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HomeMy WebLinkAbout2014 03 07 Cimarron Townhomes Dec of Covenants Conditions and Restrictions 185014853 (2)MATTHEW B. STRAIGHT OSERAN HAHN SPRING STRAIGHT & WATTS PS 10900 NE 4TH Street SUITE 1430 BELLEVUE, WA 98004 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR CIMARRON TOWNHOMES Declarant: BREMERTON AVENUE TOWNHOMES, LLC, a Washington limited liability company Legal Description: Lot 2 KC S.P. #675015, Rec. No. 709050645 Lot 3 KC S.P. #675015, Rec. No.709050645 King County, Washington. Additional legal description on Page 39 of document. Tax Parcel No(s).: 152305-9035-01 and 152305-9193-09 TABLE OF CONTENTS ARTICLE 1 -DEFINITIONS ............................................................................................ 1 ARTICLE 2-MEMBERSHIP AND VOTING RIGHTS ..................................................... 3 2.1 Membership ................................................................................................. 3 2.2 Voting ......................................................................................................... 4 ARTICLE 3-RIGHTS AND OBLIGATIONS OF THE ASSOCIATION ............................ 4 3.1 Common Area ............................................................................................. 4 3.2 Common Area Property Rights .................................................................... 4 3.3 Rules ........................................................................................................... 5 3.4 Enforcement. ............................................................................................... 5 3.5 Rights .......................................................................................................... 5 3.6 Indemnification ............................................................................................ 5 3.7 Dedication of Common Area ........................................................................ 6 3.8 Security ........................................................................................................ 6 3.9 Utility Lines .................................................................................................. 6 ARTICLE 4-MAINTENANCE ......................................................................................... 7 4.1 Association's Responsibility ......................................................................... 7 4.2 Owner's Responsibility ................................................................................ 7 4.3 Private Drainage Easements ....................................................................... 8 4.4 Private Road and Utilities Easements ....................................................... 10 4.5 Standards of Performance ............................................................. 11 ARTICLE 5-INSURANCE AND CASUALTY LOSSES ................................................ 11 5.1 Association Insurance ............................................................................... 12 5.2 Damage and Destruction ........................................................................... 13 5.3 Disbursement of Proceeds ........................................................................ 14 5.4 Repair and Reconstruction ........................................................................ 14 ARTICLE 6-NO PARTITION ....................................................................................... 14 ARTICLE 7-CONDEMNATION ................................................................................... 15 ARTICLE 8-ASSESSMENTS ...................................................................................... 15 8.1 Creation of Assessments ........................................................................... 15 8.2 Budget Approval and Computation of Base Assessment. ......................... 16 8.3 Reserve Budget and Capital Contribution .................................................. 17 8.4 Special Assessments ................................................................................ 17 DECLARATION OF CIMARRON TOWN HOMES i F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 8.5 Specific Assessments ................................................................................ 17 8.6 Lien for Assessments ................................................................................ 17 8. 7 Date of Commencement of Assessments .................................................. 18 8.8 Failure to Assess ....................................................................................... 18 8.9 Capitalization of Association ...................................................................... 18 8.10 Exempt Property ........................................................................................ 19 ARTICLE 9-ARCHITECTURAL STANDARDS ............................................................ 19 9.1 General. ....................................................................................................... 19 9.2 Architectural Review .................................................................................... 19 9.3 Guidelines and Procedures ......................................................................... 20 9.4 No Waiver of Future Approvals .................................................................... 20 9.5 Variances ..................................................................................................... 20 9.6 Limitation of Liability .................................................................................... 21 9.7 Enforcement. ............................................................................................... 21 ARTICLE 10-USE GUIDELINES AND RESTRICTIONS ............................................. 21 10.1 Plan of Development: Applicability; Effect. ................................................ 21 10.2 Board Power .............................................................................................. 22 10.3 Members' Power. ....................................................................................... 22 10.4 Owners' Acknowledgment. ........................................................................ 22 10.5 Rights of Owners ....................................................................................... 23 10.6 Initial Use Guidelines and Restrictions ...................................................... 24 ARTICLE 11 -EASEMENTS ......................................................................................... 27 11.1 Easements of Encroachment... .................................................................. 27 11.2 Easements for Utilities, Etc ........................................................................ 27 11.3 Easement for Emergency .......................................................................... 28 11 .4 Easements for Maintenance and Enforcement. ......................................... 28 ARTICLE 12-MORTGAGEE PROVISIONS ................................................................ 28 12.1 Notices of Action ........................................................................................ 28 12.2 Other Provisions for First Lien Holders ...................................................... 29 12.3 Amendments to Documents ...................................................................... 29 12.4 No Priority .................................................................................................. 30 12.5 Notice to Association ................................................................................. 31 12.6 Amendment by Board ................................................................................ 31 12.7 Applicability of Article 12 ............................................................................ 31 12.8 Failure of Mortgagee to Respond .............................................................. 31 ARTICLE 13-DECLARANT'S RIGHTS ........................................................................ 31 DECLARATION OF CIMARRON TOWN HOMES ii F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 ARTICLE 14-DISPUTE RESOLUTION AND LIMITATION ON LITIGATION .............. 32 14.1 Agreement to Avoid Costs of Litigation and to Limit Right to Litigate Disputes ........................................................................................ 32 14.2 Exempt Claims .......................................................................................... 32 14.3 Mandatory Procedures for All Other Claims .............................................. 33 14.4 Allocation of Costs of Resolving Claims .................................................... 35 14.5 Enforcement of Resolution ........................................................................ 35 ARTICLE 15-GENERAL PROVISIONS ....................................................................... 35 15.1 Term .......................................................................................................... 35 15.2 Amendment. ..................................................................................... '·'······· 35 15.3 Severability ................................................................................................ 35 15.4 Litigation .................................................................................................... 35 15.5 Compliance ................................................................................................ 36 15.6 Notice of Sale or Transfer of Title .............................................................. 36 EXHIBIT A .......................................................................................................... 39 DECLARATION OF CIMARRON TOWN HOMES iii F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR CIMARRON TOWNHOMES THIS DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS is made this day of , 2013, by BREMERTON AVENUE TOWNHOMES, LLC, a Washington limited liability company ("Declarant"). Declarant is the owner of the real property described in Exhibit A attached hereto and incorporated herein by reference. Declarant intends by this Declaration to (a) impose upon the Property mutually beneficial restrictions under a general plan of improvement for the benefit of all owners of such property; (b) provide a flexible and reasonable procedure for the overall development of the Property; (c) establish a method for the administration, maintenance, preservation, use and enjoyment of the Property; (d) create easements, covenants, conditions and restrictions to protect the value and desirability of the real property subject to this Declaration; and (e) establish a Homeowners Association, to be known as CIMARRON COMMUNITY ASSOCIATION. Declarant hereby declares that the Property shall be held, sold, used and conveyed subject to the provisions of this Declaration, which are for the purpose of protecting the value and desirability of and which shall run with title to the Property. This Declaration shall be binding on all parties having any interest in the Property, their heirs, successors and assigns, and shall inure to the benefit of each Owner. ARTICLE 1 DEFINITIONS 1.1 "Areas of Common Responsibility". The Common Area and the portions of Lots and other areas, if any, which become the responsibility of the Association to maintain, including but not limited to, the following: (a) the entry monument sign area located on Lot 1, (b) the perimeter fences along the boundaries of the Property, (c) the planter strip located along Bremerton Avenue, (d) the driveway, recreation area and related improvements located on Tract A, (e) the planting areas located along the north and south boundaries of the Property, (f) certain planting areas located in the front yards of Lots, and (f) the rockery located on the east side of the Property. 1.2 "Articles". The Articles of Incorporation of CIMARRON COMMUNITY ASSOCIATION filed with the Secretary of State of the state of Washington. 1.3 "Association". CIMARRON COMMUNITY ASSOCIATION, its successors or assigns. DECLARATION OF CIMARRON TOWN HOMES F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 1.4 "Base Assessment". Assessments levied on all Lots subject to assessment under Article 8 to fund Common Expenses for the general benefit of all Lots, as more particularly described in Sections 8.1 and 8.2. 1.5 "Board of Directors" or "Board". The body responsible for administering the Association, selected as provided in the Bylaws and serving as the Board of Directors under Washington corporate law. 1.6 "Bylaws". The Bylaws of the Association, as they may be amended. 1.7 "Cimarron. Townhomes". The development comprised of all property subjected to this Declaration. 1.8 "Class "B" Control Period". The period during which the Class "B" Member is entitled to appoint a majority of the Board members under Section 3.2 of the Bylaws. 1.9 "Common Expenses". The actual and estimated expenses incurred, or anticipated to be incurred, by the Association for the general benefit of all Owners, including any reasonable reserve, all as may be found necessary and appropriate by the Board under this Declaration, the Bylaws and the Articles of the Association. Common Expenses include but are not limited to real estate taxes and similar charges for Common Areas. 1.10 "Common Areas". The Common Areas are portions of the Property owned and maintained by the Association for the benefit of all Owners as described herein. Tract A is the only Common Area located in the Property. Tract A contains an underground storm water detention vault, a driveway providing access to Lot 7, and an open space/recreation area with a small tot lot. Declarant, on its sole signature, may amend the Declaration to include additional Common Areas to be incorporated into CIMARRON TOWN HOMES and subjected to this Declaration as provided for herein. 