AMENDED AND RESTATED BYLAWS

OF

GREEN VALLEY DESERT HILLS NO. 2, INC.

an Arizona non-profit corporation

PLEASE NOTE: this document is annotated to compare it to the

current Bylaws of Green Valley Desert Hills No. 2, Inc. The final

version, which will be filed in the Association’s records, will not

show the annotations.

[ANNOTATIONS ARE SHOWN IN BRACKETS THROUGHOUT THE DOCUMENT]

i

TABLE OF CONTENTS

INTRODUCTION .............................................................................................. 1ARTICLE I.

1.1 Amendment and Restatement of Bylaws ..................................................................................... 1

1.2 Declaration.................................................................................................................................... 1

1.3 Governing Documents .................................................................................................................. 1

NAME, PRINCIPAL OFFICE, AND DEFINITIONS .................................................. 1ARTICLE II.

2.1 Name............................................................................................................................................. 1

2.2 Principal Office.............................................................................................................................. 1

2.3 Definitions..................................................................................................................................... 1

ASSOCIATION: MEMBERSHIP, MEETINGS, QUORUM, VOTING......................... 2ARTICLE III.

3.1 Membership.................................................................................................................................. 2

3.2 Place of Meetings.......................................................................................................................... 2

3.3 Annual Meetings ........................................................................................................................... 2

3.4 Special Meetings ........................................................................................................................... 2

3.5 Notice of Meetings........................................................................................................................ 2

3.6 Waiver of Notice ........................................................................................................................... 3

3.7 Voting Rights ................................................................................................................................. 3

3.8 Voting Procedures......................................................................................................................... 4

3.9 Majority......................................................................................................................................... 6

3.10 Quorum......................................................................................................................................... 6

3.11 Conduct of Meetings..................................................................................................................... 6

BOARD OF DIRECTORS: NUMBER, MEETINGS.................................................. 6ARTICLE IV.

4.1 Governing Body; Composition ...................................................................................................... 6

4.2 Number of Directors ..................................................................................................................... 7

4.3 Nomination Procedures ................................................................................................................ 7

4.4 Election Procedures ...................................................................................................................... 7

4.5 Term of Office ............................................................................................................................... 7

4.6 Removal of Directors and Vacancies............................................................................................. 8

ii

4.7 Board Meetings............................................................................................................................. 9

4.8 Notice; Waiver of Notice.............................................................................................................10

4.9 Telephonic Participation in Meetings .........................................................................................10

4.10 Quorum of Board of Directors ....................................................................................................10

4.11 Compensation.............................................................................................................................11

4.12 Conduct and Organization of Meetings ......................................................................................11

4.13 Open Meetings............................................................................................................................11

4.14 Action without a Meeting ...........................................................................................................11

4.15 Emergency Action .......................................................................................................................11

POWERS AND DUTIES OF BOARD OF DIRECTORS ........................................... 12ARTICLE V.

5.1 General Powers and Duties.........................................................................................................12

5.2 Powers of the Board ...................................................................................................................12

5.3 Duties of the Board .....................................................................................................................13

5.4 Management...............................................................................................................................15

OFFICERS....................................................................................................... 15ARTICLE VI.

6.1 Officers........................................................................................................................................15

6.2 Election and Term of Office ........................................................................................................17

6.3 Removal and Vacancies...............................................................................................................17

6.4 Resignation..................................................................................................................................17

6.5 Agreements, Contracts, Deeds, Leases, Checks, Etc...................................................................17

6.6 Compensation.............................................................................................................................17

6.7 Special Appointments .................................................................................................................17

COMMITTEES ................................................................................................ 18ARTICLE VII.

7.1 General........................................................................................................................................18

7.2 Standing Committees..................................................................................................................18

INDEMNIFICATION OF DIRECTORS AND OFFICERS [N ew S ection]................... 20ARTICLE VIII.

8.1 Indemnification...........................................................................................................................20

8.2 Exclusions....................................................................................................................................20

8.3 Procedure....................................................................................................................................20

8.4 Expense Advances.......................................................................................................................21

8.5 Settlement of Claims...................................................................................................................21

iii

8.6 Insurance and Other Indemnification.........................................................................................21

8.7 Effect of Repeal...........................................................................................................................22

MISCELLANEOUS ........................................................................................... 22ARTICLE IX.

9.1 Fiscal Year....................................................................................................................................22

9.2 Conflicts.......................................................................................................................................22

9.3 Books and Records......................................................................................................................22

9.4 Notices ........................................................................................................................................22

9.5 Amendment ................................................................................................................................22

CERTIFICATION.................................................................................................................... 23

1

ARTICLE I.1

INTRODUCTION [NEW SECTION]2

1.1 Amendment and Restatement of Bylaws. These Amended and Restated3

Bylaws (these “Bylaws”) of Green Valley Desert Hills No. 2, Inc., an Arizona nonprofit4

corporation (the “Association”), hereby amend and restate in their entirety all previous Bylaws5

of the Association. However, prior acts and actions taken in accordance with prior Bylaws are6

hereby validated and saved following adoption of these Bylaws. Any reference herein made to7

the Association’s Bylaws will be deemed to refer to these Bylaws.8

1.2 Declaration. The use of Green Valley Desert Hills No. 2 for the benefit of the9

Members is governed by that certain Amended and Restated Declaration of Establishment of10

Conditions, Covenants and Restrictions for Green Valley Desert Hills No. 2, recorded on11

_____________________, at Sequence #_______________, office of the Pima County Recorder12

(the “Declaration”). All references to the Declaration shall include any amendments.13

1.3 Governing Documents. The term “Governing Documents” shall refer to the14

Declaration, the Articles, the Bylaws and the Rules.15

ARTICLE II.16

NAME, PRINCIPAL OFFICE, AND DEFINITIONS17

[N ew S ection: R eplacesA rticleI(Definitions)inCurrentBylaw s. N otethatA rticleIIincurrent18

