TABLE OF CONTENTS

DEClaRATION

OF

CONDITIONS, COVENANTS 1D RESTRICTIONS

OF

ANDZqTE,

A CONDOMINIUM PROJECT

ARTICLE I - DEFXNITIONS . . . 2

Section 1.1 "Articles" 2Section 1.2 "Assessments" 2Section 1.3 "Association" 2Section 1.4 "Board" or "Board of Directors" 2Section 1.5 "Bylaws" 2Section 1.6 "City" 2Section 1.7 "Commercial Unit" 2Section 1.8 Cormnon Area" 3Section 1.9 "Common Expenses" 3Section 1.10 "Common Interest" 3Section 1.11 "Condominium" 3Section 1.12 "Condominium Building" or Condominiums

Buildings"3

Section 1.13 "Condominium Documents" 3Section 1.14 "Condominium Plan" or "Plan" 3Section 1.15 "Conditions of Approval" 3Section 1.16 "Declarant" 4Section 1.17 "DecLaration" 4Section 1.18 tEligib1e Insurer or Guarantor" 4Section 1.19 "Eligible Mortgagee" 4Section 1.20 "Exc].usive Use Common Area" 4Section 1.21 "Institutional Lender" 4Section 1.22 "Map"

4Section 1.23 "Member"

4Section 1.24 "Mortgage"

4Section 1.25 "Mortgagee"

4Section 1.26 "Mortgagor 4Section 1.27 "Owner" or "Owners" 4Section 1.28 "Person" 5Section 1.29 "Project' 5Section 1.30 "Property" 5Section 1.31 "Regular Assessment" 5Section 1.32 "Residential Unit" 5

Section 1.33 "sharet'Section 1.35 "Unit"Section 1.36 "Unit Designation"Section 1.37 "Number and Gender"Section 1.38 "Mandatory and Permissive"

ARTICLE II - DESCRIPTION OF PROaECT, DIVISION OF PROPERTY ANDCREATION OF PROPERTY RIGHTS 6

Section 2.1 Description of Project(a) The Project(b) Existing Encumbrances

Section 2.2 Division of Property(a) Units(b) Common Areas(d) No Separate Conveyance of Undivided Interest

Section 2.3 Easements to Accompany Conveyance ofCondominium

Section 2.4 Delegation of UseSection 2.5 Annexation of Additional Real Property

ARTICLE III - ASSOCIATION-ADMINISTRATION, MEMBERSHIP ANDVOTING RIGHTS 14

Section 3.1 Association to Manage Common AreasSection 3.2 MembershipSection 3.3 Transferred MembershipSection 3.4 Membership Classes and Voting Rights

(a) Class A(b) Class B

ARTICLE IV MkI14TENMqCZ AND ASSESSMENT . . . . . 16

(a) Annexation by Declarant(b) Other Annexation of Property(c) Effect of Annexation(d) Quality of Construction(e) Failure to Annex(f) Right of Successor Declarant to Annex

Section 2.6 Reservation of EasementsSection 2.7 Other EasementsSection 2.3 Rights of Entry and UseSection 2.9 Commercial Units Party Walls . . -

(a) General Rules of Law to Apply .

(b) Sharing of Repair and Maintenancec) Destruction by Fire or Other Casualty(ci) Weatherproofing(e) Right to Contribution Runs with Land(f) Arbitration

Section 2.10 Commercial Units CorridorSection 2.11 Partition Prohibited

9

• . . . 10• . • . 10• . . . 11

11• . . 11• . . . 11• . . 12• . . 12• . . . 13• . . . 13• . . . 13• . . . 13• . . . 13

1313

• . . . 13• . . 13

• 14

• 141414

• 14

15

—ii.-

Section 4.1 Creation of the Lien and Personal Obligationof Assessment

Section 4.2 Purpose of AssessmentSection 4.3 Regular Assessment and Reserve Fund .

Section 4.4 Special AssessmentsSection 4.5 Limitation on Board's Authority to Increase

and Decrease AssessmentsSection 4.6 Notice and Quorum for Any Action Authorized

Under Section 4.5Section 4.7 Levying of Regular and Special AssessmentsSection 4.8 Assessment PeriodSection 4.9 Notice and Assessment Installment Due

Dates; Delinquent AssessmentSection 4.10 Payment of Delinquent Assessments Under

ProtestSection 4.11 Effect of Transfer of Condominium by Sale

or ForeclosureSection 4.12 Estoppel CertificateSection 4.13 Right to EnforceSection 4.14 Creation of LienSection 4.15 Enforcement of Assessment LienSection 4.16 Waiver of ExemptionsSection 4.17 Unallocated Taxes

ARTICLE V - DUTIES ThND POWERS OF THZ ASSOCIATION 25

16161718

18

191920

21

21

22222223252525

Section 5.1 Duties 25

(a) Maintenance 25(b) Insurance 27(c) Discharge of Liens 30(d) Assessments 30(e) ?ayment of Expenses 30(f) Enforcement 30(g) Account Review 30(h) Notice of Civil Action 30(i) Condominium Documents and Statement of

Unpaid Assessments 30(Ic) Informational Notice to Secretary of State . 31(1) Repair and Maintenance Requirements 31(m) Participation in Emery—Go-Round 31(0) Capitalization Fund 31

Section 5.2 Powers 31(a) Utility Service 31(b) Easements 32

Ic) Manager 32(d) Adoption of Rules 32(e) Access 32(f) Assessments, Liens and Fines 32(g) Enforcement 33(h) Acquisition of Property 33Ii) Loans 33(j) Contract 33

—iii—

(k) Delegation. 33(1) Temporary Removal of Occupants 33(rn) Use of Facilities 34(n) Appointment of Trustee 34(o) Litigation, Arbitration, Mediation

or Administrative Proceedings 34(p) Other Powers 34(q) Capitalization Fund 34

ARTICLE VI - UTILITIES . . . . . . . . 35

Section 6.1 Owners' Rights and Duties 35Section 6.2 Easements for Utilities and Maintenance 35Section 6.3 Associatiorits Duties 35

ARTICLE VII - RESIDENTIn USE RESTRICTIONS 36

Section 7.1 Residential Condominium Use 35Section 7.2 Affordable Units 36Section 7.3 Nuisances 36Section 7.4 Signs 36Section 7.5 Pets 37Section 7.6 Garbage and Refuse Disposal 37Section 7.7 Radio and Television Antennas; Satellite

S'stems; Data Communication 37Section 7.8 Right to Lease 38Section 7.9 vehicle Restrictions 38Section 7.10 Parking 39(a) General 39(b) Handicap Parking 40Section 7.11 Window Covering 40Section 7.12 Floor Covering 40Section 7.13 Clothes Lines 40Section 7.14 Power Equipment and Car Maintenance . . 41

Section 7.15 Liability of Owners for Damage to CommonArea 41

Section 7.16 Hazardous Materials 41Section 7.17 Architectural Control 41

(a) Approval of Plans 41(b) Architectural Control Committee Action . 42(c) Landscaping 42(d) Governmental Approval 42

ARTICLE VIII - USE OF COMNRRCIAL UNITS. 43

Section 8.1 Commercial Use 43Section 8.2 Advertising arid Signs 43Section 8.3 Leasing of a Commercial Unit 43Section 8.4 Customers, Guests and Lessees; Insurance . 43Section 8.5 Restrictions on Board 44Section 8.6 Change in Commercial Status 44Section 8.7 Inclusion of Residential Restrictions . . . 44

- iv-

Section 0.8 Hazardous Materials . . . 44

ARTICLE IX - GENERMJ PROVISIONS 44

Section 9.1 Enforcement; Claims Procedures 44(a) Right to Enforce 44

(b) MANDATORY ALTEP.NATIVE DISPUTE RESOLUTION . . 44(d) Optional Alternative Dispute Resolution

. . 48(e) Judicial Reference of Claims Against Declarant 49

(f) Civil Code Section 896 Compliance. 49(g) (untitled)(h) Civil Code Sections 896 and $97 Clams. . . 50

Section 9.2 Invalidity of any Provision 51Section 9.3 Term 51Section 9.4 Amendments 51Section 9.5 Encroachment Easements 51Section 9.6 Mortgage Protection Provision 52

(a) Mortgage Permitted 52(b) Subordination 52(C) Amendment 52(d) Restrictions on Certain Changes 52(e) Right to Examine Books and Records 54(f) Distribution of Insurance and Condemnation

Proceeds 54(g) Notice to Mortgagees cYf Record 55(h) Effect of Breach 55(U Foreclosure 55(j) Appearance at Meetings 56(k) Right to Furnish Any Information 56(1) Inapplicability of Right of First Refusal

to Mortgagee 56(m) Payment of Taxes or Insurance by Mortgagees 56

Section 9.7 Owner's Right and Obligations to Maintain,Repair and Insure 56

Section 9.8 Entry for Repairs 57Section 9.9 Damage or Destruction 57Section 9.10 Condemnation 60Section 9.11 Owners' Compliance 61Section 9.12 Limitation of Restrictions on Declarant . 61Section 9.13 Termination of Any Responsibility of

Declarant 62Section 9.14 Notices 62Section 9.15 Required Documentation 62Section 9.16 Special Provisions for Enforcement of

Bonded Obligations 62(a) Special Procedures 62(b) Action by Board 63(c) Meeting of Members to Override Decision by

Board 63(d) Vote by Members at Special Meeting 63(e) Release of Bond 63

-V..

EXHIBIT A - LEGAL DESCRIPTION

EXHIBIT B - PHASING SCHEDULE

EXHIBIT C - PERMITTED COMMERCIAL USES

EXHIBIT D - PRORATION OF ASSESSMENTS

EXHIBIT E - SAMPLE LIMITED WABflNTY

—vi-

DECLJjflTION

OF

CONDITIONS • COVENANTS AND RESTRICTIONS

OF

ANDANTE,

A CONDOMINIUM PROJECT

THIS DECLARATION is made on the date hereinafter set forth bySNK CAPTEC ANDANTE LLC, a Delaware Limited Liability Company,referred to herein as "Declarant."

Declarant is the owner of that certain real property locatedin the City of Emeryville, County of Alameda, State of California,more particularly described as Lot 2 on that certain map entitled"Parcel Map No. 8005, recorded March 26, 2003, in Map Book 270 atPages 44 and 45, Alameda County Records", as amended by thatcertain Certificate of Correction recorded October 6, 2004, asInstrument No. 2004451874, Alameda County Records.

Said real property is being improved with four (4) buildingscontaining eleven (11) Commercial Units and one hundred two (102)Residential Units. Declarant intends to establish a condominiumproject under the provisions of the Davis-Stirling Common InterestDevelopment Act, providing for separate title to each Unit withinsuch project, each Unit to have an undivided interest in the CommonArea, as set forth in this Declaration. Each Unit will have as anappurtenance to it a membership in the Andante Owners Association,a California nonprofit Plutual benefit corporation.

The Project, as defined in Section 1.30 below, may bedeveloped in two (2) phases, as provided in Exhibit "B" hereto,incorporated herein by this reference.

Declarant intends by this document to impose upon theProperty, as defined in Section 1.30 below, mutually beneficialrestrictions under a general plan of improvement for the benefit ofall the Condominiums in the Project and the Owners thereof. PhaseI of the Project will be subject to this Declaration uponrecordation hereof. Phase II may subsequently be subject to thisDeclaration upon recording a Declaration of Annexation, as providedin Section 2.6 hereof.

—1-S

NOW, THEREFORE, Declarant hereby establishes that the Propertyshall be held, conveyed, mortgaged, encumbered, leased, rented,used, occupied, sold and improved, subject to the followingdeclarations, limitations, covenants, conditions, restrictions andeasements, all of which are imposed as equitable servitudes,pursuant to a general plan for the development of the Property, forthe purposes of enhancing and protecting the value andattractiveness of the Property. All of the limitations, covenants,conditions, restrictions and easements shall constitute covenantswhich shall run with the land and shall be binding upon Deelarant,and the successors and assigns of Declararit, and all parties havingor acquiring any right, title or interest in or to any part of theProperty or the Project.

ARTICLE I

DEFINITIONS

Section 1.1 "Articles" Shall mean and refer to the Articlesof Incorporation of the Association, as amended from tine to time.

Section 1.2 "Assessments" Shall mean Regular Assessmentsand/or Special Assessments which are a portion of the cost ofmaintaining, repairing, improving, operating and managing theProperty, or which are imposed to bring an Owner and his Unit intocompliance with the Condoninium Documents, and which are to be paidby Owners at such times as determined by the Association, pursuantto Section 4.8 below.

Section 1.3 "Association" Shall mean and refer to theAndante Owners Association, a California nonprofit mutual benefitcorporation, the Members of which shall be Owners of Condominiumsin the Project.

Section 1.4 "Board" or "Board of Directors" Shall mean andrefer to the governing body of the Association.

Section 1.5 'Bylaws" Shall mean or refer to the Bylaws ofthe Association, as amended from time to time.

Section 1.6 "City" Shall mean and refer to the City ofEmeryville, Alameda County, California.

Section 1.7 "Commercial Unit" Shall mean any Unit designatedfor commercial use as such use is described in Article VIII hereof.The Commercial Units are designated as Unit Cl through Unit Cli,inclusive, on the Plan.

Section 1.8 TTCoonAreaIr Shall mean and refer to thoseportions of the Property to which title is held by all Owners in aparticular phase in common, and excepting the individual Units.The Common Area includes, without limitation: land; stairs (exceptstairs connecting levels within a Unit) ; elevators and elevatorshafts; basements and storage areas; bicycle racks; bearing walls,columns, girders, subfloors, unfinished floors, roofs, andfoundations; central heating equipment, ducts, flues and chutes andfire escapes; satellite dishes; conduits, pipes, plumbing, wiresand other utility installments (except the outlets thereof locatedwithin a Unit), required to provide power, light, telephone, gas,water, sewerage, drainage, heat, and elevator services; sprinklers,sprinkler pipes and sprinkler heads which protrude into the airspace of a Unit; central television antenna, if any.

Section 1.9 "Common Expenses Means and includes the actualand estimated expenses of operating the Property and any reasonablereserve for such purposes, as fdund and determined by the Board,and all sums designated common expenses by or pursuant to theCondominium Documents. -

Section 1.10 "Common Interest" Means the proportionateundivided interest in the Common Area which is appurtenant to eachUnit, as set forth in this Declaration.

Section 1.11 "Condominium" Shall mean an estate in realproperty, as defined in California Civil Code Section 1351(f),consisting of fee title to a Unit and an undivided interest in theComon Area.

Section 1.12 "Condominium Building" or CondominiumsBuildings" Shall mean the structure(s) containing Units.

Section 1.13 "Condominium Documents" Means and includes thisDeclaration, as it may be amended from time to time, theattachments, if any, annexed hereto, the Articles, the Bylaws, theDeclarations of Annexation, and the rules and regulations for theMembers, as established from time to time.

Section 1.14 "Condominium Plan" or "Plan" Shall mean andrefer to that certain diagrammatic floor plan entitled "CondominiumPlan for Andante, Emeryville, California", prepared pursuant toCalifornia Civil Code Section 1351(e) and attached hereto asExhibit "A".

Section 1.15 'Conditions of Approval" Shall mean and referto the Conditions of Approval Andante Mixed Use Project UP 00-21and DR 00-34 dated February 22, 2001, and Conditions of ApprovalAndante II Mixed Use Project Up 00-21 and DR 00-34 dated December11, 2003.

—3—

Section 1.16 "Declarant" Shall mean and refer to SNIC CAPTECANDANTE LLC, a Delaware limited liability company, together withits successors and assigns, provided:

(a) Such successors and assigns acquire five (5) or moreCondominiums for the purpose of resale to others, and

(b) Declarant has expressly assigned to suchsuccessor(s) its rights and duties to all or a portion of theProject.

Section 1.17 "Declaration" Shall mean and refer to thisenabling Declaration.

Section 1.10 "Eligible Insurer or Guarantor" Shall mean andrefer to an insurer or governmental guarantor of a first mortgagewho has requested notice of certain matters from the Association inaccordance with Section 9.6(g)

Section 1.19 "Eligible Mortgagee" Shalt mean and refer to afirst mortgagee who has requested notice of certain matters fromthe Association in accordance with Section 9.6(g)

Section 1.20 "Exclusive Use Common Area!! Shall mean andrefer to those portions of the Comrnop Area, if any, set aside forthe exclusive use of a Unit Owner or Owners, pursuant to ArticleII, Section 2.2(c), and shall constitute "exclusive use commonarea" within the meaning of California Civil Code Section 1351(i).

Section 1.21 "Institutional Lender" Shall mean any bank,savings and loan association, insurance company, or other financialinstitution holding a recorded mortgage on any Condominium.

Section 1.22 "Map" Shall mean that subdivision nap entitled"Parcel Map No. 8005", recorded March 26, 2003, in Map Book 270 atPages 44 and 45, Alameda County Records".

Section 1.23 "Member" Shall mean and refer to a personentitled to membership in the Association, as provided in thisDeclaration.

Section 1.24 "Mortgage" Shall include a deed of trust aswell as a mortgage.

Section 1.25 "Mortgagee' Shall include a beneficiary or aholder of a deed of trust as well as a mortgagee.

Section 1.26 "Mortgagor" Shall include the trustor of a deedof trust as well as a mortgagor.

Section 1.27 "Owner" or "Owners" Shall mean or refer to therecord holder or holders of title, if more than one, of a

Condominium in the Project. This shall include any person havinga fee simple title to any Condominium but shall not includecontract sellers and those persons or entities having any interestmerely as security for the performance of any obligation. If aCondominium is sold under a recorded installment land contract toa purchaser, such purchaser, rather than the fee Owner, shall beconsidered the Owner.

Section 1.28 "Person" Means a natural person, a corporation,a partnership, a trust or other legal entity.

Section .29 "Project Shall mean and refer to the entirereal property described herein as Lot 2, including all structuresand improvements erected or to be erected thereon, and includingProperty to be annexed, as may be hereinafter be brought under thewithin the jurisdiction of the Association.

Section 1.30 "Property" Means and includes the real propertydescribed herein as Lot 2 and all improvehents erected or to beerected thereon and such additions thereto as may hereafter bebrought within the jurisdiction of the Association, and allproperty, real, personal or mixed, intended for or used inconnection with the Project.

Section 1.31 "Regular Assessment" Shall mean an Assessmentwhich is a portion of the cost of maintaining, improving, operatingand managing the Property which is to be paid by each Owner, asdetermined by the Association.

Section 1.32 "Residential Unit" Shall mean any Unit which isrestricted by Article VII of the Declaration to be occupied andused for residential purposes, only. Residential Units aredesignated on the Plan as:

Building 1: Units 201 through 206, Units 301 through 306, andUnits 401 through 406;

Building 2: Units 201 through 208, Units 301 through 308, andUnits 401 through 408;

Building 3: Units 101 through 107, Units 201 through 207,Units 301 through 307, and Units 401 through 407; and

Building 4: Units 101 through 108, Units 201 through 208,Units 301 through 308, and Units 401 through 408.

Section 1.33 'Share" Means the percentage interest in and tothe Common Area attributed to and appurtenant to each Unit, as setforth on the Condominium Plan.

Section 1.34 "Special Assessment" Shall mean a supplementalAssessment to meet expenses which is to be paid by each Owner whenthe total amount of funds available to defray common expenses isdetermined to be inadequate by the Association.

—5—

Section 1.35 'TUnit" Shall mean and refer to the elements ofthe Condominium, as defined in Article II, Section 2.2(a), whichare not owned in common with the owners of other Condominiums inthe Project.

Section 1.36 "Unit Designation" Means the number, letter orcombination thereof or other official designation of a Unit asshown on the Condominium Plan.

Section 1.37 "Number and Gender' The singular and pluralnumber and masculine, feminine and neuter gender shall each includethe other where the context requires.

Section 1.38 "Mandatory and Permissive" "Shall", "will", and"agree" as used herein are mandatory and "may" as used herein ispermissive.

ARTICLE It

DESCRIPTION OF PROJECT, DIVISION

OF PROPERTY AND CREATION

OF PROPERTY RIGHTS

Section 2.1 Description of Project.

(a) The Prolect. The Project consists of the underlyingreal property with Condominiums and all other improvements locatedthereon. Declarant intends to build upon the Property up to atotal of one hundred thirteen (113) Units, comprised of eleven (11)Commercial Units and one hundred two (102) Residential Units infour (4) separate buildings on one (1) 1t. The Project mayinclude a second phase, as more particularly described in Exhibit"B" hereto, upon election of Declarant. Each Owner of a Unit ineach phase will receive fee title to the Unit, plus an undividedinterest (pursuant to Section 2.2(b) hereof) in the Common Area inthat phase. Reference is made to the Map and the Condominium Planto supply further details concerning the Project.

(b) Existing Encumbrances. As of the date hereof, theProject is subject to certain recorded encumbrances, includingwithout limitation, those set forth below:

i. Emeryville Redevelopment Agency Project documentrecorded July 30, 1976, Reel 4467 at Image 170; Amendment recordedAugust 18, 1983, as Series No. 83—151851; Amendment recorded August18, 1983, as Series No. 83—151849, and Implementation of the

—6—

Redevelopment Plan amendment recorded August 18, 1983, as SeriesNo. 83—151850, Official Records of the County of Alameda;

ii. Easement for slope and incidental purposes,recorded November 1, 2001, as Series No. 2001—428744, OfficialRecords of the County of Alameda;

iii. Agreement on Affordable Units recordedDecember 26, 2001, as Series No. 2001—501435, official Records ofthe County of Alameda (the "Affordable Units Agreement");

iv. Assignment and Assumption of Disposition andDevelopment Agreement, recorded April 2, 2003, as Series No. 2003—192154, Official Records of the County of Alameda;

v. Option to repurchase site in favor of TheEneryville Redevelopment Agency as disclosed in Grant Deed recordedApril 2, 2003, as Series No. 2003—192156, Official Records of theCounty of Alameda;

vi. Declaration Establishing Easements, Covenantsand Restrictions recorded April 2, 2003, as Series No. 2003-192157,Official Records of the County of Alameda;

vii. Maintenance and Easement Agreement for the SanPablo Avenue at 40th Street Farside Transit Stop, recorded April 2,2003, as Series No. 2003—192158, Official Records of the County ofAlameda (the "City Transit Agreement")

viii. Memorandum of Agreement recorded April 2,2003, as Series No. 2003—192160, Official Records of the County ofAlameda;

ix. Easement for Cable and Internet System recordedApril 2, 2003, as Series No. 2003—192161, official Records of theCounty of Alameda; and

x. Easement recorded April 2, 2003, as Series No.2003—192161, official Records of the County of Alameda.

Section 2.2 Division of Property. The Property is herebydivided into the following separate freehold estates:

(a) Units. Each of the Units, as separately shown,numbered and designated in the Condominium Plan, consists of thespace bounded by and contained within the interior unfinishedsurfaces of the perimeter walls, floors, ceilings, windows anddoors of each Unit and the fixtures and utility installation s

located therein, each of such spaces being defined and referred toherein as a "Unit". Each Unit includes both the portions of theCondominium Building(s) so described and the air space soencompassed. The Unit does not include those areas and those

—7—

things which are defined as "Common Area" in Article I, Section1.8. Each Unit is subject to such encroachments as are contained inthe Condominium Building(s), whether the same now exist or may belater caused or created in any manner referred to in Article IX,Section 9.5. It is expressly understood that Commercial Units 2through 11 do not include the one—hour fire exit corridor locatedat the rear of such Units. In interpreting deeds and plans, thethen existing physical boundaries of a Unit, whether in itsoriginal state or reconstructed in substantial accordance with theoriginal plans thereof, shall be conclusively presumed to be itsboundaries, rather than the boundaries expressed in the deed orplan, regardless of settling or lateral movement of the CondominiumBuilding(s) and regardless of minor variance between the boundariesshown on the plan or deed, and those of the CondominiumBuilding(s).

(b) Common Areas. The remaining portion of the Propertyreferred to herein as "Common Area" or "Common Areas" shallinclude, without limitation, all of the elements set forth inArticle t, Section 1.8. Each Owner of a Unit in a phase shall haveappurtenant to his Unit an undivided interest in the Common Area inthat phase (which is based upon the square footage of the Unit)Each Owner in Phase I shall have appurtenant to his Unit theundivided interest in the Comon Area set forth on the CondominiumPlan of Phase I.

Each Owner in Phases I and II shall have appurtenant to hisUnit the undivided interest in the Common Area of that phase, asset forth on the Condominium Plan for that phase.

The ownership of each Condominium shall include a Unit andsuch undivided interest in the Comon Area in the particular phase.The common interest appurtenant to each Unit is declared to bepermanent in character and cannot be altered without the consent ofall Owners affected and the first mortgagees of such Owners, asexpressed in an amended declaration. Such common interest cannotbe separated from the Unit to which it is appurtenant. Each Ownermay use the Comon Area in accordance with the purposes for whichit is intended without hindering the exercise of or encroachingupon the rights of any other Owners.

The Common Area in each phase is subject to a nonexelusiveeasement for ingress and egress for the benefit of all Owners ofthe Project. Each Owner shall have appurtenant to his Unit, anonexclusive easement to use each portion of the Common Area forits intended purpose.