1.11 "Community-Wide Standards". Standards of conduct, maintenance or other activity generally prevailing throughout the Property. Such standards may be more specifically determined by the Board and the Architectural Control Committee. 1.12 "Declarant". BREMERTON AVENUE TOWNHOMES, LLC, a Washington limited liability company, and its (a) successor by merger or consolidation, (b) successor-in-title, or (c) assignee, provided any such successor-in-title or assignee shall own or acquire for the purpose of development or sale all or any portion of the remaining unsold portions of the real property described in the attached Exhibit A; and provided further, in the instrument of conveyance to any such successor-in-title, such successor-in-title or assignee is designated as "Declarant" hereunder by the grantor of such conveyance or assignor, as the case may be, such grantor or assignor shall be the "Declarant" under this Declaration at the time of such conveyance or assignment; and DECLARATION OF CIMARRON TOWN HOMES 2 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 provided further, upon such designation of such successor Declarant, all rights of the former Declarant in and to such status as "Declarant" under this Declaration shall cease, it being understood that as to all of the property described in Exhibit A, which is now or hereafter subjected to this Declaration, there shall be only one (1) "Declarant" hereunder at any one point in time. 1.13 "Lot". Any contiguous portion of the Property, whether improved or unimproved, other than Common Area and property dedicated to the public, which may be independently owned, conveyed, developed and used as a detached residence for a single family. The term shall refer to the land, if any, which is part of the Lot as well as any improvements thereon. The Property consists of twenty-six (26) Lots, all of which are shown on the Plat Map. 1.14 "Member". A person entitled to membership in the Association. 1.15 "Mortgage". Any mortgage, deed of trust or similar instrument used for the purpose of encumbering the Property as security for the payment or satisfaction of an obligation. 1.16 "Mortgagee". The holder of a Mortgage. 1.17 "Owner". One or more Persons who hold the record title to any Lot, except persons holding an interest merely as security for the performance of an obligation, in which case the equitable owner will be considered the Owner. Unless a recorded contract of sale specifically provides otherwise, the purchaser (rather than the fee owner) will be considered the Owner. 1.18 "Person". A natural person, corporation, partnership, trustee or any other legal entity. 1.19 "Plat Map". The recorded subdivision map for ______ _ 1.20 "Property". The real property described in Exhibit A. 1.21 "Special Assessments". All Assessments levied under Section 9.4. 1.22 "Specific Assessments". All Assessments levied under Section 9.5. ARTICLE 2 MEMBERSHIP AND VOTING RIGHTS 2.1 Membership. Every Owner shall have a membership in the Association. No Owner shall have more than one membership per Lot owned. If a Lot is owned by more than one Person, all co-Owners shall be entitled to the privileges of membership, subject to the restrictions on voting set forth in Section 2.2 and in the Bylaws. All DECLARATION OF CIMARRON TOWNHOMES 3 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 co-Owners shall be jointly and severally obligated to perform the responsibilities of Owners hereunder. The membership rights of an Owner who is a natural person may be exercised by the Member or the Member's spouse. The membership rights of an Owner which is a corporation, partnership or other legal entity may be exercised only by the individual designated from time to time by the Owner in a written instrument provided to the Secretary of the Association. 2.2 Voting. The Association shall have two {2) classes of membership, Class !JAil and Class .. B.,. 2.2.1 Class "A". Class "A" Members shall be all Owners except the Class "B" Member, if any. Each Class "A" Member shall have one (1) equal vote for each Lot in which he or she holds the interest required for membership under Section 2.1. There shall be only one ( 1) vote per Lot. In any situation where there is more than one Owner of a particular Lot, the vote for such Lot shall be exercised as such co-Owners determine among themselves and advise the Secretary of the Association in writing prior to any meeting. Absent such advice, the Lot's vote shall be suspended if more than one Person seeks to exercise it. 2.2.2 Class "B". The sole Class "B" Member shall be Declarant. The rights of the Class "B" Member are specified elsewhere in the Articles, Declaration and Bylaws. The Class "B" Member may appoint a majority of the Board members during the Class "B" Control Period, as specified in Section 3.2 of the Bylaws. The Class "B" membership shall terminate and convert to Class "A" membership upon the earlier of (a) five (5) years after expiration of the Class "B" Control Period; or (b) when, in its discretion, Declarant so determines and declares in a recorded instrument. ARTICLE 3 RIGHTS AND OBLIGATIONS OF THE ASSOCIATION 3.1 Common Area. The Association, subject to the rights of the Owners set forth in this Declaration, shall manage and control the Common Area and all improvements thereon and shall keep it in good, clean, attractive, safe, secure and sanitary condition, order and repair under the terms and conditions of this Declaration and consistent with the requirements of the City of Renton. It is anticipated that the underground storm water detention vault will be maintained by the City of Renton. 3.2 Common Area Property Rights. Every Owner shall have a right and nonexclusive easement of use, access and enjoyment in and to the Common Area, subject to the following: (a) this Declaration, any other applicable covenants, and the terms of any deed conveying such property to the Association; (b) the right of the Board to adopt rules regulating the use and enjoyment of the Common Area, including rules limiting the number of guests; and (c) the right of the Board to suspend an Owner's right to use recreational facilities within the Common Area (i) for any period during which any charge, including Assessments, against such Owner's Lot remains delinquent, and/or DECLARATION OF CIMARRON TOWN HOMES 4 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 (ii) for a period not exceeding thirty (30) days for a single violation, or for a longer period in the case of any continuing violation, of the Declaration, the Bylaws or rules of the Association after notice and a hearing under the Bylaws. Any Owner may extend their right of use and enjoyment to the Members of their family, lessees and social invitees, as applicable, subject to rules of the Board. An Owner who leases their Lot shall be deemed to have assigned all such rights to the lessee. 3.3 Rules. The Association, through its Board, may make, modify and enforce reasonable rules governing the use of the Property, consistent with the rights and duties established by this Declaration, as provided in Article 10. Such rules shall bind all Owners, occupants, invitees and licensees until and unless repealed or modified in a regular or special meeting of the Association by the vote of sixty-seven percent (67%) of the total Class "A" votes and, so long as such membership exists, by the Class "B" Member. 3.4 Enforcement. The Association may impose sanctions for violations of this Declaration, the Bylaws or rules, including without limitation reasonable monetary fines, suspension of voting rights and the right to use any recreational facilities within the Common Area. In addition, under the Bylaws, the Association may exercise self-help remedies to cure violations and may suspend any services it provides to the Lot of any Owner thirty (30) days or more delinquent in paying any Assessment or other charge due to the Association. The Board may seek relief in any court for violations or to abate nuisances. Board actions to impose or seek sanctions shall be governed by the Bylaws. 3.5 Rights. The Association may exercise any right or privilege given to it expressly by this Declaration or the Bylaws, or which may be reasonably implied from, or reasonably necessary to effectuate, any such right or privilege. 3.6 Indemnification. The Association, to the fullest extent allowed by law, shall indemnify every officer, director and committee member against all expenses, including counsel fees, reasonably incurred by or imposed upon such officer, director or committee member in connection with any action, suit or other proceeding (including settlement of any suit or proceeding, if approved by the Board) to which he or she may be a party by reason of being or having been an officer, director or committee member. The officers, directors and committee members shall not be liable for any mistake of judgment, except for their own individual misfeasance, malfeasance, misconduct or bad faith, and shall have no personal liability to third parties with respect to any contract or action taken by them in good faith on behalf of the Association. The Association shall indemnify and hold each such officer, director and committee member harmless against all liability to others on account of any such contract, commitment or action. Any right to indemnification provided for herein shall not be exclusive of any other rights to which any present or former officer, director or committee member may be entitled. The Association shall, as a Common Expense, maintain adequate general liability and DECLARATION OF CIMARRON TOWN HOMES 5 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 officers and directors liability insurance to fund this obligation, if such insurance is reasonably available. 3.7 Dedication of Common Area. The Association, by Board resolution, may dedicate or grant easements over or under portions of the Common Area on behalf of the Owners to any local, state or federal government entity, public utility or private party when such conveyance is consistent with the requirements of the City of Renton or other applicable jurisdiction for the development of the Property, or Declarant's master plan for the development of the Property. · 3.8 Security. Neither the Association, DeClarant nor any successor Declarant shall in any way be considered insurers or guarantors of security within the Property. Neither the Association, Declarant nor any successor Declarant shall be held liable for any loss or damage for failure to provide adequate security or ineffectiveness of security measures undertaken. All Owners and occupants of any Lot, and all tenants, guests and invitees of any Owner, acknowledge that the Association and its Board, Declarant, any successor Declarant, and the ACC represent or warrant that any fire protection system, burglar alarm system or other security system designated by or installed according to guidelines established by Declarant or the ACC may not be compromised or circumvented; nor that any fire protection or burglar alarm system or other security systems will prevent loss by fire, smoke, burglary, theft, holdup or otherwise; nor that fire protection or burglar alarm systems or other security systems will in all cases provide the detection or protection for which the system is designed or intended. All Owners and occupants of any Lot, and all tenants, guests and invitees of any Owner acknowledge and understand that the Association, its Board, committees, Declarant or any successor Declarant are not insurers. All Owners and occupants of any Lot and all tenants, guests and invitees of any Owner assume all risks for loss or damage to persons, to Lots and to the contents of Lots, and further acknowledge that the Association, its Board, committees, Declarant or any successor Declarant have made no representations or warranties, nor has any Owner, occupant or any tenant, guest or invitee of any Owner relied upon any representations or warranties, expressed or implied, including any warranty of merchantability or fitness for any particular purpose relative to any fire and/or burglar alarm systems or other security systems recommended or installed or any security measures undertaken within the Property. 