for service. The certificate of the president or secretary that notice was duly given shall be prima facie evidence thereof. 3.6 Adjourned Meeting. If any meeting of owners cannot be organized because a quorum has not attended, the owners who are present either in person or by proxy may adjourn the meeting to a time not less than forty-eight (48) hours from the time the original meeting was called. Falls Subdivision Bylaws 2

3 3.7 Order of Business. The order of business at all meetings of the owners of Residential Lots shall be as follows: (a) (b) (c) (d) (e) (f) (g) (h) Roll call. Proof of notice of meeting or waiver of notice. Reading of minutes of preceding meeting. Reports of officers. Reports of committees. Election of trustees. Unfinished business. New business. ARTICLE IV BOARD OF TRUSTEES (Power and Meetings) 4.1 Number and Qualification. The affairs of this Association shall be governed by a Board of Trustees composed of four (4) persons. A corporation or partnership which is a member may designate one of its officers or partners to serve as a trustee if so elected or appointed to the Board. 4.2 Declarant Control. Initially the Declarant shall appoint all four Trustees. However, not later than sixty (60) days after conveyance of twenty-five percent (25%) of the Residential Lots to owners other than the Declarant, at least one member and not less than twenty-five percent (25%) of the members of the Board of Trustees must be elected by Residential Lot owners other than the Declarant. Not later than sixty (60) days after conveyance of fifty percent (50%) of the Residential Lots to owners other than the Declarant, not less than thirty-three and one-third percent (33 1/3%) of the members of the Board of Trustees must be elected by Residential Lot owners other than the Declarant. Not later than either sixty (60) days after the conveyance of seventy-five percent (75%) of the Residential Lots to owners other than the Declarant, two years after the last conveyance of a Residential Lot by the Declarant in the ordinary course of business, or two years after any right to add new Residential Lots was last exercised, the owners of the Residential Lots shall elect the entire Board of Trustees, at least a majority of whom must be Residential Lot owners other than the Declarant or designated representatives of Residential Lot owners other than the Declarant. 4.3 Power and Duties. The Board of Trustees shall have the powers and duties necessary for the administration of the affairs of the Association and for the operation and maintenance of a first-class project. 4.4 Other Powers and Duties. The Board of Trustees shall be empowered and shall have the following duties: Falls Subdivision Bylaws 3

4 (a) (b) (c) (d) (e) (f) (g) (h) To administer and enforcement the covenants, conditions, restrictions, easements, uses, limitations, obligations and all other provisions set forth in the Covenants. To establish, make and enforce compliance with such reasonable rules as may be necessary for the operation, use and occupancy of this project with the right to amend same from time to time. To keep or cause to be kept in good order, condition and repair all of the common areas and all items of common personal property, if any. To insure and keep in force insurance required to be carried by the Association as provided in the Covenants. To prepare an annual budget. Within thirty (30) days after adoption of any proposed budget for the Subdivision, the Board of Trustees shall mail, by ordinary first-class mail, or otherwise deliver a summary of the budget to all the unit owners and shall set a date for a meeting of the unit owners to consider ratification of the budget not less than fourteen (14) days or more than sixty days after mailing or other delivery of the summary. Unless at that meeting a majority of all Residential Lot owners reject the budget, the budget is ratified, whether or not a quorum is present. In the event that the proposed budget is rejected, the periodic budget last ratified by the Residential Lot owners must be continued until such time as the Residential Lot owners ratify a subsequent budget proposed by the executive board. To set aside from time to time those sums it deems expedient as a reserve fund to meet contingencies for maintaining any property of the Association and for any other Association purposes. To collect delinquent assessments by suit or otherwise and to enjoin or seek damages from an owner as is provided in the Covenants and these Bylaws. To protect and defend the entire premises from loss and damage by suit or otherwise. (i) To borrow funds only when so authorized by seventy-five percent (75%) written consent and authority of the Residential Lot owners and, when so authorized to execute all such instruments evidencing such indebtedness as is expressly authorized. Any such authorized indebtedness shall be the several obligation of all of the Residential Lot owners only in the same proportion as their voting interest in the Association. Additional liens, other than judgment liens, mechanics liens, assessments liens or tax liens, may be obtained against existing common areas only when so authorized Falls Subdivision Bylaws 4