(c) Exclusive Use Common Areas. Portions of the CommonArea shown and delineated on the Condominium Plan shall be"Exclusive Use Common Areas' and are hereby reserved by Declarantas exclusive use common areas, as defined in California Civil CodeSection 1351 (i) to be granted as exclusive easements appurtenant

—8—

to a particular Unit. The Exclusive Use Common Areas shall bethose portions of the Common Area designated as residential parkingareas (Rl, R2, R3, etc.), residential handicap parking areas (Pfollowed by a numeral and bearing the handicap symbol), storageareas (5202, 5203, 5204, etc.) and decks (D201, 0202, 0203 etc.) onthe Plan. Easements for the exclusive use of the decks and storageareas shall be granted to the correspondingly numbered Units at thetime the Units are deeded. Easements for the Exclusive Use CommonAreas residential parking areas and handicap parking areas shall begranted by the Declarant at the time the Units are deeded.

The assignment, transfer or exchange, either reciprocal orunilateral, of the right to the exclusive use of an Exclusive UseCommon Area from one Owner to another or between two or moreOwners, is authorized, provided that the approval of the Board isfirst obtained, and the assignment, transfer or exchange of suchExclusive Use Common Area is evidenced by a recorded document.

(d) No Separate Conveyance of Undivided Interest. Theforegoing undivided interests are hereby established and are to beconveyed with the respective Units, as set forth above. Suchundivided interests cannot be changed, except as set forth in thisDeclaration. Declarant, and the successors, assigns and granteesof Declarant, covenant and agree that the undivided interests inthe Common Area referred to in Section 2.2W) and the fee title tothe respective Units conveyed therewith, shall not be separated orseparately conveyed, and each such undivided interest shall bedeemed to be conveyed or encumbered with its respective Unit, eventhough the description in the instrument of conveyance orencumbrance may refer only to the fee title to the Unit.

Section 2.3 Easements to Accompany Conveyance of Condominium.Easements that benefit or burden any Condominium shall beappurtenant to that Condominium and shall automatically accompanythe conveyance of the Condominium, even though the description inthe instrument of conveyance may refer only to the fee title to theUnit.

Section 2.4 Delegation of Use. Any Owner may delegate, inaccordance with this Declaration, his right of enjoyment to theCommon Area and facilities to the members of his family, histenants, or contract purchasers, who reside on the Property.

Section 2.5 Annexation of Additional Real Property.Additional real property may be annexed to the Project and becomesubject to this Declaration by, but only by, any of the followingmethods:

(a) Annexation by Declarant. Declarant may, but shallnot be required to, annex the real property described as Phase IIin Exhibit "B", attached hereto and made a part hereof. ADeclaration of Annexation shall be recorded by Declarant without

—9—

the consent of the Association or its Members or without theconsent of Owners or Mortgagees, on the condition that:

1. The terms of said Declaration of Annexationshall not be inconsistent with this Declaration, nor shall itrevoke, modify or add to the limitations, restrictions andcovenants established by this Declaration; and

ii. A detailed plan for such annexation wasapproved by the Real Estate Commissioner of the State of Californiaprior to issuance of the public report for the first phase of theProject; and

iii. Declarant has made a written commitment to payto the Association, upon the close of escrow for the sale of thefirst Unit in the annexed parcel, appropriate amounts for reservesfor the replacement or deferred maintenance of Common Areaimprovements in the annexed parcel, necessitated by or arising outof the use and occupancy of Units in the annexed parcel under arental program conducted by Declarant, if such program has been ineffect for at least one year prior to the closing of escrow for thefirst sale of such a Unit.

(b) Other Annexation of Property. Additional propertyadjacent to the Project, which does not qualify for annexationpursuant to the terms of Section 2.5(a) above, may be annexed tothe Project upon the written vote or consent of not -less thantwo—thirds (2/3) of the total votes of the Association, excludingthe votes of the Declarant, and written consent of the owner ofsuch property and upon fulfillment of procedures by the owner ofsuch property substantially similar to those set forth in Section2.6(a) above.

(c) Effect of Annexation. Upon annexation, theadditional property shall become subject to this Declarationwithout the necessity of amending individual sections hereof. TheOwners of Condominiums in Phase I will continue to have undividedpercentage interests in the Common Area of Phase I, and will havenonexclusive easements for ingress and egress over the Common Areasof subsequently annexed phases. Owners of Condominiums insubsequently annexed phases will have undivided interests in theCommon Areas of subsequently annexed phases, and will havenonexclusive easements for ingress and egress over the Common Areasof previously annexed phases and Phase I. Assessments collectedfrom Owners may be expended by the Assoiation without regard tothe particular phase from which Assessments came. All Owners shallhave the right of ingress to and egress from all portions of theCommon Area throughout the Project, subject to the provisions ofthe Condominium Documents.

—10--

(d) QualIty of Construction. Future improvements to theProject will be consistent with initial improvements in terms ofquality of construction.

(e) Failure to Annex. If any remaining phase is notannexed as provided above and the property in that phase requiresingress and egress access over private streets located within theProject and access to and use of common utilities, easements shallexist for reasonable vehicular and pedestrian traffic andreasonable use of the common utilities for residential developmentsof comparable size and density; provided, however, that theproperties (and the owner(s) thereof) shall be obligated to paytheir equitable share of the cost of maintenance and repair of saidprivate streets and utilities and shall be subject to a lien orliens for said maintenance and repair costs, as provided in Section4.14 hereof.

(f) Right of Successor Declarant to Annex. The right ofunilateral annexation provided for in Section 2.5(a) constitutes acovenant running with the land and is as such enforceable by anysuccessor or assignee of Declarant who acquires the Property, orany part thereof, and who assumes the role of Declarant, asprovided in Section 1.16.

Section 2.6 Reservation of Easements. Upon annexation ofsubsequently annexed phases pursuant to Section 2.5, subsequentlyannexed phases shall be made subject to the terms of thisDeclaration and thereby become subject to the jurisdiction of theAssociation. Declarant hereby reserves to itself, its successorsand assigns, the right to, and agrees that it will, grant to theOwners of Units in subsequently annexed phases, nonexolusiveeasements for ingress and egress over the Common Area of Phase Iand any other previously annexed phase of the Project, as theservient tenement. Declarant further agrees that it will reserveto itself, its successors and assigns, the right to grant, andcovenants and agrees that it will grant, to the Owners of Units inPhase I of the Project and any other previously annexed phase ofthe Project, as the dominant tenement, nonexciusive easements foringress and egress over the Common Area of any other subsequentlyannexed phases, upon annexation of subsequently annexed phases,pursuant to Section 2.5.

All of the easements are subject to the following provisions:

(a) The right of the Association to dedicate Cr transferall or any part of the Common Area to any public agency, authorityor utility for such purposes and subject to such conditions as maybe agreed to by the Members. No such dedication or transfer shallbe effective unless an instrument signed by at least two-thirds(2/3rds) of the Members, agreeing to such dedication or transfer,has been recorded;

—11—

(b) To avoid the necessity of a separate televisionantenna or satellite system for each lot and/or Unit, a cabletelevision system may be installed and may be hooked up to eachUnit on a lot. Said system, if and when installed, shall bemaintained by the Association or cable television franchisee. Tothe extent necessary to effectuate the foregoing plan, there shallbe an easement in favor of each lot and each Unit for the purposeof connecting the same with the central television service or line.Each lot and each Unit shall be subject to an easement in favor ofall other lots and Units and in favor of the entity holding thecable television franchise, to provide for the passage through thelot, Condominium Building and/or Unit of television connectionsfrom any other lot, Condominium Building and/or Unit to the cablesystem, and shall be subject to a further easement for theplacement and maintenance of such connections;

(c) Easements in favor of the Declarant for worknecessary to complete development and construction of the Project,including all phases annexed or to be annexed.

The foregoing easements are granted and reserved subject tothe condition that their use and enjoyment shall not unreasonablyinterfere with the use, occupancy or enjoyment of all or any partof the lot or Unit servient to them or to which they areappurtenant.

Section 2.7 Other Easements. The Common Area and each Unitare subject to all easements, dedications and rights of way grantedor reserved in, on, over and under the Property, as shown on theMap.

Section 2.8 Rights of Entry and Use. The Units and CommonArea (including Exclusive Use Common Areas) shall be subject to thefollowing rights of entry and use:

(a) The right of the Association or its agents to enterany Unit to cure any violation of this Declaration or the Bylaws,provided that the Owner has received notice and a hearing (exceptin the case of emergency), as required by the Bylaws, and the Ownerhas failed to cure the violation or take steps necessary to curethe violation within thirty (30) days after the finding of aviolation by the Association?

(b) The access rights of the Association to maintain,repair or replace improvements or Property located in the CommonArea, as required by Section 5.1(a);

(c) The easements described in this Article II; and

(d) The rights of the Declarant during the constrt,otionperiod, as described in Section 9.12.

—12--

Section 2.9 Commercial Units Party Walls.

(a) General Rules of Law to Apply. Each wall which isbuilt as a part of the original construction of a Commercial Unitand placed on the dividing line between the Units shall constitutea party wall, and, to the extent not inconsistent with theprovisions of this Section 2.10, the general rules of law regardingparty walls and liability for property damage due to negligence orwillful acts or omissions shall apply thereto.

(b) Sharing of Repair and Maintenance. The cost ofreasonable repair and maintenance of a party wall shall be sharedby the Owners who make use of the wall in proportion to such use.

(c) Destruction by Fire or Other Casualty. If a partywall is destroyed or damaged by fire or other casualty, any Ownerwho has used the wall may restore it, and, if the other Ownersthereafter make use of the wall, they shall contribute to the costof restoration thereof in proportion to such use; provided,however, that the Owner or Owners whose negligent act or omissionproximately caused the damage or destruction shall bear the fullcost of restoration that is not covered by insurance.

(d) Weatherproofing. Notwithstanding any otherprovision of this Article, an Owner who by his negligent or willfulact causes the party wall to be exposed to the elements shall bearthe whole cost of furnishing the necessary protection against suchelements.

(e) Right to Contribution Runs with Land. The right ofany Owner to contribution from any other Owner under this Articleshall be appurtenant to the land and shall pass to such Owner'ssuccessors in title.

(f) Arbitration. In the event of any dispute arisingConcerning a party wall, or under the provisions of this Article,each party shall choose one (1) arbitrator, and such arbitratorsshall chose one (1) additional arbitrator, and the decision shallbe by a majority of all the arbitrators. Alternatively, if Ownersof both Units agree, the matter may be submitted to the AmericanArbitration Association, or such other similar organizationexisting from time to time.

Section 2.10 Commercial Units Corridor. The one—hour fireexit corridor located at the rear of Commercial Units C2 throughCl]. is Common Area and not a part of the Units. In the event oneuser leases all of Units C2 through C8 or all of Units C9 throughCli, such user may remove the rear wall of the Units and such usershall be granted an exclusive easement to use such corridor area.

Section 2.11 Partition Prohibited. There shall be nosubdivision or partition of the Common Area, nor shall any Owner

—13—

seek any partition or subdivision thereof. Except as provided byCalifornia Civil Code Section 1359, as amended from time to time,no Owner shall bring any action for partition of the Project or anypart thereof, it being agreed that this restriction is necessary inorder to preserve the rights of the Owners with respect to theoperation and management of the Project. Judicial partition bysale of a single Unit owned by two or more persons and division ofthe sale proceeds is not prohibited hereby. However, partition oftitle to a single Unit is prohibited.

ARTICLE IIIASSOCIATION-ADMINISTRZtflON. MEMBERSHIP MiD VOTING RIGHTS

Section 3.]. Association to Manage Common Areas. Themanagement of the Comon Area shall be vested in the Association,in accordance with its Bylaws. The Owners of all of theCondominiums covenant and agree that the administration of theProject shall be in accordance with the provisions of theCondominiuni Documents.

Section 3.2 Membership. The Owner of a Condominiumautomatically, upon becoming an Owner, shall be a Member of theAssociation, and shall remain a Member thereof until such time ashis ownership ceases for any reason, at which time his membershipin the Association shall automatically cease. Membership shall beheld in accordance with this Declaration, the Articles and theBylaws of the Association.

Section 3.3 Transferred Membership. Membership in theAssociation shall not be transferred, pledged or alienated in anyway, except upon the sale of the Condominium to which it isappurtenant, and then only to the purchaser of such Condominium.A mortgagee does not have membership rights until it becomes anOwner by foreclosure or deed in lieu thereof. Any attempt to makea prohibited transfer is void. In the event the Owner of anyCondominium should fail or refuse to transfer the membershipregistered in his name to the purchaser of his Condominium, theAssociation shall have the right to record the transfer upon itsbooks and thereupon any old membership outstanding in the name ofthe seller shall be null and void.

Section 3.4 Membership Classes and Voting Rights. TheAssociation shall have two classes of voting membership:

(a) Class A. Class A Members shall be all Owners withthe exception of the Declarant. Each Condominium shall beallocated one vote in the Association. When more than one Ownerholds an interest in any Condominium, all such co-Owners shall beMembers of the Association; however, the vote for each Condominium

—14—

must be cast as a whole. No fractional votes shall be allowed withrespect to any Condominium, nor shall more than one vote be castwith respect to any Condominium. When more than one person owns aCondominium, there shall be one 'Voting Owner" for suchCondominium. The Voting Owner shall be designated by the recordOwners of each Condominium by written notice to the Board. Thedesignation shall be revocable at any time by actual notice to theBoard given by any Owner of record of such Condominium or by thedeath or judicially declared incompetency of any record Owner. Thepower herein conferred to designate a Voting Owner, and to revokesaid designation, may be exercised by the Owner's conservator or bythe guardian of his estate, or in the case of a minor having noguardian, the parent or parents entitled to custody of said minor,or during the administration of his estate, the executor or theadministrator of a deceased O'ner, vthere the latter's interest inthe Condominium is subject to administration in his estate. Whereno Voting Owner of a Condominium has been designated, or thedesignation has been revoked as provided herein, the vote for suchCondominium shall be exercised as the majority of the co-Owners ofthe Condominium mutually agree. No vote shall be cast for anyCondominium where there is no designated Voting Owner or themajority of co-Owners present in representing the Condominiumcannot agree in their vote as provided herein.

(b) Class B. The Class B Member shall be Declarant whoshall be entitled to vote as follows: Voting shall be the same asfor Class A memberships, except that the Class B Member may tripleits vote for each Condominium owned, Class B membership shallcease and be converted to Class A membership on the happening ofeither of the following events, whichever first occurs:

i. On the second anniversary of the firstconveyance of a Condominium in the most recent phase of theProject; or

ii. On the fourth anniversary date of the firstconveyance of a Condominium in the first phase of the Project.

Except as otherwise provided in the Condominium Documents, anyaction by the Association which must have the approval of theMembers before being undertaken shall require the vote or writtenassent of fifty—one percent (51%) of each class of membershipduring the time that there are two outstandthg classes ofmembership. Any provision in this Declaration which requires thatthe vote of Declarant be excluded during any such vote shall beapplicable only if there has been a conversion of Class Bmembership to Class A membership, and shall be understood torequire the vote or written assent of fifty—one percent (51%) ofthe total voting power of the Association and the vote or writtenassent of fifty—one percent (51%) of the total voting power ofMembers other than Declarant. The immediately foregoing sentenceshall not apply to those situations governed by Title 10,

'-15—

California Code of Regulations, Section 2792.4, governing theenforcement of bonded obligations. Voting rights attributable toCondominiums shall not vest until Assessments have been leviedagainst those Condominiums by the Association. Owners ofCondominiums in all phases shall have the same voting rights. Thevote or written assent referred to herein shall mean the vote orwritten assent of Owners in the Project as whole, not Owners ineach phase.

ARTICLE IV

MAINTENANCE ND ASSESSMENT

Section 4.1 Creation of the Lien and Personal Obligation ofAssessment. The Declarant, for each Condominium owned within theProject, hereby covenants, and each Owner of any Condominium byacceptance of a deed therefor, whether or not it shall be soexpressed in such deed, is deemed to covenant and agrees to pay tothe Association Regular Assessments and Special Assessments, suchAssessments to be established, made and collected as provided inthis Declaration.

Each Assessment or installment thereof, together with any latecharge, interest, collection costs and reasonable attorneys' fees,shall be the personal obligation of the Owner at the time suchAssessment, or installment, became due and payable. If more thanone person is the Owner of a Condominium, the personal obligationto pay such Assessment, or installment, respecting such Condominiumshall be both joint and several. The annual Regular Assessmentsand the Special Assessments provided for in this Article IV,together with interest, late charges, collectthn costs andreasonable attorneys fees, shall be a continuing lien upon theCondominium against which the Assessment is made, as provided inSection 4.14 hereof. No Owner of a Condominium may exempt himselffrom payment of Assessments, or installments, by waiver of the useor enjoyment of all or any portion of the Common Area or by waiverof the use or enjoyment of, or by abandonment of, his Condominium.

Section 4.2 Purpose of Assessment. The Assessments levied bythe Association shall be used exclusively to promote therecreation, health, safety and welfare of the Members of theAssociation; the improvement, replacement, repair, operation andmaintenance of the Comon Area; and the performance of the dutiesof the Association, as set forth in this Declaration.

—16—

Section 4.3 Regular Assessment and Reserve Fund.

(a) The Board shall establish and levy annual RegularAssessments in an amount the Board estimates will be sufficient toraise the funds needed to perform the duties of the Associationduring each fiscal year, subject to the limitations contained inSection 4.5 hereof. Such annual Regular Assessments shall includean adequate reserve fund for maintenance, repairs and replacementof those major components of the Common Area and facilities whichthe Association is obligated to maintain and that must be replacedon a periodic basis, and shall be payable in regular installmentsrather than by Special Assessments.

(b) Unless the Association is exempt from Federal orState taxes, all reserves shall be accounted for as contributionsto the capital of the Association and as trust funds segregatedfrom the regular income of the Association or in any other mannerauthorized by law or regulation of the Internal Revenue Service andthe California Franchise Tax Board that will prevent such fundsfrom being taxed as income to the Association.

(C) Failure of the Board to set new Regular Assessmentsshall not be deemed a waiver of Regular Assessments but, rather,the prior fiscal year's Regular Assessment shall remain in fullforce and effect.

-

(d) The Board shall not expend funds designated asreserve funds for any purpose other than the repair, restoration,replacement, or maintenance of, or litigation involving the repair,restoration, replacement, or maintenance of, major components ofthe Common Area and facilities which the Association is obligatedto repair, restore, replace, or naintain, and for which suchreserve fund was established. However, the Board may authorize thetemporary transfer of money from a reserve fund to theAssociation's general operating fund to meet short—term cash—flowrequirements or other expenses, provided the Board has made a

written finding, recorded in the Boards minutes, setting forth thereasons that the transfer is needed, and describing when and howthe money will be repaid. The transferred funds shall be restoredto the reserve fund within one (1) year of the date of the initialtransfer, except that the Board may, upon making a findingsupported by documentation that a temporary delay would be in thebest interests of the Project, temporarily delay the restoration.The Board shall exercise prudent fiscal management in maintainingthe integrity of the reserve account and shall, if necessary, levya Special Assessment to recover the full amount of the expendedfunds within the time limits required by this Section. suchSpecial Assessment is subject to the limitation imposed by Section4.5 of this Declaration. The Board may, at its discretion, extendthe date on which the payment of the Special Assessment is due.

—17—

Any extension shall not prevent the Board from pursuing any legalremedy to enforce the collection of an unpaid Special Assessment.

(e) When the decision is made to use reserve funds or totemporarily transfer money from the reserve fund to pay forlitigation, the Association shall notify the Members of thatdecision in the next available mailing of any nature to all Members(with the Association newsletter, magazine, etc., if there is one)and of the availability of an accounting of those expenses. TheAssociation shall make an accounting of expenses related to suchlitigation on at least a quarterly basis. The accounting shall bemade available for inspection by Members at the Association'soffice.

Section 4.4 Special Assessments. If the Board determinesthat the estimated total amount of funds necessary to defray thecommon expenses of the Association for a given fiscal year is, orwill become, inadequate to meet expenses for any reason (including,but not limited to, unanticipated delinquencies, costs ofconstruction, unexpected repairs or replacements of capitalimprovements on the Common Area) the Board shall determine theapproximate amount necessary to defray such expenses, and if theamount is approved by a majority vote of the Board, it shall becomea Special Assessment. The Board may, in its discretion, proratesuch Special Assessment over the remaining months of the fiscalyear or levy the Special Assessment immediately against eachCondominium. Unless exempt from Federal or State income taxation,all proceeds from any Special Assessment shall be segregated anddeposited into a special account and shall be used solely for thepurpose or purposes for which they were levied, or they otherwiseshall be handled and used in a manner authorized by law orregulations of the Internal Revenue Service and the CaliforniaFranchise Tax Board in order to avoid, if possible, their taxationas income to the Association.

-

Section 4.5 Limitation on Board's Authority to Increase andDecrease Assessments.

(a) Any increases in Regular Assessments shall not beimposed unless the Board has complied with Section 9.2(b) of theBylaws with respect to that fiscal year, or has obtained, inaccordance with Section 4.6 hereof, the approval of a majority ofthe Owners at a meeting or election at which a quorum was present.

(b) Notwithstanding subsection (a) above, the Board maynot, without the approval of a majority of the Owners at a meetingor election at which a quorum was present:

i. Increase Regular Assessments more than twentypercent (20%) greater than the Regular Assessments for theAssociation's preceding fiscal year, or

—as--

ii. Impose Special Assessments which in theaggregate exceed five percent (5%) of the budgeted gross expensesfor the current fiscal year.

(c) Assessment increases are not limited in the case ofemergency situations, which are any of the following:

i. An extraordinary expense required by courtorder.

ii. An extraordinary expense necessary to repair ormaintain the Project, or any part of it for which the Associationis responsible, where a threat to safety of persons is discovered.

iii. Repairs to or maintenance of the Project thatcould not have been reasonably foreseen in preparing the budget.Prior to imposition of the Assessment, the Board shall make writtenfindings, distributed to the Members, as to the necessity of theexpense and why it could not have been foreseen.

(d) The Association may not charge or collect fees orAssessments in connection with a transfer of a Condominium inexcess of the actual cost to change its records.

(e) The annual Regular Assessment may not be decreasedby the Board or by the Members by more than ten percent (10%) inany one (1) year without the approval of a majority of the votingpower of the Association residing in Members other than Declarant.

(f) The Association shall provide notice by first—classmail to the Members of any increase of Regular or SpecialAssessments not less than thirty (30) days nor more than sixty (60)days prior to the increased Assessment becoming due.

Section 4.6 Notice and Quorum for Any Action Authorized UnderSection 4.5. Any action authorized under Section 4.5, whichrequires a vote of the membership, shall be taken at a meetingcalled for that purpose at which a quorum equal to more than fiftypercent (50%) of the total voting power of the Association ispresent. Written notice of said meeting shall be sent to allMembers not less than ten (10) nor more than ninety (90) days inadvance of the meeting, specifying the place, day and hour of themeeting and, notwithstanding any other provision of law, shallspecify those matters the Board intends to present for action bythe Members; but, except as otherwise provided by law, any propermatter may be presented at such meeting for action. The action mayalso be taken without a meeting pursuant to the provisions ofCalifornia Corporations Code Section 7513.

Section 4.7 Levying of Regular and Special Assessments.Except as provided below, all Regular and Special Assessments shallbe equally assessed to the Owners.

—19—

(a) Regular and Special Assessments for GeneralAssessments, as defined in Exhibit D hereto, for insurance;miscellaneous administrative costs; building exteriors (includingcaulking, paint and repair of masonry, metal railing and siding andstucco); and roofing system (including BUR, gutters, downspouts,metal roofing, roof inspection and repair) shall be assessed to allOwners, according to each Owner's Share (said Share is based on theratio of the square footage of the floor area of the Unit to thetotal square footage of all of the Units)

(b) Regular and Special Assessments for ResidentialAssessments, as defined in Exhibit D hereto, for custodial costs(including window washing and miscellaneous custodial costs);Utilities (including natural gas, water and sewer, refusecollection and miscellaneous utility costs); and mechanical watersystems (including circulation pumps and water heaters) shall beassessed to all Residential Owners, according to each Owner's Share(said Share is based on the ratio of the square footage of thefloor area of the Residential Unit to the total square footage ofall of the Residential Units)

(c) Residential Unit Owners shall pay all expenses formaintenance, repair and operation of the garage gate which accessesthe residential parking areas of the garage.

(d) Any Special Assessment for the rebuilding or majorrepair of the Common Area shall be assessed according to eachOwner's Share (said Share is based on the ratio of the squarefootage of the floor area of the Unit to the total square footageof all of the Units)

Section 4.8 Assessment Period. The Regular Assessment periodshall commence on January 1 of each year and shall terminate onDecember 31 of each year, or such other dates as may be approved bythe Board, and Regular Assessments shall be payable in equalmonthly installments, unless the Board adopts some other basis forcollection. However, the initial Regular Assessment period shallcommence on the first day of the calendar month following the dateon which the sale under authority of a public report of the firstCondominium in Phase I to a purchaser is closed and shall terminateon December 31 of the year in which the initial sale is closed. Insubsequent phases the Assessments against all Condominiums in eachphase shall commence on the first day of the month following theclosing of the first sale in such phase. The first RegularAssessment and all Special Assessments shall be adjusted accordingto the number of months remaining in the fiscal year and shall bepayable in equal monthly installments, unless the Board adopts someother basis for collection. The Association shall not change theobligation of any Condominium for purposes of levying Assessments,unless all Owners affected and all the mortgagees of such Ownershave given their prior written consent.

—20—

Section 4.9 Notice and Assessment Installment Due Dates;Delinquent Assessment.