3.9 Utility Lines. Each Owner, occupant, guest and invitee acknowledges that neither the Association, the Board nor Declarant shall in any way be considered insurers or guarantors of health within the Property, and neither the Association, the Board nor Declarant shall be held liable for any personal injury, illness or any other loss or damage caused by the presence or malfunction of utility lines adjacent to, near, over or on the Property. Each Owner, occupant, guest and invitee assumes all risk of personal injury, illness or other loss or damage arising from the presence of utility lines, and further acknowledges that neither Declarant nor the Association has made any warranties, nor has any Owner, occupant, guest or invitee relied upon any DECLARATION OF CIMARRON TOWN HOMES 6 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 representations or warranties, expressed or implied, relative to the condition or impact of utility lines or utility substations. ARTICLE 4 MAINTENANCE 4.1 Association's Responsibility. The Association shall maintain and keep in good repair the Areas of Common Responsibility, which shall include but need not be limited to: (a) any Common Area, including the underground storm water detention vault and related facilities located in Tract A (until the City of Renton assumes responsibility for the maintenance thereof; (b) any contract, easement or agreement for maintenance thereof entered into by either the Association or Declarant, on behalf of the Association, to be included within any Areas of Common Responsibility, if any; Notwithstanding the foregoing, at any time after two (2} years following the recording of this Declaration, the Board may elect to require the front yard planting areas described in Section 1 (f). Except as provided above, the Area of Common Responsibility shall not be reduced by Amendment of this Declaration or any other means without prior written approval of Declarant so long as Declarant owns any property subject to the Declaration. The Association shall be relieved of its responsibilities under this Section to the extent they are assumed by the City of Renton or any other local, state or federal government entity, except that the Association may provide any additional maintenance for the Area of Common Responsibility transferred to any such government entity, if the Board determines that such additional maintenance is necessary or desirable to maintain the Community-Wide Standards. The Association may also maintain other property which it does not own, including property dedicated to the public, if the Board determines that such maintenance is necessary or desirable to maintain the Community-Wide Standards. Except as otherwise specifically provided, all costs for maintenance, repair and replacement of the Area of Common Responsibility shall be a Common Expense allocated among all Lots as part of the Base Assessment without prejudice to the Association's right to seek reimbursement from Persons responsible for such work. 4.2 Owner's Responsibility. Except as otherwise set forth in the Declaration, each Owner shall maintain their Lot, including without limitation all structures, fencing, yard drains, drainage, landscaping, parking areas and other improvements comprising DECLARATION OF CIMARRON TOWN HOMES 7 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 the Lot consistent with the Community-Wide Standards and all applicable covenants, unless such maintenance responsibility is assumed by or assigned to the Association. In addition to any other enforcement rights, if any Owner fails to properly maintain their Lot, the Association may perform such maintenance and assess the costs against the Lot and the Owner under Article 9; provided, that the Association shall give the Owner reasonable notice and an opportunity to perform such maintenance, unless the Board determines that maintenance is needed on an emergency basis. 4.2.1 Slope Maintenance. Each Lot Owner must maintain and shall not modify the slope grades of their Lot from the original grade and condition installed by Declarant. Likewise, each Lot Owner must maintain and shall not modify any of the original landscaping on any such slopes installed by Declarant. If Lot Owners fail to do so, the Association shall perform all slope work necessary to maintain slope grades of Lots and will assess the costs of such maintenance against the Lot and the Owner as provided herein. No Lot Owner may modify or alter in any way the natural water drainage from or across their Lot in a manner which would impair or prevent water drainage into the water drainage conveyance systems internal to all Lots. 4.2.2 Fences and Irrigation. TBD. 4.3 Private Drainage Easements and Maintenance of Private Drainage Facilities. The Plat for the Property establishes a number of private drainage easements over Lots for the benefit of specific Lots. All of the private drainage easements are shown on the Plat Map. The Lots benefitted by any such private drainage easements, and the Lots Owners responsible to maintain the private drainage facilities located therein are as follows 4.3.1 The ten (10) foot private drainage easement located on Lot 3 is for the benefit of Lots 1 and 2. The Owners of Lots 1, 2 and 3 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally among the Owners of Lots 1, 2 and 3. 4.3.2 The ten (10) foot private drainage easement located on Lot 4 is for the benefit of Lots 1, 2 and 3. The Owners of Lots 1 through 4 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally among the Owners of Lots 1 through 4. 4.3.3 The ten (10) foot private drainage easement located on Lot 5 is for the benefit of Lots 1 through 4. The Owners of Lots 1 through 5 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally among the Owners of Lots 1 through 5. DECLARATION OF CIMARRON TOWN HOMES 8 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 4.3.4 The ten (10) foot private drainage easement located on Lot 6 is for the benefit of Lots 1 through 5. The Owners of Lots 1 through 6 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally among the Owners of Lots 1 through 6. 4.3.5 The ten (10) foot private drainage easement located on Lot 8 is for the benefit of Lot 7. The Owners of Lots 7 and 8 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally between the Owners of Lots 7 and 8. 4.3.6 The ten (10) foot private drainage easement located on Lot 9 is for the benefit of Lot 10. The Owners of Lots 9 and 10 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally between the Owners of Lots 9 and 10. 4.3.7 The ten (10) foot private drainage easement located on Lot 20 is for the benefit of Lot 19 and Lots 21 through 24. The Owners of Lots 19 through 26 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally among the Owners of Lots 19 through 26. 4.3.8 The five (5) foot private drainage easement located on Lot 20 is for the benefit of Lot 19. The Owner of Lots 19 is responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be paid by the Owner of Lot 19. 4.3.9 The ten (10) foot private drainage easement located on Lot 23 is for the benefit of Lots 21, 22, and Lots 24 through 26. The Owners of Lots 19 through 26 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally among the Owners of Lots 19 through 26. 4.3.1 0 The five (5) foot private drainage easement located on Lot 23 is for the benefit of Lot 21. The Owner of Lot 21 is responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be paid by the Owner of Lot 21. 4.3.11 The ten ( 1 0) foot private drainage easement located on Lot 24 is for the benefit of Lots 21, 25 and 26. The Owners of Lots 22 through 26 are jointly responsible to maintain any private drainage facilities located in such private drainage easement, the costs of which maintenance shall be shared equally between the Owners of Lots 22 through 26. DECLARATION OF CIMARRON TOWN HOMES 9 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 4.4 Private Road and Utilities Easements. The Plat for the Property establishes a number of private road and utilities easements over Lots for the benefit of specific Lots. All of the private road and utilities easements are shown on the Plat Map. The Lots benefitted by any such private road and utility easements, and the Lots Owners responsible to maintain the private road and utilities facilities located therein are as follows: 4.4.1 The nineteen ( 19) foot private road and utilities easement located on Lots 1, 2 and 3 is for the benefit of Lots 1, 2 and 3. The Owners of Lots 1, 2 and 3 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally among the Owners of Lots 1, 2 and 3. 4.4.2 The nineteen ( 19) foot private road and utilities easement located on Lots 4 and 5 is for the benefit of Lots 4 and 5. The Owners of Lots 4 and 5 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally between the Owners of Lots 4 and 5. 4.4.3 The nineteen (19) foot private road and utilities easement located on Lots 8 and 9 is for the benefit of Lots 8 and 9. The Owners of Lots 8 and 9 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally between the Owners of Lots 8 and 9. 4.4.4 The nineteen (19) foot private road and utilities easement located on Lots 10 and 11 is for the benefit of Lots 10 and 11. The Owners of Lots 1 0 and 11 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally between the Owners of Lots 10 and 11. 4.4.5 The nineteen (19) foot private road and utilities easement located on Lots 12 and 13 is for the benefit of Lots 12 and 13. The Owners of Lots 12 and 13 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally between the Owners of Lots 12 and 13. 4.4.6 The twenty-six {26) foot private road and utilities easement located on Lots 14 through 17 is for the benefit of Lots 14 through 17. The Owners of Lots 14 through 17 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally between the Owners of Lots 14 through 17. 4.4. 7 The nineteen ( 19) foot private road and utilities easement located on Lots 19, 20, 21 and 23 is for the benefit of Lots 19, 20, 21 and 23. The Owners of DECLARATION OF CIMARRON TOWNHOMES 10 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 Lots 19, 20, 21 and 23 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally among the Owners of Lots 19, 20, 21 and 23. 4.4.8 The nineteen (19) foot private road and utilities easement located on Lots 22, 24, 25 and 26 is for the benefit of Lots 22, 24, 25 and 26. The Owners of Lots 22, 24, 25 and 26 are jointly responsible to maintain any private road and utility facilities located in such private road and utilities easement, the costs of which maintenance shall be shared equally among the Owners of Lots 22, 24, 25 and 26. 4.5 Standard of Performance. Unless otherwise specifically provided in this Declaration or in other instruments creating and assigning such maintenance responsibility, responsibility for maintenance shall include responsibility for repair and replacement, as necessary. All maintenance shall be performed consistent with the Community-Wide Standards and all applicable covenants. Neither the Association, Declarant nor any Owner shall be liable for any damage or injury occurring to or arising out of the condition of property maintained by the Association. ARTICLE 5 INSURANCE AND CASUALTY LOSSES 5.1 Association Insurance. The Association, acting through its Board or its duly authorized agent, shall obtain blanket "all-risk" insurance, if reasonably available, for all insurable improvements on the Common Area and other portions of the Area of Common Responsibility for which it has assumed responsibility for maintenance, repair and/or replacement. If blanket "all-risk" coverage is not generally available at reasonable cost, fire and extended coverage insurance, including coverage for vandalism and malicious mischief, shall be obtained. The face amount of the policy shall be sufficient to cover the full replacement cost of insured structures. The Board shall also obtain a public liability policy covering the Area of Common Responsibility, insuring the Association and its Members for all damage or injury caused by the negligence of the Association, any of its Members, its employees, agents or contractors acting on its behalf. If generally available at reasonable cost, the public liability policy shall have at least a Two Million Dollar ($2,000,000) combined single limit per occurrence and in the aggregate. The Association shall also obtain, if reasonably available, an umbrella policy providing at least Three Million Dollars ($3,000,000) in additional coverage, bringing total liability coverage to at least Five Million Dollars ($5,000,000). Premiums for all insurance shall be Common Expenses included in the Base Assessment. The policies may contain reasonable deductibles which shall be disregarded in determining whether the insurance meets the coverage requirements. In the event of an insured loss, the deductible shall be treated as a Common Expense. DECLARATION OF CIMARRON TOWN HOMES 11 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 However, if the Board reasonably determines, after notice and an opportunity to be heard under the Bylaws, that the loss resulted from negligence or willful misconduct of one or more Owners, then the Board may assess the full amount of such deductible against such Owner(s) and their Lot(s) under Section 9.6. All insurance coverage obtained by the Board on behalf of the Association shall: (a) be written with a company authorized to do business in Washington which holds a B or better general policyholder's rating, or a financial performance index of 6 or better in the Best's Key Rating Guide, or an A or better rating from Demotech,lnc., orin the aUernative, the highesttating generally available; (b) be written in the name of the Association as trustee for the benefitted parties (policies on the Common Area shall be for the benefit of the Association and its Members); (c) vest in the Board exclusive authority to adjust losses, provided that a Mortgagee having an interest in such losses may participate in any settlement negotiations; (d) provide that it will not be brought into contribution with insurance purchased by individual Owners, occupants or their Mortgagees; (e) if for property insurance, have inflation guard endorsements, if reasonably available; (f) if containing a co-insurance clause, have an agreed amount endorsement, if reasonably available; and (g) provide for a Certificate of Insurance to be furnished to the Association. A copy of such Certificate shall be provided by the Association to any Member upon request. The Association shall arrange for an annual review of the sufficiency of insurance coverage by one or more qualified persons, at least one of whom must be in the real estate industry and familiar with construction in the area of King County, Washington. The Board shall use reasonable efforts to secure insurance policies that provide endorsements: (i) waiving subrogation as to any claims against the Association's Board, officers, employees and Manager, the Owners and occupants of Lots and their respective tenants, servants, agents and guests; DECLARATION OF CIMARRON TOWN HOMES 12 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 (ii) wa1v1ng rights of the insurer to repair and reconstruct instead of paying cash; (iii) providing that the policy may not be cancelled, invalidated, suspended or subjected to non-renewal on account of any one or more individual Owners; (iv) providing that the policy may not be cancelled, invalidated, suspended or subjected to non-renewal on account of any curable defect or violation without prior written demand to the Association to cure the defect or violation and allowance of a reasonable time to cure; (v) excluding individual Owner policies from consideration under any other insurance clause; and (vi) providing that the Association will be given at least thirty (30) days' prior written notice of any cancellation, substantial modification or non-renewal. The Association also shall obtain, as a Common Expense, a fidelity bond or bonds, if generally available at reasonable cost, covering all persons responsible for handling Association funds. The amount of fidelity coverage shall be determined by the Board but, if reasonably available, may not be less than one-fourth (1/4) of the annual Base Assessments on all Lots plus reserves on hand. Bonds shall contain a waiver of all defenses based upon the exclusion of Persons serving without compensation and shall require at least thirty (30) days' prior written notice to the Association of any cancellation, substantial modification or non-renewal. The Board shall also obtain liability insurance coverage for directors and officers in the amount of at least Two Million Dollars ($2,000,000), if reasonably available, insuring the Association and its officers, directors and committee members (former, present and future) from liability for any actions or decisions for which the Association would have the duty to indemnify them under this Declaration. The Board shall also obtain, as a Common Expense, worker's compensation and employer's liability insurance if and to the extent required by law, and such other insurance as it deems necessary or advisable, including flood insurance. 