Bylaw shasbeendeletedasitreferstoP roperty R ightsandR ightsofEnjoym ent,w hichare19

includedintheDeclaration.]20

2.1 Name. The name of the corporation is Green Valley Desert Hills No. 2, Inc. (the21

“Association”).22

2.2 Principal Office. The principal office of the Association shall be located in Green23

Valley, Pima County, Arizona.24

2.3 Definitions. The words used in these Bylaws shall be given their normal,25

commonly understood definitions. Capitalized terms shall have the same meaning as set forth26

in the Declaration, unless the context indicates otherwise.27

28

29

30

2

ARTICLE III.1

ASSOCIATION: MEMBERSHIP, MEETINGS, QUORUM, VOTING2

3.1 Membership. [N ew S ection]3

3.1.1 Eligibility. Each Owner of a Lot shall be a Member of the Association as4

more fully set forth in the Declaration, the terms of which that pertain to5

Membership are incorporated by this reference.6

3.1.2 Privileges. The privileges of Membership shall be to vote (in accordance7

with this Article III), to hold office, and to enjoy or benefit from the Common8

Areas, subject to the Governing Documents.9

3.1.3 Suspension of Privileges. The Board has the right to suspend the voting10

rights of any Owner for any period in which the Assessment against his/her Lot11

remains unpaid.12

3.2 Place of Meetings. Meetings of the Association shall be held at a suitable place13

as the Board may designate, provided such place is as convenient and practical for the14

Members as possible. [N ew S ection]15

3.3 Annual Meetings. The Members shall meet at least annually with such annual16

meeting to be held in February of each year on a date and at a time set by the Board. [N ew17

S ection]18

3.4 Special Meetings. The President may call special meetings of the Members. In19

addition, it shall be the duty of the President to call a special meeting if so directed by20

resolution of the Board or upon a written petition signed by at least 10% of the Members21

eligible to vote in the Association. The petition shall state the purpose(s) of the proposed22

meeting, and the business transacted at the special meeting shall be confined to the purpose(s)23

stated in the petition. The close of business on the day before delivery of the petition for a24

special meeting shall be the record date for the purpose of determining whether the demand25

for the special meeting has been signed by at least 10% of the Members eligible to vote in the26

Association. [R eplacesand expandsA rticleVIII,S ection2,currentBylaw s,w hichrequires25%27

ofM em berstocallaspecialA ssociationM eeting.]28

3.5 Notice of Meetings. A notice stating the place, day, and hour of any meeting of29

the Members shall be delivered, either personally or by first class mail or as otherwise provided30

by A.R.S. §33-1804, to each Member entitled to vote at such meeting, not less than twenty (20)31

nor more than fifty (50) days before the date of such meeting, by or at the direction of the32

President or the Secretary or the officers or persons calling the meeting.33

3

In the case of a special meeting or when otherwise required by statute or these Bylaws,1

the purpose(s) for which the meeting is called shall be stated in the notice. No business shall be2

transacted at a special meeting except as stated in the notice.3

Any notice required by these Bylaws will be effective and deemed to be delivered upon4

receipt when delivered personally; three (3) days after deposit in the United States Postal5

Service when mailed; one (1) business day after pick-up by the courier service when sent by6

overnight courier, properly addressed and prepaid; and on the business day after the date of7

the sender’s electronic confirmation or receipt when sent by facsimile transmission. If sent by8

electronic mail, the notice shall be deemed delivered when sent to the intended recipient’s9

electronic mail address and not returned to sender as “undeliverable” through the electronic10

mail server.11

Notices will be sent to the addresses, facsimile numbers or electronic mail addresses12

last appearing on the records of the Association.13

[R eplacesand expandsA rticle VIII,S ection 3 ofcurrent Bylaw s,w hich callsfornotice of14

A ssociation m eetings(notBoard m eetings)to besentby m ailnotlessthan 10 daysnorm ore15

than50 daysbeforethem eeting.]16

3.6 Waiver of Notice. Waiver of notice of a meeting of the Members shall be17

deemed the equivalent of proper notice. Any Member may, in writing, waive notice of any18

meeting of the Members, either before or after such meeting. Attendance at a meeting by a19

Member shall be deemed waiver by such Member of notice of the time, date, and place20

thereof, unless such Member specifically objects to lack of proper notice at the time the21

meeting is called to order. Attendance at a special meeting also shall be deemed waiver of22

notice of all business transacted at such meeting unless an objection on the basis of lack of23

proper notice is raised before the business is put to a vote. [N ew S ection]24

3.7 Voting Rights. The voting rights of the Members shall be as set forth in the25

Declaration and in these Bylaws. No change in Membership shall be effective for voting26

purposes until the Board receives written notice of such change. Owners are entitled to one27

vote for each Lot owned. There is only one vote for each Lot, whether owned by one or more28

Persons. The vote for each Lot must be cast as a single vote. Fractional votes shall not be29

allowed. In the event that a Lot is owned by more than one Person and such Owners are unable30

to agree as to how their vote or votes shall be cast, they shall not be entitled to vote on the31

matter in question. If any Owner casts a vote representing a certain Lot, he/she will be32

conclusively presumed to be acting with the authority and consent of all other owners of the33

same Lot unless written objection is made to the Board at or prior to the time the vote is cast.34

4

In the event that more than one Person casts or attempts to cast a vote for a particular Lot, all1