(a) A single ten (10) day prior written notice of eachannual Regular Assessment and each Special Assessment, specifyingthe due dates for the payment of installments, shall be given toeach Owner of every Condominium subject to Assessment; provided,however, in the event of an increase in any Regular or SpecialAssessment, such notice shall be given not less than thirty (30)nor more than sixty (60) days prior to the increased Assessmentbecoming due. The due dates for the payment of installmentsnormally shall be the first day of each month, unless some otherdue date is established by the Board. Each installment of RegularAssessments and Special Assessments shall become delinquent if notpaid within fifteen (15) days after its due date.

(b) If an Assessment is delinquent, the Association mayrecover the following:

i. Reasonable costs incurred in collecting thedelinquent Assessment, including reasonable attorneys' fees;

- ii. A late charge of ten percent (10%) of thedelinquent Assessment, or ten dollars ($10.00), whichever isgreater;

iii. Interest on all sums imposed in accordance withthis Section, including the delinquent Assessment, reasonable feesand costs of collection, and reasonable attorney's fees, at thelesser of an annual percentage rate of twelve percent (12%)interest or the maximum rate permitted by applicable law,commencing thirty (30) days after the Assessment becomes due.

Section 4.10 Payment of Delinquent Assessments Under Protest.In accordance with California Civil Code Section 1366.3, an Ownermay dispute a delinquent Assessment, as defined in Section 4.9hereof, by paying to the Association in full the amount ofAssessment in dispute, late charges, interest, and all reasonabletees and costs associated with the preparation and filing of anotice of delinquent assessment, including reasonable attorney'sfees as may be prescribed by statute, and giving written notice tothe Association that the amount is being paid under protest. Suchnotice shall be given by certified mail not more than thirty (30)days from the recording of a notice of delinquent assessment.

Following receipt of such notice, the Association shall informthe Owner that the dispute may be resolved by alternative disputeresolution as set forth in California Civil Code Section 1354, bycivil action, or by other dispute resolution procedure available tothe Association. The right of any Owner to utilize alternativedispute resolution under this Section shall be limited to not more

-2].—

than two (2) times in any single calendar year and not more thanthree (3) times in any five calendar years.

Section 4.11 Effect of Transfer of Condominium by Sale orForeclosure. Sale or transfer of any Condominium shall not affectthe Assessment lien. However, the sale of any Condominium pursuantto a power of sale in a first mortgage shall extinguish the lien ofsuch Assessments as to payments which became due prior to suchSale. No sale or transfer shall relieve the Owner of suchCondominium from liability for any Assessments thereafter becomingdue or from the lien thereof.

Where the mortgagee of a first mortgage of record or otherpurchaser of a Condominium obtains title to the Condominium as aresult of foreclosure of any such first mortgage, such purchaser,including said purchaser's successors and assigns, shall not beliable for the share of the Assessment chargeable to suchCondominium by the Association which became due prior to theacquisition of title to such Condominium by such purchaser (exceptfor Assessments liens recorded prior to the mortgage) . Such unpaidshare of Assessments shall be deemed to be common expensescollectible front Owners of all of the Condominiums, including suchpurchaser or the purchaser's successors and assigns.

If a Condominium is transferred, the grantor shall remainliable to the Association for all unpaid Assessments against theCondominium through and including the date of transfer. Thegrantor shall be entitled to a statement from the Association datedas of the date of transfer, setting forth the amount of unpaidAssessments against the grantor due the Association and theCondominium so transferred shall not be subject to a lien forunpaid Assessments in excess of the amount set forth in thestatement; provided, however, the grantee shall be liable for anysuch Assessment that becomes due after the date of the transfer.

Section 4.12 Estoppel Certificate. The Board, on not lessthan twenty (20) days prior written request, shall execute,acknowledge and deliver to the party making such request astatement in writing stating whether or not, to the knowledge ofthe Association, a particular Owner is in default as to hisCondominium under the provisions of this Declaration and furtherStating the dates to which installments of Assessments, Regular orSpecial, have been paid as to such Condominium. Any certificatedelivered pursuant to this Section may be relied upon by anyprospective purchaser or mortgagee of such Condominium, butreliance on such certificate may not extend to any default notinvolving the payment of Assessments of which the signer had noactual knowledge.

Section 4.13 Right to Enforce. The right to collect andenforce Assessments is vested in the Board, acting by and on behalfof the Association. The Board, or its authorized representative,

—22—

can enforce the obligations of the Owners to pay Pssessmentsprovided for in this Declaration by commencement and maintenance ofa suit at law or in equity, or the Board may foreclose by judicialproceedings or through the exercise of the power of sale, pursuantto Section 4.15, to enforce the lien rights created. Suit torecover a money judgment for unpaid Assessments, together with allamounts described in Section 4,1, shall be maintainable withoutforeclosing or waiving the lien rights.

Section 4.14 Creation of Lien. If there is a delinquency inthe payment of any Assessment or installment thereof on aCondominium, as described in Section 4.9 hereof, any amounts thatare delinquent, together with any late charges, interest and allcosts that are incurred by the Board or its authorizedrepresentative in the collection of the amounts, includingreasonable attorneys' fees, shall be a lien against suchCondominium upon the recordation in the Office of the CountyRecorder of the County of Alameda of a notice of delinquentassessment, as provided in California Civil Code Section 1367.

Before the Association may place a lien upon a Condominium tocollect a debt which is delinquent under Section 4.9 hereof, theAssociation shall, at least thirty (30) days prior to recording alien, notify the Owner in writing by certified mail of:

(a) The general collection and lien enforcementprocedures of the Association and the method of calculation, astatement that the Member has the right to inspect Associationrecords, and the following statement in 14—point boldface type, ifprinted, or in capital letters, if typed: "IMPORTANT NOTICE: IFYOUR SE?ARATE INTEREST IS PLACED IN FORECLOSURE BECAUSE YOU AREBEHIND IN YOUR ASSESSNENTS, IT MAY EE SOLD WITHOUT COURT ACTION".

(b) An itemized statement of the charges owed by theMember, including the delinquent assessments, the fees andreasonable costs of collection, reasonable attorney's fees, anylate charges, and interest, if any.

(c) A statement that the Member shall not be liable topay the charges, interest, and costs of collection if it isdetermined the Assessment was paid on time to the Association.

(d) The right to request a meeting with the Board asprovided hereinbelow.

Any payments towards such debt shall be first applied toprincipal owed, and only after the principal owed is paid in fullshall such payments be applied to fees and costs of collectionexpenses, attorney's fees, late charges or interest. When a Membermakes a payment, he may request a receipt and the Association shallprovide it, such receipt to indicate the date of payment and the

person receiving it. mA Association shall provide a mailingaddress for overnight payment of Assessments.

The notice of delinquent assessment shall state the amount ofthe Assessment, collection costs, attorneys' fees, late charges,and interest, a legal description of the Condominium against whichthe Assessment and other sums are levied, the name of the recordOwner, and the name and address of the trustee authorized by theAssociation to enforce the lien by sale. The notice shall besigned by the President of the Association or such other persondesignated by the Association for that purpose, and mailed in themanner set forth in California Civil Code Section 2924b, to allrecord Owners of the Condominium no later than ten (10) calendardays after recordation.

A Member may dispute the debt noticed by submitting to theBoard a written explanation of the reasons for such dispute. TheBoard shall respond in writing to the Member within fifteen (15)days of the postmark date of the explanation, if the explanation ismailed within fifteen (15) days of the postmark of the notice ofdelinquent assessment. A Member may request to meet with the Boardto discuss a payment plan for the debt, as provided in CaliforniaCivil Code Section 1367.1.

Monetary penalties levied by the Association (1) as adisciplinary measure for failure of an Owner to comply with theCondominium Documents, or (2) as a means of reimbursing theAssociation for costs incurred by the Association in the repair ofdamage to the Common Area and facilities for which the Owner wasallegedly responsible, or (3) in bringing the Owner and hissubdivision interest into compliance with the CondominiumDocuments, shall not be Assessments which may become a liet againstthe Unit Owner's subdivision interest enforceable by a sale of theinterest in accordance with the provisions of Section 2924, 2924(b)and 2924(c) of the California Civil Code.

The Assessment lien created by this Section shall be prior toall other liens recorded subsequent to the notice of delinquentassessment, except for taxes, bonds, assessments and other levies,which by law would be superior thereto, and except for the lien ofany first mortgage made in good faith and for value.

If a lien previously recorded against a Condominium wasrecorded in error, the Association shall, within twenty-one (21)calendar days, record a release of lien and provide the Member witha declaration that the notice recording was in error and a copy ofthe lien release.

If the Association fails to comply with the procedures setforth in this Section, it shall recommence the required noticeprocess prior to recording a lien, and any costs associatedtherewith shall be borne by the Association and not by the Member.

—24-

Section 4.15 Enforcement of Assessment Lien. After theexpiration of thirty (30) days following recording of the liencreated pursuant to Section 4.14 above, the lien may be enforced inany manner permitted by law, including sale by the court, sale bythe trustee designated in the notice of delinquent Assessment, orsale by a trustee substituted pursuant to California Civil CodeSection 2934 (a) . Any sale by a trustee shall be conducted inaccordance with the provisions of California Civil Code Sections2924, 2924W), 2924(c), 2924(f), 2924(g), and 2924(h), applicableto the exercise of powers of sale in mortgages and deeds of trust.Trustees fees may not exceed the amounts prescribed in CaliforniaCivil Code Sections 2924(c) and 2924(d).

Section 4.16 Waiver of Exemptions. Each Owner, to the extentpermitted by law, waives, to the extent of any liens createdpursuant to this Article IV, the benefit of any homestead orexemption laws of the State of California in effect at the time anyAssessment or installment becomes delinquent or any lien isimposed.

Section 4.17 Unallocated Taxes. In the event that any taxesare assessed against the Common Area, or the personal property ofthe Association, rather than against the Condominiums, such taxesshall be included in the Assessments made under the provisions ofSection 4.1, and if necessary, a Special Assessment may be leviedagainst the Condominiums in an amount equal to such taxes, to bepaid in two (2) installments, not less than thirty (30) days priorto the due date of each installment.

ARTICLE V

DUTIES AND POWERS OF THE ASSOCIATION

Section 5.1 Duties. In addition to the duties enumerated inits Bylaws, or elsewhere provided in this Declaration, and withoutlimiting the generality thereof, the Association shall perform thefollowing duties:

() Maintenance. The Association shall maintain,repair, replace, restore, operate and manage all of the Common Area(except Exclusive Use Common Area decks, which shall be maintainedin accordance with Section 9.7 below) and all facilities,improvements, furnishings and equipment, including, but not limitedto, landscaping, benches, bicycle racks, leaning rails, picnictables, trash and garbage receptacles, automatic sprinkler system,ground water wells, lighting standards and fixtures locatedthereon, and all property that may be acquired by the Association.Maintenance shall include, without limitation, painting,maintaining, repairing and replacing all Common Areas (except

—25-

Exclusive Use Common Area decks), exterior glass surfaces,landscaping, and maintenance and monitoring of the ground waterwells for so long as required by any governmental authority havingjurisdiction therefor. Landscaping maintenance shall includeregular fertilization, irrigation and other garden managementpractice necessary to promote a healthy, weed-free environment forOptimum plant growth. Maintenance shall also include periodicsweeping or cleaning of fireplace chimneys and flues, if any; andperiodic maintenance and testing of all built—in fire detection andprotection devices and equipment, if any. The Project shall bewell maintained and shall be kept free of liter, debris, graffitiand weeds at all times. Any graffiti shall be removed withinseventy (72) hours of discovery and such removal shall be in amanner which retains the existing color and texture of the originalwall or fence, as most practically feasible.

The Association shall (1) maintain and repair the public busshelter and waiting area and its amenities, including landscaping,installed on the 40th Street frontage of the Property, as well asthe public access easement for the area of the sidewalk where itpasses over private property, pursuant to the City TransitAgreement; and (2) adhere to the Stormwater Pollution Preventionand Control Measures program, as required by the Conditions ofApproval, by (i) sweeping and cleaning up the litter and cleaningup spills in the loading areas, parking areas, drive ways and walkways; (ii) cleaning all onsite storm drains at least annually,immediately prior to the rainy season (October 1) and as requiredby the City Engineer; (iii) maintaining stormwater pollutionprevention and control features by performing specified tasksaccording to a specified schedule; (iv) restricting washing ofvehicles, mats, equipment and containers to covered areas thatdrain to the sanitary sewer; and (v) managing outdoor storage tominimize stormwater contact with pollutants, covering storedmaterials as required by the City Engineer.

The Association shall perform all reasonable maintenanceobligations and follow all reasonable maintenance schedu.esprovided to the Association by the developer.

The Association shall bear the costs for any portion of theCommon Area damaged by the presence of wood-destroying pests ororganisms. The responsibility of the Association for maintenance,repair and replacement shall not extend to repairs or replacementsarising out of or caused by the willful or negligent act or neglectof an Owner or his guests, tenants or invitees, the cost of whichis not covered by insurance. Repairs or replacements resultingfrom such excluded items shall be the responsibility of each Owner;provided, however, that if an Owner shall fail to make the repairsor replacements which are his responsibility as provided herein,then, upon a vote of a majority of the Board of Directors, andafter not less than thirty (30) days notice to the Owner, andhearing (except in an emergency situation), the Association shall

—26—

have the right (but not the obligation) to make such repairs orreplacements, and the cost thereof shall be added to theAssessments chargeable to such Condominium and shall be payable tothe Association by the Owner of such Condominium.

(ID) Insurance. The Association shall obtain andmaintain the following policy or policies of insurance:

i. A policy or policies of fire and casualtyinsurance (Special Form) , for the full replacement value, covering:

A. Conmon Area: All Common Area improvements,including building(s) and any additions or extensions thereto; allfixtures, machinery and equipment permanently affixed to thebuilding(s) and not located within a Unit; fences; monuments;lighting fixtures; benches, picnic tables, bike rack, leaningrails, trash and garbage receptacle, and ash urns; exterior signs;recreational facilities, if any; and personal property owned by theAssociation (but excluding land, foundations, excavations and otheritems typically excluded from property insurance coverage);

B. Units: Interior walls and doors; ceiling,floor and wall surface materials (e.g., paint, wallpaper, mirrors,carpets, and hardwood floors); utility fixtures (including gas,electrical, and plumbing); cabinets; built—in appliances; heatingand air conditioning systems; water heaters (but excluding anyimprovements or upgrades to any of the foregoing to the extent ofany such improvement or upgrade); and

C. Landscaping: Lawn, trees, shrubs andplants located in the Common Area.

The policy or policies shall be primary and noncontributingwith any other insurance policy or policies covering the same loss.

Each policy shall provide that it shall not be canceledwithout at least thirty (30) days prior written notice to theAssociation and to each of the Owners and their mortgagees ofrecord. The Board shall review the limits of such insurance atleast every year and shall increase or adjust the same, ifnecessary, to provide the coverage and protection required by thisDeclaration. Such policy or policies shall provide for a separateloss payable endorsement in favor of the mortgagee or mortgagees ofeach Condominium, if any.

ii. A policy or policies of commercial generalpublic liability insurance, including, but not limited to, generalpublic liability insurance, including coverage for bodily injury,emotional distress, wrongful death, and/or property damage. Suchinsurance shall insure the Association, the Declarant, the Board,the directors, the officers, the Owners and any appointed manager,against any liability to the public or to any Owner incident to the

-27—

ownership and/or use of the Project or incident to the use of, orresulting from, any accident or intentional act occurring in orabout any Unit or the Common Area. The general public liabilityinsurance required by this Section shall each be in an amount ofnot less than three million dollars ($3,000,000.00) per occurrence,or such other minimum amount as may be required by California CivilCode Section 1365.9. The Board shall review the limits andcoverage of such insurance at least every year and shall increaseor adjust the same, if necessary, to provide the coverage andprotection required by this Declaration.

iii. Worker's Compensation Insurance to the extentnecessary to comply with all applicable Laws of the State ofCalifornia or the regulations of any governmental body or authorityhaving jurisdiction over the Project.

iv. Fidelity insurance, in a commercial blanketfidelity insurance form, naming such persons as may be designatedby the Board as principals, and the Owners as obligees, in anamount to be determined by the Board in its absolute discretion.

v. Flood insurance if the Project is located in anarea designated by an appropriate governmental agency as a specialflood hazard area.

vi. Earthquake insurance only if a majority of theMembers vote to purchase such insurance. If the Members elect topurchase such earthquake insurance, the insurance may besubsequently cancelled on a vote of the majority of the Members.If cancelled, the Association shall make reasonable efforts tonotify the Members of the cancellation.

vii. Board, directors and officers errors andomissions insurance, in a commercial blanket errors and omissionsinsurance form, naming the Board, directors and officers asprincipals, and the Owners as obligees, in an amount to bedetermined by the Board in its absolute discretion.

In addition to the policies required to be maintained by theAssociation pursuant to this Section 5.1(a), each Owner shallmaintain personal property and liability insurance policy asprovided in Section 9.7 below.

Nothing in this subsection (b) [except as provided insubsection (b) (vi) 3 shall restrict or prohibit the Board frommaintaining such additional policies of insurance or endorsementsas it, in its absolute discretion, shall deem reasonable andnecessary. Any insurance acquired by the Board may be taken in thename of the Board as trustee, for the use and benefit of the Boardand all Owners.

—28—

The Board periodically (and not less than once each year)shall review the Association's insurance policies and make suchadjustments to the policies terms and conditions as the Boardconsiders to be in the best interests of the Association. Thereview shall include an appraisal by a qualified appraiser of thecurrent replacement costs of all covered property under theAssociation's fire and casualty policy unless the Board issatisfied that the current dollar limit of such policy, coupLedwith the amount of actual reserves on hand, is equal to or greaterthan the current replacement costs.

The amount, terra, and coverage of any policy requiredhereunder (including the type of endorsements, the amount of thedeductible, the named insureds, the loss payees, standard mortgageclauses, and notices of changes or cancellations) shall satisfy theminimum requirements imposed for this type of project by theFederal National Mortgage Association (nFNMAI) or any successorthereto. If FNMA does not impose requirements On any policyrequired hereunder, the term, amount, and coverage of such policyshall be no less than that which is customarily carried by prudentowners of similar property in the County in which the Project islocated.

Each Owner appoints the Association or any insurance trustee(as defined in Section 8.9(b) (ii) below) designated by theAssociation to act on behalf of the Owners in connection with allinsurance matters arising from any insurance policy maintained bythe Association, including, without limitation, representing theOwners in any proceeding, negotiation, settlement or agreement.

Any insurance maintained by the Association shall contain"waiver of subrogationtt as to its officers, directors, and Members,the Owners and occupants of the Condominiums (including Declarant)and mortgagees, and, if obtainable, cross liability endorsements orseverability of interest endorsements insuring each insured againstthe liability of each other insured.

Except in the case of earthquake insurance and subject to anyrestrictions imposed by any Mortgagees or by applicable law, theBoard shall have the power and right to deviate from the insurancerequirements contained in this Section 5.1(b) in any manner thatthe Board, in its discretion, considers to be in the best interestsof the Association. If the Board elects to materially reduce thecoverage from the coverage required in this Section 5.1(b), theBoard shall make all reasonable efforts to notify the Members ofthe reduction in coverage and the reasons therefor at least thirty(30) days before the effective date of the reduction.

The Association and its directors and officers shall have noliability to any Owner or Mortgagee if, after a good faith effort,(1) the Association is unable to obtain any insurance requiredhereunder because the insurance is no Longer availb1e; 2) if

—29—

available, the insurance (except for earthquake insurance) can beobtained only at a cost that the Board, in its sole discretion,determines is unreasonable under the circumstances; or (3) theMembers fail to approve any assessment increase needed to fund theinsurance preniiums.

Cc) Discharge of Liens. The Association shall dischargeby payment, if necessary, any lien against the Common Area, andassess the cost thereof to the Member or Members responsible forthe existence of such lien; provided that such Member(s) shall begiven notice and the opportunity to be heard before the Boardbefore discharge of the lien.

(d) Assessments. The Association shall fix, levy,collect and enforce Assessments, as provided in Article IV hereof.

(e) Payment of Expenses. The Association shallpay allexpenses and obligations incurred by the Association in the conductof its business including, without limitation, all licenses, taxesor governmental charges levied or imposed against the Property ofthe Association.

(f) Enforcement. The Association shall enforce thisDeclaration.

(g) Account Review. The Association shall review itsoperating and reserve accounts, their reconciliations and accountstatements, as set forth in the Bylaws. For purposes herein,"reserve accounts" shall mean monies that the Association hasidentified from its annual budget to defray the future repair orreplacement of, or additions to, those major components of theCommon Area and facilities which the Association is obligated tomaintain.

(h) Notice of Civil Action. The Association shallnotify the Members of filing of any civil action by the Associationagainst the Declarant or other developer for alleged damage, asspecified in Section 9.7 of the Bylaws.

(i) Condominium Documents and Statement of UnpaidAssessments. Within ten (10) days of receipt of a written requestfrom a Member, the Association shall provide copies of theCondominium Documents, copies of the documents required by Article1X of the Bylaws and a statement of any unpaid Regular or SpecialAssessments, late charges, interest and collection costs which areor may become a lien against his Unit, for delivery to aprospective purchaser of the Unit, pursuant to Civil Code Section1368. The Association may charge a reasonable fee for suchservice, which shall ot exceed the reasonable cost to prepare andreproduce the requested items.

-30—

(j) Notice of Assessments and Foreclosure. TheAssociation shall distribute to the Members the written Notice ofAssessments and Foreclosure required by California Civil CodeSection 1365.1, during the sixty (60) day period immediatelypreceding the Association's fiscal year.

(k) Informational Notice to Secretary of State. TheAssociation annually shall submit to the California Secretary ofState a form containing all the information and the fee prescribedby California Civil Code Section 1363.6.

(1) Repair and Maintenance Requirements. The Associationshall comply with all applicable provisions of Title 7 of Division2, Part 2 of the California Civil Code, but shall only enforce suchstatute with respect to repair of Common Areas. The Associationshall follow all reasonable maintenance obligations and schedulescommunicated in writing to the Association by the builder andproduct manufacturers, as well as commonly accepted maintenancepractices. The Association shall make any such maintenance manualsand/or schedules available to the Owners.

(in) Participation in Emery—Go-Round. The Associationshall become a member of and fully participate in the EmeryvilleTransportation Management Association (the "TMA"), administeringthe Emery-Go—Round transportation system for Emeryville andparticipating TMA members.

(n) Employee Trip Reduction. The Association shallcontinue to operate the City's trip reduction program.

(o) Capitalization Fund. Pursuant to the terms ofDeclarant's Contract for the Sale and Purchase of Real Property forthe Condominiums, the initial Owner of each Condominium is requiredto pay to the Association an amount equal to two (2) months' worthof Regular Assessments to be used to establish a capitalizationfund (the "Fund") . The Association shall maintain the Fund in aseparate account to be disbursed by the Board to pay for the start-up and initial organization of the Association, the initialoccupancy and operation of the Project, additions and upgrades tothe Project, and other purposes deemed appropriate by the Board.

Section 5.2 Powers. In addition to the powers enumerated inits Bylaws, or elsewhere provided herein, and without limiting thegeneral.ity thereof, the Association shall have the followingpowers:

(a) Utility Service. The Association shall have theauthority to obtain, for the benefit of all of the Condominiums,all water, gas and electric service; refuse collection; janitorialor window cleaning service; and fireplace cleaning and chimneycleaning service.

-31—

(ID) Easements. The Association shall have the authorityto reserve easements, where necessary, for utilities and sewerfacilities over the Common Area to serve the Common Area and theCondominiums.

(c) Manager. The Association shall have the authorityto employ a manager or managing agent and to contract withindependent contractors to perform all or any part of the day today management duties and responsibilities of the Association, eachof whom shall be subject to the direction and control of the Board,provided that any contract with a firm or person appointed asmanager or managing agent shall not exceed a one (1) year term andshall provide for the right to terminate by either party withoutcause and without payment of a termination fee on thirty (30) dayswritten notice. Any delegation of authority to a manager ormanaging agent shall be subject to Section 5.2(k) hereof.

Notwithstanding the above, no manager or officer may bedelegated the power or authority to levy fines, hold hearings orimpose discipline, make capital expenditures, file suit, record aclaim of lien, or foreclose for failure to pay Assessments.

(d) Adoption of Rules. The Association may adoptreasonable rules not inconsistent with this Declaration relating tothe use of the Common Area, the Exclusive Use Common Areas, if any,and all facilities thereon, and the conduct and use thereof and theconduct of Owners and their tenants and guests with respect to theProperty and other Owners.

(e) Access. For the purpose of performing themaintenance authorized herein, or for any other purpose reasonablyrelated to the performance by the Association or the Board of theirrespective responsibilities, the Associations agents or employeesshall have the right, after reasonable notice to the Owner thereof,to enter upon any Unit or to enter any portion of the Common Areaat reasonable hours.. Except in the case of any emergency,forty—eight (48) hours advance notice shall be given to the Owneror occupant prior to any entry of a Unit, and such entry shall bemade at reasonable hours.