5.2 Damage and Destruction. 5.2.1 Immediately after damage or destruction by fire or other casualty to all or any part of the Property covered by insurance written in the name of the Association, the Board or its agent shall file all claims arising under such insurance and obtain reliable and detailed estimates of the cost of repair or reconstruction of the damaged or destroyed property. Repair or reconstruction, as used in this Section, means repairing or restoring the property to substantially the condition existing prior to DECLARATION OF CIMARRON TOWN HOMES 13 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 the damage, with any changes needed to comply with applicable building codes. 5.2.2 Any damage to the Common Area shall be repaired or reconstructed unless at least seventy-five percent (75%) of the total Class "A" votes in the Association, and the Class "B" Member, if any, decide within sixty (60) days after the loss either (a) not to repair or reconstruct, or (b) to construct alternative improvements. If either the insurance proceeds or reliable, detailed estimates of the cost of repair or reconstruction are not available to the Association within the sixty (60) day period, then the period may be extended for not more than sixty (60) additional days. No Mortgagee shall have the right to participate in the determination of whether the damage or destruction to the Common Area shall be repaired or reconstructed. 5.2.3 If it is determined that the damage to the Common Area shall not be repaired or reconstructed and no alternative improvements on the affected portion of the Property are authorized, the affected area shall be cleared of all debris and ruins and thereafter maintained by the Association in a neat and attractive, landscaped condition consistent with the Community-Wide Standards. 5.3 Disbursement of Proceeds. Any insurance proceeds remaining after paying for repair or reconstruction or, if no repair or reconstruction is made, after such settlement as is necessary and appropriate with the affected Owner and their Mortgagees as their interests may appear, shall be retained by the Association and placed in a capital improvements account. This is a covenant for the benefit of any Mortgagee of a Lot and may be enforced by such Mortgagee. 5.4 Repair and Reconstruction. If the insurance proceeds are insufficient to pay for repairing or reconstructing the damage to the Common Area, the Board may, during and following the completion of any repair or reconstruction and without membership approval, levy Special Assessments to pay for such repair or reconstruction against those Owners responsible for the premiums for the applicable insurance coverage under Section 5.1. The Association shall have the exclusive right to deal with all venders, contractors or subcontractors in connection with the performance of any such repair and/or reconstruction work. ARTICLE 6 NO PARTITION Except as permitted in this Declaration or amendments to this Declaration, the Common Area shall remain undivided, and no Owner nor any other Person shall bring any action for partition of the whole or any part thereof without the written consent of all Owners and Mortgagees. DECLARATION OF CIMARRON TOWN HOMES 14 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 ARTICLE 7 CONDEMNATION Whenever any part of the Common Area shall be taken or conveyed under threat of condemnation by any authority having the power of eminent domain, each Owner shall be entitled to notice thereof. The Board may convey Common Area under threat of condemnation only if approved in writing by at least sixty-seven percent (67%) of the total Class "A" votes in the Association and Declarant, as long as Declarant owns any Property described on Exhibit A. The award made for such taking or conveyance shall be payable to the Association as trustee for all Owners to be disbursed as follows: If the taking involves a portion of the Common Area on which improvements have been constructed, the Association shall restore or replace such improvements on the remaining land included in the Common Area to the extent practicable, unless within sixty (60) days after such taking, Declarant, so long as Declarant owns any Property described in Exhibit A, and at least sixty-seven percent (67%) of the total Class "A" vote of the Association shall otherwise agree. Any such construction shall be in accordance with plans approved by the Board. The provisions of Section 5.3 regarding the disbursement of funds shall apply to disbursement of awards. ARTICLE 8 ASSESSMENTS 8.1 Creation of Assessments. There are hereby created three (3) types of Assessments for Association expenses: (a) Base Assessments to fund Common Expenses for the general benefit of all Lots, (b) Special Assessments as described in Section 8.4, and (c) Specific Assessments as described in Section 8.5. Each Owner, by acceptance of a deed or recording a contract of sale for any portion of the Property, is deemed to covenant and agree to pay these Assessments as levied from time to time by the Association. All Assessments, together with interest at a rate set by the Board (not to exceed eighteen percent [18%] or the highest rate allowed by Washington law, if less) from the date of delinquency, late charges, costs and reasonable attorneys' fees, shall be a charge and a continuing lien upon each Lot against which the Assessment is made until paid, as more particularly provided in Section 8.6. Each such Assessment, with interest, late charges, costs of collection, including reasonable attorneys' fees, also shall be the personal obligation of the Person who was the Owner of such Lot at the time the Assessment arose. If title to a Lot is transferred, the grantee shall be jointly and severally liable for Assessments and charges due at the time of conveyance, except that a first Mortgagee who obtains title to a Lot by exercising rights under the Mortgage shall not be liable for previously accrued Assessments and related charges. DECLARATION OF CIMARRON TOWN HOMES 15 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 The Association shall, on request, furnish to any Owner a written certificate setting forth whether Assessments have been paid for any particular Lot, on advance payment of a reasonable processing fee as set by the Board. Assessments shall be paid in a manner and by dates fixed by the Board. The Board may allow payment of Assessments in installments. Unless the Board otherwise provides, the Base Assessment shall be due in advance on a monthly basis on the first day of each month of the fiscal year. If any Owner is delinquent in paying any Assessments or charges levied on the Lot, the Board may require all unpaid Assessment installments to be paid immediately. No Owner may exempt themself from liability for Assessments by non-use of Common Area, abandonment of the Lot or any other means. The obligation to pay Assessments is a separate and independent covenant of each Owner. No diminution or abatement of Assessment or setoff shall be claimed or allowed for any alleged failure of the Association to take any action required of it or for inconvenience or discomfort arising from repairs or improvements or other actions taken by it. During the Class "B" Control Period, Declarant may elect annually to pay the Association either (a) regular Assessments on all of its unsold Lots within the Property, notwithstanding the commencement date under Section 8. 7, or (b) the difference between the amount of Assessments against all other Lots and the necessary expenditures of the Association within a division of the Property during the fiscal year. Unless Declarant otherwise notifies the Board at least sixty (60) days before the beginning of a fiscal year, or at any time during a fiscal year after at least sixty (60) days' notice frorn Declarant to the Board, Declarant shall continue paying on the same basis as the preceding fiscal year. Declarant's obligations hereunder may be satisfied in cash, by "in kind" contributions of services or materials, or by a combination of these. The Association is specifically authorized to enter into subsidy contracts or contracts for "in kind" contribution of services and materials with Declarant or others for payment of Common Expenses. 8.2 Budget Approval and Computation of Base Assessment. Within thirty (30) days after adoption of any proposed budget for the Association, the Board shall provide a summary of the budget to all Owners and shall set a date for a meeting of the Owners to consider ratification of the budget not less than fourteen (14) nor more than sixty (60) days after mailing of the summary. Unless at that meeting the budget is rejected by both fifty-one percent (51%) of the Class "A" votes in the Association and the Class "B" Member, if any, the budget is ratified, whether or not a quorum is present. In the event the proposed budget is rejected, the periodic budget last ratified by the Owners shall be continued until such time as the Owners ratify a subsequent budget proposed by the Board. DECLARATION OF CIMARRON TOWN HOMES 16 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 The Base Assessment shall be set in aggregate amounts reasonably expected to produce income equaling the total budgeted Common Expenses. In determining Assessments, the Board may consider other sources of funds available to the Association. In addition, the Board shall take into account the number of Lots subject to assessment under Section 8. 7 on the first (1st) day of the fiscal year for which the budget is prepared and the number of Lots reasonably anticipated to become subject to assessment during the fiscal year. Declarant may, but is not obligated to, reduce the Base Assessments by paying a subsidy (in addition to any amounts paid by it under Section 8.1 ), which may be either a contribution, an advance against future Assessments due from Declarant, or a loan, in Declarant's discretion. Any such subsidy shall be disclosed as a line item in the Common Expense budget. Payment of any subsidy shall not obligate Declarant to continue subsidies in the future. 8.3 Reserve Budget and Capital Contribution. The Board shall annually prepare reserve budgets for general purposes which take into account the number and nature of replaceable assets, the expected life of each asset, and the expected maintenance repair or replacement cost. The Board shall include in Base Assessments capital contributions in amounts sufficient to meet these projected needs. 8.4 Special Assessments. In addition to other authorized Assessments, the Association may levy Special Assessments from time to time to cover expenses greater or different than those budgeted. Special Assessments shall be levied against the entire membership. Except as otherwise specifically provided in this Declaration, Special Assessments must be approved by the affirmative vote or written consent of Owners representing at least a majority of the Class "A" votes, and consent of the Class "B" Member, if any. Special Assessments shall be paid in a manner and by dates fixed by the Board. The Board may allow payment in installments extending beyond the fiscal year in which the Special Assessment is approved. 8.5 Specific Assessments. The Board may specifically assess against particular Lots, expenses incurred by the Association to provide special benefits, items or services (a) on request of the Owner of a Lot, (b) made necessary by the conduct of the Owner or its licensees, invitees or guests, or (c) necessary to bring the Lot into compliance with this Declaration, the Articles, the Bylaws or Association rules. Such Specific Assessments may be levied by the Board after notice to the applicable Owners and an opportunity for a hearing. 