such votes shall be deemed void. [N ew S ection]2

3.8 Voting Procedures. [R eplaces and expands A rticles III & IX , on voting3

procedures,m ostly new language]4

3.8.1 Proxies. Members may not vote by proxy, but only in person or by5

absentee or written ballot as provided in this Section 3.8.6

3.8.2 Voting at Meetings. The Association shall provide for votes to be cast in7

person and by absentee ballot and, in addition, the Association may provide for8

voting by some other form of delivery, including the use of e-mail and fax9

delivery. When absentee ballots or ballots provided by some other form of10

delivery are used, the following procedure shall apply:11

3.8.2.1 The ballot shall set forth each proposed action to be taken at12

the meeting.13

3.8.2.2 The ballot shall provide an opportunity to vote for or against14

each proposed action.15

3.8.2.3 The ballot is valid for only one specified election or meeting of16

the Members and expires automatically after the completion17

of the election or meeting.18

3.8.2.4 The ballot must specify the time and date by which the ballot19

must be delivered to the Board in order to be counted. Ballots20

received after this date shall not be counted.21

3.8.2.5 The ballot must be sent to Members at least twenty (20) days22

but not more than fifty (50) days prior to the date of the23

election or vote on an issue, and the date set for the24

tabulation of the ballots shall be stated on the ballot.25

3.8.2.6 Absentee ballots shall be valid for the purpose of establishing26

a quorum for the vote or election.27

3.8.2.7 The absentee ballot cannot authorize another person to cast28

votes on behalf of the Member.29

5

3.8.3 Voting By Written Ballot. Any action that the Members may take at any1

annual or special meeting may be taken without a meeting if the Association2

delivers a written ballot to every Member entitled to vote on the matter.3

3.8.3.1 A written ballot shall:4

(A) Set forth each proposed action.5

(B) Provide an opportunity to vote for or against each6

proposed action.7

3.8.3.2 Approval by written ballot is valid only if both:8

(A) The number of votes cast by ballot equals or exceeds the9

quorum required to be present at a meeting authorizing10

the action.11

(B) The number of approvals equals or exceeds the number of12

votes that would be required to approve the matter at a13

meeting.14

3.8.3.3 All solicitations for votes by written ballot shall:15

(A) Indicate the number of responses needed to meet the16

quorum requirements.17

(B) State the percentage of approvals necessary to approve18

each matter other than election of Directors.19

(C) Specify the time by which a ballot must be delivered to the20

Association in order to be counted, which time shall not be21

l less than ten (10) days after the date that the Association22

delivers the ballot.23

3.8.3.4 The determination of eligibility and tabulation of votes shall24

proceed under the supervision of the Nominating and Election25

Committee as hereinafter provided.26

3.8.4 Voting shall proceed under supervision of the Nominating and Election27

Committee.28

6

3.8.4.1 The Nominating and Election Committee shall be in1

attendance at all times during voting tabulation and during check-in at2

any meeting of Members, and the Committee designee(s) shall verify3

whether a Member is eligible to vote; and shall issue all of the official4

ballots. In addition, some or all of the Committee members shall witness5

the placing of the ballots into the ballot box at the meeting and the6

opening of absentee or written ballots.7

3.8.4.2 The ballots shall remain sealed until the voting is closed, at8

which time they shall be opened and the votes tabulated.9

3.8.4.3 Upon completion of the tabulation of ballots, the results shall10

be certified to the Board of Directors by the Nominating and Election11

Committee and announced to the Membership either at a meeting or, if12

written ballots are used in the absence of a meeting, by written13

notification to the Members.14

3.8.4.4 In the event of a tie vote, there shall be another vote solely for15

the purpose of breaking the tie.16

3.9 Majority. As used in these Bylaws, the term "majority" shall mean those votes,17

Members, Owners, or other groups as the context may indicate totaling more than 50% of the18

total eligible number.19

3.10 Quorum. Except as otherwise provided in these Bylaws or in the Declaration, the20

presence in person or by absentee ballot of Members entitled to cast at least 10% of the votes21

in the Association shall constitute a quorum at all meetings of the Association. [T he current22

Bylaw sdo not establish aquorum forA ssociation m eetings; therefore,the S ection 10-3722,23

A rizonaN on-P rofitCorporationsA ctapplies,w hichstatesthatthequorum isone-tenthofthe24

votesentitledtobecastintheA ssociation.]25

3.11 Conduct of Meetings. The President shall preside over all meetings of the26

Association, and the Secretary or designee shall take the minutes of the meetings and record in27

a minute book all resolutions adopted and all other transactions occurring at such meetings.28

ARTICLE IV.29

BOARD OF DIRECTORS: NUMBER, MEETINGS30

4.1 Governing Body; Composition. The affairs of the Association shall be governed31

by a Board of Directors, with each Director having one (1) equal vote. The Directors shall be32

Members. Members of the same household and related persons including spouses, significant33

7

others, siblings, parents, and children shall not be entitled to serve on the Board of Directors at1

the same time. In the case of a Member which is not a natural person, any officer, director,2

member, partner or trust officer of such Member shall be eligible to serve as a Director unless3

otherwise specified by written notice to the Association signed by such Member; provided, no4

Member may have more than one such representative on the Board at a time. [N ew S ection]5

4.2 Number of Directors. The Board shall consist of not less than five (5) or more6

than seven (7) Directors, provided there is an odd number of Directors on the Board. [R eplaces7

A rticle III,S ection 7 ofthe currentBylaw sw hich statesthatthere shallbe no lessthan seven8

directors. T hecurrentA rticlesofIncorporation,w hichtrum ptheBylaw s,statesthattherebe9

from fivetosevendirectors.]10

4.3 Nomination Procedures. Prior to each election of Directors, the Board shall11

prescribe the opening date and the closing date of a reasonable filing period in which each and12

every eligible person who has an interest in serving as a Director may file as a candidate for any13

position to be filled. The Board shall also establish such other rules and regulations as it deems14

appropriate to conduct the nomination of Directors in a fair, efficient and cost-effective15

manner. [R eplacesandexpandsA rticleIII,S ections2-4 ofthecurrentBylaw s]16

4.3.1 Nominations for election to the Board may also be made by a Nominating17

and Election Committee. The Nominating and Election Committee shall be18

appointed and governed as set forth in Article VII hereof.19

4.3.2 Each candidate shall be given a reasonable, uniform opportunity by the20

Board of Directors to communicate his or her qualifications to the Members and21

to solicit votes.22

4.4 Election Procedures. Each Member may vote by secret ballot for each position23

to be filled from the slate of candidates for the election. There shall be no cumulative voting24

and there shall be a space on the ballot for a write-in vote for each open position on the Board.25

The number of candidates equal to the number of positions to be filled receiving the greatest26

number of votes shall be elected. [R eplacesA rticleIII,S ections1 & 5ofthecurrentBylaw s]27

4.5 Term of Office. Notwithstanding any other provisions of these Bylaws, each28

elected Director shall serve for a term of three (3) years. The terms of the Directors shall be29

staggered. Upon the expiration of the term of office of each Director elected by the Members,30

the Members entitled to elect such Director shall be entitled to elect a successor. Directors31

shall hold office until their respective successors have been elected and qualified. If there is a32

possibility of no staggered terms in any election year, the Board may adopt reasonable rules33

and regulations governing the Nominating and Election Committee’s procedures for the34