(f) Assessments, Liens and Fines. The Association shallhave the power to levy and collect Assessments, in accordance withthe provisions of Article IV hereof. The Association may imposefines or take disciplinary action against any Owner for failure topay Assessments or for violation of any provision of theCondominium Documents. Penalties may include but are not limitedto: fines, temporary suspension of voting rights or otherappropriate discipline, provided that the accused Member is givenat least fifteen (15) days notice and the opportunity to be heardorally or in writing before the Board of the Association withrespect to the alleged violations at least five (5) days before adecision to impose discipline is made. All notices required under

—32—

this Section shall be made pursuant to Section 9.14 of thisDeclaration

(g) Enforcement. The Association shall have theauthority to enforce this Declaration, as provided in Section 9.1hereof.

(h) Acquisition of Property. The Association shall havethe power to acquire (by gift, purchase or otherwise), own, hold,improve, build upon, operate, maintain, convey, sell, lease,transfer, dedicate for public use, or otherwise dispose of, real orpersonal property in connection with the affairs of theAssociation.

(1) Loans. The Association shall have the power toborrow money, and only with the consent (by vote or writtenconsent) of three—fourths (3/4) of each class of Members, tomortgage, to pledge, to encumber or to hypothecate any or all ofits real or personal property as security [or monies borrowed ordebts incurred.

(j) Contract. The Association shall have the power tocontract for goods and/or services for the Common Area facilitiesand interests or for the Association, subject to any limitationsset forth in the Condominium Documents.

(k) Delegation. The Association shall have the power todelegate its authority and powers to committees, officers oremployees of the Association. The Association may not, however,delegate the following powers:

i. To levy fines, hold hearings, or imposediscipline;

ii. To make capital expenditures;

iii. To file suit, to cause a claim of lien to berecorded, or to foreclose for failure to pay Assessments; or

iv. To levy Regular Assessments or SpecialAssessments.

U) Temporary Removal of Occupants. The Association maycause the temporary removal of any occupant for such periods and atsuch times as necessary for prompt, effective treatment ofwood-destroying pests or organisms. The cost of the temporaryrelocation is to be borne by the Owner of the Unit affected. Notless than fifteen (15) days nor more than thirty (30) days noticeof the need to temporarily vacate shall be given to occupants andto the Owner of the Unit affected. The notice shall state:

i. The reason for the temporary relocation;

—33—

ii. The date and time of the beginning of thetreatment;

iii. The anticipated date and time of termination oftreatment; and

iv. That the occupants will be responsible fortheir own accommodations during the temporary relocation.

Notice is deemed complete if a copy is personally delivered ormailed first class to the occupants and a copy is sent tonon-occupying Owners via first class mail.

(m) Use of Facilities. The Association shall have thepower to limit the number of an Owner's tenants or guests who mayuse the Common Area facilities, provided that any limitation applyequally to all Owners, except in the case of disciplinary measurestaken after notice and hearing, as provided in the ByLaws.

(n) Appointment of Trustee. The Association, or theBoard on behalf of the Association, shall have the power to appointa trustee to enforce Assessment Liens as provided in Section 4.14hereof, and as provided in California Civil Code Section 1367(b)

(o) Litigation, Arbitration, Mediation or AdministrativeProceedings. The Association, or the Board on behalf of theAssociation, shall have the authority to institute, defend, settleor intervene on behalf of the Association in litigation,arbitration, mediation, or administrative proceedings in matterspertaining to (1) enforcement of the Condominium Documents, (2)damage to the Common Areas, (3) damage to the separate interestswhich the Association is obligated to maintain or repair, or (4)damage to the separate interests which arises out of, or isintegrally related to, damage to the Common Areas or separateinterests that the Association is obligated to maintain or repair,subject to compliance with California Civil Code Section 1354.

(p) Other Powers. In addition to the powers enumeratedin this Declaration and in the Bylaws, the Association may exercisethe powers granted to a nonprofit mutual benefit corporation, assuch exist from time to time, under the California CorporationsCode.

(q) Capitalization Fund. The Association, through theBoard, shall have the power to maintain and disburse all moniesdeposited into and accumulated by the Fund in accordance with thisDeclaration and the Bylaws.

—34—

ARTICLE VI

UTfl.IT ItS

Section 6.1 Owners' Rights and Duties. The rights and dutiesof the Owners of Condominiums with respect to electric, telephone,water, gas and sanitary sewer lines, facilities and connections;cable or master television antenna lines or satellite system,facilities and connections; and security system lines, facilitiesand connections (collectively referred to as "utility facilities")shall be as follows:

(a) Whenever utility facilities are installed within theProperty, which utility facilities, or any portion thereof, liewithin or upon Units owned by other than the Owner of a Unit servedthereby, the Board or its authorized representative shall have theright to enter (or to have the utility company enter) upon theUnits within or upon which such utility facilities, or any portionthereof, lie, in connection with construction, maintenance orrepair for the benefit of the Common Area or the Owners in common.

(b) Whenever utility facilities are installed within theProperty, which utility facilities serve more than one Unit, theOwner of each Unit served thereby shall be entitled to the full useand enjoyment of the portions of such utility facilities as servicehis Unit.

(C) In the event of a dispute between Owners withrespect to the maintenance, repair or rebuilding of such utilityfacilities, or with respect to the sharing of the cost thereof,then, upon written tequest of one of such Owners addressed to theAssociation, the matter shall be submitted to the Board ofDirectors who shall decide the dispute, and the decision of theBoard shall be final and conclusive on the parties.

Section 6.2 Easements for Utilities and Maintenance.Easements over and under the Property for the installation, repairand maintenance of utility facilities, as shown on the Map and asmay be hereafter required or needed to service the Property arehereby reserved by Declarant and the successors and assigns ofDeclarant, including the Association, together with the right togrant and transfer the same.

Section 6.3 Associationts Duties. The Association shallmaintain all utility installations located in the Common P.reaexcept those installations maintained by utility companies, public,private or municipal. The Association shall pay all charges forutilities supplied to the Project, except those metered and chargedseparately to the Units.

ARTICLE VII

RESIDENTIaL USE RESTRICTIONS

Section 7.1 Residential Condominium Use.

(a) No Condominium shall be occupied and used except forresidential purposes by the Owners, their tenants and guests, andno trade or business shall be conducted therein, except that:

i. A home office may be maintained to conduct atrade or business provided such office complies with therequirements of local laws and regulations governing themaintenance of offices in residential dwelling units.

ii. Declarant, and the successors or assigns ofDeclarant, may use any Condominium or Condominiums in the Projectowned by Declarant for a model home site or sites and display andsales office until the last Condominium is sold by Declarant, or,if Declarant elects to retain one (1) or more Condominiums, three(3) years after the close of the sale of the first Condominium inthe final phase of the Project.

(b) No Condominium shall be owned, leased, occupied orrented pursuant to auy time sharing agreement of any kind.

Section 7.2 Affordable Units. Pursuant to the requirementsof the Affordable Units Agreement, twenty (20) Units shall bedesignated moderate or low income Units and at least ten (10) ofsuch affordable Units shall be designated low income Units. Theterm of the Affordable Unit Agreement shall run for a period oftwenty—seven (27) years from the date of recording of suchAgreement.

Section 7.3 Nuisances. No illegal or seriously offensiveactivity shall be transacted or conducted in any Unit or on anypart of the Property, nor shall anything be done thereon which maybe a serious annoyance or a nuisance to or which may in any wayinterfere with the quiet enjoyment of each of the Owners of hisrespective Unit, or which shall in any way increase the rate ofinsurance for the Project, or cause any insurance policy to becanceled or to cause a refusal to renew the same, or which willimpair the structural integrity of any Condominium Building.

Section 7.4 Signs. No commercial sign shall be displayed tothe public view on any Residential Unit or any portion of theProperty. In accordance with California Civil Code Section 712,one (1) "For Sale" or "For Rent" sign for each Condominium shall beallowed, provided that it is reasonable in size and posted atappropriate locations on the Property. The Board may adopt rulesand regulations concerning the size and location of "For Sale or

—36—

"For Rent signs. Noncommercial signs or posters that are nine (9)square feet, or less, and flags or banners that are fifteen squarefeet, or less, made of paper, cardboard, cloth, plastic or fabricmay be posted or displayed from the yard, window, door, balcony oroutside wall of a Unit, unless prohibited by the Board for reasonsof public health or safety or if such posting or display wouldviolate any law.

Section 7.5 Pets. An Owner shall be allowed to keep no morethan two (2) domesticated birds, cats, dogs, or other pets asagreed upon between the Association and the Owner; provided that noanimal is kept, bred or maintained for any commercial purposes, andis kept under reasonable control at all times. Notwithstanding theabove, no dog or dogs weighing more than twenty (20) pounds eachshall be kept or allowed in a Unit or on the Property.

No pet may be kept on the Property which is a seriousannoyance or is obnoxious to the Owhers. No pet shall be allowedin the Common Area except as may be permitted by the rules of theAssociation. Declarant or any Owner may cause any unauthorized petfound in the Common Area to be removed to a pound or animal shelterunder the jurisdiction of the City of Emeryville or the County ofAlameda, by calling the appropriate authorities, whereupon theOwner (upon payment of all expenses connected therewith) mayrepossess the pet. No dog whose barking seriously disturbs otherOwners shall be permitted to remain on the Property. Any decisionregarding the conduct of a pet shall be made only after notice tothe Owner and the opportunity to be heard before the Board. Ownersshall prevent their pet from soiling any portion of the Common Areaand shall promptly clean up any fouling by their pet. Owners shallcarry on their persons and use dog waste bags whenever the pet isin the Common Area.

Section 7.6 Garbage and Refuse Disposal. All rubbish, trashand garbage shall be regularly removed from the Property and shallnot be allowed to accumulate thereon. Trash, garbage and otherwaste shall not be kept except in sanitary containers. Allequipment for the storage or disposal of such materials shall bekept in a clean and sanitary condition. All equipment, garbagecans, wood piles or storage piles shall be kept screened and sealedfrom view of other Units, streets and Common Areas. No toxic orhazardous materials shall be disposed of within the Project bydumping in the garbage containers or down the drains, or otherwise,other than those required, in limited quantities, for the normalcleaning of a Condominium. There shall be separate trash locationsfor Residential Units and Commercial Units.

Section 7.7 Radio and Television Antennas Satellite Systems;Data Communication. No Owner shall alter or modify a central radioantenna, television antenna system, cable television system, datacommunication system or satellite dish, if any, as developed byDeclarant and as maintained by the Association, without the

—37—

permission of the Board. No Owner shall construct and/or use andoperate his own external radio, television antenna or satellitedish without the approval of the Board, except that the Board maynot prohibit or restrict the construction and or/use of a satellitedish having a diameter or diagonal measurement of one (1) meter orless which is located inside a Unit or inside a balcony areaappurtenant to such Unit. Notwithstanding the foregoing, the Boardmay impose reasonable restrictions for the installation and use ofa video or television antenna, including a satellite dish, that donot significantly increase the cost of the system or significantlydecrease its efficiency or performance, as set forth in Civil CodeSection 1376. If the Board requires approval for the installationof such antenna or satellite dish, the application for approvalshall be processed in the same manner as an application forarchitectural modification and the issuance of a decision on theapplication shall not be willfully delayed.

Section 7.8 Right to Lease. Owners shall be entitled to rentor lease their Unit provided that:

(a) Not less than the entire Unit is rented or leased.Nothing contained in this Section 7.8(a) shall be construed toprohibit roommates.

(b) The lease term is for a period of not less than one(1) year.

(c) Any lease or occupancy agreement for a Unit shall bein writing and shsll specifically provide that it is subject to theCondominium Documents, and that violation or infraction of theCondominium Documents shall constitute a default thereunder. TheOwner shall remain liable for any violation or infraction of theCondominium Documents by the tenant.

Section 7.9 vehicle Restrictions. No trailer, camper, mobilehome, commercial vehicle, truck (other than standard size pickuptruck or standard size van), boat, inoperable automobile or similarequipment shall be permitted to remain upon any area of the

Property other than on a temporary basis. Commercial vehiclesshall not include sedans (or standard vans or pickup trucks) whichare used both for business and personal use, provided that anysigns or markings of a commercial nature on such vehicles shall beunobtrusive and inoffensive, as determined by the Board. No noisyor smoky vehicles or unlicensed motor vehicles shall be operatedupon the Property.

The Association may cause the removal of any vehiclewrongfully parked on the Property, including a vehicle owned by anoccupant. If the identity of the registered owner of the vehicleis known or readily ascertainable, the President of the Associationor his or her designee shall, within reasonable time thereafter,notify the owner of the removal in writing by personal delivery or

—38-

first class mail. In addition, notice of the removal shall begiven to the local traffic law enforcement agency immediately afterthe vehicle has been reruoved. The notice shall include a

description of the vehicle, the license plate number and theaddress from where the vehicle was removed.

If the identity of the owner is not known or readilyascertainable and the vehicle has not been returned to the ownerwithin one hundred twenty (120) hours after its removal, theAssociation irrmiediately shall send or cause to be sent a writtenreport of the removal by wail to the California Department ofJustice in Sacramento, California, and shalt file a copy of thenotice with the proprietor of the public garage in which thevehicle is stored. The report shall be made on a form furnished bythe Department of Justice and shall include a complete descriptionof the vehicle, the date, time and place from which the vehicle wasremoved, the amount of mileage on the vehicle at the time ofremoval, the grounds for removal and the name of the garage orplace where the vehicle is stored. Notwithstanding the foregoing,the Association may cause the removal, without notice, of anyvehicle parked (1) in a marked fire lane, (2) within fifteen (15)feet of a fire hydrant, (3) in a parking area designated forhandicapped, without proper authority, or (4) in a manner whichinterferes with any entrance to, or exit from, the Project or anyCondominium, parking area or garage located thereon.

The Association shall not be liable for any damages incurredby the vehicle owner because of the removal iii compliance with thisSection or for any damage to the vehicle caused by the removal,unless such damage resulted from the intentional or negligent actof the Association or any person causing the removal of, oractually removing, the vehicle. If requested by the owner of thevehicle, the Association shall state the grounds for the removal ofthe vehicle.

Section 7.10 Parking

_________ (a) General. All Common Area parking areas which areneither Exclusive Use Common Areas conveyed as easementsappurtenant to a Unit or assigned by the Association for specificuse shall remain permanently available for guest parking. Parkingareas shalL be used for parking of permitted vehicles only and notfor the permanent parking or storage of boats, trailers ornonmobile vehicles of any description. Garage space may not beconverted into any use (such as recreational rooms or storageareas) that would prevent its use as a parking area for the numberof vehicLes for which the area was originalLy intended. TheAssociation shall establish rules and regulations regarding the useof unassigned parking areas in the Common Area. Use by Owners ofsuch unassigned parking areas shall only be valid if established bythe Association and such use must be set forth in writing by thehssociation. ithy permission given by the Association pursuant to

—39—

the foregoing shall create a license only, said license to berevocable upon five (5) days written notice from the Association.

_____ (b) Handicap Parking. The Project contains residentialhandicap parking areas designated on the Plan as P-followed by anumeral and bearing a handicap symbol, easements for the exclusiveuse of which shall be granted by the Declarant to particular Units.It is the intention of the Declarant to grant easements to all ofthe residential handicap parking areas and residential parkingareas at the time title to the Units is conveyed to the originalpurchasers.

Notwithstanding the requirements of Article II, Section 2.2(c)regarding the assignment of Exclusive Use Comon Areas, the Ownerof a Unit who has been conveyed an exclusive easement for aresidential handicap parking area and who is not, himself,handicapped shall assign to the owner or occupant of another Unitin the Project who becomes handicapped for an extended andcontinuous period, or new owner or occupant who is handicapped, theexclusive right to use such residential handicap parking area;provided such person makes available to such Owner the exclusiveuse of the parking area such person would otherwise be entitled touse, as set forth in the deed for such other condominium unit.Such rights to use the handicap parking area shall terminate whensuch person ceases to be handicapped. Evidence of handicap statusshall be by distinguishing license plate or placard issued by theCalifornia Department of Motor Vehicles.

The Association shall be responsible for coordinating theexchange of parking areas pursuant to this section and shall adoptrules and regulations with respect thereto, including the procedureto be followed should an owner or occupant be handicapped and wishto use a residential handicap parking area, notice to be given tothe Association and Owner, and review of the required evidence ofhandicap. The Association shall maintain appropriate records ofsuch exchanges, including a copy of the evidence provided.

Section 7.11 Window Covering. Window Coverings on windowsvisible from the street shall be restricted to drapes, curtains,shutters or blinds of a neutral color, unless expressly approved bythe Association.

Section 7.12 Floor Covering. Each room (excluding kitchensand bathrooms) in all Units situated above other Units shall havecarpeting or rugs covering at least seventy-five percent (75%) ofits square footage in order to reduce noise and maximize quietenjoyment of those Owners whose Units are situated beneath otherUnits, unless expressly approved by the Association.

Section 7.13 clothes Lines. No exterior clothes lines shallbe erected or maintained and there shall be no outside laundering

—40—

or drying of clothes. No draping of towels, carpets or laundryover railings shall be allowed.

Section 7.14 Power Equipment and Car Maintenance. Withtheexception of emergency car maintenance requiring less than 24 hoursto complete, no power equipment, hobby shops, boat or carmaintenance shall be permitted on the Property, except with theprior written consent of the Board. The Board shall consider thefollowing factors in determining whether to grant or deny approval:effects of noise, air pollution, dirt or grease, fire hazard,interference with radio or television reception, and similarissues.

Section 7.15 Liability of Owners for Damage to Common Area.The Owner of each Condominium shall be liable to the Associationfor all damage to the Common Area, or improvements thereon, causedby such Owner or Owner's agent, any occupant, invitee, guest orpet, except for that portion, if any, fully covered by insurance.Liability of an Owner shall be established only after notice to theOwner and hearing before the Board.

Section 7.16 Hazardous Materials. An Owner shall not use orkeep in a Unit or the Common Area any kerosene, gasoline orinflammable or combustible fluid or material or other hazardousmaterials, other than those required, in limited quantities, fornormal cleaning or landscaping work.

Section 7.17 Architectural Control

__________ (a) Approval of Plans. No building, fence, wall, pooi,spa, obstruction, outside or exterior wiring, balcony, deck,screen, patio, patio cover, tent awning, carport, carport cover,trellis, improvement or structure of any kind shall be commenced,installed, erected, painted or maintained upon the Property, norshall any alteration or improvement of any kind be made thereto, orto the exterior of any residence, until the same has been approvedin writing by the Architectural Control Committee appointed by theBoard, pursuant to Section 7.17(b) hereof. Notwithstanding theforegoing, an Owner may improve or alter any improvements locatedwithin the interior boundaries of the Owner's Unit, provided theimprovement or alteration does not impair the structural oracoustical integrity of the Condominium Building or any CommonArea, the utilities, or other systems servicing the Cormnon Area orother Condominiums, and does not involve altering any Common Area(including roofs and bearing walls) . Plans and specificationsshowing the nature, kind, shape, color, size, materials andlocation of such improvements, alterations, etc., shall besubmitted to the Architectural Control Committee for approval as toquality of workmanship and design and harmony with all improvementslocated in the Project, and as to location in relation tosurrounding structures, topography and finish grade elevation. Nopermission or approval shall be required to repaint in accordance

—41—

with Declarant's original color scheme previously approved by theCommittee, or to rebuild in accordance with plans andspecifications previously approved by the Comittee. Nothingcontained herein shall be construed to limit the right of an Ownerto remodel the interior of his residence, or to paint the interiorof his residence any color desired.

_____ Ib) Architectural Control Committee Action. TheArchitectural Control Comittee shall consist of three (3) members.Declarant may appoint all of the original members of the Committeeand all replacements until the first anniversary of the issuance ofthe California Department of Real Estate original final publicreport for the first phase of the Project. The Declarant reservesto itself the power to appoint a majority of the members to theCommittee until ninety percent (90%) of all the Condominiums in theProject, including subsequent phases, have been sold or until thefifth anniversary of the issuance of such original final publicreport for the first phase of the Project, whichever first occurs.After one (1) year from the date of issuance of such original finalpublic report for the first phase of the Project, the Board shallhave the power to appoint at least one (1) member to the Committeeuntil ninety percent (90%) of all the Condominiums in the Project,including subsequent phases, have been sold or until the fifthanniversary date of the issuance of such original final publicreport for the first phase of the Project, whichever first occurs.Thereafter, the Board shall have the power to appoint all of themembers of the Architectural Control Committee. In the event ofdeath or resignation of any Committee member, said member'sreplacement shall be appointed by whomever (the Board or Declarant)appointed that member. A majority of the members of the Committeemay appoint a single member to act for it. Neither the members ofthe Committee nor its designated representative shall be entitledto any compensation for services performed pursuant thereto. Inthe event the Committee fails to approve or disapprove plans andspecifications within thirty (30) days after the same have beensubmitted to it, approval will not be required and the relatedcovenants shall be deemed to have been fully complied with.

_____ (C) Landscaping. No landscaping of patios or yardsvisible from the street or from any Common Area shall be undertakenby any Owner until plans and specifications showing the nature,kind, shape, and location of the materials shall have beensubmitted to and approved in writing by the Architectural ControlCommittee or the Board,

____ (d) Governmental Approval. Before commencement of anyalteration or improvements approved by the Architectural ControlCommittee, the Owner shall comply with all appropriate governmentallaws and regulations. Approval by the Committee does not satisfythe appropriate approvals that may be required by any governmentalentity with appropriate jurisdiction.

—42—

ARTICLE VIII

11SF OF COMMERCIAL UNITS

Section 8.1 Commercial Use. No Commercial Unit shall beoccupied and used except for commercial purposes by the Owners ortheir lessees. For purposes of this Article VIII, "commercialpurposes" shall include those listed in the Conditions of Approvaland on Exhibit "C' attached hereto and by this reference made apart hereof.

No sales of merchandise or services nor any business activityrelated to a Commercial Unit shall take place outside of theCondominium Buildings or in any retail kiosk, without the priorapproval of the City Director of ?lanning and Building and theBoard.

Section 8.2 Advertising and Signs. No Owner, or his lessee,shall employ an advertising medium which can be heard orexperienced outside of the Commercial Unit, including, withoutlimiting the generality of the foregoing, flashing lights,searchlights, loudspeakers, phonographs, radios or television. NoOwner, or his lessee, shall distribute, or cause to be distributed,any handbill or other advertising device in the Common Area or onthe public sidewalks or streets adjacent to the Project. All signsdisplayed for public view on a Commercial Unit shall be locatedinside the windows of the Commercial Unit or on the awning over thedoor to such Unit, and no exterior signs shall be affixed to theBuildings without the prior consent of the Association, whichconsent shall be at the Association's sole discretion. In addition,all signs displayed for public view shall comply with allapplicable federal, state and local laws and regulations.

Section 8.3 Leasing of a Cornraercial Unit. Except for therestrictions contained in this Section 8.3, there shall be norestriction on the right of an Owner to lease his Commercial Unit.An Owner may lease his Commercial Unit for the uses allowed bySection 8.1. Any lease shall provide that it is subject, in allrespects, to the provisions of the Condominium Documents.

Section 8.4 Customers, Guests and Lessees; Insurance. AnOwner shall be responsible for compliance by his customers, guestsand lessees, and his lessees' customers and guests, with theprovisions of the Condominium Documents. The Owner of a ConmiercialUnit, or such Owner's lessee or purchaser, shall maintain a policyor policies of commercial general liability insurance in a

conunercially reasonable amount, including a waiver of subrogationin favor of the Association, and shall demonstrate proof of suchinsurance to the Board upon execution of the lease or the close ofescrow of the purchase.

—43—

Section 8.5 Restrictions on Board. The Board may notrestrict the reasonable use of a Commercial Unit. All uses shallbe in strict conformity with the Zoning Ordinances of the City ofEmeryville and the Conditions of Approval.

Section 8.6 Change in Commercial Status. No change in thecommercial status of a Commercial Unit shall be effective, unlessapproved by a unanimous vote of all Owners of Coronercial Units andpermitted by the City of Emeryville.

Section 8.7 Inclusion of Residential Restrictions. Theprovisions of Sections 7.4, 7.5, 7.6, 7.7, 7.9, 7.10, 7.13, 7.14,7.15 and 7.17 are hereby incorporated into this Article VIII andshall be restrictions on the use of the Commercial Unit.

Section 8.8 Hazardous Materials. An Owner shall not use orkeep in a Commercial Unit or the Common Area any kerosene, gasolineor inflammable or combustible fluid or material or other hazardousmaterials, other than those required to operate the business forwhich the Unit is used and for normal cleaning and landscapingwork.

ARTICLE IX

GENERAL PROVISIONS

Non THAT THE FOLLOWING PROCEDURES INVOLVE A WAIVER OF THERIGHT TO A JURY tRIM... BY SIGNING IN THE SPACE BELOW, YOU AREGIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTESLITIGATED IN A COURT OR JURY TRIAL.

Section 9.1 Enforcement; Claims Procedures.

(a) Right to Enforce. The Association, or any Ownershall have the right to enforce, by any proceeding at law or inequity, all restrictions, conditions, covenants, reservations,liens and charges now or hereafter imposed by the provisions ofthis Declaration, or decisions made by the Association pursuant tothe provisions of this Declaration, and in such action shall beentitled to recover reasonable attorneys' fees as are ordered bythe court. Failure by the Association or by any Owner to enforceany covenant or restriction contained herein shall in no event bedeemed a waiver of the rights to so do thereafter.