8.6 Lien for Assessments. The Association shall have a lien against each Lot to secure payment of delinquent Assessments, interest, late charges and costs of collection (including attorneys' fees). Such lien shall be prior and superior to all other liens, except (a) the liens for taxes and governmental Assessments which by law are superior, and (b) the lien of any first Mortgage of record (meaning any recorded DECLARATION OF CIMARRON TOWN HOMES 17 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 Mortgage with first priority over other Mortgages) made in good faith and for value. Such lien, when delinquent, may be enforced by suit, judgment and foreclosure in the same manner as a Mortgage. The Association may bid for a Lot at the Foreclosure sale and acquire, hold, lease, mortgage and convey the Lot. When a Lot is owned by the Association following Foreclosure, (a) no right to vote shall be exercised on its behalf, (b) no Assessment shall be levied on it, and (c) each other Lot shall be charged, in addition to its usual Assessment, its pro rata share of the Assessment that would have been charged such Lot had it not been acquired by the Association. The Association may sue to recover a money judgment for unpaid Assessments and related charges, including attorneys' fees, without foreclosing or waiving the lien securing the same. The sale or transfer of any Lot shall not affect the Assessment lien or relieve such Lot from the lien for any Assessments thereafter becoming due. Where the Mortgagee holding a first Mortgage of record or other purchaser of a Lot obtains title pursuant to Foreclosure of the Mortgage, it shall not be liable for the share of the Assessments which became due prior to such acquisition of title. Such unpaid share of Assessments shall be deemed to be Common Expenses collectible from Owners of all Lots including such acquirer. 8.7 Date of Commencement of Assessments. The obligation to pay Assessments shall commence as to each Lot after the Board first determines a budget and levies Assessments upon the first (1st) day of the month following the date of conveyance of such Lot by Declarant to any Person other than a builder. The first monthly Assessment levied on each Lot shall be adjusted according to the number of days remaining in the monthly period at the time Assessments commence on the Lot. 8.8 Failure to Assess. Failure of the Board to fix the Assessment amounts or rates or to deliver Assessment notices shall not be deemed a waiver, modification or a release of any Owner from the obligation to pay Assessments. In such event, each Owner shall continue to pay Base Assessments on the same basis as for the prior year until a new Assessment is made, at which time any shortfalls in collections may be assessed retroactively. 8.9 Capitalization of Association. Upon acquisition of record title to a Lot by the first Owner other than a builder, a contribution shall be made by or on behalf of the purchaser to the working capital of the Association in an amount equal to one-sixth ( 1 /6) of the annual Base Assessment per Lot for that year. This amount shall be in addition to and not in lieu of the annual Base Assessment levied on the Lot and shall not be considered an advance payment thereof. This amount shall be collected at the closing of the Lot and disbursed to the Association for use in covering operating and other expenses incurred by the Association under the terms of this Declaration and the DECLARATION OF CIMARRON TOWNHOMES 18 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 Bylaws, together with reserves established by the Association for future expenses of the Association. 8.10 Exempt Property. All Common Areas are exempt from payment of Base Assessments and Special Assessments: ARTICLE 9 ARCHITECTURAL STANDARDS 9.1 General. No improvements (including staking, clearing, excavation, grading and other site work), exterior alteration of existing improvements (including painting), placement or posting of any object or thing on the exterior of any Lot or the Common Area (e.g., fences, signs, antennas, satellite dishes, clotheslines, playground equipment, lighting, temporary structures, artificial vegetation, exterior sculptures and fountains), or planting or removal of plants, trees or shrubs shall take place except in compliance with this Article and with the approval of the appropriate committee under Section 9.2. An Owner may remodel or redecorate the interior of buildings in any manner desired, repaint the exterior of structures in accordance with the originally approved color scheme, or rebuild structures in accordance with originally approved plans and specifications without approval under this Article; however, modifications to the interior of screened porches, patios and similar portions of a Lot visible from outside the Lot shall require approval under this Article. Each single-family dwelling shall incorporate a minimum one ( 1) car garage, designed and constructed as an integral part of the residence. All dwellings constructed on any Lot shall be designed by and built in accordance with the plans and specifications of a building designer, licensed architect or engineer. All dwellings shall be constructed of new construction materials on-site, unless otherwise approved by the appropriate committee under Section 9.2, and shall be constructed in compliance with all applicable building codes. This Article shall not apply to (a) activities of Declarant, or (b) improvements or modifications to the Area of Common Responsibility by or on behalf of the Association. This Article may not be amended without Declarant's written consent so long as Declarant owns any land subject to this Declaration or which it may unilaterally submit to this Declaration. 9.2 Architectural Review. Administration of the Residential Design Guidelines and review of applications for construction and modifications under this Article shall be handled by an Architectural Control Committee ("ACC"). Committee members need not be Owners or representatives of Owners and may but need not include architects, engineers or similar professionals, whose compensation, if any, shall be established by DECLARATION OF CIMARRON TOWNHOMES 19 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 the Board. The Board may establish reasonable fees for review of applications by the Committee and their consultants, if any, and require them to be paid by the Owner(s) submitting such application prior to review. The ACC shall consist of at least three (3) but not more than five (5) persons, and shall have exclusive jurisdiction over all construction of any Lot, excluding any construction by Declarant. Until all Lots have been developed and conveyed to Owners other than builders in the normal course of development and sale, Declarant may appoint all members of the ACC who shall serve at its discretion. There shall be no surrender of this right prior to that time except by a recorded instrument executed by Declarant. After all Lots have been developed and conveyed to the Owners other than the builder, the members of the ACC appointed by Declarant shall resign, and the Board shall appoint new members of the ACC. Those members of the ACC shall then be either reappointed or replaced annually by the Board within thirty (30) days of the regular annual meeting of the Association described in the Bylaws. The ACC shall also have exclusive jurisdiction over modifications, additions or alterations made on or to existing structures on Lots and any appurtenant open space. 9.3 Guidelines and Procedures. 9.3.1 Declarant shall prepare initial design, development and construction guidelines and application and review procedures (the "Residential Design Guidelines"), which may contain general provisions applicable to all of the Property and specific provisions which vary from one portion of the Property to another depending upon the location, characteristics and intended use thereof. 9.3.2 Plans and specifications showing the nature, kind, shape, color, size, materials and location of all proposed construction and modifications shall be submitted to the ACC for review and approval. In reviewing each submission, the committees may consider the quality of workmanship and design, harmony of external design with existing structures, and location in relation to surrounding structures, topography and finish grade elevation, and other factors, as well as the Residential Design Guidelines. 9.4 No Waiver of Future Approvals. The approval of any proposals, plans, specifications, drawings or other matters in any one instance shall not be deerned a waiver of any right to withhold subsequent approval of any similar proposals, plans, specifications, drawings or matters. 9.5 Variances. The ACC rnay authorize variances in writing from its guidelines and procedures, but only (a) in accordance with duly adopted rules and regulations, (b) when unique circumstances dictate, such as unusual topography, natural obstructions, hardship or aesthetic or environmental considerations require, and (c) when construction in accordance with the variance would be consistent with the purposes of the Declaration. Inability to obtain or the terms of any governmental DECLARATION OF CIMARRON TOWN HOMES 20 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12120/2013 (m) #210061.014 approval, or the terms of any financing shall not be considered a hardship warranting a variance. 9.6 Limitation of Liability. The ACC shall not be responsible for the structural integrity or soundness of approved construction or modifications, nor for ensuring compliance with building codes and other governmental requirements. Neither Declarant, the Association, the Board, any committee nor member of any of them shall be liable for any injury, damages or loss arising out of the manner or quality of approved construction or modifications. 9.7 Enforcement. Any construction, alteration or other work done in violation of this Article shall be deemed nonconforming. On written request from the Board or Declarant, Owners shall, at their own expense, cure such nonconformance to the satisfaction of the requester, or restore the land to substantially the same condition as existed prior to the nonconforming work. If an Owner fails to so cure or restore, the Board, Declarant or their designees may do so at the Owner's expense and assess the cost against the benefitted Lot as a Specific Assessment under Section 9.5. Any contractor, subcontractor, agent, employee or other invitee of an Owner who fails to com ply with this Article may be excluded by the Board from the Property, subject to the notice and hearing procedures in the Bylaws. In such event, neither the Association, its officers or directors shall be held liable to any Person for exercising the rights granted by this paragraph. In addition, the Board may, on behalf of the Association, pursue all legal and equitable remedies available to enforce this Article and the decisions of the ACC. ARTICLE 10 USE GUIDELINES AND RESTRICTIONS 10.1 Plan of Development: Aoolicabilitv: Effect. Declarant has created CIMARRON TOWN HOMES as a community of single-family residential properties. The Property is subject to land development, architectural and design guidelines as set forth in Article 9. The Property is subject to guidelines and restrictions governing land use, individual conduct and uses of or actions upon the Property as provided in this Article 10. Guidelines dealing with architecture and design are set forth in Article 9. This Declaration and resolutions the Board may adopt establish affirmative and negative covenants, easements and restrictions (the "Use Guidelines and Restrictions"). All provisions of the Declaration and of any rules shall also apply to all occupants, tenants, guests and invitees of any Lot. The Owner shall cause all occupants of their Lot to comply with these provisions. Every Owner shall be responsible for all violations and losses to the Common Area caused by such occupants, although the occupants also are fully liable and may be sanctioned for such violations and losses. Any lease of any Lot shall provide that the lessee and all occupants of the leased Lot shall be bound by the terms of this Declaration, the Bylaws and the rules of the Association. DECLARATION OF CIMARRON TOWN HOMES 21 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 Declarant has promulgated CIMARRON TOWNHOMES' general plan of development in order to protect all Owners' quality of life and collective interests, the aesthetics and environment within the Property, and the vitality of and sense of community within CIMARRON TOWNHOMES, all subject to the Board's ability to respond to changes in circumstances, conditions, needs and desires within the master- planned community. Declarant has prepared initial Use Guidelines and Restrictions which contain general provisions applicable to all of the Property, as well as specific provisions which may vary within the Property, depending upon the location, characteristics and intended use. Such Use Guidelines and Restrictions. are set forth in Section 10.6 below. Based upon these Use Guidelines and Restrictions, the Board shall adopt the initial rules at its initial organizational meeting. 10.2 Board Power. Subject to the terms of this Article 10 and to its duty of care and undivided loyalty to the Association and its Members, the Board shall implement and manage the Use Guidelines and Restrictions through rules which adopt, modify, cancel, limit, create exceptions to, or expand the Use Guidelines and Restrictions. Prior to any such action, the Board shall conspicuously publish notice of the proposal at least five (5) business days prior to the Board meeting. Owners shall have a reasonable opportunity to be heard at a Board meeting prior to action being taken. The Board shall send a copy of any proposed new rule or amendment to each Owner at least thirty (30) days prior to its effective date. The rule shall become effective unless disapproved at a meeting by at least seventy-five percent (75%) of the total Class "A" votes and by the Class "B" Member, if any. The Board shall have no obligation to call a meeting of the Members to consider disapproval except upon petition of the Owners as required for special meetings in the Bylaws. The Board shall have all powers necessary and proper, subject to its exercise of sound business judgment and reasonableness to effect the duties contained in this Section 1 0.2. The Board shall provide, without cost, a copy of the Use Guidelines and Restrictions, including the Initial Use Guidelines and Restrictions in Section 10.6 below and rules then in effect to any requesting Member or Mortgagee. 