5 by seventy-five percent (75%) written consent and authority of the Residential Lot owners or when so authorized by unanimous consent of the Board of Trustees and one hundred percent (100%) of the first mortgagees of record. (j) To enter into contracts within the scope of their duties and powers listed in Section 4.3 hereof; however, the Board of Trustees, when so delegating, shall not be relieved of its responsibility under the Covenants. Any management agreement shall be subject to the terms of the Covenants. 4.5 Election and Term of Office. Subject to Declarant s rights to appoint the Board set forth in the Covenants and Section 4.2 of these Bylaws, at the organizational meeting of the Association, the initial trustees of the corporation shall be elected for a term which will expire on the first annual meeting of the Association. At each annual meeting, a Board of Trustees shall be elected by and from the Residential Lot owners for a term of one (1) year; and they shall serve until their successors have been elected and hold their first meeting. 4.6 Vacancies. Vacancies in the Board of Trustees by any reason other than the removal of a trustee by a vote of the Association shall be filled by vote of the majority of the remaining Trustees, even though they may constitute less than a quorum, and each person so elected shall be a trustee until a successor is elected in the next annual meeting of the Association. 4.7 Removal of Trustees. Subject to Declarant s rights to appoint the Board set forth in the Covenants and Section 4.2 of these Bylaws, at any regular meeting or at any special meeting called for that purpose, any one (1) or more of the Trustees may be removed with or without cause by a two-thirds (2/3) vote of all persons present and entitled to vote at any meeting of the owners at which a quorum is present, and a successor then and there may be elected to fill the vacancy thus created. Any trustee whose removal has Been proposed by the owners shall be given an opportunity to be heard at the meeting. 4.8 Organizational Meeting. The first meeting of a newly elected Board of Trustees shall be held within ten (10) days of election at such place as shall be fixed by the Trustees at the meeting at which such Trustees were elected, and no notice shall be necessary to the newly elected Trustees in order legally to institute such meeting, providing a majority of the whole board shall be present. In lieu of an organizational meeting, the Board of Trustees may sign a unanimous consent to the taking of actions as if an actual organizational meeting had been held. 4.9 Regular Meetings. Regular meetings of the Board of Trustees may be held at such time and place as shall be determined from time to time by a majority of the Trustees, and at least two (2) such meetings of the Board of Trustees shall be given to each trustee personally or by mail, telephone, or telegraph at least three (3) days prior to the day named for such meeting. Falls Subdivision Bylaws 5

6 4.10 Special Meetings. Special meetings of the Board of Trustees may be called by the president on three (3) days notice to each trustee given personally or by mail, telephone or telegraph, which notice shall state the time, place (as hereinabove provided) and purpose of the meeting. Special meetings of the Board of Trustees shall be called by the president or secretary in like manner and on like notice on the written request of at least two (2) Trustees Waiver of Notice. Before, at or after any meeting of the Board of Trustees, any trustee may, in writing, waive notice of such meeting; and such waiver shall be deemed equivalent to the giving of such notice. Attendance by a trustee at any meeting of the board shall be a waiver of notice by him of the time and place thereof. If all the Trustees are present at any meeting of the board, no notice shall be required, and any business may be transacted at such meeting Quorum. At all meetings of the Board of Trustees, a majority thereof shall constitute a quorum for the transaction of business, and the acts of the majority of the Trustees present at a meeting at which a quorum is present shall be the acts of the Board of Trustees. If, at any meeting of the Board of Trustees, there is less than a quorum present, the majority of those present may adjourn the meeting from time to time. At any such adjourned meeting any business which may have been transacted at the meeting as originally called may be transacted without further notice Fidelity Bonds. The Board of Trustees may require that all officers and employees of the Association handling or responsible for the Association funds shall furnish adequate fidelity bonds. The premiums on such bonds shall be paid by the Association Duties of Declarant upon Termination of Control. Within sixty (60) days after the Residential Lot owners other than Declarant elect a majority of the members of the executive board, the Declarant shall deliver to the Association all property of the Residential Lot owners and of the Association held by or controlled by the Declarant, including without limitation the following items: (a) (b) The original or a certified copy of the recorded Declaration as amended, the Association s Articles of Incorporation, Bylaws, minute books, other books and records, and any rules and regulations which may have been promulgated. An accounting for the Association funds and financial statements, from the date the Association received funds and ending on the date the period of Declarant control ends. The financial statements shall be audited by an independent certified public accountant and shall be accompanied by the accountants letter, expressing either the opinion that the financial statements present fairly the financial position of the Association in conformity with generally accepted accounting principles or a disclaimer Falls Subdivision Bylaws 6