8

upcoming election, including a modification of terms for some of the newly-elected Directors so1

that staggered terms will be restored. No duly-elected Director shall serve on the Board for2

more than two elected three-year terms. Partial term appointments made by the Board to fill3

vacancies shall be exempt from term limits. [R eplacesand expandsA rticle III,S ection 7 ofthe4

currentBylaw sonstaggering term sofBoardm em bers.]5

4.6 Removal of Directors and Vacancies. [R eplacesandexpandsA rticleIII,S ection86

ofthe current Bylaw sto com ply w ith S ection 33-1813 ofthe A rizonaP lanned Com m unities7

A ct; and to add provisionson filling vacancieson the Board and to addressunexcused8

absencesfrom Boardm eetingsofaDirector.]9

4.6.1 The Members, by a majority vote of Members entitled to vote and voting10

on the matter at a meeting of the Members called pursuant to these Bylaws, at11

which a quorum is present, may remove any Director from the Board with or12

without cause. For purposes of calling for removal of a Director by the13

Members, the following apply:14

4.6.1.1 On receipt of a petition that calls for removal of a Director and15

that is signed by the Members entitled to cast at least 25% of the votes16

in the Association, the Board shall call and provide written notice of a17

special meeting of the Association as prescribed by these Bylaws. A18

Person is eligible to sign the petition if he/she is eligible to vote in the19

Association at the time of signing.20

4.6.1.2 The special meeting shall be called, noticed and held within21

thirty (30) days after the Board’s receipt of the petition. A quorum is22

present if 20% of the Members who are eligible to vote in the23

Association as of the date of the meeting are present in person or by24

absentee ballot.25

4.6.1.3 If a civil action is filed regarding the removal of a Director, the26

prevailing party in the civil action shall be awarded its reasonable27

attorney fees and costs.28

4.6.1.4 The Board shall retain all documents and other records relating29

to the proposed removal of any Director for at least one (1) year after30

the date of the special meeting and shall permit Members to inspect31

those documents and records pursuant to these Bylaws and applicable32

law.33

9

4.6.1.5 A petition that calls for the removal of the same Director shall1

not be submitted more than once during each term of office for that2

Director.3

4.6.2 If fewer than all of the Directors are removed, the remaining Directors4

shall appoint a successor to fill each vacancy for the remainder of the term. If all5

of the Directors are removed, the Nominating and Election Committee shall6

organize an election to replace the removed Directors, who shall remain in office7

(but shall take no action other than to maintain the day-to-day operations of the8

Association) until the replacement Directors are elected and qualified.9

4.6.3 Any Director who has three (3) consecutive unexcused absences from10

Board meetings, or is more than ninety (90) days delinquent (or is the11

representative of a Member who is delinquent) in the payment of any12

assessment or other charge due the Association, without being excused by the13

President for good cause, shall be deemed to have resigned from office and the14

Board may appoint a successor to fill the vacancy for the remainder of the term.15

4.6.4 In the event of the death, disability, or resignation of a Director, the16

Board may declare a vacancy and appoint a successor to fill the vacancy until the17

next annual meeting, at which time the Members entitled to fill such18

Directorship may elect a successor for the remainder of the term. The Board19

shall act to fill any vacancy within a period of sixty (60) days after the vacancy20

arises unless the annual election will take place within ninety (90) days of the21

vacancy occurring.22

4.6.5 Any Director who the Board appoints shall be selected from among23

Members.24

4.7 Board Meetings. [N ew S ection]25

4.7.1 Organizational Meetings. The first meeting of the Board following each26

annual meeting of the Membership shall be held within ten (10) days thereafter at such time27

and place as the Board shall fix.28

4.7.2 Regular Meetings. Regular meetings of the Board may be held at such29

time and place, within the State, as a majority of the Directors shall determine, but at least four30

(4) such meetings shall be held during each fiscal year.31

10

4.7.3 Special Meetings. Special meetings of the Board shall be held when called1

by written notice signed by the President or Vice President or by any two (2) Directors after2

three days’ notice to each director unless emergency circumstances require shorter notice.3

4.8 Notice; Waiver of Notice. Notice of meetings of the Board of Directors shall4

specify the time and place of the meeting and, in the case of a special meeting, the nature of5

any special business to be considered. The notice shall be given to each Director by: (A)6

personal delivery; (B) first class mail, postage prepaid; (C) telephone communication, either7

directly to the Director or to a person at the Director's office or home who would reasonably be8

expected to communicate such notice promptly to the Director; (D) electronic mail with9

confirmation of the transmission or (E) facsimile (fax) with confirmation of transmission. All10

such notices shall be given at the Director's telephone number or sent to the Director's address11

as shown on the records of the Association. Notices sent by first class mail shall be deposited12

into a United States mailbox at least four (4) business days before the time set for the meeting.13

Notices given by personal delivery, telephone, electronic mail or facsimile shall be delivered,14

telephoned or transmitted by telephone at least seventy-two (72) hours before the time set for15

the meeting. Notice of Board meetings shall also be given to the Members in accordance with16

applicable State law.117

4.9 Telephonic Participation in Meetings. Members of the Board or any committee18

designated by the Board may participate in a meeting of the Board or committee by means of19

conference telephone or similar communications equipment, so that all persons participating in20

the meeting can hear each other. Participation in a meeting pursuant to this Section shall21

constitute presence in person at such meeting.22

4.10 Quorum of Board of Directors. At all meetings of the Board, a majority of the23

Directors shall constitute a quorum for the transaction of business, and the affirmative vote of a24

majority of the Directors present at a meeting at which a quorum is present shall constitute the25

decision of the Board, unless otherwise specifically provided in these Bylaws or the Declaration.26

If any meeting of the Board cannot be held because a quorum is not present, a majority of the27

Directors present at such meeting may adjourn the meeting to a time not less than five (5) nor28

more than thirty (30) days from the date of the original meeting. At the reconvened meeting, if29

a quorum is present, any business which might have been transacted at the meeting originally30

called may be transacted without further notice.31

1 As of the date of these Bylaws, A.R.S. §33-1804 requires forty-eight (48) hours advance notice tomembers of meetings of the Board by newsletter, conspicuous posting or any other reasonable meansas determined by the Board.