(b) NN4DATORY ALtERNATIVE DISPUTE RESOLUTION. Prior tothe filing by either the Association or an Owner of a civil actionrelated to the enforcement of the Condominium Documents (i) solelyfor declaratory relief, or (ii) solely for injunctive relief, or(iii) for declaratory relief or injunctive relief in conjunctionwith a claim for monetary damages not in excess of five thousand

dollars ($5,000), the parties shall endeavor to submit theirdispute to a form of alternative dispute resolution such asmediation or arbitration (collectively, alternative disputeresolution proceedings"), as required by Section 1354(b) of theCalifornia Civil Code. As provided therein:

i. The form of alternative dispute resolution

chosen may be binding or nonbinding at the option of the parties.ii. Any party to such a dispute may initiate the

process by serving on another party to the dispute a Request forResolution. The Request for Resolution shall include (1) a briefdescription of the dispute, (2) a request for alternative disputeresolution, and (3) a notice that the party receiving the Requestfor Resolution is required to respond within thirty (30) days ofreceipt or it will be deemed rejected. Service of the Request forResolution shall be as required by Section 1354(b)

iii. Parties receiving a Request for Resolution

shall have thirty (30) days following service of the Request forResolution to accept or reject alternative dispute resolution and,if the Request is not accepted within said thirty (30) day periodby a party, it shall be deemed rejected by that party.

iv. If alternative dispute resolution is accepted

by a party, it shall be completed within ninety (90) days ofreceipt of the acceptance by the party initiating the Request,unless extended by written stipulation signed by both parties.

v. The costs of the alternative dispute resolution

shall be borne by the parties.

Any such action filed by the Association or an Owner shall besubject to the provisions of Section 1354(b), and failure by anyMember or the Association to comply with the prefiling requirementsof Section 1354(b) may result in the loss of the right to sue theAssociation or another Member to enforce the Condominium Documents.

(c) MANDATORY ARBITRATION OF CLAIMS AGAINST DECLARANT.

Notwithstanding California Code of Civil Procedure Section 1298.7,any controversy or claim between or among Declarant as builder, onthe one hand, and either the Association or any Owner, on the otherhand, relating to the design or construction of the improvements onthe Property, shall be submitted to binding arbitration before theAmerican Arbitration Association ("AAA") or Judicial Arbitrationand Mediation Service/Endispute ("JAMS") , as provided in thissubsection (c) The entity selected by the parties is hereinafterreferred to as the "Arbitrating Entity", and if the parties areunable to agree on the Arbitrating Entity, the dispute shall bearbitrated before AAA.

—45—

i. The purchaser of each Unit in the Project has

been given a Limited Warranty in the form attached hereto asExhibit E (the "Limited Warranty"). As noted in Section gi(fof this Declaration, with respect to Comon Areas only, theAssociation has the same Limited Warranty as the owner of a Unit,and, for this purpose, the terms of the Limited Warranty apply tothe Association as if it were the purchaser of the Common Areas andas if the Common Areas were the Unit described in the LimitedWarranty. Terms defined in the Limited Warranty and not otherwisedefined in this Section 9.1(c) shall have the same meanings asthose set forth in Limited Warranty. The Declarant, as builder,has elected to use the following Non—Adversarial Procedures inplace of those set forth in California Civil Code Division 2, Part2, Title 7, chapter 4, (sections 910 through 938, inclusive, exceptthat the following Sections shall continue to apply: 912, 916(b)and (e) , 922, the last sentence of Section 927, 936, and 937) . TheParties shall comply with the following Non—Adversarial Proceduresprior to initiating arbitration proceedings under thissubsection (c) or reference proceedings under subsection (e) below.

A. Making a Claim. If you wish to make a

claim under the Limited Fit and Fitness Warranty or under theLimited Functionality Standards Warranty, you must give writtennotice of the claim (the "Warranty Claimt) to the Declarant at theaddress set forth in Section I.E of the Limited Warranty. TheWarranty Claim must be given in a timely manner and will not beconsidered timely if it is made: (i) more than thirty (30) daysafter you first become aware of the any facts or circumstanceswhich place you on notice of any damage, defect or deficiency whichmight be covered by this Limited Warranty; (ii) after the WarrantyPeriod, if the Claim is made under the Limited Fit and FinishWarranty for any deficiency in a Covered Component; or (iii) afterthe applicable statute of limitations has expired. Notice need notbe in writing if a situation requires immediate response to addressan imminent risk of personal injury or property damage.

B. Developer's Response to Clams. Upon

receipt of a Warranty Claim, the Declarant and its representativesshall determine whether or not the Claim is covered by the terms ofthe Limited Warranty. If the Claim is covered by this LimitedWarranty, then Declarant has the right, in its sole discretion, to(a) repair the claimed deficiency or defect, (b) replace theclaimed defective item, or (c) pay you an amount equal to thereasonable cost to repair or replace the defective item or, ifless, the amount by which the defective item reduces the value ofyour Unit. If a Claim is made, then the Declarant shall have theright to (1) meet with you to discuss the claim; (2) enter yourUnit to inspect any areas that are the subject of the Claim; and(3) conduct inspections and testing (including destructive orinvasive testing) in a manner deemed appropriate by the Declarant.If Declarant determines that a Claim is not covered by this Limited

—46—

Warranty, then the Developer shall so inform you, in writing, notmore than thirty (30)days after completing the actions permitted inthe preceding sentence.

C. Access to Make Repairs. If Declarantelects to take any corrective action, Declarant and itsrepresentatives shall be provided full access to the Unit to takeand to complete the corrective action.

D. Selection of Contractors and Subcontractorsand Methods for Repair. The Declarant shall, in its solediscretion: (fl select the contractors, subcontractors andsuppliers to be used for any repair or replacement which Declarantdecides to undertake to respond to any Claim hereunder; and (ii)the methods and materials which will be used to make any suchrepair or replacement.

E. time for Repair or Replacement. TheDeclarant shall have a period of one hundred twenty (120) daysafter receipt of a Claim to respond to the Claim and to completeany repairs or replacements which the Declarant determines to beappropriate. This time period shall be extended due to causesbeyond the reasonable control of the Declarant.

F. Calderon Act. The right to inspect andcorrect granted in these Non—Adversarial Procedures is in additionto the rights granted in California Civil Code Section 1375 (the"Calderon Act"). The procedures established in the Calderon Actmay be implemented, before, during or after the procedure in thisSection is implemented.

ii. If a Claim is not resolved under the foregoingNon-Adversarial procedures, then it may be submitted to arbitrationfor resolution. The arbitration shall be conducted in accordancewith the commercial arbitration rules of AAA or the Streamlined orComprehensive Rules and Regulations of JAMS, as the case may be,modified, in the case of AAA by a written agreement to varyprocedures and in the case of JAMS by party-agreed procedures, asfollows:

A. Declarant shall advance the fees necessaryto initiate the arbitration, with ongoing costs and fees to be paidas agreed by the parties and, if they cannot agree, as determinedby the arbitrator; provided, however, that the costs and fees ofthe arbitration shall be ultimately borne as determined by thearbitrator. All such determinations shall be consistent withSection 1284.3 of the California Civil Code.

B. There shall be only one arbitrator whoshall be selected by mutual agreement of the parties within thirty(30) days of the administrator of the Arbitrating Entity receivinga written request from a party to arbitrate the controversy or

—47-.

claim. The arbitrator shall be a neutral and impartial individual,and the provisions of California Code of Civil ProcedureSection 1297.121 shall apply to the selection of the arbitrator.An arbitrator may be challenged on any of the grounds listed inCalifornia Code of Civil Procedure Sections 1297.121 or 1297.124.If the parties are unable to agree on an arbitrator, theArbitrating Entity shall select the arbitrator.

C. The venue of the arbitration shall be the

county in which the Property is located unless the parties agree tosome other location.

D. The arbitrator shall apply Californiasubstantive law in rendering a final decision. The arbitratorshall have the power to grant all legal and eq'aitable remediesconsistent with the Limited Warranty with potential damages limitedpursuant to Section 944 of the California Civil Code.

E. Discovery shall be allowed pursuant toCalifornia Code of Civil Procedure Section 1253.05, and arbitrationof any matter pursuant to this Section shall not be deemed a waiverof the attorney-client or attorney-work product privilege in anyway.

iii. The parties agree to be bound by the decisionof the arbitrator, which shall be final and non—appealable.Judgment upon the decision rendered by the arbitrator may beentered in any court having proper jurisdiction or application maybe made to such court for judicial acceptance of the award and anorder of enforcement. If a party refuses to arbitrate, the otherparty may seek a court order compelling arbitration.

(d) Optional Aiternative Dispute Resolution. Inaddition to the requirements of Sections 9.1(b) and (c) above, theAssociation may perform any act reasonably necessary to resolve anycivil claim or action through alternative dispute resolutionproceedings, including, without limitation, the following:

i. Provide advance notice of the Association'sintent to initiate the prosecution of any civil action.

vi. After initiating the prosecution or defense of

any civil action, meet and confer with every person who is a party.vii. Consider diversion of the prosecution or

defense of any civil action to alternative dispute resolutionproceedings.

viii. Agree to both participate in alternative

dispute resolution proceedings and pay costs therefor incurred bythe Association.

—48—

(e) Judicial Reference of Claims Aqainst fleclarant. Inthe event that the mandatory arbitration provision ofsubsection (c) hereinabove is unenforceable for whatever reason,then, after compliance by the parties with the Non—AdversarialProcedures, any controversy or claim referenced therein shall beadjudicated by using voluntary judicial reference in accordancewith the provisions of Code of Civil Procedure sections 638—645 orany successor statutes. The parties shall use a general refereeacceptable to both parties, or, if the parties cannot agree, anyparty may petition the Superior Court of the County of Alameda forappointment of a generaL referee by the presiding judge. Theparties shall cooperate in good faith to ensure that all necessaryand appropriate parties are included in the judicial referenceproceeding. Declarant shall not be required to participate in thejudicial reference proceeding unless Declarant is satisfied thatall necessary and appropriate parties will participate.

Declarant shall advance the fees necessary to initiate thejudicial reference, with ongoing costs and fees to be paid asagreed by the parties and, if they cannot agree, as determined bythe referee; provided, however, that the costs and fees of thejudicial reference shall be ultimately borne as determined by thereferee.

The judicial reference shall be a general reference. Thegeneral referee shall have the authority to try any and all of theissues in the proceeding whether of fact or of law, and to reporta statement of decision thereon. Neither the referee nor any partyshall have the right to impanel a jury and accordingly, EACH PZiP.TYWAIVES ITS RIGHT TO A TRIAL BY JURY. Each party retains the sameappeal rights of the referee's decision as if the decision wererendered by a trial court judge.

(f) Civil Code Section 896 Cozwliance. For any claimfor defective construction filed by the Association or any Ownerunder subsection Cc) above (or subsection Ce) where the provisionsof subsection (c) are unenforceable), where the claim should seekto enforce compliance by the Declarant with the functionaLitystandards of California Civil Code Section 896 (including anysuccessor statute) , the Association shall only have the authorityto enforce such compliance with respect to the Comon Areas.

(g) The Declarant shall not be entitled to vote on anydecision concerning whether or not to make a claim against theDeclarant for any violation of the Limited Warranty. This section9.1 may be amended only with the Declarants prior written consent.

NOTICE: BY SIGNING BELOW YOU ARE AGREEING TO HAVE ANYDISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE'ARBITRATION OF DISPUTES' PROVISIONS DECIDED BY NEUTRALARBtTRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ABE

—49—

GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO RAVE TUEDISPUTE LITIGATED IN A COURT OR JURY TRIM... BY SIGNINGIN TIlE SPACE BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTSTO DISCOVERY AND APPEAL, Utmzss THOSE IkIGHTS ABE SPECIFICALLYINCLUDED IN THE 'ABEflBATIOW OF DISPUTES' PROVISION. IF YOUREFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THISPROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THEAUTHORITY OF THE CALIFORNIA CODE OP CIVIL PROCEDURE.YOUR AGREEMENT TO THIS ARBITRATiON PROVISION ISVOLUNTARY.

WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TOSUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED INTHE 'ARBITRATION OF DISPUTES' PROVISION TO NEUTRALARBITRATION.

(h) Civil Code Sections 896 and 897 Claims. The soleand exclusive authority to initiate claims on behalf of theAssociation in connection with improvements or Landscapingmaintained by the Association for violations of the functionalitystandards set forth in Civil Code Sections 896 and 897 shall restwith the Board members elected solely by Class A Members describedin Section 3.4 of this Declaration and Section 3.6 of the Bylaws(the "Non—Declarant Directors") Any Non—Declarant Director may atany time request a meeting for the purpose of discussing,inspecting, investigating and/or initiating any claims under CivilCode Sections 896 or 897. Notice of the meeting shall be sent inthe same manner as notice of special meetings of the Board. Anymember of the Board appointed by Declarant or elected by votes castby Declarant shall be entitled to attend the meeting but shall notbe entitled to vote. The meeting shall be open to all Members ofthe Association, unless the Non-Declarant Directors adjourn to anexecutive session as authorized by the Bylaws. The decision of amajority of the Non-Declarant Directors shall control. If the Non-Declarant Directors elect to initiate a claim, the authority toinitiate a claim also shall require the approval of the votes castby a majority of the Class A Members present in person or by proxyat a duly—held meeting. Any Non-Declarant Director may call aspecial meeting of the Members for this purpose. The claim issubject to the provisions and procedures set forth in this Section9.1. If requested by the Non-Declarant Directors, the Associationshall provide the administrative support for the notice and conductof its meetings and any meeting of the Members cai>led to approvethe initiation of a claim. In addition, the Association shallprovide such reasonable financial support as may be necessary inorder for the Non-Declarant Directors to inspect, investigateand/or initiate the claim on behalf of the Association, subject tothe applicable requirements and procedures set forth in thisSection 9.1. The provisions of this Section 9.1(h) are effectiveautomatically on the date the first Non-Declarant Director iselected to the Board. At such time as the Board no longer has a

—50—

majority of its members appointed or elected by the Declarant, theprovisions of this Section 9.1(h) automatically shall be null andvoid.

Section 9.2 Invalidity of any Provision. Should anyprovision of any Condominium Document be declared invalid or inconflict with any law of the jurisdiction in which this Project issituated, the validity of all the remaining provisions and portionsthereof shall remain unaffected and in full force and effect.

Section 9.3 Term. The covenants, conditions and restrictionsof this Declaration shall run with and bind the Property and shalLinure to the benefit of and shall be enforceable by the Associationor the Owner of any property subject to this Declaration, theirrespective legal representatives, heirs, successors and assigns fora term of thirty (30) years from the date that this Declaration isrecorded, after which time, these covenants, conditions andrestrictions shall be automatically extended for successive periodsof ten (10) years, unless an instrument in writing, signed byseventy—five percent (75%) of the then Owners of the Condominiums(and approved by first mortgagees in accordance with Section 9.6.)has been recorded within the year preceding the year of eachsuccessive period of ten (10) years, agreeing to change suchcovenants and restrictions, in whole or in part, or to terminatethem.

Section 9.4 Amendments. This Declaration may be amended onlyby the affirmative vote of seventy—five percent (75%) of each classof the Association Members, if the two class voting structure isstill in effect. Under the single class voting structure,amendment of this Declaration shall require both the affirmativevote of seventy-five percent (75%) of the total voting power of theAssociation Menthers and a bare majority (51%) of the votes ofMembers other than Declarant, each Unit having one (1) vote. In noevent, however, may any clause, provision or Section of thisDeclaration be amended by a percentage of voting power of theAssociation which is lower than the percentage of affirmative votesprescribed for action to be taken under that clause, provision orSection. All such amendments must be recorded and shall becomeeffective upon being recorded in the Recorder's Office of theCounty of Alameda.

Section 9.5 Encroachment Easements. Each Condominium withinthe Property is hereby declared to have an easement over alladjoining Condominiums and the Common Area for the purpose ofaccommodating any encroachment due to engineering errors, errors inoriginal construction, settling or shifting of the CondominiumBuilding, or any other cause. There shall be valid easements forthe maintenance of such encroachments as long as they shall exist,and the rights and obligations of the Owners shall not be alteredin any way by such encroachment, settlement or shifting; provided,however, that in no event shall a valid easement for encroachment

—51—

be created in favor of an Owner or Owners if such encroachmentoccurred due to willful misconduct of such Owner or Owners. In theevent that a structure is partially or totally destroyed, andsubsequently repaired or rebuilt, the Owners of each Condominiumagree that minor encroachments over adjoining Condominiums orCommon Area shall be permitted and that there shall be valideasements for the maintenance of such encroachments, so long asthey shall exist.

Section 9.6 Mortgage Protection ?rovision.

(a) Mortgage Permitted. Any Owner may encumber hisCondominium with a mortgage. The Exclusive Use Common Areas, ifany, are a part of the Project and are covered by the mortgage atleast to the same extent as are the Comon Areas. All such areasare fully installed, completed, and in operation for use by theOwners.

(b) Subordination. Any lien created or claimed underthe provisions of this Declaration is expressly made subject andsubordinate to the rights of any first mortgage that encumbers anyCondominium, made in good faith and for value, and no such lienshall in any way defeat, invalidate or impair the obligation orpriority of such mortgage, unless the mortgagee expresslysubordinates his interest in writing to such lien. The transfer ofownership of a Condominium as the result of the exercise of a powerof sale or a judicial foreclosure involving a default under thefirst mortgage, shall extinguish the lien of Assessments which weredue and payable prior to the transfer of the ownership interest.No transfer of an ownership interest, as the result of af-preclosure or exercise of a power of sale, shall relieve the newOwner, whether it be the former mortgagee or beneficiary of thefirst mortgage or another person, from liability for anyAssessments thereafter becoming due or from the lien thereof. Alltaxes, assessments and charges which may become liens prior to thefirst mortgage under local law shall relate only to the individualCondominiums and not to the Project as a whole.

• (c) Amendment. No amendment to the CondominiumDocuments shall affect the rights of any mortgagee under anymortgage made in good faith and for value and recorded before therecordation of any such amendment, unless a mortgagee either joinsin the execution of the amendment or approves it in writing as apart of such amendment.

(d) Restrictions on Certain Changes.

i. Unless sixty—seven percent (67%) of all firstmortgagees of Condominiums (based on one vote for each firstMortgage owned) and sixty-seven percent (67%) of Owners (other thanDeclarant or sponsors, developers, or builders) have given theirprior written approval (unless a higher percentage is required by

—52--

a specific provision of this Declaration) neither the Associationnor the Owners shall be entitled:

A. By act or omission to seek to abandon orterminate the Project, except for abandonment provided by statutein case of substantial loss to the Units and the Comon Area.

B. To change the pro rata interest orobligations of any Condominium for purposes of levying Assessmentsor charges or allocating distributions of hazard insurance proceedsor condemnation awards or for determining the pro rata share ofownership of each Condominium in the Common Area.

C. To partition or subdivide any Condominium.

D. By act or omission to seek to abandon,partition, subdivide, encumber, sell or transfer the Common Area.The granting of easements for public utilities or for other publicpurposes consistent with the intended use of the Common Area by theAssociation or the Owners shall not be deemed a transfer within themeaning of this subparagraph.

E. To use hazard insurance proceeds forlosses to Units or Common Area for other than the repair,replacement or reconstruction of improvements, except as providedby statute in case of substantial loss to the Units or Common Areaof the Project.

ii. A. Except the annexation rights under Section2.6 and any reallocation of interests in the Common Area which mayoccur pursuant to any plan of expansion or phased developmentcontained in the original Condominium Documents, and unless ahigher percentage is required by a specific provision of thisDeclaration, the consent of sixty—seven percent (67%) of Owners andthe approval of Eligible Hortgagees holding mortgages onCondominiums which have at least fifty—one percent (51%) of thevotes of Condominiums subject to mortgages held by EligibleMortgagees shall be required to add or amend any materialprovisions of the Condominium Documents which establish, providefor, govern, or regulate any of the following: (1) voting; (2)increases in Assessments that raise the previously assessed amountby more than twenty—five percent (25%) , Assessment liens or thepriority of such liens; (3) reductions in reserves for maintenance,repair and replacement of the Common Area; (4) insurancerequirements; (5) reallocation of the interests in the Common Areaor the Exclusive Use Common Areas or rights to their use; (6)responsibility for maintenance and repair; (7) expansion orcontraction of the Project or the addition, annexation, orwithdrawal of property to or from the Project; (8) the redefinitionof boundaries of any Condominium; (9) restoration or repair of theProject (after damage or partial condemnation) in a manner otherthan that specified herein; (10) convertibility of Units into

—53—

Common Area or of Common Area into Units; (11) imposition of anyrestriction on the leasing of Condominiums; (12) imposition of anyright of first refusal or similar restriction on the right of aCondominium Owner to sell, transfer, or otherwise convey hisCondominium; and (13) any provisions which are for the expressbenefit of Eligible Mortgagees or Eligible Insurers or Guarantors)

B. An addition or amendment to such documentshall not be considered material if it is for the purpose ofcorrecting technical errors, or for clarification only. AnyEligible Mortgagee who receives a written request to approveadditions or amendments who does not deliver or post to therequesting party a negative response within thirty (30) days shallbe deemed to have approved such request.

iii. Unless the prior consent of sixty—seven percent(67%) of Owners and approval of Eligible Mortgagees holdingmortgages on Condominiums which have at least sixty—seven percent(67%) of the votes of Condominiums subject to mortgages held byEligible Hortgagees has been obtained, neither the Association northe Owners shall be entitled to terminate the legal status of theProject as a condominium project; except that the approval of onlyfifty—one percent (51%) of Eligible Mortgagees shall be required toterminate the legal status of the Project after substantialdestruction or a substantial taking in condemnation.

(e) Right to Examine Books and Records. The Associationshall make available to Owners and first mortgagees (and insurersor guarantors of any first mortgage)

, current copies of theCondominium Documents and the books, records, and financialstatements o the Association. "Available" means available forinspection arid copying, upon request, during normal business hoursor under other reasonable circumstances. The Association mayimpose a fee for providing the foregoing which may not exceed thereasonable cost to prepare and reproduce the requested documents.Any first mortgagee shall be entitled, on written request, to havean audited financial statement for the immediately preceding fiscalyear. Such statement shall be furnished within a reasonable timefollowing such request.

(f) Distribution of Insurance and Condemnation Proceeds.No Owner, or any other party, shall have priority over any right offirst niortgagees of Condominiums pursuant to their mortgages incase of a distribution to Owners of insurance proceeds orcondemnation awards for losses to or taking of Units or CorrmionArea. Any provision to the contrary in this Declaration or in theBylaws or other documents relating to the Project is to such extentvoid. All applicable fire and all physical loss or extendedcoverage insurance policies shall contain loss payable clausesacceptable to the affected mortgagees naming the xnortgagees, astheir interests may appear.

—54—

(g) Notice to Mortgagees of Record. On receipt ofwritten request to the Association froth any Eligible Mortgagee orEligible Insurer or Guarantor, identifying both its name andaddress and the Unit number or address of the Unit on which it hasthe mortgage, the Association shall give written notice to eachEligible Mortgagee or Eligible Insurer or Guarantor of thefollowing:

i. Any loss to any Unit covered by such mortgage,if such loss exceeds one thousand dollars ($1,000), or any takingof such Unit;

ii. Any loss to the Common Area, if such lossexceeds five thousand dollars; ($5,000), or any taking of the CommonArea;

iii. Any default by the Owner of any Unit covered bysuch mortgage under any provision of this Declaration or any otherprovision of the Bylaws or rules and regulations adopted by theAssociation, which default is not cured within sixty (60) daysafter written notice to such Owner (such notice to include the factthat said sixty (50) day period has expired);

iv. Any lapse, cancellation, or materialmodification of any insurance policy or fidelity insurancemaintained by the Association; and

v. Any proposed action which would require theconsent of a specified percentage of Eligible Mortgagees asspecified in Section 9.6(d) (ii).

(h) Effect of Breach. No breach of any provision ofthis Declaration shall invalidate the lien of any mortgage on anyCondominium made in good faith and for value, but all covenants,conditions and restrictions shall be binding on any Owner whosetitle is derived through foreclosure sale, trustee's sale, orotherwise.

(i) Foreclosure. If any Condominium is encumbered by afirst mortgage made in good faith and for value, the foreclosure ofany lien created by any provision set forth in this Declaration forAssessments, or installments of Assessments, shall not operate toaffect or impair the lien of the first mortgage. On foreclosure ofthe first mortgage, the lien of Assessments, or installments, thathave accrued up to the time of foreclosure shall be subordinate tothe lien of the first mortgage, with the foreclosure—purchasertaking title to the Condominium free of the lien for Assessments,or installments, that have accrued up to the time of theforeclosure sale. On taking title to the Condominium, theforeclosure-purchaser shall only be obligated to pay Assessments orother charges levied or assessed by the Association after theforeclosure-purchaser acquired title to the Condominium. The

—55—

subsequently levied Assessments or other charges may includepreviously unpaid Assessments; provided all Owners, including theforeclosure—purchaser, and his successors and assigns, are requiredto pay their proportionate share, as provided in this Section.

(j) Appearance at Meetings. Because of its financialinterest in the Project, any mortgagee may appear at meetings ofthe Members and the Board to draw attention to violations of thisDeclaration that have not been corrected or macic s-ubject toremedial proceedings or Assessments.

(k) Right to Furnish Any Information. Any mortgagee mayfurnish information to the Board concerning the status of anymortgage.