10.3 Members' Power. The Members, at a meeting duly called for such purpose as provided in Article 2 of the Bylaws, may adopt, repeal, modify, limit and expand Use Guidelines and Restrictions and implement rules by a vote of seventy-five percent (75%) of the total Class "A" votes and the approval of the Class "B" Member, if any. 10.4 Owners' Acknowledgment. All Owners are subject to the Use Guidelines and Restrictions and are given notice that (a) their ability to use their privately owned property is limited thereby, and (b) the Board may add, delete, modify, create exceptions to, or amend the Use Guidelines and Restrictions in accordance with DECLARATION OF CIMARRON TOWN HOMES 22 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 Sections 10.2, 10.3 and 15.2. Each Owner, by acceptance of a deed, acknowledges and agrees that the use, enjoyment and marketability of their property can be affected by this provision, and the Use Guidelines and Restrictions and rules may change from time to time. 10.5 Rights of Owners. Except as may be contained in Section 10 .6 below, neither the Board nor the Association may adopt any rule in violation of the following provisions: 1 0.5.1 Equal Treatment. Similarly situated Owners and residents shall be treated similarly. 10.5.2 Speech. The rights of Owners and occupants to display on their Lot political signs and symbols of the kinds normally displayed in or outside of residences located in residential neighborhoods in individually owned property shall not be abridged, except that the Association may adopt reasonable time, place and manner restrictions for the purpose of minimizing damage and disturbance to other Owners and occupants. 10.5.3 Religious and Holiday Displays. The rights of Owners to display on their Lots religious and holiday signs, symbols and decorations of the kinds normally displayed in or outside of residences located in residential neighborhoods shall not be abridged, except that the Association may adopt reasonable time, place and manner restrictions for the purpose of minimizing damage and disturbance to other Owners and occupants. 10.5.4 Household Composition. The Association or Board shall make no rule that interferes with the freedom of occupants to determine the composition of their households, except that the Association shall have the power to require that all occupants be members of a single housekeeping Lot, and to limit the total number of occupants permitted in each Lot on the basis of the size and facilities of the Lot, to the extent not prohibited by law, and consistent with its fair share use of the Common Area, including parking. 1 0.5.5 Activities within Lot. Neither the Association nor the Board shall make any rule that interferes with the activities of the residents carried on within the confines of their Lot, except that the Association may prohibit activities not normally associated with property restricted to residential use, and it may restrict or prohibit any activities that impose monetary costs on the Association or other Owners, that create a danger to the health or safety of other occupants, that generate excessive noise or traffic, that create unsightly conditions visible outside the Lot, that block the views from other Lots, or that create an unreasonable source of annoyance. 1 0.5.6 Pets. Unless the keeping of pets is prohibited at the time of the sale of the first Lot by rule or Use Guidelines and Restrictions, no rule prohibiting the DECLARATION OF CIMARRON TOWN HOMES 23 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 keeping of ordinary household pets shall be adopted thereafter over the objection of any Owner expressed in writing to the Association. Notwithstanding the above, the Association or Board may adopt reasonable regulations designed to minimize damage and disturbance to other Owners and occupants, including regulations requiring damage deposits, waste removal, leash controls, noise controls, occupancy limits based on size and facilities of the Lot and fair share use of the Common Area. Nothing in this provision shall prevent the Association from requiring removal of any animal that presents an actual threat to the health or safety of residents, or from requiring abatement of any nuisance or unreasonable source of annoyance. 10.5.7 Allocation of Burdens and Benefits. The initial allocation. of financial burdens and rights to use Common Areas among the various Lots shall not be changed to the detriment of any Owner over that Owner's objection expressed in writing to the Association. Nothing in this provision shall prevent the Association from changing the Common Areas available, from adopting generally applicable rules for use of Common Areas, or from denying use privileges to those who abuse the Common Area, violate rules or this Declaration, or fail to pay Assessments. This provision does not affect the right to increase or decrease the amount of Assessments as provided in Article 9. 1 0.5.8 Alienation. The Association or Board shall not adopt rules that prohibit transfer of any Lot or require consent of the Association or Board for transfer of any Lot. 10.5.9 Reasonable Rights to Develop. Neither the Association nor the Board shall adopt any rule or take any action which would impede Declarant's right to develop in accordance with the master plan for CIMARRON TOWN HOMES. 1 0.5.1 0 Abridging Existing Rights. If any rule would otherwise require Owners to dispose of personal property which they owned at the time they acquired their Lots, such rule shall not apply to any such Owners without their written consent. 10.6 Initial Use Guidelines and Restrictions. 1 0.6.1 General. The Property shall be used only for residential, recreational and related purposes (which may include without limitation business offices for the Declarant or the Association consistent with this Declaration). 10.6.2 Restricted Activities. The following activities are prohibited within the Property unless either (a) expressly authorized by and then subject to such conditions as may be imposed by the Board, or (b) undertaken by Declarant in the normal course of developing the Property: (a) Parking of commercial vehicles, recreational vehicles, mobile homes, boats or other watercraft, or other oversized vehicles, stored vehicles or DECLARATION OF CIMARRON TOWNHOMES 24 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 inoperable vehicles in places other than enclosed garages (unless adequately screened from view of both all Lots and approved by the ACC). The term "commercial vehicles" shall be defined as any vehicle used for business related purposes, whether so labeled or not, that meets any of the following criteria: (i) Gross Vehicle Weight Rating (GVWR) over 10,000 pounds, (ii) dual rear wheels on a single axle ("dually"), (iii) multiple rear axles, or (iv) the vehicle has motorized exterior accessories that can extend or can be extended from the vehicle beyond or above the perimeter of the vehicle's body. No motor vehicle may be parked in a location or manner that blocks or impairs access to any other Lots or fire lanes. Also, no portion of a motor vehicle may be parked within the "no parking" zone designated on any road or street, if any. No vehicles may be parked on any road or street, other than within parking spaces designated and physically marked by the Declarant or the Association, if any. The Board shall require removal of any inoperative or improperly licensed vehicle, or any unsightly vehicle. If the same is not removed, the Board shall cause removal at the risk and expense of the Owner thereof; (b) Capturing, trapping, injuring or killing of wildlife within the Property, except in circumstances posing an imminent threat to the safety of persons using the Property or except as required or permitted by any applicable governmental authority; (c) Chasing, injuring or killing of wildlife within the Property by pets of Owners or occupants of Lots within the Property; (d) Raising, breeding or keeping of animals, livestock or poultry of any kind, except that a reasonable number of dogs, cats or other usual and common household pets may be permitted in a Lot. However, those pets which are permitted to roam free or, in the sole discretion of the Board, make objectionable noise, endanger the health or safety of or constitute a nuisance or inconvenience to the occupants of other Lots shall be removed upon request of the Board. If the pet owner fails to honor such request, the Board may remove the pet; (e) Obstruction or re-channeling of drainage flows after location and installation of drainage swales, storm sewers or storm drains, except that the Declarant and the Association shall have such right, provided the exercise of such right shall not materially diminish the value of or unreasonably interfere with the use of any Lot without the Owner's consent; (f) Subdivision of a Lot into two (2) or more Lots after a subdivision plat including such Lot has been approved and filed, or changing the boundary lines of any Lot, except that the Declarant and builder, with Declarant's consent, shall be permitted to subdivide or change the boundary lines of Lots which they own; DECLARATION OF CIMARRON TOWN HOMES 25 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 (g) Excavating, filling or otherwise altering the grade of slopes within a Lot including, but not limited to, trenching, digging, installation of walls, patios, trees, play equipment, water features, stairways, paths and structures, removing grass or other slope stabilizing vegetation between October 1 and May 1 of each year, or having a slope in an unvegetated or stabilized and protected condition for more than thirty (30) days. Lot Owners requesting ACC approval to alter slopes shall be required to submit an evaluation of the proposed alteration by a professional geotechnical or soils engineer. (h) Excavating, filling or otherwise altering the grade above or below retaining walls and rockeries within fifteen (15) feet of the walls or rockery, or construction of any structures within fifteen ( 15) feet of a rockery or retaining wall. (i) Excavating, filling, covering or otherwise altering the ground above subsurface drainage facilities, such as footing drains at the retaining walls, trench or French drains at the toe of a slope, and front or rear yard area drains. Alteration of drainage facilities can cause significant damage to property and may represent a life safety hazard. All proposed alterations of drainage facilities shall require the review and concurrence of a professional registered civil or geotechnical engineer. (j) Operation of a timesharing, fraction-sharing or similar program, whereby the right to exclusive use of the Lot rotates among participants in the program on a fixed or floating time schedule over a period of years, except that Declarant and its assigns may operate such a program with respect to Lots which it owns. (k) Conversion of any garage, attic or other unfinished space, other than a basement, to finished space for use as an apartment or other integral part of the living area on any Lot, except as approved by the ACC; (I) Any business, trade or similar activity, except that an Owner or occupant residing in a Lot may conduct business activities within the Lot so long as (i) the existence or operation of the business activity is not apparent or detectable by sight, sound or smell from outside the Lot; (ii) the business activity conforms to all zoning requirements for the Property; (iii) the business activity does not involve regular visitation of the Lot by clients, customers, suppliers or other business invitees or door-to-door solicitation of residents of the Property; or (iv) the business activity is consistent with the residential character of the Property and does not constitute a nuisance or a hazardous or offensive use, or threaten the security or safety of other residents of the Property, as may be determined in the sole discretion of the Board. This Subsection shall not apply to any activity conducted by the Declarant or a builder approved by the Declarant DECLARATION OF CIMARRON TOWNHOMES 26 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 with respect to its development and sale of the Property or its use of any Lots which it owns within the Property; (m) Any construction, erection, modification or placement, permanently or temporarily, on the outside portions of the Lot, whether such portion is improved or unimproved, except as provided in Article 8; and (n) Posting, placing or maintaining any signs on any portion of the Property, including Lots, except for those signs approved by the Board in writing. ARTICLE 11 EASEMENTS 11.1 Easements of Encroachment. There shall be reciprocal appurtenant easements of encroachment, and for maintenance and use of any fence, retaining walls, roof overhangs or other improvements encroaching between each Lot and any adjacent Common Area, and between adjacent Lots due to the unintentional misplacement, settling or shifting of the improvements constructed, reconstructed or altered thereon (in accordance with the terms of these restrictions). Such easements of encroachments shall be to a distance of not more than one ( 1) foot, and such easements for maintenance shall be to a distance of not more than six (6) feet, as measured from any point on the common boundary along a line perpendicular to such boundary. This latter easement for maintenance includes the right of an Owner to enter upon the side yard of the adjoining Lot(s) in order to perform maintenance or improvements located on their Lot. 11.2 Easements for Utilities. Etc. Declarant reserves unto itself, so long as it owns any property described on Exhibit A, and grants to the Association an easement for the purposes of access and maintenance upon, across, over and under all of the Property to the extent reasonably necessary to install, replace, repair and maintain, as applicable, cable television systems, master television antenna systems, security and similar systems, roads, walkways, bicycle pathways, lakes, ponds, wetlands, drainage systems, street lights, signage and all utilities, including but not limited to water, sewer, meter boxes, telephone, gas and electricity. The Declarant and/or the Association may assign these rights to any local utility supplier, cable company, security company or other company providing a service or utility to CIMARRON TOWNHOMES, subject to the limitations herein. Notwithstanding anything to the contrary herein, this easement shall not entitle the holders to construct or install any of the foregoing systems, facilities or utilities over, under or through any existing dwelling on a Lot; and any damage to a Lot resulting from the exercise of this easement shall promptly be repaired by and at the expense of the Person exercising the easement. Exercise of this easement shall not unreasonably interfere with the use of any Lot and, except in an emergency, entry onto any Lot shall be made only after reasonable notice to the Owner or occupant. No DECLARATION OF CIMARRON TOWN HOMES 27 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 utilities may be installed or relocated on the Property without approval of the Board or as provided by Declarant. 