11

4.11 Compensation. Directors shall not receive any compensation from the1

Association for acting as such. Any Director may be reimbursed for expenses incurred on behalf2

of the Association. Any expenditure in excess of $100.00 need to be approved by a majority of3

the other Directors. Nothing herein shall prohibit the Association from compensating a4

Director, or any entity with which a Director is affiliated, for services or supplies furnished to5

the Association in a capacity other than as a Director, pursuant to a contract or agreement with6

the Association, provided that such Director's interest was made known to the Board prior to7

entering into such contract and such contract was approved by a majority of the Board of8

Directors, excluding the interested Director.9

4.12 Conduct and Organization of Meetings. Each meeting will be called to order and10

thereafter chaired by the President of the Association acting as the Chairperson of the Board of11

Directors. The Association’s Secretary will act as Secretary of each meeting; in his/her absence,12

the chairperson of the meeting may appoint any person to act as Secretary. The Secretary shall13

keep a minute book of Board meetings, recording all Board resolutions and all transactions and14

proceedings occurring at such meetings.15

As long as there is no showing of bad faith on his/her part, the Chairperson of a meeting16

will, among other things, have absolute authority to determine the order of business to be17

conducted at such meeting and to establish reasonable rules for expediting the business of the18

meeting (including any informal, or question and answer portions thereof.)19

4.13 Open Meetings. Subject to the provisions of Section 4.15, all meetings of the20

Board shall be open to all Members as required under A.R.S. §33-1804(A) or any successor21

statute. Presentation of one or more issues by any Member for consideration by the Board at22

any meeting shall be submitted in writing in order for the issue(s) to be included among agenda23

items for such meeting.24

4.14 Action without a Meeting. Any action that may be taken or is to be taken at a25

meeting of the Directors may be taken without a meeting if a consent in writing, setting forth26

the action so taken, is signed by all of the Directors, and such consent shall have the same force27

and effect as a unanimous vote. Such consents may be submitted via e-mail or fax, and signed28

in counterparts. Such consents shall be announced at and filed with the minutes of the next29

Board meeting. Action without a meeting may be taken only when it is not possible to30

assemble a quorum for a meeting or Board action is required for immediate Association31

business.32

4.15 Emergency Action. In the case of an emergency necessitating an immediate33

decision and action by the Board is required and a quorum of the Board cannot be convened,34

those Directors who are physically present in the Association area shall be empowered to35

12

render an interim decision for the protection and well-being of the Members. A written1

summary of the interim decision(s) will be entered into the Association’s records and shall be2

signed by all the Directors involved in the interim decision.3

ARTICLE V.4

POWERS AND DUTIES OF BOARD OF DIRECTORS5

[R eplacesandexpandsA rticleIV ofthecurrentBylaw s]6

5.1 General Powers and Duties. The Board of Directors shall have all of the powers7

and duties necessary for the administration of the Association’s affairs and for performing all8

responsibilities and exercising all rights of the Association as set forth in the Declaration, these9

Bylaws, the Articles, and as provided by law. The Board may do or cause to be done all acts and10

things which the Declaration, Articles, these Bylaws, or State laws do not prohibit or direct to11

be done and exercised exclusively by the membership generally. [R eplacesand expandsA rticle12

IV,S ection1(e)ofthecurrentBylaw s]13

5.2 Powers of the Board. The powers of the Board include but are not limited to the14

following:15

5.2.1 Hold and administer the assets and direct, control, manage and supervise16

the business and affairs of the Association;17

5.2.2 Enforce all applicable provisions of the Governing Documents;18

5.2.3 Make and publish architectural and design standards, and rules and19

regulations within the authority set forth in the Articles of Incorporation, these20

Bylaws, and the Declaration, and to establish penalties (including but not21

necessarily limited to fines and/or suspension of voting privileges) for the22

infraction thereof. There shall be copies of the complete architectural and design23

standards, and rules and regulations available for purchase or inspection by any24

Member of the Association upon request;25

5.2.4 Employ or terminate the services of any independent contractor, a26

managing agent or such other personnel and employees as the Board deems27

necessary, and to prescribe their duties;28

5.2.5 As more fully provided in these Bylaws and the Declaration to:29

30

(A) Establish and collect Assessments from each Member.31

(B) Perfect and foreclose a lien against any property for which32

Assessments are not paid, or to bring an action at law against the33

Member personally obligated to pay the same.34

13

(C) Pay any taxes and assessments which are, or could become, a lien1

on the property owned by the Association.2

(D) Contract for goods and/or services for the maintenance of3

property for which the Association is responsible.4

(E) When permitted by law, represent the Association before any and5

all governmental or quasi-governmental agencies, offices, groups6

or bodies in conjunction with any matters bearing upon or affect-7

ing the quality of life and property values of the Association’s8

Members, including but not necessarily limited to all planning9

and zoning, fire protection, street lighting, public utility and10

similar regulatory agencies.11

(F) Grant and convey easements, licenses or rights-of-way in12

accordance with the terms of the Declaration.13

(G) Borrow money for maintenance or improvement of14

property owned by the Association, and to mortgage, pledge, or15

hypothecate any or all of the Association’s real or personal16

property as security for money borrowed or debts incurred.17

5.3 Duties of the Board. The duties of the Board shall include, without limitation:18

5.3.1 Preparing and adopting, in accordance with the Declaration, an annual19

budget establishing each Owner's Assessment for his/her share of the common20

expenses, which budget shall include, but not necessarily be limited to, the21

estimated revenue and expenses and the annual cash reserves available for22

replacement and major repairs of the Association’s facilities;23

5.3.2 Levying and collecting such Assessments from the Owners;24

5.3.3 Complying with applicable state law with respect to periodic audit, review25

or compilation of the Association’s financial records, at the discretion of the26

Board, provided that if the services of a certified public accountant are retained,27

he or she shall be appointed by the Board and paid by the Association;28

5.3.4 Providing for the operation, care, upkeep, and maintenance of Common29

Areas;30

14

5.3.5 Designating, hiring, and dismissing the personnel necessary to carry out1

the rights and responsibilities of the Association and where appropriate,2

providing for the compensation of such personnel and for the purchase of3

equipment, supplies, and materials to be used by such personnel in the4

performance of their duties;5

5.3.6 Supervising all officers, agents and employees of the Association and6

ensuring that their duties are properly performed;7

5.3.7 Depositing all funds received on behalf of the Association in a bank8

depository which it shall approve, and using such funds to operate the9

Association; provided, any reserve funds may be deposited, in the Directors' best10

business judgment, in depositories other than banks;11

5.3.8 Opening of bank accounts on behalf of the Association and12

designating the signatories required;13

5.3.9 Making or contracting for the making of repairs, additions, and14

improvements to or alterations of the Common Area in accordance with the15

Declaration and these Bylaws, including borrowing money on behalf of the16

Association when required for Common Area repairs or improvements;17

5.3.10 Enforcing by legal means the provisions of the Governing Documents18

and bringing any proceedings which may be instituted on behalf of or against the19