(1) Inapplicability of Right of First Refusal toMortgagee. The Condominium Documents contain no right of firstrefusal or similar restriction on the right of an Owner to sell,transfer or otherwise convey the Owner's Condominium. No suchright of first refusal or similar right shall be granted to theAssociation in the future without the consent of any mortgagee ofthe Condominium. Any right of first refusal or similar right thatmay be granted to the Association (or other person or entity) shallnot apply to any conveyance or transfer of title to suchCondominium, whether voluntary or involuntary, to a mortgagee whoacquires title to or ownership of the Condominium, pursuant to theremedies provided in its mortgage, or by reason of foreclosure ofthe mortgage or deed (or assignment) in lieu of foreclosure. Inaddition, said right of first refusal or similar right shall notimpair the rights of a mortgagee to sell or lease a Condominiumacquired by the Mortgagee.

(in) Payment of Taxes or Insurance by Mortgagees. Firstmortgagees may, jointly or singly, pay taxes or other charges whichare in default and which may or have become a charge against theCommon Area, and may pay overdue premiums on hazard insurancepolicies, or secure new hazard insurance coverage on the lapse ofa policy, for such Comon Area; provided such first mortgageesmaking such payment have given notice to the Association prior tothe making of such payment(s) and the Association has failed to paythe same.

Section 9.7 Owner's Right and Obligations to Maintain, Repairand Insure. Except for those portions of the Project that theAssociation is required to maintain and repair, each Owner shall,at his sole cost and expense, maintain and repair his Unit, keepingthe same in good condition. Each Owner shall keep those portionsof Exclusive Use Common Areas, if any, to which he has an exclusiveeasement or license, clean and neat. The Owners of Units to whichExclusive Use Common Area decks are appurtenant shall maintain andrepair decks, excluding, however, the structural components of theCommon Area associated therewith. Each Owner shall have the

—56—

exclusive tight to paint1 plaster, panel, tile, wax, paper orotherwise refinish or decorate the inner surfaces of the walls,ceilings, floors, windows, and doors bounding his Unit.

Each Unit Owner shall maintain a personal property andpersonal liability insurance policy in an amount deemed sufficientby the Associatior and shall provide the Association with proof ofsuch insurance and payment therefor. An Owner shall also maintainadditional insurance to cover improvements to his Unit. All suchOwners' policies shall include a waiver of subrogation in favor ofthe Association.

In the event that an Owner fails to maintain and repair theinterior of his Unit, or his Exclusive Use Common Area deck, in amanner which the Board deems necessary to preserve the appearanceand value of the Property, or necessary to keep such Exclusive UseCommon hreas in good repair and condition, the oard may notify theOwner of the work required and request that it be done within sixty(60) days from the giving of such notice. In the event the Ownerfails to carry out such maintenance or repair within such sixty(60) day period, the Board nay give notice and hold a hearing andcause such work to be done and may specially assess the costthereof to such Owner and, if necessary, place a lien on hisCondominium for the amount thereof.

Section 9.8 Entry for Repairs. The Board or its appointedagents may enter upon any Unit when necessary in connection withany maintenance, repair or construction for. which the Associationis responsible. Such entry shall be made with as littleinconvenience to the Owner as is practicable, and any damage causedthereby shall be repaired by the Board at the expense of theAssociation. Except in the case of any emergency, forty-eight (48)hour advance notice shall be given to the Owner or occupant priorto any such entry.

Section 9.9 Damage or Destruction.

(a) If the Project improvements are damaged by fire orother casualty, the improvements shall be rebuilt or repairedsubstantially the same as the improvements existed prior to thefire or other casualty, subject to local building codes and otherapplicable governmental regulations, unless either of the followingOccurs:

i. The cost of repair or reconstruction is morethan fifty percent (50%) of the current replacement costs of allthe Project improvements, the available insurance proceeds are notsufficient to pay for at least eighty—five percent (85%) of thecost of such repairs Or reconstructions, and three-fourths (3/4ths)of the total voting power of the Association residing in Membersand their first mortgagees vote against such repair andreconstruction Or

—57—

ii. Available insurance proceeds are not sufficientto substantially repair or reconstruct the improvements within areasonable time as determined by the Board, a Special Assessmentfails to receive the requisite approval (if such approval isrequired) as provided herein, and the Board is unable to supplementthe insurance by borrowing on behalf of the Association sufficientmonies to enable the improvements to be substantially repaired orreconstructed within a reasonable time.

(b) The following procedures shall be employed fordisposition of insurance proceeds and guidance in reconstruction:

i. Minor Casualty. If the cost to repair orreconstruct does not exceed the sum of thirty thousand dollars{$30, 000), the Board shall thereupon contract to repair and rebuildthe damaged portions of all Units and the Common Area, inaccordance with the conditions existing immediately prior to damage(modified at the discretion of the Board to comply with buildingcodes and consttuctjon standards in effect at the tine of therebuilding) and the funds held in the insurance trust fund shall beused for that purpose. If the insurance proceeds are insufficientto pay all of the costs of repairing or rebuilding, the Owners ofthe Units affected shall pay for the portion of the insufficiencyattributed to their Unit by the Board and the Board shall levy aSpecial Assessment on all Condominiums to make up any deficiencyattributed to the Common Area. The Special Assessment shall besubject to the provisions of this Declaratioi-i governing membershipapproval of Special Assessments and shall be levied according tothe Ownerts Share, as set forth on the Condominium Plan.

ii. Ma-jor Casualty. If subparagraph (b) (i) isinapplicable, then,

A. ll insurance proceeds and funds borrowedby the Association, if any, shall be paid to a bank, trust companyor other entity designated by the Board ("the insurance trustee")to be held for the benefit of the Owners and their rnortgagees, astheir respective interests may appear. Said funds shall bedisbursed according to standard construction loan procedures. TheBoard, on behalf of the Association and of the Owners, hereby isauthorized to enter into an insurance trust agreement, consistentwith this Declaration, with such insurance trustee, relating to itspowers, duties and compensation.

B. The Board shall obtain firm bids from two(2) or more responsible contractors to rebuild the Project inaccordance with the conditions existing immediately prior to damageand destruction (modified at the direction of the Board to complywith building codes and construction standards in effect at thetime of the rebuilding) The Board may also obtain an estimatefrom the insurance carrier of the scope of work included within theamount of the insurance coverage. To be considered, any

—58—

EXMISZT "A

TO

DECLIiflTIQN OF

CONDITIONS, COVENANTS AZW RESTRICTIONS

OF

MJDANTE,

A CONDOMINIUM PROJECI'

CONDOMINIUM PLAN

— EX3IBIT "A" —

CONDOMINIUM PLr14 FORAN DANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

SIJPWIIDR'S STATEMENT

1 HEREBY STATE THAT I AM A UCENSED SURVEYOR NLJFABER 7756, OF THE STATE OF CAUFORNIA; ANt)NAT THE CONDOMINIUM PLAN CONSISTS OF A DESCRIPTION OR SURVEY MAP OF A CONDOMINIUMPROJECT 1ICH REFERS TO OR SHOWS MONUMENTAT1ON ON THE GROUND AND A THREE DIMENSIONALDESCRIPTION OF THE PROJECT IN SUffiCIENT DErAIL TO IDEflIFY THE COMMON AREAS AND EACHSEPARATE INTEREST PURSUANT TO THE REQUIREMENTS OF CALIFORNIA CML CODE E4AI 1351(f)?

LAURA J. CABR. LS 7756EXPIRES: 12/31/2005

GOERAL NOTES AND nmwmos

1. THE SUBDIVISION DEPICTED HEREON IS SUBJECT TO NE PROVISIONS OF

COMMON INTEREST DEVELOPMENT ACT, liThE 6, PART 4, DMSION 2 OF THE CML CODE.

2. AU. DIMENSIONS AND ELEVATIONS SHOWN ON THESE SHEETS ARE IN FEET AND DECIMALS THEREOF

UNLESS OThERWISE NOTED.

3. ALL LINES or NE UNITS OR YARDS ARE AT RIGHT ANGLES OR 45 DEGREE ANGLES UNLESS

OTHERWISE SHOWN.

4. IN INTERPRETiNG DEEDS DECLAM11ONS AND LANDS, ThE EXISTING PEffSICAL BOUNDARIES OF THE

UNIT OR OF A UNIT RECONSTRUCTED IN SUBSTANTIAL CONFORW1CE WiTh THE ORIGINAL PLANS

THEREOF SHALL BE CONCLUSIVELY PRESUMED TO BE ITS BOUNDARIES RATHER THAN THE METES

AND BOUNDS (OR OThER DESCRIPTION) EXPRESSED IN ThE DEED, PLAN OR DECLARATION,REGARDLESS or MINOR VARIANCE BEIWEEN BOUNDARIES SHOWN ON THE PLM OR JN THE DEED

AND CLARAT1OI1 AND NOSE OF THE UNIT.

5. EACH PARCEL DESIGNATED WITH A P AND NUMBER IS A PtJBUC PARKING SPACE.

6. EACH PARCEL DESIGNATED WITH A R AND NUMBER IS A RESIDENCE PARKING SPACE.

7. EACH PARCEL DESIGNATED WITH A AND A NUMBER IS A STORAGE UNET, THE USE OF WHICH

SHALL BE GRANTED AS AN EXCLUSNE USE COMMON AREA, APPURTENANT TO THE OWNER OF THECORRESPONDINGLY NUMBERED UNIT.

S. tACK PARCEL DESIG4AWD WITH A t" 14D A NUMBER iS A DECK. THE USE OF WHICH SHALL BEGIt4TCD AS AN EXCLUSIVE USE COMMON AREA, APPURTENANT TO THE OWNER OF THE

CORRESPONDINGLY NUMBERED UNrr.

SflJØJk4ARK:

ThE BASIS OF ELEVATIONS FOR ThIS SURVEY IS IIA11ONAL GEODETIC SURVEY BENCHMARKNo. 7 A ECC, BEING A BRONZE DISK ESTABLISHED BY THE art OF OA&QAND, SETUA1ED

IN ThE OIlY OF EMERYALI.E. AT THE INlsECmow OF SAN PABLO AVENUE, ADEUNE STREETAND 38TH STREET, AT THE SAN PABLO AVENUE BRIDGE OVER MacARThUR BLVD., IN NE TOPOF NE WEST SIDE OF Il-IE CONCRETE FLOOR (ELEW34.76, SEA LEVEL DATUM OF 1929).

ÔOADOMINIUM PLA11 FOR

ANDANTEEMERWILLE, CALIFORNIA

GENERAL LOCATION PLANBUILDINGS 1,23,4 AND GARAGE

40Th STREET

1

EXHIBIT SA

//

/

AN

DA

NT

EA

ThO

LO

T 4

OM

SI0t

I FO

R C

VIO

ON

PIIU

Ufl

flPO

S C

OtI

SiSf

llO O

F 12

5I%

EttI

UA

Lca

toM

INflf

lI$M

ID ii

cmM

azR

cAL

WIT

SB

EIN

OA

RtS

U!S

ILO

TS

MID

2 O

F P

AR

tS.

14)?

O5

RE

OE

O M

RC

14 2

6, 2

003

VI

MP

BO

<21

0.A

TP

AG

ES

44—

45. W

I lil

t PIC

C O

F T

hER

WO

fØE

RA

LM

IWA

Ct1

t LW

IG E

H1m

EL

YIT

I* T

hE O

TT

tER

YM

LIZ

. CO

IS1T

Y O

FA

LA

M. S

TA

lE N

CA

Lfl

Nlk

CIT

Y O

FE

ME

RY

VItL

EC

OU

NT

Yor

ALA

ME

DA

SCA

LE

: 1"

tOO

DA

Tt

MA

RC

H20

Q4

40th

SW

EE

T

4--

--

-"4

0th

SIR

EE

1'

// C4%

rc4.

toos

. M m

c. v

u43

.

m z/ /

9F /

'37, I- lo

/E

GS

CA

LL0W

MS

MC

DO

IDIS

lON

s A

RE

1O

VR

4 14

Efl

MID

QE

4AL

S T

hDIE

W.

—IM

ES

SIII

CB

St E

ftW

—-—

--—

t__-

-__

iMJI

OA

1ES

IWC

•eW

ltS F

øOS

TM

WU

, aT

? 4W

aWT

ow

ocna

sw

w a

ir vn

ea o

x S

•*t

lCS

raim

ID

IMIT

iS N

O1T

ho

II1cA

1SFW

W 1

W!M

Efl

As

orn,

IWT

ES

PS lI

E

/F

/B

ASS

OF

BE

PJ1

NQ

SIN

C9E

PIH

C N

OR

Th

1t'4

&15

EA

SI O

F 1W

MG

MIB

IT L

ilt40

Th

S1R

EE

T A

S IO

Nal

1U

AT

aR

TA

PI U

P? 9

1111

LW

WA

d N

a63

68'

rUe

Afl

Y 2

t 19R

3 04

BO

UC

269

WA

tT M

S A

TP

M1E

S 2

7 -

35W

I ilL

C O

f NE

CO

WIT

Y R

EW

Efl

N M

.MIE

DA

CW

NIY

. CA

IJFU

mIA

WA

S T

frJ<

D1

AS

ThE

BA

SS O

F B

EPf

lIG

$ ra

Thi

s R

EY

./ '/,4D

. NA

IL A

t TA

O IS

717

0t'

o_R

Ecf

l)

63

tnac

EU

AA

VE

NU

E

/[_

___ S

Aw

flU

MIJ

(çaa

sIe

.a.n

Inn

r

CONDOMINIUM PL 1 FOR

AN DANTEEMERWILLE CALIFORNIA

BUILDING LOCA11ON PLANRRST LEVEL GARAGE PLAN

EXHIBIT "A"

/

/

,&C7/14'l's -

/Q

1

if/4•4

ACA ASSDUA11ON COMMON AREAC — COMPACT pPRKttlG STALLP PUBLiC PARKiNGR RESIDENCE PMKIHG

— TtO flt rflI'1V Cl tVIllflN

/ /HANDICAPPED STAU.

CONDOMINIUM PL 4 FOR

ANDANTEEMERYVLLE, CALIFORNIA

BUILDING LOCATION PLANSECOND LEVEL GARAGE PLAN

EXHIBIT "A"

ACA ASSOUAIIOH COMM*4 AREA

C COMPACT PARK!NO STALL

P = PIJBUC PMKNG is:iHMDICRPED STALL

/

bONDOMINIUM PL J FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

BUILDNG LOCATION PLANTHIRD LEVEL GARAGE PLAN

ACA ASSOQA11ON COMMON MEAC COMPACT PNKINC sTAa NAWDICtPPED STALLP = PUBliC PARKNG ____

ri/rip.a PL$ 7047

84

/

I

•

CONDOMINIUM PL FOR

AN DANTEEMERYVILLE, CAL(FORNIA

BUILDING LOCATION PLANFOURTH LEVEL GARAGE PLAN

-

ACA = PSSOCIAT1 COMMON AREAC a COMPACT PARXINC SThLL LA I HANDICAPPED STALL

EXHIBIT 0A"

/

CONDOMINIUM PL N FOR

ANDANTEEMERWILLE, OAL!FORNIA

BUILDING LOCATION PLANFIFTH LEVEL GARAGE PLAN

EXHIBIT 'A"

Ti

'4+IC,

/

/

/ct

//k'lie/NJ

/tQPtA — ASSOQATION COMMON AREATOC. TOP OF CONCRE1E UEVkIIONC COMPACT PARKING STALl.

HANDICAPPED STALL

- _____w7Li57Lt. 8402'——---

It-

CONDOMINIUM PL. FOR

ANDANTEEMERWILLE, CALIFORNIA

BUILDING LOCA11ON PLANBUILDING 1FIRST FLOOR

ACA = ASSOCIAIICW COMMON AREA

EXHIBIT 5K

SLOPE EASEMENTCITY OF EMERnqLLEDOa # 2007428 744SET NAIL & TAG

7047S7545'15W 74.07'

/(

40th sT EXTENS'/OI'/

___ ___ 95.84'_ASS' 3' 17

16.!

liT ____-n 14.67 AI

AC4

7.

ACA

.7667•

L 0 I 2

37.33

89

1 flCTAK I I

/N /

V

CONDOMINIUM PL

ANDANTEEMERYVILLE, CALiFORNIA

'FOR

EXHIBIT W

BUILDING LOCA11ON PLANBUILDING 1SECOND FLOOR

73.75, 40th ST. 6.67'

5.50

0205

UNIT 201

V 206-'

UNIT 205l.

UNIT 206J ACA

0.67'

flP.L

71.75'C

23.50

A CA

I

-f

BUILDING' S

F7/i'ST FLOOR Hj

t

11—I

CA = ASSOQAI1ON COMO1 AREA

CONDOMINIUM PL FOR

ANDANTEEMERYVILLEI CAUFORNIA

BUILDING LOCA11ON PLANBUILDING 1THIRD FLOOR

EXHIBIT 'A"

I

BUILDING 2FiRST FLOOR

_____ ___________ _____ II

I—

IL'

ST EXTENSION6.73'

'4-1

4 BUILDINGS

FiRST FLOOR

ACA AS5DCIM)Gt COMM AflEA

CONDOMINIUM PU-

FOR

AN DANTEEMERYVILLE CALIFORNIA

BUILDING LOCA11ON PLANBUILDING 1FOURTH FLOOR

EXHIBIT "A"

fl-ii

40th ST EXTENSION 6.67'6.73'

85.50'

I

1jul11

I

801W/NC 3_j

1

L

ACA ASSCcIA11ON COMMON AREA

53'

0—4

KrK_

CONDOMINIUM PLL FOR

ANDANTEEMERYV1LLE CALIFORNIA

EXHIBIT W

37,

BUILDING LOCATION PLANBUILDING 2PIRST FLOOR

FflTFWJ? I

3,33-I'd 7.33•

/ tsr-/ J.sst.

7,33,15.33'—

133L r-S742528WN/Cl TA RA S

DOE.

CONDOMINIUM P1 N FOR

ANDANTEEMERWILLE CALIFORNIA

37' I

ULj

I.,tfr)

EXHIBIT "A"V

BUILDING LOCATION PLANBUILDING 2SECOND FLOOR

ACA ASSOA11ON GOMMON AREA

N/Cl TARASØ. #97149054

• -yr120.96 —•1

SETS/4"I.P. __/& CAP PLS 7047

•OQNDOMINILJM P1 &N FOR

ANDANTEEMERWILLE CALIFORNIA EXHIBIT 'A"

BUILDING LOCATION PLANBUILDING 2THIRD FLOOR

37* 63'

II

I-u

I Ic0—1cmI.:'-4--

7Z29

N764628t 63.0O'SET NAIL & TAG

PLS 7047

ACA = ASSOCIAnON COMMON MEA

IIMn.JIqun nR rIrvallnM = nfl

U U L? V

N! CI TARASDX. p97149054

____ p9 120.95' — /ti SETJ/CI.P.

& CAP PIS 7047

EXHIBIT "A"

CQNDOMINIUM PL 'N FOR

ANDANTEEMERWILLE CALIFORNIA

BUILDING LOCA11ON PLAN

BUILDING 2FOURTH FLOOR

37' 63'

0—.1

IcLiI

4/72.29'aoo

L..N7646'28t63.00' !L!

I SET

ACA ASSQcIMIDPJ COMMON AREA

UNF1N!SHED FLOOR ELEVA11ON 72.5

N/UI TARASDOC. /97749054

CONDOMINIUM PU. FOR

ANDANTEEMERYVILLEI CAUFORNIIA

EXHIBIT "A"

BUILDING LOCATION PLAN

BUILDING 3FIRST FLOOR

53'

'cc7- C 0

—Icr

'ccCr)

I.1V7646'2tE 6JOO ______ — —-

SET NNL&TAG /C ?425'28W

PLS 7047—'

ACA = ASSCCIA114 C*AMON AREA

AC4

NI Ci TIARASDoG. /9 7749054

sET!Ac0t7.!f-'

LOCATION PLAN3FLOOR

EXHIBIT "A".4C4

Ø0ND0MINIUM put. FORANDANTEEMERYVILLE, CALIFORMA

BUILDINGBUILDINGSECOND

63'

S.

01* -JI"

57425'28 W

N/Cl TARASooc. g7149O54

ACA ASSOCIA11ON COMM AREA

'CONDOMINIUM PL. FORAN DANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

BUILDING LOCA11ON PLANBUILDING 3THIRD FLOOR

63'

I—

)12-4En

N7 a c_gSET NAIL & TAG /

P/S 7047—"

ACA ASSOCIA11ON COUMC*1 AREA

ACA

Nic/TARASDoc. #4O

OONDOMINIUM PLki FOR

ANDANTEEMERYVILLE, CALIFORNIA

EXHIBIT 'A"

BUILDING LOCATION PLANBUILDING 3FOURTH FLOOR

63'

0'a-a

(J•)

If4/

VN7545'28t 63.00'

SET NAIL & TAG /P15 7047—'

ACA ASSOCIAI1ON C4M4 AREA

N/Cl TARASDoc. #7'°

CONDOMINIUM PLk d FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

ACA ASSCCIA1ICt4 COMMON AREA

/

BUILDING LOCATION PLANBUILDING 4.FIRST FLOOR

J0-

1

__-Th.4

- L

NICJTARASPVC. .g7J49°

/ro: 3/C/P.& CAP as 7047

/ //

//'

.4VALUN SENIOR HOUSiNG

DOC +973i7035

C)

/

///

'ÔONDOMINIUM PLAN FOR

ANDANTEEMERYVILLE, CAUFORNLk

BUILDING LOCATION PLANBUILDING 4SECOND FLOOR

-Th—-• ')IIL

EXHIBIT W

N JC I IA RA SDOG. +97149054

4VALON SENIOR HOUSiNG

DDC. #g73J7D35

_ - -ACA = ASSOCIA11ON COMMON AREA

4'/

///

/

CONDOMINIUM Pt) FOR

ANbANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

ACA = ASSOCIA11ON COMMON AREA

//

/

BUILDING LOCATION PLANBUILDING 4 U

THIRD FLOOR

L

J

r

WA

Nit IIABASDOt. +97)49054

A). J/4LP.& CAP PLS 7047

// /

///

AVALON SENIOR HOLJSJN&

poc. +973!7035 /L c&

/

/

ÔONDOMINIUM PLA FOR

ANDANTEEMERWILLE, CAUFORNIA

BUILDING LOCA11ON PLANBUILDING 4

U

FOURTh FLOOR

41

II

EXHIBIT "A"

<(I

/

____________________________________ F

-t

-Nit JTAHA S

DOG. •91 149054

Ft. 3/C IP.& CAP PiS 7047

1//

/ // 4,/

AVALUN sENIDH 14oUNDOC. +973i7035

1// /

ACA ASSOCIATION C4MON AREA

/

QONDOMINIUM PU 'FORANDANTEEMERYVILLE, CAUFORNIA

UNII TYPE 'Ci'BUILDING 1

LEGEND

UFF 42.5

IWO/CA iFSIf 11TH SHED

FLOOR ELEVAI7ON

EXHIBIT "A"

ANGLE=45

a 77'

DETAIL i

t0NDOMINIUM PLk FORANDANTEEMERYVILLEI CAUFORNIA

UNif TYPE 'DBUILDING 1

LEGEND

EXHIBIT "A"

UP' 425 (770)

/,VDICA IFSUNF7MSHEVFLOOR ELE VA flON

UNIT NUA4ER

H

IWO/CA 11 S—0'

SOFF7T CE/UNC

NDICA YES 9'—O"

CE/LING

(307.407 ONLY)

CONDOMINIUM PLL. FOR

AN DANTEEMEFIYVILLE, CALIFORNIA

UNIT TYPE "A'BUILDING 1

LEGEND

tW 425 (ito)

[L UNIT NUMBER

I ND/tA IFSUNfiNISHEDFLOOR ELEVA lioN

INDICA WS

SOFFIT CEILING

EXHIBIT 'A"

INDICATES 9-OCEiLING

HG HANDICAPPED

ACCESSIBLE

UN! r

CONDOMINIUM PLA1i FOR

AN DANTEEMERWILLE, CALIFORNIA

UNIT TYPE 'A" (R)BUILDING 1

LEGEND

UR' 425 (110)

[L UNIT NUMBER

IWO/CA IFSUNFiNISHEDFLOOR ELE VA 770W

INDICATES 8'—0

SOFT7T CEILING

INDICATES 9LCEILING

EXHIBIT WA

HC HANDICAPPED

A CCESS/SLE

tiM T

(R) REWRSE T)PE A UNIT

CONDOMINIUM PLA. FOR

ANDANTEEMERYVILLE, CALIFORNIA

UNIT TYPE "A-i'BUILDING 1

LEGEND

EXHIBIT 'K

OFT 42.5 (110)

lAID/CA TES

ONE/NI SHEDFLOOR ELEVA77ON

INDICATES (-0"SOFF1T CEILING

UNIT NUMBER

INOICA TES 9—0

CEILiNG'

CoNDOMINIUM PESi FOR

ANDANTEEMEFRYViLLE, CALIFORNIA

UNIT TYPE 'CTBUILDING 2

un' 42.5

WV/CA IFSUNFINISHEDFLOOR ELEVA77ON

EXHIBIT "A"

EXIT CORRIDOR

STAIRS

UP/IT T)PE C2LIFE 39.05CEILING 9.0

*

ci

tONDOMINIUM PLEAI FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

UNIT TYPE "CYBUILDING 2

EXIT CORRIDOR

LEGEND 19.oop

(FF42.5

0.30' 0.30'UNFINISHED

I 133' L33'FLOOR ELf VA 770W o.jo' 0.30'

0.40' 0.40'

U-)

1_INtl T)I'E CSLIFT 39.05cEILING 9.0'

ax' 0.30'L33' L33ajo 0.30'

K0

0.830.83'

______r 16.67' _______I I ii

t0SD0MINEUM PLA1 FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

UNIT TYPE "C4"

BUILDING 2

LEGEND

tIFF 42.5

/NDICA IESI//VAN/SHEDFZOO ELE VA 770W

EXIT CORRIDOR

U/I/I WE C4WV 38.65

CEILING 9.0'

aio'

ax'

d

CONDOMINIUM PLA.. FOR

ANDANTEEMERYVILLE, CALIFORNIA

UNIf TYPE C5'BUILDING 2

EXHIBIT "A"

LEGEND

UFF 425

NDICA ESUNF7N/SHEOFLOOR ELEVA77ON

a jo'

EXIT CORRIDOR

0.40'

LNTT)PEtSUFF 38.55CEILING 9.0'

CONDOMINIUM PLk FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

UNIT TIPE "C6BUILDING 2

LEGEND

LIFT 425

(ND/CA TESUNFINISHEDFLOOR ELf VA 770/V

&kIT CORRIDOR

LIMT nfl csUP!' 38.36

CEILING 90'

CONDOMINIUM PU FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A

UNIT TYPE "CTBUILDING 2 ___________________________

EXIT CORRIDOR

LEGEND

UFF 42.5

!NDICASUNFiNISHED 1.33' 7.33'—

a. jo'FLOQR ELEVA liON

0.40' 0.40'

Ui#T7wEC7UTF 38.35CEILING 9.0

030' 030'

133' 73j'_030' 0.30'

K'0

147' 0.83 7.47'___________r

_Z /4.00' I —j________

I__i I I

CONDOMINIUM PLA.4 FOR

AN DANTEEMERYVILLE, CALIFORNIA

UNIT TYPE 'OWBUILDING 2

LEGEND

tIFF 42.5

IND/CA IFSUNFINISHEDFLOOR ELE VA liON

0.40'

EXHIBIT 'K

EXIT CORRIDOR

UMT 11Ff 08tIFF 38.36

CEILING 9.0'

CONDOMINIUM PtA FOR

ANDANTEEMERYVILLE. CALIFORNIA EXHIBIT "A"

UNIt TYPE '09"BUILDING .2

EXIT CORRIDOR

LEGEND

(FF42.5 -

INDICATES 0.27'

FLOOR ELEVA 770N 1.33 '—•027'

067 0.40'

1.33'

11)I I'L Jt _____

0.83 UFFJ&15CEILIWU 9.0'

d

0.83'0.30'[J

0.83'0.30'

7.500.83

75.33' —]______

CONDOMINIUM PLL FOR

ANDANTEEMERYV!LLEI CALIFORNIA EXHIBIT AW

UNFI TYPE 'C1OBUILDING 2

LEGEND

UFF 42.5

/ND(CA YES

UNFINISHEDFLOOR ELF VA VON

EXIT CORRIDOR

1& 94

N-.N

0.34'

0,34'

a jo'

1.33a 3O

'CI-iN

'F,

J.irgir np cioUFF 38.15CEILING go

0.40' 0. 40

0.30'7.