7 of the accountant s ability to attest to the fairness of the presentation of the financial information in conformity with generally accepted accounting principles and the reasons therefor. The expense of the audit shall not be paid for or charged to the Association. (c) (d) (e) (f) (g) (h) (i) (j) (k) The Associations funds or control thereof. All of the Declarant s tangible personal property that has been represented by the Declarant to be the property of the Association or all of the Declarant s tangible personal property that is necessary for, and has been used exclusively in, the operation and enjoyment of the common elements, and inventories of those properties. A copy of any plans and specifications used in the construction of the improvements in the Subdivision which were completed within two years before the Declaration was recorded. All insurance policies then in force, in which the Residential Lot owners, the Association, or its Trustees and officers are named as insured persons. Any other permits issued by governmental bodies applicable to the Subdivision and which are currently in force or which were issued within one year prior to the date on which Residential Lot owners other than the Declarant took control of the Association. Written warranties of the contractor, subcontractors, suppliers, and telephone numbers, if known, as shown on the Declarant s records. A roster of Residential Lot owners and mortgagees and their addresses and telephone numbers, if known, as shown on the Declarant s records. Employment contracts in which the Association is a contracting party. Any service contract in which the Association is a contracting party or in which the Association or the Residential Lot owners have any obligation to pay a fee to the person performing the services Insurance. Commencing not later than the time of the first conveyance of a Residential Lot to a person other than the Declarant, the Association shall maintain, to the extent reasonably available: (a) Property insurance on the Common Areas and on the property that must become Common Areas for broad-form covered causes of loss, except that the total amount of insurance must be not be less than the full insurable replacement cost of the insured property less applicable deductibles at the time the insurance is purchased and at each renewal date, exclusive of Falls Subdivision Bylaws 7

8 land, excavations, foundations, and other items normally excluded fro property policies; and (b) Commercial general liability insurance against claim and liabilities arising in connection with the ownership, existence, use, or management of the Common Areas in an amount deemed sufficient in the judgment of the Board of Trustee but not less than any amount specified in the Association documents, insuring the Board of Trustees, the Association, the management agent, and their respective employees, agents, and all persons acting as agents. The Declarant shall be included as an additional insured in such Declarant s capacity as a Residential Lot owner and Board member. The Residential Lot owners shall be included as additional insureds but only for claims and liabilities arising in connection with the ownership, existence, use, or management of the Common Areas. The insurance shall cover claims of one or more insured parties against other insured parties. (i) (ii) (iii) (iv) Each Residential Lot owner is an insured person under the policy with respect to liability arising out of such Residential Lot owner s interest in the Common Areas or membership in the Association. The insurer waives its rights to subrogation under the policy against any Residential Lot owner or member of his household; No act or omission by any Residential Lot owner, unless acting within the scope of such Residential Lot owner s authority on behalf of the Association, will void the policy or be a condition to recovery under the policy; and If, at the time of a loss under the policy, there is other insurance in the name of a Residential Lot owner covering the same risk covered by the policy, the Association s policy provides primary insurance. (c) Any loss covered by the property insurance policy described in this section must be adjusted with the Association, but the insurance proceeds for that loss shall be payable to any insurance trustee designated for that purpose, or otherwise to the Association, and not any holder of a security interest. The insurance trustee or the Association shall hold any insurance proceeds in trust for the Association Residential Lot owners and lien holders as their interests may appear. Subject to the provisions of Section 4.15(g) of this Article, the proceeds must be disbursed first for the repair or restoration of the damaged property, and the Association, Residential Lot owners, and lien holders are not entitled to receive payment of any portion of the proceeds unless there is a surplus of proceeds after the Falls Subdivision Bylaws 8