Owners concerning the Association; provided, the Association shall not be20

obligated to take action to enforce any covenant, restriction or rule which the21

Board in the exercise of its business judgment determines is, or is likely to be22

construed as, inconsistent with applicable law, or in any case in which the Board23

reasonably determines that the Association's position is not strong enough to24

justify taking enforcement action;25

5.3.11 Obtaining, maintaining and carrying property and liability insurance26

and fidelity bonds, as provided in the Declaration, and, in the discretion of the27

Board, errors and omissions insurance on behalf of the Association’s Officers and28

Directors, paying the cost of all such insurance and/or fidelity bonds, and filing29

and adjusting claims, as appropriate;30

5.3.12 Paying the cost of all services rendered to the Association;31

15

5.3.13 Keeping books with detailed accounts of the receipts and1

expenditures of the Association;2

5.3.14 Making available to any prospective purchaser of a Lot, any Owner,3

and the holders, insurers, and guarantors of any Mortgage on any Unit, current4

copies of the Declaration, the Articles of Incorporation, the Bylaws, rules and all5

other books, records, and financial statements of the Association as provided in6

Section 9.3 hereof;7

5.3.15 Permitting utility suppliers to use portions of the Common Area8

reasonably necessary to the ongoing development or operation of the9

Properties; and10

5.3.16 Performing any other duties or functions which are required in the11

Governing Documents or applicable law.12

5.4 Management. The Board may employ for the Association a professional13

management agent(s) at such compensation as the Board may establish to perform such duties14

and services as the Board shall authorize. Any Management Agreement hereunder shall have15

a maximum term of three (3) years and shall provide for termination by either party thereto,16

with or without cause and without payment of a termination fee, upon thirty (30) days’ prior17

written notice. [N ew S ection]18

ARTICLE VI.19

OFFICERS20

[R eplacesandexpandsA rticleVIofthecurrentBylaw s]21

6.1 Officers. The officers of the Association shall be a President, Vice President,22

Secretary, and Treasurer. The President, Vice President, and Secretary shall be elected from23

among the members of the Board; other officers may, but need not be members of the Board.24

The Board may appoint such other officers, including one or more Assistant Secretaries and one25

or more Assistant Treasurers, as it shall deem desirable, such officers to have such authority26

and perform such duties as the Board prescribes. Any two (2) or more offices may be held by27

the same person, except the offices of President and Secretary.28

6.1.1 President. The President shall preside at and conduct all meetings of the29

Board and the Members. The President shall see that orders and resolutions of30

the Board are carried out; shall sign on behalf of the Association all leases,31

mortgages, deeds and other written instruments and agreements necessary to32

16

the Association’s business; and shall co-sign all promissory notes. The President1

shall perform such other services as the Board of Directors may designate.2

6.1.2 Vice President. The Vice President has such powers and performs such3

duties as the President or the Board may from time-to-time prescribe and shall4

perform such other duties as may be prescribed by these Bylaws. At the request5

of the President, or in case of his/her absence or inability to act, the Vice6

President shall perform the duties of the President and, when so acting, shall7

have all the powers of, and be subject to all the restrictions upon, the President.8

6.1.3 Secretary. The Secretary (or his or her designee) shall record the votes9

and keep the minutes of all meetings and proceedings of the Board and of the10

Members; provide notice of meetings of the Board and of the Members; keep11

appropriate current records showing the Members of the Association together12

with their addresses, and shall perform such other duties as required by the13

Board. The Secretary (or his or her designee) shall ensure that all the14

proceedings of the membership, and the Board of Directors, are recorded in one15

or more books kept for that purpose. The Secretary (or his or her designee) is the16

custodian of all contracts, deeds, documents, all other indicia of title to17

properties owned by the Association and of its corporate records (except18

accounting records). Upon request, the Secretary (or his or her designee) shall19

make the records of the Association which are not in the custody of the20

Treasurer, available for inspection, at all reasonable times to any Director or21

Member. All records of the Association shall be kept and maintained at the22

Association’s principal office.23

6.1.4 Treasurer. The Treasurer is responsible for supervising all of the funds24

and securities of the Association, official records, documents, ledgers and25

accounts involving the financial business of the Association. All financial records26

and documents shall be kept and maintained at the Association’s principal office.27

The Treasurer shall see to it that the Association’s funds are deposited to the28

account of the Association in such bank(s) which are federally insured and/or29

shall use said funds to purchase U.S. Treasury Notes, Certificates of Deposits or30

other obligations of the Federal Government or agencies thereof, as designated31

by the Board of Directors. The Treasurer (or his or her designee) shall prepare32

the annual operating and capital budget for the Association, which shall include,33

but not be limited to, the following: estimated revenue and expenses and the34

annual cash reserves available for replacement and major repairs of the35

Association’s facilities. This must be completed in a timely fashion, so that the36

17

Board can approve the budget no later than the January Board meeting. The1

Treasurer also shall issue financial statements when required, and perform such2

other duties as ordinarily pertain to that office. The Board of Directors may3

appoint an Assistant Treasurer who shall, in the absence or incapacity of the4

Treasurer, have the powers, duties and the responsibilities of the Treasurer5

except check signing). The Treasurer, except if unavailable, shall sign all checks6

and promissory notes of the Association.7

6.1.5 Bonding. At the Board’s discretion, all officers, Directors, Committee8

Chairs and members and employees, who are in any way involved in the9

handling of Association funds, and the paid managerial personnel of the10

Association shall be bonded or insured in a sum to be determined by the Board11

of Directors.12

6.2 Election and Term of Office. The Board shall elect the officers of the Association13

at the first meeting of the Board following each annual meeting of the Members, to serve until14

their successors are elected by the Board.15

6.3 Removal and Vacancies. The Board may remove any officer whenever in its16

judgment the best interests of the Association will be served, and may fill any vacancy in any17

office arising because of death, resignation, removal, or otherwise, for the unexpired portion of18

the term.19

6.4 Resignation. Any officer may resign at any time by giving written notice to the20

Board of Directors, the President, or the Secretary. Such resignation shall take effect on the21

date of the receipt of such notice or at any later time specified therein, and unless otherwise22

specified therein, the acceptance of such resignation shall not be necessary to make it effective.23