0

a. sj' 0.83'

76.00'

cONDOMINPJM PL .1 FOR

ANDANTEEMERYVILLE, CALIFORNIA EXHIBIT "A"

uNrr TYPE til"BUILDING 2

LEGEND

11FF 42.5

INDICA 115UNFiNISHEDFLOOR ELEVA77ON

CONDOMINIUM PLt 'FORAN DANTEEMERYVILLE, CALIFORNIA

UNIT TYPE 'CBUILDING 2

EXHIBIT 'A"

LEGEND

(1FF 42.5 (710)

(ND/CA 7FS

UNFINISHEDR.OOR ELEVAI7ON

UNIT NUMBER

11*2/CA IFS 8—0"

SOFF7T CEILING

I/VU/CA IFS g'—o"

CEILING

HG HANDICAPPED

ACCESSIBLE

UN! T

CONDOMINIUM PL '1 FORANDANTEEMERYVILLE CALIFORNIA

UNF TYPE 'B" (R)BUILDING 2

LEGEND

EXHIBIT 'A

UFF 42.5 (710)

INDICA IFSUNFiNISHEDFLOOR ELE VA 770W

UNIT NUMSER

INO/CA7ES 8-o"SOFF7 CEILING

INDICAES 9L0"CEiLING

(R) REVERSE T)PE B UNIT

STORA GE

5.42'

:cDOMjNIUM PL .1 FOR

ANDANTEEMERYVILLE CALIFORNIA

UNIT TYPE 'B"BUILDING 2

LEGEND

EXHIBIT "As

tIFF 42.5 (710)

INO/CA iFSLWF7N/SHEL)FLOOR ELE VA liON

UNIT NUMSER

H

INDICATES 5'—Q"

SOFFif CEJUNG

INOICA YES 9'—O"

cEILING

1.56'

5..

LNTIWEB(JET 57.5 (203,205.207)tIFF 52.0 (303,305,307)(if F 72.5 (404405,407)

dONDOMINIUM pts FORAN DANTEEMERYVILLE, CALIFORNIA

UNIT TYPE 'B-i"BUILDING 2

LEGEND

OW 42.5 (no)

[L UNIT NUMBER

(ND/CA iFSUNFINISHEDFLOOR ELE VA liON

INDICATES 8—O"

SOFFIT CEILING

EXHIBIT 'A'

iNDiCATES 9-O"CEILING

CONDOMINIUM PLA. FOR

AN DANTEEMERYV1LLE, CALIFORNtA

UN TYPE "A-i'BUILDING 3

EXHIBIT W

LEGEND

UFF 42.5 (iio)

IND/CA IFSUNRMSHEDFLOOR ELEVATION

UNIT NUMBER

H

IND/CA rES 8'—tY

somr CEILING

INOICA ITS 9'—O

CEILING

CoNDoMINIuM PLk FOR

AN DANTEEMERWILLE CALIFORNIA

UNIT TYPE "A" (9)BUILDING 3

EXHIBIT 'A'

LEGEND

11FF 425 (710)- —

L UNIT NUMBER

L lAID/CA iFStJWF7MSKEDFLOOR ELEVATiON

INDICATES 8'—O"SOFFIT CE/U MG

IND/C,4 iFS 9—0'CEILING

(R) REI.IRSE TYPE A UNIT

CONDOMINIUM PL FOR

ANDANTEEMERYVILLE, CALIFORNIA

UNIT TYPE 'A'BUILDING 3

EXHIBIT W

LEGEND

VET 42.5 (110)

UNIT NUMBER

(ND/CA iFSVA/FiN/SHEDFLOOR ELF VA lION

(NO/CA IFS 8'—O"

SOFFJT CEILING

INDICATES 9—O'

ca/Nc

CONDOMINIUM PL J FOR

AN DANTEEMERYVILLE, CALIFORNIA

UNIT TYPE "B'BUILDING 3

LEGEND

EXHIBIT "A"

tJFT• 42.5 (no)

INDICA YESU TM SHEDFt 00k ELEVA lION

LIMIT NUMBER

I

NC

hYO/C,4?ES 8•.-O"

SOFF1T CEILING

lAID/CA/ES g'—o

CEiLING

HANDICAPPED

ACCESSIBLE

UNIT

STORAGE

Cbt4DOMINIUM PL I FOR

ANDANTEEMERYVILLE, CALIFORNIA

UNIT TYPE 'B-VBUILDING 3

LEGEND

tIFF 425 (110)

L Ut/IT NUMBER

iNO/A itsUNF7MSHEf)FLOOR aEVA 770N

JNt4CAIES 8'-OSOFFIT CEILING

EXHIBIT WAIl

H IN V/CA irs g—o"

CEILING

CONDOMINIUM PL

ANDANTEEMERYVILLE, CALIFORNIA

'FOR

EXHIBIT 'N

UNIT TYPE 'N (R)BUILDING 4

LEGEND

LIFT 42.5 (170)

INOICA TES

UNFINISHEDFLOOR ELE VA liON

//VDICA IFS f—oSOFRT CEILING

LIMIT NUMBER

0.23'

I/VP/CA 115 9'—O'

CEILING

(R) REWRSE IWE A UNIT

0.23'

tONP0MINIUM put. FOR

ANDANTEEMERYVILLE, CALIFORNIA

UNIT TYPE A'BUILDING 4

LEGEND

UFT 425 (110)

L UNIT NUMBER

L IND/CA TESUNfiNISHEDFLOOR ELE VA lION

!NOICA IFS 8'—O

SOFF7T CEILING

INDICATES 9'—O"

CDL INC

EXHIBIT 1A'

0.23'

CoNDOMINIUM PEA. FOR

AN DANTEEMERYVILLEI CALIFORNIA

UNIT TYPE 'A—?

BUILDING 4

[L UNIT NUMBER

IN V/CA IFSUNFINISHEDFLOOR arw )I

HG HANDICAPPED

ACCESSIBLE

UN! T

EXHIBIT 'K

LEGEND

UFF 42.5 (110)

' AIND/CA ITS

SOFF1T CEILING

I IWO/CA IFS 9—U

I Icatwo

0.23'

0.23'

CONDOMINIUM PLe 'FORAN DANTEEMEAWILLE, CALIFORNIA

UNIT TYPE 'A-2'BUILDING 4

LEGEND

EXHIBIT 'K

UFT 42.5 (110)

IWO/CA IFSUNF?N(SHEOFLOOR ELEVII liON

UNIT NUMBER

N

IWO/CA 7F5 8'—d"

SOFI7T CEILING

INDICATES 9O#cEILING

1311

1311

I1CIflS REVERSE TYPEAUNITINDICATES REVERSE TYPE B th4E1

11%101%Q 92%

120%1 16%

1.18%

1.16%

1 18%

1.18%

1.18%1 18%

B-I I 1813 1.35%

Se) lIs]!

105 A 6228 1144 __________________

6-1 1*54 107 41 HO

201 1A-I 830 108 42

064% 201

064% 202

1.18%1.t9%

r 065%

0.84%-- 084%

004%

1 19%0 cS%

o4%1.18%1.19% 40t

IhVCA1ES REVERSE TYPE B UNIT

INDICATES KNC)ICAPPED ACCESS UNIT

E!IBIT

TO

DECLARATION OF

CONDITIONS • COVENMflS AND RESTRICTIONS

OF

ANDANTL

A CONDOMINIUM PROJECT

PHASING $rHXDDLE*

Units TotalPer Units

Phase Units Phase P.miexed

I Tract 8005 2 113 113 113

II Tract 8005 1 23 23 136

* Declarant reserves the right to change the order and nuither of

phases, number of Units, or Unit mix, at any time, subject toapproval of the Department of Real Estate.

- EIBIT 3" -

EXHIBIT "Ce

•10

DzcJ:1AnnON OP

CONDITtONS, COlatN?1NTS AND RESTRtCTIORS

OF

MwMnzI

A CONDOMINIUM PROJECT

COMMERCIAL USE

MULTI- TtNAI4T STANDAPDS.

1. USES. Only the following uses are permitted in the project subjeøt to thisConditional Use Pe,mit and additional review and approval by the following individualsfentifiesas noted. In all situations, Staff has the discretion to stoIc review by the Planning Commissionand/or the Redevelopment Agency if deemed appropriate.

Building 1Ground FloorEating and

Establishments(Full-ServiceRestaurant) Planning Director.

Retail: Planning Director and Economic DevelopmentDirector consistent with the Disposition andDevelopment Agreement (DDA).

Other Uses: Planning Commission and Redevelopment Agency.

Residential Planning Director

No other uses allowed.

Building 2 (a, b and c)Qwd Floor

Retail: Planning Director

Office Planning Director and Economic DevelopmentDirector consistent with the Disposition andDevelopment Agreement (ODA).

Other Uses: Planning Commission and Redevelopment Agency.

UnDer Fl®rsResidential: Planning Director

No other uses allowed.

BuIlding 3 and 4AllFloorsResidential Planning Director.No other uses allowed.

Andantefl(formerlyBuilding5) (PRASEII) --

Ground FloorLeasing OfficeWorkout AreaResidential Planning DirectorNo other uses allowed.

Unvez FloorsResidential Planning DirectorNo other uses allowed.

2. DEFINITIONS: The uses allowed for buildings in the project are noted below. Thespecific definition for each use is contained in the Emeryville zoning ordinance.

Rsail (allowed Ground Floor of Buildings I and 2 only)Convenience Sales and Services.Bating and Drinbng Establishments: Convenience - Full Service(excluding drive-through windows).Financial Services (excluding check cashing services).Food and Beverage Retail Sales (excluding alcoholic beverages).Personal Services (excluding massage services).Retail Sales and Services (excluding pawn shops, big box retailfronted by surf hoe parking).

Office (allowed Ground Floor of Building 2)Mminislrative and Business Offices.Professional Services.

3. VSS RWUIRING APPROVAL OF TUE PLANNING COMMISS JOE. All

other uses shall require Planning Commission approval pursuant to the Emeryville Municipal

Code Section 9-4.82.

4.. PKRFORMANCE STAIqDARDS AND REVIEW CRITERIA FOR USES. Thefollowing performance standards and review criteria shall be used to evaluate uses for the

project.

A. Review and written verification shall be provided to confirm thatparking and loading areas have been designed and designated to account for theneeds of the proposed use y'ithout interfering with the parking, access or loading

areas of the hotel, theater, residential or any retail uses.

B. Review and written verification shall be provided to confirm that thetotalnumberofrequiredpai*ingspacesmeetstherequiremeflts of theseconditions of approval and EmeryvilleMunicipal Code Section 9-4 .5S

C. For commercial entertainment or uses involving cabarets or publicdanøes as defined in Chaper4 of Title V of the Emeryville Municipal Code orany other public events or use of amplified sound, a sitesecurity and management plan shall be submitted with the use request,documenting compliance with the overall Site Security andManagement Plan of the Project, compliance with the other provisionsof Chapter 4 of Title 5 of the Emeryvilie Municipal Code as applicable; andspecial acoustical requirements if warranted.

I). For food related uses such as cafes, delicatessens, restaurants and similaractivities, the following standards and conditions shall apply:

i. Appropriate provisions shall be made for trash disposal and recycling.following the provisions of the California Uniform Retail Food FacilitiesLaw (Health and Safety Code Sections 37500 et. seq.) as reviewed by thePlanning Department or other designated City Staft

ii. Adequate ventilation, filtration and odor control systems shall be installedfor any commercial hoods, along with submittal of provisions formaintenance and inspection of such a system should odor complaints bereceived.

E. Compatibility of proposed use with current uses with respect to uS; odor,vibrations, glare, number of other similar uses, hours, location to residential uses, security orpolicing concerns or other potential nuisance conditions.

- EXNTRIT "C" (3) -

E)uII3IT 3—i

ADDENDUM NO.2TO

DEPOSft RECEIPT, OFFER TO PURCHASE PROPERTYAND ESCROW INSTRUCTIONS

LIMITED WARRANTYRIGHT TO REPAIR LAW, LIMrTED FIT AND FINISH WARRM4TY AND INDEMNITY

FROM: SNI< CAPTEC ANDANTE 11G.a Delaware limited liability companyrDeveloper)

TO: ___________________Purchaser(s)

PROJECT: ANDANTE, A CONDOMINIUM PROJECTCONDOMINIUM UNIT: ___________ADDRESS: 1121 40m Street

Emerwille, CalIfornia 94805

This is an Addendum (Addendum') to the Deposit Receipt. Offer to Purchase Property andEsuow Instructions rAgreemenn dated_____________ 200_ between the undersigned Developerand Purchaser conàemlng the condominium Unit described above. Terms defined In the Agreement shallhave the same meanings In this Addendum.

I. RIGHT TO REPAIR LAW. California Civil Code Sections 895 and toflowing (the 'Right to RepairLat) establish residential construci ion standards (the 'Functionality Standards'), warTanty requirementsand certain claim-resolution procedures. CertaIn notices required under the Right to Repak-t.w-andsummaries of torn. of its provisions foilow

A. PURCHASER MAINTENANCE OBLIGATIONS. It Is Important under the Right to RepairLaw and this Addendum that the Purchaser properly maintain the Unit. Developer wifi provide Purchaserwith a maintenance manual which includes maintenance requirements that then pertain to the Unit and toany Item which is covered under a Manufacture?s Warranty, as described in Section III below. TheDeveloper may supplement the maintenance manual from lime, to time. Purchaser shall follow all suchmaintenance requirements, shall provide such maintenance requirements to the purchaser to whomPurchaser sells the Unit and shall cause that purchaser to agree to do so and to cause each subsequentpurchaser to agree to do so as well.

B. RECEIPT OF RIGHT TO REPAIR LAW. Purchaser acknowledges that (I) Purchaser hasbeen provided a written copy of the Right to Repair Law, (ii) Purchaser agrees to provide a copy of theRight to Repair Law to the purchaser to sthorn Purchaser sells the UnIt and shall cause that purchaser toagree to do so as well and to cause each subsequent purchaser to agree to do so as well.

Purchaser's Initials ________ _________ DevelopeCs Initials: __________

C. Right to Repair Procedures. Developer advises Purchaser of the existence of thepreiltigation procedures set forth in Chapter 4 (SectIons 910 through 938) of the right to Repair Law (thewlight to Repair Procedures') and that such procedures Impot the legal rights of Purchaser.

Purchaser's Initials Develope?s Initials: __________

D. Alternative Nonadversanial Contractual Provisions. Developer elects to use Its ownalternative nonadversarlal contractual provisions instead of the Right to Repair Procedures as authorizedby Section 914 of the Right to Repair Law. Developers nonadversarlal contractual provisions are set forthin ArticleVIll below and in ArticleVIll of the Declaration of Covenants, Conditions and Restiletlons ofMdante, A Condominium Project (the "Declaration'). My dispute which is not resolved under those

Buyers Initials

EXHIBIT E-2

contractual provisions, which, in some cases include mediation and/or arbitration shall be resolved byjutlal reference under Section 8.01(e) of the Dedacatbn.

Purchaser's initIals Developer's initials: _________

E. Claims, any claim by Purchaser or Purchaser's successors In Interest that a componentof the Unit violates the Umited Pit and Fitness Warranty or any of the Functionality Standards, shall beprovided to Developers agent at the address listed below. The name and address of the DevelopeYsagent is subject to change by written notice to Purchaser.

AshSy GamboaSNK Development Inc.1313 East Osborn Road, Suite 213Phoenbc, AZ 85014Telephone: (510)812-8003

Purchase(s Initials Developers Initials: ________

II. ONE YEAR FIT AND FINISH WARRANTY: THIS CONSTITUTES A ONE-YEAR E XPRESSLIMITED WARRANTY COVERING THE prr MD FINISH OF CERTAIN BUILDING COMPONENTS(THE "FIT AND FINISH WARRANTY") AND IS INTENDED TO COMPLY WITH CALIFORNIA CMLCODE SECTION 900.

A. Warranty Coverage: The Developer warrants that the "fit and finish" of the followingcomponents will be free of deficiencies during the term of this Fit and Finish Warranty cabinets, mIrrorsflooring, Interior and exterior walls, countertops, paint finishes and trim of your Unit and in the CommonArea of the Project Covered Components').

B. Term: The term of this Fit and Finish Warranty shall be for one (1) year commencing on—-the-date of the daw of escrow, whichis thdate on which?ëcöfdlllle of your tMiffsfrmnsferrèdlb you by

the Developer ('Warranty Period").

C. Fit arid Finish Standards: The fit and finish" of the Covered Components means thenon-structural, cosmetic appearance and alignment of the Covered Components as manufactured,constructed or Installed. beficlencles shall be deemed to exist In the fit arid finish of a CoveredComponent If the fit and finish falls to meet the standards of quality established in the documents andmanuals pertaining to the Covered Component provided by the Developer or, if no applicable standardshave been provided, then the standards of quality established by accepted trade practices or by applicablestandards of the ReSeMla Construction Pert oTmance Gthdelhes pubflshed by the National Associationof Home Builders.

D. Limitations on Warranty; Minor imperfections of finishes (natural or synthetic) whichdo not materially detract from the appearance of the tbish as a whole, or whose existence does notmaterially affect the peiforrnance of the component are not covered by this Fit and Finish Warranty. Thefollowing are specific Items that are covered by this Fit and Finish Warranty, but are limited as stated:

1. VIsible Deficiencies in Finished Surfaces: Material deficiencies In finishedsurfaces which are evident upon examination, are covered by this Fit and Finish Warranty only ifnoted on the Inspection Ust (described in subparagraph E below). Examples are chipped,scratched, cracked or broken windows, mirrors or shower doors; chipped or scratched bathtubsor washbowls; scratched, gouged, or scuffed flooring or counter-tops; stained or dirty carpethg;stained, scratched, gouged or dented walls, ceilings, doors, him or cabinetry. Visible deficienciesin finished surfaces not noted on the Inspection List are deemed to have attuned after btnsfer oftitle and are not covered by this Fit and Pinisti Warranty.

2. Lumber and MillworIc Material deflcencles in the fit and finish of the woodenportions of the Covered Components are covered by this Fit and Finish Wananty. Minor

Buyts InitialsAdd,durn No. 2

EXHIBIT E—3

shrinkage and expansion of sucbwod is to be expected and does notconstiluteadefi&eneykt fitand finish. Some shrinkage of wood in the joists; studding, framing and rafters in your Unit mayocwr. arid consequently some moldings or trim may shift from their original position, joints In thewoodwork may open, doors may warp, and cracks may appear In dryall which are not material Ineffect. Wood wilt shrink as it loses moisture and swell as it absorbs moisture. This characteristicof wood may cause joints fri mfllwoilc to develop separations or gaps which are not material Ineffect

3. Cabinetly Operat4on of cabinetry and hardware for drawers and cabinets doorsis covered by this Fit and Finish Warranty if defects are noted on the Inspection List Cabinetdrawers and hardware are subject to misalignment through use over a period of time.Readjustment of the cabinetry and cabineby hardware Is not covered by this Fit and FinishWarranty. If there are any hardware malfunctions, they should be noted at the time of theinspection Ust.

4. Floors:, This Fit and Finish Warranty covers nail or seam popping, cracked orloose tile or imperfections In the sub-flooring that occur during the Fit and rinish Warranty Period.This Fit and Finish Warranty further covers scratches, gouges, heel marks and other visiblesurface defects, provided they are noted In the Inspection List. Because shade, feel, and colorwill vary within each production run of a manufactureYs carpet, tile or hardwood, and may alsovary as a result of use, cleaning, waxing, or exposure to sunlight over time, Developer cannotassure color match In case repair or replacement of these items Is required.

5. Countertops and Tile: This Fit and Finish Warranty applies to deficiencies In fitand finish in countertops and tile during the Warranty Period. The Fit and Finish Warranty doesnot apply to bums or damage from frozen foods or hot implements, or to stains from use orImproper usage.

6. Paint and Exterior Wood: A deficiency in the fit and finish of the paint usedinside and outside your Unit will be deemed to occur if the paint blisters, peels or flakes during theFit and Finish Wananty Period. This warranty also covers serious smudges, stains or othersolUng of painted surfaces, provided they are noted on the Inspection List Paint will graduauychange color with time, as no paint Is completely color-stabe when exposed to light, air andvarftg temperature and humidity. Developer does not warrant against such color change.Painted wood is expected to change color with time. Regular care of painted surfaces andavoidance of damage from water and direct sun exposure, will prolong the life of painted surfaces.

E. Inspection: By your execution of this Warranty, you acknowiedge and agree that vuhave hspected or will inspect the Unit and are or will be thoroughly familiar with Its condition prior to theclose of escrow. You further acknowledge that you flave completed or will complete, prior to close ofescrow, with a representative of Developer, a list (the "Inspection List") of all visible surface defects whichwere present at the lime of that inspection and such other defects as were apparent at inspection. Bufiderwffi correct deficiencies in Covered Components which are listed on the Purchaser Inspection List(wWalkThrough ltems within thirty (30) days after the Purchaser Inspection List is completed or as soonthereafter as reasonably practicable

F. Developefs Obligation to Repair or Replace: Developet at its sole and exclusivediscretion, will repair, replace or otherwise compensate Purchaser, for any deficiency In any CoveredComponent of the U nit to the extent covered under the terms of this Limited FIt and Finish Warranty.Developer shalt make said repairs or complete said replacements as soon as practicable, and without anyunreasonable delay. If an Item Is repaired or replaced, Developer will use reasonable efforts to matDi theexisting material as closely as possible, however, due to inherent shade variations In materials Oncluding,but not Hmltad to, grout carpeting, Wny, hardwood, marble, nab aral stone and ceramic tile) and Inability tomatch existing materials because they are no longer available, an exact match Is not guaranteed.

Buyers InitialsAddendum No 2

XJ.LT —4

G. Clalmsfllotlce: All daims concerning deficiencies in Covered Components must bemade by written notice, reasonably describing the deficiency, addressed and mailed to Developer at theaddress set forth In Section I.E above. No claim under this Limited Fit and Fiflss Warranty shall be validIf not made within the Werranty Period.

H. Access: Purchases must aflow Developer reasonable access to the Unit to Inspect and toremedy the deficiency. The failure or the rehisal of Purchaser to allow Developer reasonable access toinspect or complete warranty work will entitle Developer to declare the Warranty void and of no furtherforce or effect with respect to that deficiency.