11.3 Easement for Emergency. Authorized agents of the Association shall have the right, but not the obligation, and a perpetual easement is hereby granted to the Association, to enter all portions of the Property, including each Lot, for emergency, security and safety reasons. Except in emergencies, entry onto a Lot shall be only during reasonable hours and after notice to and permission from the Owner thereof. This easement includes the right to enter any Lot to cure any condition which increases the risk of fire or other hazard if an Owner fails or refuses to cure the condition within a reasonable time after request by the Board, but does not authorize entry into any dwelling without permission of the Owner. 11.4 Easements for Maintenance and Enforcement. Authorized agents of the Association shall have the right, but not the obligation, and a perpetual easement is hereby granted to the Association, to enter all portions of the Property, including each Lot, to (a) perform its maintenance responsibilities under Article 4, and (b) make inspections to ensure compliance with this Declaration, the Bylaws and rules. Except in emergencies, entry onto a Lot shall only be during reasonable hours and after notice to and permission from the Owner. This easement shall be exercised with a minimum of interference to the quiet enjoyment to Owners' property, and any damage shall be repaired by the Association at its expense. The Association, without approval of the Owners, may grant temporary or permanent easements to any public entity, private entity or private party over, under and across any part of the Common Areas as the Association may deem desirable, necessary or convenient to accomplish its maintenance and other responsibilities hereunder. The Association also may enter a Lot to abate or remove, using such force as may be reasonably necessary, any structure, thing or condition which violates the Declaration, the Bylaws or the rules. All costs incurred, including reasonable attorneys' fees, shall be assessed against the violator as a Specific Assessment. ARTICLE 12 MORTGAGEE PROVISIONS The following provisions are for the benefit of holders, insurers and guarantors of first Mortgages on Lots in the Property. This Article applies to both this Declaration and the Bylaws, notwithstanding any other provisions contained therein. 12.1 Notices of Action. An institutional holder, insurer or guarantor of a first Mortgage who provides written request to the Association (such request to state the name and address of such holder, insurer or guarantor, and the street address of the DECLARATION OF CIMARRON TOWN HOMES 28 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 Lot to which its Mortgage relates, thereby becoming an "Eligible Holder") will be entitled to timely written notice of: (a) any condemnation or casualty loss which affects a material portion of the Property or which affects any Lot on which there is a first Mortgage held, insured or guaranteed by such Eligible Holder; (b) any delinquency in the payment of Assessments or charges by the Owner of any Lot subject to the Mortgage of such Eligible Holder, where such delinquency has continued for a period of sixty (60) days. Notwithstanding this provision, upon request, any holder of a first Mortgage is entitled to written notice from the Association of any default in the performance by an Owner of a Lot of any obligation under the Declaration or Bylaws which is not cured within sixty (60) days; (c) any lapse, cancellation or material modification of any insurance policy maintained by the Association; or (d) any proposed action requiring the consent of a specified percentage of Eligible Holders. 12.2 Other Provisions for First Lien Holders. To the extent possible under Washington law: 12.2.1 Any restoration or repair of the Property after a partial condemnation or damage due to an insurable hazard shall be performed substantially in accordance with this Declaration and the original plans and specifications unless the approval is obtained of the Eligible Holders of First Mortgages on Lots to which at least fifty-one percent (51%) of the votes of Lots subject to Mortgages held by such Eligible Holders are allocated. 12.2.2 Any election to terminate the Association after substantial destruction or a substantial taking in condemnation shall require the approval of the Eligible Holders of first Mortgages on Lots to which at least fifty-one percent (51%) of the votes of Lots subject to Mortgages held by such Eligible Holders are allocated. 12.3 Amendments to Documents. The following provisions do not apply to amendments to the constituent documents or termination of the Association made as a result of destruction, damage or condemnation as provided herein. 12.3.1 Except as specifically otherwise set forth in this Declaration, the consent of at least sixty-seven percent (67%) of the Class "A" votes and of Declarant, so long as it owns any land subject to this Declaration, and the approval of the Eligible Holders of first Mortgages on Lots to which at least sixty-seven percent (67%) of the DECLARATION OF CIMARRON TOWN HOMES 29 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 votes of Lots subject to a Mortgage held by an Eligible Holder appertain, shall be required to terminate the Association. 12.3.2 The consent of at least sixty-seven percent (67%) of the Class "A" votes and of Declarant, so long as it owns any land subject to this Declaration, and the approval of Eligible Holders of first Mortgages on Lots to which at least fifty-one percent (51%) of the votes of Lots subject to a Mortgage held by an Eligible Holder appertain, shall be required materially to amend any provisions of the Declaration, Bylaws or Articles, or to add any material provisions thereto which establish, provide for, govern or regulate any of the following: Area; (a) voting; (b) Assessments, Assessment liens or subordination of such liens; (c) reserves for maintenance, repair and replacement of the Common (d) insurance or fidelity bonds; (e) rights to use the Common Area; (f) responsibility for maintenance and repair of the Property; (g) expansion or contraction of the Property; (h) boundaries of any Lot; (i) leasing of Lots; U) imposition of any right of first refusal or similar restriction of the right of any Owner to sell, transfer or otherwise convey their Lot; (k) establishment of self-management by the Association where professional management has been required by an Eligible Holder; or (I) any provisions included in the Declaration, Bylaws or Articles which are for the express benefit of holders, guarantors or insurers of first Mortgages on Lots. 12.4 No Priority. No provision of this Declaration or the Bylaws gives or shall be construed as giving any Owner or other party priority over any rights of the first Mortgagee of any Lot in the case of distribution to such Owner of insurance proceeds or condemnation awards for losses to or a taking of the Common Area. DECLARATION OF CIMARRON TOWNHOMES 30 F:\MBS\Conner Homes Group\Cimarron\Dec!aration 1.docx 12/20/2013 (m) #21 0061.014 12.5 Notice to Association. Upon request each Owner shall be obligated to furnish to the Association the name and address of the holder of any Mortgage encumbering such Owner's Lot. 12.6 Amendment by Board. Should the Federal National Mortgage Association ("Fannie Mae"), the Veterans Administration ("VA"), the Department of Housing and Urban Development ("HUD") or Freddie Mac subsequently delete any of its respective requirements which necessitate the provisions of this Article or make any such requirements less stringent, the Board, without approval of the Owners, may record an amendment to this Article to reflect such changes. 12.7 APPlicability of Article 12. Nothing contained in this Article shall be construed to reduce the percentage vote that must otherwise be obtained under the Declaration, Bylaws or Washington law for any of the acts set out in this Article. 12.8 Failure of Mortgagee to Respond. Any Mortgagee who receives a written request from the Board to respond to or consent to any action shall be deemed to have approved such action if the Association does not receive a written response from the Mortgagee within sixty (60) days of the date of the Association's request, provided such request is delivered to the Mortgagee by certified or registered mail, return receipt requested. ARTICLE 13 DECLARANT'S RIGHTS Any or all rights and obligations of Declarant may be transferred to other Persons, but the transfer shall not reduce an obligation nor enlarge a right beyond that contained in this Declaration or the Bylaws, and shall not be effective unless signed by Declarant and duly recorded in the public records of King County, Washington. So long as Declarant owns any property described in Exhibit A for development and/or sale, Declarant hereby reserves a nonexclusive perpetual easement for the benefit of Declarant, builders authorized by Declarant, and its designees to maintain and carry on upon the Property such facilities and activities as Declarant considers reasonably required, convenient or incidental to the construction or sale of Lots, including but not limited to business offices, signs, model Lots, sales offices and the right to use Lots owned by Declarant or its designees as models and sales offices. So long as Declarant continues to have rights under this Article, no Person shall record any declaration of covenants, conditions and restrictions, or declaration of condominium or similar instrument affecting any portion of the Property without Declarant's written consent. Any attempted recordation without compliance herewith shall result in such instrument being void, unless a consent of Declarant is subsequently recorded in the public records. DECLARATION OF CIMARRON TOWN HOMES 31 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 ARTICLE 14 DISPUTE RESOLUTION AND LIMITATION ON LITIGATION 14.1 Agreement to Avoid Costs of Litigation and to Limit Right to Litigate Disputes. The Association, Declarant, all Persons subject to this Declaration, and any Person not otherwise subject to this Declaration who agrees to submit to this Article (collectively, "Bound Parties") agree to encourage the amicable resolution of disputes involving the Property, and to avoid the emotional and financial costs of litigation if at all possible. Accordingly, each Bound Party covenants and agrees that all claims, grievances or disputes between such Bound Party and any other Bound Party involving the Property, including without limitation claims, grievances or disputes arising out of or relating to the interpretation, application or enforcement of this Declaration, the Bylaws, the Association rules or the Articles (collectively "Claim"), except for those Claims authorized in Section 14.2, shall be resolved using the procedures set forth in Section 14.3 in lieu of filing suit in any court or initiating proceedings before any administrative tribunal seeking redress or resolution of such Claim. 