9 property has been completely repaired or restored or the common interest community is terminated. (d) (e) (f) (g) The Association may adopt and establish written nondiscriminatory policies and procedures relating to the submittal of claims, responsibility for deductibles, and any other matters of claims adjustment. To the extent the Association settles claims for damages to real property, it shall have the authority to assess negligent Residential Lot owners causing such loss or benefiting from such repair or restoration of all deductibles paid by the Association. In the event that more than one Residential Lot is damaged by a loss, the Association in its reasonable discretion may assess each Residential Lot owner a pro rata share of any deductible paid by the Association. An insurance policy issued to the Association does not obviate the need for Residential Lot owners to obtain insurance for their own benefit. An insurer that has issued an insurance policy for the insurance described in sections 4.14 (a) and 4.15 (b) of this Article shall issue certificates or memoranda of insurance to the Association and upon request to any Residential Lot owner or holder of a security interest. Any portion of the Subdivision for which insurance is required under this section which is damaged or destroyed must be repaired or replaced promptly by the Association unless: (i) (ii) (iii) (iv) The common interest community is terminated; (ii) Repair or replacement Repair or replacement would be illegal under any state or local statute or ordinance governing health or safety; Eighty percent of the Residential Lot owners vote not to rebuilt; or Prior to the conveyance of any Residential lot to a person other than the Declarant, the holder of a deed of trust or mortgage on the damaged portion of the Subdivision rightfully demands all or a substantial part of the insurance proceeds. (h) The cost of repair or replacement in excess of insurance proceeds and reserves is a common expense. If the entire damage is not repaired, the insurance proceeds attributable to the damaged Common Areas must be used to restore the damaged area to a condition compatible with the remainder of the Subdivision, and except to the extent that other persons will be distributees, the insurance proceeds attributable to Residential Lots that are not rebuilt must be distributed to the owners of those Residential Falls Subdivision Bylaws 9

10 Lots or to the lien holders, as their interests may appear, and the remainder of the proceeds must be distributed to all the Residential Lot owners or lien holders, as their interests may appear, in proportion to the common expense liabilities of all the Residential Lots. (i) (j) The Association may carry fidelity insurance to cover any person with the authority to disburse Association funds. The Association may require any independent contractor employed for the purposes of managing the Subdivision to carry fidelity insurance coverage. Premiums for insurance that the Association acquires and other expenses connected with acquiring such insurance are common expenses. SECTION 5 OFFICERS 5.1 Designation. The officers of the Association shall be a president, a vice president, a secretary and a treasurer, all of whom shall be elected by and from the Board of Trustees Election of Officers. The officers of the Association shall be elected annually by the Board of Trustees at the organizational meeting of each new board and shall hold office at the pleasure of the board. One (1) person may hold concurrently any two (2) offices except president and secretary. The office of vice president need not be filled. 5.3 Removal of Officers. On an affirmative vote of a majority of the members of the Board of Trustees, any officer may be removed with or without cause and his successor elected at any regular meeting of the board or at any special meeting of the board called for that purpose President. The president shall be the chief executive officer of the Association. He shall preside at all meetings of the Association and the Board of Trustees. He shall have all of the general powers and duties which are usually vested in the office of president of a corporation including and not limited to the power to appoint committees from among the owners from time to time as he may in his discretion decide is appropriate to assist in the conduct of the affairs of the Association. 5.5 Vice President. The vice president shall have all the powers and authority and perform all of the functions and duties of the president, in the absence of the president and his inability for any reason to exercise such powers and functions or perform such duties Secretary. The secretary shall keep the minutes of meetings of the Board of Trustees and minutes of the Association; he shall have charge of such books and papers as the Board of Trustees may direct; and he shall, in general, perform all the duties Falls Subdivision Bylaws 10