Ill. MANUFACTURED PRODUCTS.

A. Manufactured Product Information. Purchaser acknowledges that Purchaser wasgiven the opportunity to review, in Developers sates office, maintenance procedwesfschedules,maintenance recommendations and limited warranty i,formation for the manufactured products,appliances or consumer products expected to be Installed in the Unit Manufactured ProductInformation'). For purposes of this Section, lilA, a "Manufactured Product means a product that Iscompletely manufactured off site, and "Consumer Product' means an appliance, air conditioning unit.furnace, water heater or other product that is considered a "consumer product as defined by the FederalTrade Commission for the purposes of the Magnuson Moss Act (15 U.S.C. 2301 at seq.) DeveloperShIprovide Purchaser with the Manufactured Product Information applicable to the Unit when Purchaser takespossession of the Unit.

B. Responsibility for Manufactured Produáts. Except for installation, Developer makesno warranty, express or implied, concerning Manufactured Products or Consumer Products Installed in oraround the Unit. Purchaser (on behalf of Itself and Its successors In Interest) agrees to look solely to themanufacturer and not to Developer concerning warranties on all such Manufactured Products andConsumer Products. Although the manufacturer of such Manufactured Products and Consumer Productsrnayprovlde a warranty, Developer has no obligation or responsIbility for the performance of suchproducts and appliances, except for the installation of the same, and Developer does not warrant any ofthese Items for any use, fitness for use, workmanship, quality or other purpose. If a manufacturerswarranty has been issued to Developer, Developer hereby a sslgns to Purchaser, to be effective uponclosing, without recourse to Developer, all right under such manufacture?s warranties, as are assignable1on manufactured Products and Consumer Products included in the Unit.

IV. FUNCTIONALITY STANDAIWS: In compliance with California CMI Code §898, Developerwarrants that, except for Manufactured Products and Consumer Products, which are addressed in Sectionill above, the components of the Unit shall meet and comply with the Functionality Standards (the "LimitedFunctionality Standards Warrantf). This Is not Intended to constitute an Enhanced Protection Agreementunder California CMI Code Sections 901-906.

V. EXCLUDED rIEMS: Neither the Limited FR and Finish Warranty nor the Limited FunctionalityStandards Warranty (collectively the "Limited Warranty') covers those items listed in this Section lii:

1. Faflurp to Maintain. Deficiencies caused by Purchasers failure to properly maIntain theUnit or any Covered Component.

2. Occurrences Not hi Developers Reasonable Control. Damage due to occurrences whichare not within the reasonable control of Developer including, without limitation, We, flood, earthquake, wind(that exceeds the force the structure is designed to resist), wind-driven rain, landslides, mudsildes, war,termrtsrn orvandauscn.

3. Use, Misuse or Neglect. Deficiencies due to ordinary wear and tear, misuse, abuse,neglect, damage caused by Purchaser or its movers during move In or move out, Purchasers faflure toallow reasonable and timely access for Inspections and repairs, or Purchasers failure to give tImely noticeto Developer of a problem or condition which may worsen over time.

Bt'ers Initials615CZDt.S Addendum Nc. 2

-

EXHIBIT E—5

4. Purchas&s Work. Any deficiency caused or adversely affected by any addition,alteration; remodeling, and/or repair performed by Purchaser or Purchasers agents, employees orcontractors.

5. Non-uniformIty of, or appearance of tile or wood. Due to normal variations In the densityand grahing of wood, stain or protective finishes applied to different pieces of the same type of wood mayappear to have a different color, texture or finish. While this accounts for much of the warmth and beautyof natural wood cablnetrj and/or flooring, exact color and grain matching in the cabinetry and/or flooring isneither Implied nor warranted.

S. Variation in color or appearance of stone/granite and In finished surfaces. Quarried stoneand granite are natural materials produced from rock and are not man-made products. As such thesematerials have conditions that cannot be controlled, such as color and veining, texture and fossfling. Thecolor or shade, veining, texture or fossiling of stone/granite can vary significanily in Its natural state andtherefore It may be difficult to quarry a large enough batch to lay tile that Is completely uniform. Stone willabsorb o or other liquid which Is allowed to penetrate, resulting in permanent staining. Due to thecharacteristics of stone and the manner in which it quarried and cut, cut stone thea may not be equs Insize and thickness. To minimize some of these variations, the stone tiles will be set with grout joints ofvatying thickness on a mortar set of varyfrig thickness. A "glass-f Ike" smooth surffice wilt not be achievedwith stone tiles or between adjacent granite slabs. Although care Is taken to provide a reasonable finish,neither Developer nor Its subcontractors can guarantee that there will be no variations within a stone orgranite installation. Stone is subject to abrasion and scratching. Minor abrasions will be present In theproduct and do not constitute a defect. Major chips or scratches in stone and granite are covered by thisWarranty If noted on the Purchaser's Inspection List.

7. Broken glass (except as noted above).

8. Flooring squeaks in wooden floors or subfloors, unless noted on the Inspection Ust.

Spots en-tafpetjng which-are not notedon the pre-rnove in Inspection List, thinorfadig --

due to variations in exposure to light and slight dye lot variance.

10. Defective seams or surface defects in linoleum or carpet, unless noted on the InspectionList. Note that the materials selected for various portions of the floors in your Unit may vary In thicknessand perfectly level transitions between adjacent materials of different thickness Is not included In thespecifications for your Unit. Transition strips may be used between dissimIlar floor materials. Note, aswell, that In ceflairi types of carpeting, such as bw Joop carpet, the seams are more noticeable and suchseams, even though noticeable, are not consIdered defective.

11. Cracked, chipped or scratched ceramic the and the grout Joints between tiles shall not beconsidered defective if not noted on the Inspection List.

12. Mirror defects except as noted on the Inspection List, except latent silverk-ig faliure notnoted on the Inspection List.

13. MInor cracks and/or nail pops due to normal shrinkage of lumber and/or normalsettlement.

14, Effects Induced by expansion and contraction of soil.

15. Incidental or consequential damages or losses of any kind which may arise from or out ofany of the deficiencies covered under this Limited Wa*anty, including, but not limited to, personal injury,ment pain and suffering and emotional distress, medical costs, hospital rehabilitation costs, damage topersonal property, loss of use, loss of wages, Inconvenience or diminished market value.16. THE LIMITED ('ft AND FINISH WARRANTY AND ThE LIMITED FUNCTIONASnySTANDARDS WARRANTY ARE THE ONLY WARRANTIES DEVELOPER PROVDES THAT AREAPPLICABLE TO THE PURCHASE OF THE UNIT. No OTHER UNDERSTANDINGS, PROMISES,

Buye?s Initials

61540Z0W5F Adden&jrn No. 2S757&C1&iV4:rnrc

Xtfl$jJ2 E—b

AGREEMENTS OR COMMITMENTS WHETHER ORAL OR WRI'r-rEN PJ'ID WHETHER MADE BYDEVELOPER OR ANY EMPLOYEE, AGENT OR CONTRACTOR OF DEVELOPER EXIST. ALl. OThERWARRANTIES BY THE DEVELOPER, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMErED OT,ANY IMPLIED WARRANTy OF MERCRANTABILITY AND FITNESS FOR A PARTCUIJR PURPOSEARE HEREBY EXPRESSLY DISCLAIMED.

VI. AFI'IRMATIVE DEFENSES: The affirmative defenses set forth in California CMI Code Section945.5 ae iiTcorporated by reference herein and those defenses shall be available to Developer withrespect to any claim of a .breach of either or both of the Limited Fit and FinlsN Warranty and the UnitedFunctiona4ity Standards Warranty. Under no cirvumstances will Developer have any liability for anyalleged defect where a claim was not delivered to Developer in writing prior to the expiration of the oneyear Warranty Period for the Limited Fit and Finish Warranty or prior to the expiration of the applicablestatute of limItations for any alleged detect under the Functionality Standards.

VII ASSIGNABILffYffPSFEPABILYISUCCESSORS IN INTERESTIDEFINED TERMS: ThisLimited Warranty is transferable upon resale of the Unit and will continue In effect for the balance of theapplicable warranty. It Is automatically transfen to any person who acquires the Unit from you and whoprovides written notice to the Builder. No transfer of the Unit shall extend the period during which theLimited Warranty is effective.

Viii. CLAIMS: If you wish to make a claim under the Umited Fit and Fitness Warranty or under theLimited Functionality Standards Warranty, you must give written notice of the claim (the "Warranty Claim")to the Developer at the address set forth in Section I.E above. The Warranty Claim must be given In atimely manner and will not be considered timely if it Is made: (i) more than thirty (30) days after you firstbecome aware of the any facts or circumstances wtilch place you on notice of any damage1 defect ordeflclency whICh might be covered by this Limited Warranty; (ii) after the Warranty Period, if the cl&m ismade under the Umftecj Fit and Finish Warranty for any deficiency in a Covered Component; or (1k) afterthe applicable statute of limitations has expIred. Notice need not be In writing if a situation requiresimmediate response !o address an imminent risk of personal injurypr property damageA. Developers Response to Claims. Upon receipt of a Warranty Claim, the Developerand its representatives shall determine whether or riot the claim Is covered by the terms of this LimitedWarranty. If the claim is covered by this Limited Warranty, then Developer has the right, In Its solediscretion, to (a) repair the claimed deficiency or defect, (b) replace the claimed defective Item, or (a) payyou a amount equal to the reasonable cost to repair or replace the defective Item or, If less, the amount bywhich the defective Item reduces the value of your Unfl. l a d&m is made, then the Developer shall havethe right to (1) meet with you to discuss the Claim; (2) enter your Unit to inspect any areas that are thesubject of the Claim; and (3) conduct inspections and testing (Including destructive or Invasive testing) In amariner deemed appropriate by the Developer. If Developer determines that a Claim Is not covered bythis Limited Warranty, then the Developer shall so infomi you, In wilting, not more than thIrty (30)daysafter completing the actions permitted in the preceding sentence.

B. Access to Make Repairs, If Developer elects to take any corrective action, Developerand Its represenjativis shall be provided fill access to the Unit to take and to complete the correctiveaction.

C. Selection of Contractors and Subcontractors and Methods for Repair. TheDeveloper shall, in Its sole discretion: (I) select the contractors, subcontractors and suppliers to be usedfor any repair or replacement which Developer decides to undertake to respond to arty Claim hereunderand (II) the methods and materials which will be used to make any such repair or replacementD. TUne for Repair or Replaàemen The Developer shall have a period of one hundredtwenty (120) days after receipt of a CISIm to respond to the Claim and to complete any repaIrs orreplacements which the Developer determines to be appropriate. This time period shall be extended dueto causes beyond the reasonable control of the Developer.

Buyer's Initials

81540Z08/SF Addendum No. 2na

EXNIBfl E-7

IX. DISPUTE RESOLUTION: ANY DSPUTh ARISING OUT OF OR RELATED TO THE LIMITEDFIT AND FINISH WARRANTY OR THE LIMITED FUNCTIONALflY STANDARDS WARRANTY WHICHIS NOT RESOLVED BY FOLLOWING ThE PROVISIONS OF SECTION VIII ABOVE SHALL BERESOLVED UNDER THE DISPUTE RESOLUTION PROVISIONS SET FORTH IN SECTIONS 9.1(c)THROUGH (h) OF THE DECLARATION1 WHICH SECTIONS OF THE DECLARATION ARE ATTACHEDHERETO AS EXHIBIT A AND SEPARATELY INITIALED BY THE PARTIES HERETO.

RIGHTS OF CONTRACTOR4 To the extejit Thél the Right to Repair Law knposes obligations ofthe "buHder on the contractor which conshijoted the Project, the contractor shall be entitled to all of therights and benefits afforded the Developer In this Mdendum to the extent that such rights and benefitsapply to the Developer.

Xi. IIIVALIDflY OF ANY PROVISION: Should anyprovision or portion hereof be declared invalid orin conflict with any law of the JurisdictIon where this project is sItuated, the validity of all other provisionsand portions hereof shall remain unaffected and in fufl force and effect. NO PERSON ACTING FORDEVELOPER IS AUTHORlD TO MAKE, AND PURCHASER HEREBY WAIVES. EXCEPT ASPROVIDED HEREIN, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY AND ALL OTHERWARRANTIES, WHETHER EXPRESS OR IMPLIED (EXCEPT FOR THOSE ARISING OUT OFAPPLICABLE STATUTES), OR IN ANY WAY RELATING TO TIlE CONSTRUCTION OF THEIMPROVEMENTS BY DEVELOPER OR AT DEVELOPER'S REQUEST, AND/OR THE SALE OF ThEPROPERlY BY DEVELOPER TO PURCHASER.

Developer: SNK CAPTEC ANDANTE LLC,a Delaware limited Ilabfllty company

By SNK La Playa I ftc,a Delaware corporation,Its Manager

Donald C. PetersonVice President

DATE:

ADDRESS: 1313 E. Osborn Road, Suite2laPhoenix, AZ

ACKNOWLEDGMEP(I- OF RECEIPT

On this ____ day of ________________, 20_ the undersigned Purthaset acknowtedgreceipt of the above LIMITED WARRANTY gWen by SNK CAPTEC ANDANTE LLC CDeveloper) toowner of the Unit at 1121 40th Sfreet EmerMfle, CalifornIa 94608, Unit # ________. Th Purchaseragrees that the undertakings of Developer, contained within this Warranty constitute all of theundertakings of and obligations of Developer with respect to possible defects in the desIgn, materIals andWoflcmanshlp of or relating to the construction of such Unit.

Purchaser:

Buyees Initials-

Addendar' No.—.-- —

contractor's bid shall include the premium payable for performance,

labor and material payment bonds from a reputable bonding company.

C. The Board shall, as soon as reasonablypossible after receipt of such contractors' bids or insurance

estimate, cal]. a special meeting of the Owners to consider such

bids or insurance estimate. If the Eoard fails to do so within

sixty (60) days after the casualty occurs, any Owner may obtainsuch contractors' bids or insurance estimate and call and conductsuch meeting, as provided herein. Failure to call such a meeting,

or to repair such casualty damage within twelve (12) months fromthe date such damage occurred, shall be deemed, for all purposes,a decision not to rebuild the damaged or destroyed improvements.

ID. At such meeting, the Owners may elect toreject all such bids or estimates and thus not to rebuild. A vote

in excess of seventy-five percent (75%) of each class of

Association Members shall be required to reject all bids or

estimates; provided, however, that a vote in excess of fiftypercent (50%) shall be sufficient to reject any bid or estimaterequiring more than fifteen thousand dollars ($15,000) over and

above insurance proceeds for such reconstruction, repair or

rebuilding. Failure of the Owners to reject all bids and estimatesshall authorize the Board to accept the unrejected bid it considersmost fautrable; provided, however, that if acceptance of any achbid would require the levy of a Special Assessment, such acceptanceshall only be granted following membership approval of such SpecialAssessment, as required by this Declaration. If such mentershipapproval is not obtained, the bid shall be deemed to have beenrejected.

E. In the event the Owners elect not torebuild, insurance proceeds received by the Association shall bedistributed by the Assocition among Owners and their respectivemortgagees, according to the respective fair market values of theCondominiums at the time of destruction, as determined by thefollowing procedure: The Board shall appoint two (2) independentappra.sers to deterudne the relative value of the Condoniniujusaffected. The two appraisers shall appoint a third independentappraiser. If the two appraisers are unable to agree on a third,then the third shall be appointed by the presiding Judge of theSuperior Court of the State of California for the County ofAlameda. The market value of the respective Condominiums shallthen be the average of the three values submitted by each ot theappraisers.

F. It a bid or estimate is accepted, theBoard shall levy a Special Assessment to make up any deficiencybetween the total insurance proceeds or insurance work and the costfor such repairs or rebuilding, and such Assessment and allinsurance proceeds, whether or not subject to liens of mortgages,shall be paid to the insurance trustee to be used for such

rebuilding. The Special Assessment shall be levied according tothe Owner's Share, as set forth on the Condominium Plan.

Cc) Notwithstanding any provision in this Section to thecontrary, if the insurance c&rrier offers the full amount requiredto repair and restore all of the damage, then the Board shallcontract to repair and rebuild the damaged portions of all Unitsand the Common Area in the manner provided in subparagraph (b) (iifor a minor casualty. -

(d) Without waiting to obtain insurance settlements orbids, the Board may undertake such emergency repair work after acasualty as it may deem necessary or desirable under thecircumstances.

Section 9.10 Condemnation. In the event of an award for thetaking of any Condominium in the Project by eminent domain, theOwner of such Condominium shall be entitled to receive the awardfor such taking arid, after acceptance thereof, he and his mortgageeshall be divested of all interest in the Project, if such Ownershall vacate his Unit as a result of stch taking. The remainingOwners shall decide by majority vote whether to rebuild or repairthe Project or take other action. The remaining portion of theProject shall be resurveyed, if necessary, and the DeclarationshaflThe amendec t reflectiie?r takin and to••djstproportionately the percentages of the undivided interests of theremaining Owners in the Project. The Association shall representthe Owners in any condemnation proceedings or in negotiations,settlements and agreements with the condemning authority for theacquisition of the Corcanon Area or any part thereof, and the awardor proceeds of settlement shall be payable to the Association, orany trustee appointed by the Association, for the use and benefitof the Condominium Owners and their nlortgagees, as their interestsmay appear. If Condominiums are not valued separately by Courtjudgment or by agreement between the condemning authority and eachof the affected Owners in the Project, the condemnation award shallbe distributed as follows: The Board shall appoint two (2)independent appraisers to determine the rçlative values of theCondominiums affected by the condemnation. The two appraisers shallappoint a third independent appraiser. If the two appraisers areunable to agree on a third, then the third shall be appointed bythe presiding Judge of the Superior Court of the State ofCalifornia for the County of Alameda. The value of the respectiveinterests shall be the average of the three values submitted byeach of the appraisers In the event any Owner disagrees with theproposed allocation, he may have the matter submitted toarbitration under rules of the kuerican Arbitration Association, athis sole cost and expense. In the event of eminent domainproceedings against the Project or any portion thereof,institutional lenders shall be given timely written notice thereof.

Section 9.11 Owners' Compliance. Each Owner, tenant oroccupant of a Condominium shall comply with the provisions of thisDeclaration, the Bylaws, and the decisions and resolutions of theAssociation or its duly authorized representative, as lawfullyamended from time to time. railure to comply with any suchprovisions, decisions or resolutions shall be grounds for an actionto recover sums due for damages or for injunctive relief.

All agreements and determinations lawfully made by theAssociation in accordance with the voting percentages establishedin this Declaration or in the Bylaws, shall be deemed to be bindingon all Owners of Condominiums, their successors and assigns.

Section 9.12 Limitation of estrictions on Declarant.Declarant is undertaking the work of constructing a phasedCondominium Project and incidental improvements upon the Property.The completion of that work and the sale, rental, and otherdisposal of condominiums is essential to the establishment andwelfare of said Property as a residential community. In order thatsaid work may be completed and said Property be established as afully occupied residential community as rapidly as possible,nothing in this Declaration shall be understood or construed to dothe following:

- Prevent beclararit, its contractors, -or

subcontractors, from doing on the Property or any Condominium,whatever is reasonably necessary or advisable in connection withthe completion of said work; or

(b) Prevent Declarant or its tepresentatives fromerecting, constructing and maintaining on the Property (except uponCondominiums owned by others), such structures as may be reasonableand necessary for developing said Property as a residentialcommunity and disposing of the same by sale, lease or otherwise; or

Cc) Prevent Declarant from conducting on the Property(except upon Condominiums owned by others) its business ofcompleting said work and of establishing a plan of residentialownership and of disposing of said Property in Condominiums bysale, lease or otherwise; or

(d) Prevent Declarant from maintaining such sign orsigns on the Property texcept upon Condominiums owned by others) asmay be necessary for the sale, lease or disposition thereof; or

Ce) Subject Declarant to the architectural controlprovisions of Article VII for construction of any residence orother improvements on the Property.

The foregoing rights of Declarant shall terminate upon sale ofDeclarant's entire interest in the Projeet.

So long as Declarant, or its successors and assigns, owns one(1) or more of the COndominiums described herein, Declarant, or itssuccessors and assigns, shall be subject to the provisions of thisDeclaration. Declarant shall make reasonable efforts to avoiddisturbing the use and enjoyment of Condominiums and the CommonArea by their Owners, while completing any work necessary to saidCondominiums or Common Area.

Section 9.13 Teination of Any Responsibility of Declarant.In the event Declarant shall convey all of its rights, title andinterest in and to the Property to any partnership, individual orindividuals, corporation or corporations, then and in such event,Declarant shall be relieved of the performance of any further dutyor obligation hereunder, and such partnership, individual or

individuals, corporation or corporations shall be obligated toperform all such duties and obligations of the Declarant.

Section 9.14 Notices. Any notice permitted or required bythis Declaration or the Bylaws may be delivered either personallyor by mail. If delivery is by mail, it shall be by first—classmail arid shall be deemed to have been delivered seventy—two (72)hours after a copy of the same has been deposited in the UnitedStates Mail, postage prepaid, addressed to each person at thecurrent address given by such person to the Secretary of the Boardor addressed to the Unit of sueh persontf no such address hat-Sengiven to the Secretary.

section 9.15 Required Documentation. Declarant hereby agreesto furnish the Association with copies of all documentationrequired by California Department of Real Estate RegulationsSection 2792.23(a) and (b) within ninety (90) days after the closeof escrow of the first interest in the subdivision or within ninety(90) days after the annexation of any additional phases.

Menters shall furnish subsequent purchasers with alldocumentation required by California Civil Code Sections 136L1,1368 and 1375, as well as purchase documents and any maintenancemanuals, schedules and procedures as referred to in Title 7, Part2, Division 2 of the California Civil Code.

Section 9.16 special ?rovisions for Enforcement of BondedObliQations.

(a) Special Procedures. Because certain Common Areaimprovements may not have been completed prior to the date ofexecttion of this Declaration and by the date of issuance of afinal public report covering the Project, or the first phasethereof, and because the Association is or may become obligee undera bond or other arrangement (hereafter "ond'1) to secure thecompletion of such Common Area improvements, there are herebycreated special procedures for the initiation of action to enforce

the obligations of the Declarant and the surety under any suchbond.

(b) Action by Board. The Board is hereby directed toconsider and vote on the question of action by the Association toenforce the obligations under the Bond with respect to anyimprovement for which a Notice of Completion has not been filedwithin sixty (60) days after the completion date specified for thatimprovement in the planned construction statement arpended to theBond. If the Association has given art extension in writing for thecompletion of any Common Area improvement, the Board shall considerand vote on the aforesaid question if a Notice of Completion hasnot been filed within thirty (30) days after the expiration of theextension. -

(c) Meeting of Members to Override Decision by Bbard.A special meeting of Members of the Association for the purpose ofvoting to override a decision by the Board not to initiate actionto enforce the obligations under the Bond, or on the failure of theBoard to consider the question, shall be held not less thanthirty—five (35) days nor more than forty—five (45) days afterreceipt by the Board of a petition for such a meeting signed byMembers representing five percent (5%) or more of the total votingpower of the Association.

(d Vote by Members at Special Meeting. At any meetingheld under the provisions of section (c) above, a vote shall betaken by Members of the Association other than the Declarant. Avote of a majority of the voting power of the Association residingin Members other than Declarant to take action to enforce theobligations under the Bond shall be deemed to be the decision ofthe Association, and the Board shall thereafter implement thisdecision by initiating and pursuing appropriate action in the nameof the Association.

te) Release of Bond. Upon satisfaction of theDeclarant's obligation to complete the Common Area improvements,the Association shall acknowledge in writing that it approves therelease of the Bond and execute any other documents as may benecessary to effect such release. The Association shall notcondition its approval of the release of the Bond on thesatisfaction of any conditions other than the completion of theCommon Area improvements, as described on the planned constructionstatement appended to the Bond. Any dispute between the Declarantand the Association regarding the completion of the Common Areaimprovements shall be submitted to binding arbitration under thecommercial rules of the American Arbitration Association and theprevailing party shall be entitled to recover costs, includingreasonable attorneys' fees.

IN WIThESS WHEREOF, the undersigned, being the Declarantherein, has executed this Declaration thisj/ft day

2OO.

SNKD1\c—CCRS .FINAL - 0T4

Deolarant:

SNT( CAPTZC AnDANTE LI.C,a Delaware Limited Liability CompanyBy: SNK LaPlaya I LLC, a Delaware

Limited Liability Company

Its Viw Fw0Jwt

ARIteNASTATS OF Q?.LIrOIUTIX

COUNTY OF 14MQICZPAas.

on Ote vp.cQ4520DL1 before me, the undersigned, a Notary

Public in and for said State, personally appeared &o.4...R.l-k4AQs,s UttthtSøD%k o St.alCLa PIa.&t LLC ,%i.iatas.Mn4I*.e'cjSC Oaqiec..MtAa.M tic. -J

personallyt) known to me 4c pEe'ek to e en the basis efest4ataae*?—e*tne to be the person4e+ whose name(s) islessubscribed to the within instrument and acknowledged to me thatheIehc,'th executed the sane in his/h ,'tLcr authorizedcapacityf±es4, and that by hisAe*bthr signature4a4 on theinstrument the person4s4, or the entity upon behalf of which thepersonkst acted, executed the instrument.

WITNESS my hand and official seal.

signature_______________________

NSe D QOfD.fl EVctn ____ ormciJ.sj —(typed or printed)

This ares for offici1 not.ri.1 5.ai)