14.2 Exempt Claims. The following Claims ("Exempt Claims" shall be exempt from the provisions of Section 14.3: (a) any suit by the Association against any Bound Party to enforce the provisions of Article 9; (b) any suit by the Association to obtain a temporary restraining order (or equivalent emergency equitable relief) and such other ancillary relief as the court may deem necessary in order to maintain the status quo and preserve the Association's ability to enforce the provisions of Article 9, Article 10 and the Use Guidelines and Restrictions and rules of the Association; (c) any suit between Owners (other than Declarant) seeking to redress on the basis of a Claim which would constitute a cause of action under the laws of the state of Washington in the absence of a claim based on the Declaration, Bylaws, Articles or rules of the Association; (d) any suit by the Association in which similar or identical Claims are asserted against more than one Bound Party; and (e) any suit by a Bound Party for declaratory or injunctive relief which seeks a determination as to applicability, clarification or interpretation of any provision of this Declaration. Any Bound Party having an Exempt Claim may submit it to the alternative dispute resolution procedures set forth in Section 14.3, but there shall be no obligation to do so. The submission of an Exempt Claim involving the Association to the alternative dispute resolution procedures of Section 14.3 shall require the approval of the Association. DECLARATION OF CIMARRON TOWN HOMES 32 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12120/2013 (m) #210061.014 14.3 Mandatory Procedures for All Other Claims. All Claims other than Exempt Claims shall be resolved using the following procedures: 14.3.1 Notice. Any Bound Party having a Claim ("Claimant") against any other Bound Party ("Respondent"), other than an Exempt Claim, shall notify each Respondent in writing of the Claim (the "Notice"), stating plainly and concisely: (a) The nature of the Claim, including date, time, location, persons involved and Respondent's role in the Claim; (b) The basis of the Claim (i.e., the prov1s1ons of this Declaration, the Bylaws, the Articles or rules or other authority out of which the Claim arises); (c) What Claimant wants Respondent to do or not do to resolve the Claim; and (d) That Claimant wishes to resolve the Claim by mutual agreement with Respondent and is willing to meet in person with Respondent at a mutually agreeable time and place to discuss in good faith ways to resolve the Claim. 14.3.2 Negotiation. (a) Each Claimant and Respondent (the "Parties") shall make every reasonable effort to meet in person and confer for the purpose of resolving the Claim by good faith negotiation. (b) Upon receipt of a written request from any Party, accompanied by a copy of the Notice, the Board may appoint a representative to assist the parties in resolving the dispute by negotiation, if in its discretion it believes its efforts will be beneficial to the parties and to the welfare of the Community. 14.3.3 Mediation. (a) If the Parties do not resolve the Claim through negotiation within thirty (30) days of the date of the Notice (or within such other period as may be agreed upon by the Parties) ("Termination of Negotiations"), Claimant shall have thirty (30) additional days within which to submit the Claim to mediation under the auspices of the King County Dispute Resolution Center, or such other independent agency providing similar services upon which the parties may mutually agree. DECLARATION OF CIMARRON TOWN HOMES 33 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 (b) If Claimant does not submit the Claim to mediation within thirty (30) days after Termination of Negotiations, Claimant shall be deemed to have waived the Claim, and Respondent shall be released and discharged from any and all liability to Claimant on account of such Claim; provided, nothing herein shall release or discharge Respondent from any liability to Persons not a party to the foregoing proceedings. (c) If the Parties do not settle the Claim within thirty (30) days after submission of the matter to the mediation process, or within such time as determined reasonable or appropriate by the mediator, the mediator shall issue a notice of termination of the mediation proceedings ("Termination of Mediation"). The Termination of Mediation notice shall set forth when and where the Parties met, that the Parties are at an impasse, and the date that mediation was terminated. {d) Each Party shall, within five (5) days of the Termination of Mediation, make a written offer of settlement in an effort to resolve the Claim. The Claimant shall make a final written settlement demand ("Settlement Demand"} to the Respondent. The Respondent shall make a final written settlement offer ("Settlement Offer") to the Claimant. If the Claimant fails to make a Settlement Demand, Claimant's original Notice shall constitute the Settlement Demand. If the Respondent fails to make a Settlement Offer, Respondent shall be deemed to have made a "zero" or "take nothing" Settlement Offer. 14.3.4 Final and Binding Arbitration. (a) If the Parties do not agree in writing to accept either the Settlement Demand, the Settlement Offer or otherwise resolve the Claim within fifteen (15} days of the Termination of Mediation, the Claimant shall have fifteen {15} additional days to submit the Claim to arbitration in accordance with the Rules of Arbitration of the American Arbitration Association or the Claim shall be deemed abandoned, and Respondent shall be released and discharged from any and all liability to Claimant arising out of such Claim; provided, nothing herein shall release or discharge Respondent from any liability to Persons not a party to the foregoing proceedings. (b) This Section 14.3.4 is an agreement of the Bound Parties to arbitrate all Claims except Exempt Claims and is specifically enforceable under the applicable arbitration laws of the state of Washington. The arbitration award {the "Award") shall be final and binding, and judgment may be entered upon it in any court of competent jurisdiction to the fullest extent permitted under the laws of the state of Washington. DECLARATION OF CIMARRON TOWN HOMES 34 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 14.4 Allocation of Costs of Resolving Claims. 14.1.1 Each Party shall bear its own costs incurred prior to and during the proceedings described in Sections 14.3.1, 14.3.2 and 14.3.3, including the fees of its attorney or other representative. Each Party shall share equally all charges rendered by the mediator(s) pursuant to Section 14.3.3. 14.4.2 Each Party shall bear its own costs (including the fees of its attorney or other representative) incurred after the Termination of Mediation under Section 14.3.3 and shall share equally in the costs of conducting the arbitration proceeding (collectively, "Post Mediation Costs"), except as otherwise provided in Section 14.4.3. 14.4.3 Any Award which is equal to or more favorable to Claimant than Claimant's Settlement Demand shall add such Claimant's Post Mediation Costs to the Award, such Costs to be borne equally by all Respondents. Any Award which is equal to or less favorable to Claimant than Respondent's Settlement Offer to that Claimant shall also award to such Respondent its Post Mediation Costs, such Costs to be borne by all such Claimants. 14.5 Enforcement of Resolution. If the Parties agree to resolve any Claim through negotiation or mediation in accordance with Section 14.3 and any Party thereafter fails to abide by the terms of such agreement, or if the Parties agree to accept the Award following arbitration and any Party thereafter fails to comply with such Award, then any other Party may file suit or initiate administrative proceedings to enforce such agreement or Award without the need to again comply with the procedures set forth in Section 14.3. In such event, the Party taking action to enforce the agreement or Award shall be entitled to recover from the non-complying Party (or if more than one non- complying Party, from all such Parties pro rata) all costs incurred in enforcing such agreement or Award, including without limitation attorneys' fees and court costs. ARTICLE 15 GENERAL PROVISIONS 15.1 Term. This Declaration shall run with and bind the Property, and shall inure to the benefit of and shall be enforceable by the Declarant, the Association and the Owners, their respective representatives, heirs, successors and assigns, perpetually, to the extent allowed by law. 15.2 Amendment. 15.2.1 By Declarant. Declarant may unilaterally amend this Declaration if such amendment is necessary to (a) bring any provision into compliance with any applicable government statute or regulation or judicial determination; (b) enable any reputable title insurance company to issue title insurance coverage on the Lots; (c) DECLARATION OF CIMARRON TOWN HOMES 35 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 enable any institution or government agency to make or purchase mortgage loans on the Lots, including, but not limited to, Fannie Mae, the Veterans Administration ("VA"), and the Federal Housing Administration ("FHA" or "HUD"); (d) enable any government agency or reputable private insurance company to insure or guarantee Mortgage loans on the Lots, including, but not limited to, Fannie Mae, the Veterans Administration ("VA"), and the Federal Housing Administration ("FHA" or "HUD"); (e) otherwise satisfy the requirements of any government agency or governmental regulations. However, any such amendment shall not adversely affect the title to any Lot without the written consent of its Owner, or (f) correct any errors in this Declaration. Also, so long as Declarant owns Property described in Exhibit A for development as part of the Property, it may unilaterally amend this Declaration for any other purpose, provided the amendment has no material adverse affect upon any substantive right of any Owner and does not adversely affect the title to any Lot without the written consent of its Owners. 15.2.2 By Owners. This Declaration may also be amended by the affirmative vote or written consent, or any combination thereof, of sixty-seven percent (67%) of the Class "A" votes held by Members other than Declarant, and, so long as Declarant owns any Property described in Exhibit A for development or sale as part of the Property, with written consent of Declarant. In addition, the approval requirements set forth in Article 12 hereof shall be met if applicable. Notwithstanding the above, the percentage of votes necessary to amend a specific clause shall not be less than the prescribed percentage of affirmative votes required for action to be taken under that clause. Amendments must be recorded in the public records of King County, Washington. If an Owner consents to any Amendment to this Declaration or the Bylaws, it will be conclusively presumed that such Owner has the authority so to consent, and no contrary provision in any Mortgage or contract between the Owner and a third party will affect the validity of such amendment. No Amendment may remove, revoke or modify any right or privilege of Declarant without written consent of Declarant. 15.3 Severability. Invalidation of any provision or application of a provision of this Declaration by any court shall not affect any other provisions or applications. 15.4 Litigation. No judicial or administrative proceeding shall be commenced or prosecuted by the Association unless approved by at least sixty-seven percent (67%) of the total Association vote. This Section shall not apply, however, to actions brought by the Association to (a) enforce this Declaration (including without limitation the foreclosure of liens); (b) impose and collect Assessments under Article 8; (c) challenge tax Assessments and DECLARATION OF CIMARRON TOWNHOMES 36 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 other matters relating to taxes for which the Association may be liable; or (d) counterclaims by the Association in proceedings instituted against it. 15.5 Compliance. Every Owner and occupant of any Lot shall comply with this Declaration, the Bylaws and the rules of the Association and shall be subject to all remedies provided to the Association in this Declaration or the Bylaws. In addition, failure to comply shall be grounds for an action to recover sums due, for damages or injunctive relief, or for any other remedy available at law, or in equity, by the Association or by any aggrieved Owners. 15.6 Notice of Sale or Transfer of Title. Any Owner selling or otherwise transferring title to their Lot shall give the Board at least seven (7} days' prior written notice of the name and address of the transferee, the date of such transfer of title, and such other information as the Board may reasonably require. Each transferee of a Lot shall, within seven (7) days of taking title to a Lot, confirm that the information previously provided by the transferor is complete and accurate. The transferor shall continue to be jointly and severally responsible with the transferee for all obligations of the Owner of the Lot coming due prior to the date upon which such notice is received by the Board, including Assessment obligations, notwithstanding the transfer of title to the Lot. IN WITNESS WHEREOF, the undersigned Declarant has executed this Declaration this day of , 2013. DECLARATION OF CIMARRON TOWN HOMES By: DECLARANT: BREMERTON AVENUE TOWNHOMES, LLC, a Washington limited liability company [Print Name] Its: Authorized Agent 37 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #210061.014 STATE OF WASHINGTON ) ) ss. COUNTY OF KING ) certify that know or have satisfactory evidence that ----,---,--,-...,---,-----,---is the person who appeared before me, and said person acknowledged that he signed this instrument, on oath stated that he was authorized to execute the instrument and acknowledged it as the Authorized Agent of BREMERTON AVENUE TOWNHOMES, LLC, a Washington limited liability company, to be the free and voluntary act of such entity for the uses and purposes mentioned in the instrument. Dated: _________ , 2013. (SEAL/STAMP) DECLARATION OF CIMARRON TOWN HOMES [Print Name] NOTARY PUBLIC for the state of Washington Residing at------------- My appointment expires:-------- 38 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014 EXHIBIT A Legal Description Lot 2, King County Short Plat No. 675015, recorded under Recording No. 7509050645, in King County, Washington. Lot 3, King County Short Plat No. 675015, recorded under Recording No. 7509050645, in King County, Washington. DECLARATION OF CIMARRON TOWN HOMES 39 F:\MBS\Conner Homes Group\Cimarron\Declaration 1.docx 12/20/2013 (m) #21 0061.014