11 incident to the office of secretary. The secretary shall compile and keep up to date at the principal office of the Association a complete list of members and their registered mailing addresses. Such list shall also show opposite each member s name the number or other appropriate designation of the Residential Lot owned by such members. Such list shall be open to inspection by members and other persons lawfully entitled to inspect the same at reasonable times during regular business hours Treasurer. The treasurer shall have responsibility for Association funds and shall be responsible for keeping full and accurate accounts of all receipts and disbursements in books belonging to the Association. He shall be responsible for the deposit of all monies and other valuable effects in the name and to the credit of the Association in which depositories as may from time to time be designated by the Board of Trustees. SECTION 6 INDEMNIFICATION OF OFFICERS AND TRUSTEES No member of the executive board and no officer shall be liable for actions taken or omissions made in the performance of such member s duties except for wanton and willful acts or omissions. The Association shall indemnify such trustee or officer, his heirs, executors and administrators against all loss, costs and expense, including attorneys fees, reasonably incurred by him in connection with any action, suit or proceeding to which he may be made a party by reason of his being or having been a trustee or officer of the Association, except as to matters to which he shall be finally adjudged in such action, suit or proceeding to be liable for wanton or willful acts or omissions. In the event of a settlement, indemnification shall be provided only in connection with such matters covered by the settlement as to which the Association is advised by counsel that the person to be indemnified has not been guilty of wanton or willful acts or omissions in the performance of his duty as such trustee or officer in relation to the matter involved. The foregoing rights shall not be exclusive of other rights to which such trustee or officer may be entitled. All liability, loss, damage, costs and expense incurred or suffered by the Association by reason of or arising out of or in connection with the foregoing indemnification provisions shall be treated and handled by the Association as common expenses provided, however, that nothing contained in this Section 6 shall be deemed to obligate the Association to indemnify any member or owner of a Residential Lot who is or has been a trustee or officer of the Association for his share of such common expenses. SECTION 7 OBLIGATION OF THE OWNERS 7.1. Assessments. Except as otherwise provided in the Covenants, all owners shall be obligated to pay the quarterly assessments imposed by the Association to meet the common expenses; and payment thereof shall be made not later than on the tenth day following the mailing of the quarterly statement to the registered mailing address of the owner. The assessments shall be made equally on each Residential Lot and shall be due Falls Subdivision Bylaws 11

12 quarterly in advance. A member shall be deemed to be in good standing and entitled to vote at any annual or at a specific meeting of members within the meaning of these Bylaws, if and only if he shall have fully paid all assessments made or levied against him and the Residential Lot owned by him General. (a) (b) Each owner shall comply strictly with the provisions of the Covenants. Each owner shall always endeavor to observe and promote the cooperative purposes for which the project was established. 7.3 Use of Common Areas. Each owner may use the common areas, if any, in accordance with the purposes for which they are intended so long as this use does not hinder or encroach on the lawful rights of the others owners. 7.4 Rules and Regulations. In addition to those set forth in the Covenants, the Board of Trustees or the managing agent reserves the power to establish, make and enforce compliance with such additional rules as may be necessary for the operation, use and occupancy of this project with the right to amend same from time to time. SECTION 8 AMENDMENTS These Bylaws may be amended by the Association members at a duly constituted meeting for such purpose, and no amendment shall take effect unless approved by a majority of the Board and two-thirds (2/3) of the owners. The notice of such meeting shall contain a summary of the proposed changes or a coy of such proposed changes provided, however, as long as the Declarant is in control of the selection of the Board of Trustees of the Association as provided for in the Covenants, the Declarant may amend these Bylaws so long as a copy of any change is mailed to the registered address of each owner. These Bylaws may also be amended by a majority vote of the Board of Trustees. SECTION 9 MORTGAGES 9.1. Notice to Association. An owner who mortgages his Residential Lot shall notify the Association through the managing agent, if any, or the president of the Association, giving the name and address of his mortgagee. The Association shall maintain such information in a book titled Mortgagees of Residential Lots Notice of Unpaid Assessments. The Association shall at the written request of the first mortgagee of a Residential Lot report any unpaid assessments due from the owner of such Residential Lot. Falls Subdivision Bylaws 12