6.5 Agreements, Contracts, Deeds, Leases, Checks, Etc. All agreements, contracts,24

deeds, leases, checks, and other instruments of the Association shall be executed by at least25

two officers or by such other person or persons as may be designated by Board resolution. In26

addition, checks under a dollar limit to be designed by Board resolution may be signed by one27

authorized person.28

6.6 Compensation. Compensation of officers shall be subject to the same29

limitations as compensation of Directors under Section 4.11.30

6.7 Special Appointments. As set forth in Section 6.1 above, the Board may elect31

such other officers as the affairs of the Association may require, each of whom shall hold office32

18

for such period, have such authority, and perform such duties as the Board may, from time-to-1

time, determine.2

ARTICLE VII.3

COMMITTEES4

[R eplacesandexpandsA rticleVIIinthecurrentBylaw s]5

7.1 General. The Board may appoint such committees as it deems necessary and6

appropriate to properly and effectively carry on the affairs of the Association. Each committee7

created by the Board shall perform such tasks and serve for such periods as the Board may8

designate by resolution. Each committee shall operate in accordance with the terms of such9

resolution. Other than the committees established herein, any committee may be abolished or10

any committee member may be removed from a committee, with or without cause, by a11

majority vote of the board, provided a quorum is present. A committee may exercise the12

powers specifically granted to it herein and/or by the Chairperson of the Board, which generally13

will include the delegated authority to take action on behalf of the Board of Directors. Unless14

otherwise provided in the Governing Documents, each committee shall consist of a Chair and15

two or more members approved by the Board of Directors.16

7.2 Standing Committees. The standing committees of the Association shall be17

those which are necessary for conducting the business of the Association and are as follows:18

7.2.1 Architectural Committee. This committee shall have the duties and19

authority as set forth in the Declaration. The chairperson of this Committee shall20

be a member of the Board of Directors.21

7.2.2 Nominating and Election Committee.22

7.2.2.1 Purpose and Term of Committee. The Nominating and Election23

Committee shall nominate candidates for the Directors’ positions to be24

elected and filled by the Members annually. The members of this25

Committee shall oversee all elections during a one-year term that begins26

at least one hundred twenty (120) days before the Annual Meeting each27

year.28

7.2.2.2 Selection of Members to Nominating and Election Committee.29

The Nominating and Election Committee shall consist of a chairperson30

and two or more Members of the Association, who shall be selected as31

follows: The President, with the approval of a majority of the Board of32

19

Directors shall appoint the members of this Committee. Other than the1

Secretary, no Director may be a member of this Committee.2

7.2.2.3 Notice of Initial Meeting. The President shall call the first meeting3

of the Nominating and Election Committee, by giving written notice to4

each member of the Committee at least seven (7) days prior to the date5

of that meeting.6

7.2.2.4 Selection of Candidates. The Committee or any Member of the7

Association may submit the names of prospective candidates for the8

Board positions to be elected by the Members. The name of each9

prospective candidate shall be submitted in writing to the Nominating10

and Election Committee at the general office of the Association, together11

with a resume on a form provided by the Association.12

7.2.2.5 Slate of Candidates. The Nominating and Election Committee13

shall prepare and announce a slate of candidates, which shall be mailed14

to Members with the Notice of Annual Meeting of the Association. In15

making its nominations, the Nominating and Election Committee shall16

use reasonable efforts to nominate candidates representing the diversity17

which exists within the pool of potential candidates.18

7.2.3 Finance Committee. The Treasurer shall be a member of the Finance19

Committee, which shall approve the financial statements and budget to be20

presented to the Membership.21

7.2.4 Streets and Arroyo Committee. This Committee shall advise the Board of22

Directors on all matters pertaining to the maintenance, repair, or improvement23

of all streets and arroyos, identifying any changes in arroyos that might improve24

water flow, reduce erosion, or any other matter pertaining to arroyos or streets25

that would be of benefit or detriment to the Association.26

7.2.5 Maintenance Control Committee. This Committee shall comprise no less27

than three (3) members, primarily for the purpose of directing the maintenance28

of all landscaped Common Areas and approving community plans for alterations29

or additions to the landscaped Common Areas. To this end, the Maintenance30

Control Committee shall approve/disapprove all plans and specifications related31

to changes to landscaped Common Areas; shall advise the Board of Directors on32

all matters pertaining to the maintenance, repair, or improvement of the33

landscaped Common Areas; and shall perform such other functions as the Board,34

20

in its discretion, determines. Owners may not do any landscaping, gardening, or1

changing the topography, installing any electrical or plumbing or any other type2

of equipment on the Common Areas without Maintenance Control Committee3

approval.4

7.2.6 Compliance Committee. This Committee shall oversee the enforcement5

standards and rules of the Association in the Properties. Association6

management or Compliance Committee members will receive and evaluate7

Member complaints and take appropriate action to secure compliance.8

ARTICLE VIII.9

INDEMNIFICATION OF DIRECTORS AND OFFICERS [N EW S ECT IO N ]10

8.1 Indemnification. To the greatest extent provided by law, as provided in A.R.S.11

§10-3850 et seq., and except as provided in these Bylaws, the Association shall hold harmless12

and indemnify each of its current and former Directors and Officers (hereinafter each is13

individually referred to as an “Indemnitee”) for, from and against any and all liability and14

expenses incurred by the Indemnitee in connection with any threatened or actual proceeding15

or legal action resulting from the Indemnitee’s service to the Association or to another entity at16

the Association’s request.17

8.2 Exclusions. Except insofar as permitted by law, the Association shall not18

indemnify the Indemnitee if indemnification is prohibited by A.R.S. §10-3850 et seq19

(Indemnification), or any successor thereto. In addition, the Association shall not indemnify the20