13 SECTION 10 EVIDENCE OF OWNERSHIP, REGISTRATION OF MAILING ADDRESS, REQUIRED PROXIES AND GOOD STANDING 10.1 Proof of Ownership. Any person on becoming an owner of Residential Lot shall furnish to the managing agent or Board of Trustees a photocopy or a certified copy of the recorded instrument vesting that person with an interest or ownership, which instrument shall remain in the files of the Association Registration of Mailing Address. The owners of each Residential Lot shall have one (1) and the same registered mailing address to be used by the Association for mailing monthly statements, notices, demands and all other communications; and such registered address shall be the only mailing address of a person or persons, firm corporation, partnership, association or other legal entity. Such registered address of a Residential Lot owner or owners shall be furnished by such owners to the secretary within five (5) days after transfer of title. Such registration shall be in written form and signed by all of the owners of the Residential Lot or by such persons as are authorized by law to represent the interest of all of the owners thereof. If no such address is registered or if all of the owners cannot agree, then the address of the Residential Lot shall be the registered address until another registered address is furnished as permitted under this section. Registered addresses may be changed from time to time by similar designation Required Proxies. If only one of the multiple owners of a Residential Lot is present at a meeting of the Association, such owner is entitled to cast all the votes allocated to that Residential Lot. If more than one of the multiple owners are present, the votes allocated to that Residential Lot may be cast only in accordance with the agreement of a majority in interest of the owners. There is majority agreement if any one of the multiple owners casts the votes allocated to that unit without protest being made promptly to the person presiding over the meeting by any of the other owners of the Residential Lot. Votes allocated to a Residential Lot may be cast pursuant to a proxy duly executed by a Residential Lot owner. If a Residential Lot is owned by more than one person, each owner of the Residential Lot may vote or register protest to the casting of votes by the other owners of the Residential Lot through a duly executed proxy. A Residential Lot owner may not revoke a proxy given pursuant to this section except by actual notice of revocation to the person presiding over a meeting of the Association. A proxy is void if it is not dated or purports to be revocable without notice. A proxy terminates eleven months after its date, unless it provide otherwise Good Standing. The requirements contained in this Section 10 shall be first met before an owner of a Residential Lot shall be deemed in good standing and entitled to vote at any special or annual meeting of members. Falls Subdivision Bylaws 13

14 SECTION 11 NOT FOR PROFIT This Association is not organized for profit. No member, member of the Board of Trustees or persons from whom the Association may receive any property or funds shall receive or shall be lawfully entitled to receive any pecuniary profit from the operation thereof; and in no event shall any part of the funds or assets of the Association be paid as salary or compensation to be distributed to or inure to the benefit of any member of the Board of Trustees provided, however, always (1) that reasonable compensation may be paid to any member or manager while acting as an agent or employee of the Association for the services rendered in effecting one or more of the purposes of the Association and (2) that any member or trustee may from time to time be reimbursed for his actual and reasonable expenses incurred in connection with the administration of the affairs of the Association. SECTION 12 UNPAID COMMON EXPENSES ASCERTAINING LIABILITY The Association shall furnish to a Residential Lot owner or such owner s designee or to a holder of a security interest or its designee upon written request, delivered personally or by certified mail, first-class postage prepaid, return receipt requested, to the Association s registered agent, a statement setting forth the amount of unpaid assessments currently levied against such owner s Residential Lot. The statement shall be furnished within fourteen (14) business days after receipt of the request and is binding on the Association, the Board of Trustees, and every Residential Lot owner. If no statement is furnished to the unit owner or holder of a security interest or their designee, delivered personally or by certified mail, first-class postage prepaid, return receipt requested, to the inquiring party, then the Association shall have no right to assert priority lien upon the Residential Lot for unpaid assessments which were due as of the date of the request. SECTION 13 RECREATIONAL FACILITIES Any major recreational facilities of the project shall be available to all Residential Lot owners. Fees or charges in conjunction with the use, maintenance, and upkeep of these facilities shall be included within the regular assessment. SECTION 14 SEAL The corporate seal of the Association shall be circular in form and shall contain the name of the Association, the year of its organization, and the words Seal, Colorado. IN WITNESS WHEREOF, the undersigned have adopted these Bylaws this day of, Falls Subdivision Bylaws 14

15 BOARD OF TRUSTEES: [ Unsigned] Brian Rapp Rita Robinson Frank Patitucci Stewart Emery Falls Subdivision Bylaws 15