Indemnitee for the following:21

8.2.1 The amount of a financial benefit received by an Indemnitee to which the22

Indemnitee is not entitled.23

8.2.2 An intentional infliction of harm by the Indemnitee on the Association or24

its members.25

8.2.3 A violation of A.R.S. §10-3830 (General Standards for Directors) and/or26

A.R.S. §10-3833 (Liability for Unlawful Distributions).27

8.2.4 An intentional violation by the Indemnitee of criminal laws.28

8.3 Procedure. The Indemnitee shall notify the Association promptly of the threat or29

commencement of any proceeding or legal action with respect to which the Indemnitee intends30

to seek indemnification and shall give the Association a reasonable opportunity to defend the31

same at its own expense and with counsel reasonably satisfactory to the Indemnitee. The32

21

Association shall be entitled to assume the Indemnitee’s defense with counsel reasonably1

satisfactory to the Indemnitee, unless the Indemnitee provides the Association with an opinion2

of counsel reasonably concluding that there may be a conflict of interest between the3

Indemnitee and the Association in the defense of the proceeding or legal action; or that there4

may be legal defenses available to the Indemnitee which are different from or in addition to5

those available to the Association; or if the Association shall, after receiving notice of the6

Association’s indemnification obligation and within a period of time necessary to preserve any7

and all defenses to any claim asserted, fails to assume the defense or to employ counsel for8

that purpose satisfactory to the Indemnitee, the Indemnitee shall have the right, but not the9

obligation, to undertake the defense of, and to compromise or settle the claim or other matter10

on behalf of, for the account of, and at the risk of, the Association. The Association shall be11

responsible for the reasonable counsel fees, costs, and expenses of the Indemnitee in12

conducting its defense.13

8.4 Expense Advances. The Association shall advance expenses, including attorneys’14

fees, incurred or to be incurred by the Indemnitee in defending a proceeding or legal action15

upon receipt of notice and, if required by law, of an undertaking by or on behalf of the16

Indemnitee. The Indemnitee shall repay all amounts advanced if it is ultimately determined by17

final judicial decision (after expiration or exhaustion of any appeal rights) that the Indemnitee is18

not entitled to be indemnified for such expenses. In addition, whether the Association pays for19

the reasonable expenses or reimburses an Indemnitee, the Indemnitee must first provide the20

Association with a written affirmation of the Indemnitee’s good faith belief that he or she has21

met the standard of conduct contained in A.R.S. §10-3830 (General Standards for Directors)22

and/or A.R.S. §10-3851 (Authority to Indemnify), or that the proceeding involves conduct for23

which liability has been eliminated pursuant to A.R.S. §10-3202(B)(1) (Articles of24

Incorporation).25

8.5 Settlement of Claims. Neither the Association nor the Indemnitee will26

unreasonably withhold consent to any proposed settlement. The Association shall not be27

obligated to indemnify the Indemnitee for any amounts incurred in settlement, if settlement is28

made without the Association’s prior written consent. The Association shall not enter into any29

settlement that would impose any penalty or limitation on the Indemnitee without the30

Indemnitee’s prior written consent.31

8.6 Insurance and Other Indemnification. The Board of Directors shall have the32

power to cause the Association: (A) to purchase and maintain, at the Association’s expenses,33

insurance on behalf of the Association and on behalf of others to the extent that power to do34

so has been or may be granted by statute; and (B) to give other indemnification to the extent35

permitted by law.36

22

8.7 Effect of Repeal. In order that Officers and Directors may rely on the1

indemnification promised by this Article VII, no repeal or amendment of this Article VII shall2

reduce the right of the Indemnitee to payment of expenses or indemnification for acts of the3

Indemnitee taken before the date of repeal or amendment.4

ARTICLE IX.5

MISCELLANEOUS6

9.1 Fiscal Year. The fiscal year of the Association shall be the calendar year unless7

the Board establishes a different fiscal year by resolution. [N ew S ection that reflectscurrent8

practiceofA ssociation]9

9.2 Conflicts. If there are conflicts between the provisions of the Declaration and10

any other of the Governing Documents, the provisions of the Declaration shall prevail. If there11

are conflicts between the provisions of the Articles of Incorporation and these Bylaws, the12

Articles shall prevail. [N ew S ection]13

9.3 Books and Records. All financial and other records of the Association shall be14

made reasonably available for examination by any Member or any person designated by the15

member in writing as the Member’s representative. The Association shall have ten (10)16

business days to fulfill a request for examination, which must be made in writing. Books and17

records kept by or on behalf of the Association and the Board may be withheld from disclosure18

to the extent set forth in A.R.S. §33-1805 or any other pertinent statute. [R eplacesand19

expandsA rticleX ofcurrentBylaw s.]20

9.4 Notices. [N ew S ection] Except as otherwise provided in the Declaration or these21

Bylaws, all notices, demands, bills, statements, or other communications under the Declaration22

or these Bylaws shall be in writing and shall be deemed to have been duly given if delivered23

personally or if sent by United States mail, first class postage prepaid:24

9.4.1 If to a Member, at the address which the Member has designated in25

writing and filed with the Secretary or, if no such address has been designated,26

at the address of the Lot of such Member; or27

9.4.2 If to the Association, the Board, or the managing agent, at the principal28

office of the Association or of the managing agent, or at such other address as29

shall be designated by notice in writing to the Members pursuant to this Section.30

9.5 Amendment. These Bylaws may be amended by the affirmative vote of two-31

thirds (2/3rds) of the Members present in person or by absentee ballot at any Annual or Special32

Meeting of Members, provided a quorum is present. These Bylaws shall not be amended to33

23

contain any provisions that would be contrary to or inconsistent with the Declaration or the1

Articles. Any provisions or purported amendment or modification to these Bylaws that is2

contrary to or inconsistent with the Declaration or the Articles shall be void to the extent of the3

inconsistency. [R eplacesand revised A rticle X IofcurrentBylaw sto com ply w ith S ections10-4

11021 and10-11003 ofA rizonaN on-P rofitCorporationsA ct]5

CERTIFICATION

The undersigned President of GREEN VALLEY DESERT HILLS NO. 2, INC., an Arizona

nonprofit corporation does hereby certify that the foregoing Bylaws constitute the official

Bylaws of said Association, as duly adopted by the Association on the _____ day of

____________, 2016.

IN WITNESS WHEREOF, I have subscribed my name and affixed the seal of said

Association this _____ day of __________, 2016.

By: _______________________________________Its: President

ATTEST:

_______________________________________Secretary