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Annual Budget Report (Required Civil Code Sec. 4525)The Village Serramonte Homeowners Association

Articles of Incorporation (Required Civil Code Sec. 4525)The Village Serramonte Homeowners Association

NOTICE

"If this document contains any restrictions based onrace, color, religion, sex, familial status, marital status,disability, national origin or ancestry, that restrictionviolates state and federal fair-housing laws and is void,and may be removed pursuant to subdivision ofSection 12956.1 of the Government Code. Lawfulrestrictions under state and federal law on the age ofoccupants in senior housing or housing for olderpersons shall not be construed as restrictions based onfamilial status."

T U FJLE

SECRETARY OF STATE

I, EDMUND C. BROWN JR. Seaetaryof State of the State of California. herebycerrn:

That the annexed transcript has been compared with the aco on ifie in thisoffice, of which it purports to be a copy, and that same is fulL thie and correct.

IN WITNESS WHEREOF, I executethis certificate and affix the GreatSeal of the State of California this

II?' Y 1q74

2-NSecretary of St.n.

08904 04Afl 'Cj tfrtCLJd

OFFICE OF THE

ENDORSEDFILEDin .*eCe 5a.L.7 Ce StS.

ARTICLES OF Ir4CORPORATIOr4aiS5tSflECaIfSflJUL31 1974

OF EDMUIIDG.BIOVI%S.CNW,OISIBy JA145 I. HARRIS

TilE VILLAGE SERRAMOt4TE HOMEOWIJERS ASSOCIATIOND.puty

ARTICLE I

NAME

The name of the corporation. hereinafter called the

"Associ ati on" is THE VILLAGE SERRAIIOUTE HOMEOWnERS ASSOCIATIOH.ARTICLE II

PRINCIPAL OFFICE

The principal office of the Association is located in

San Mateo County, California.

ARTICLE III

PURPOSE ANO POWERS OF THE ASSOCIATION

This Association is organized pursuant to the General

MonProfit Corporation Law. This Association does not contemplate

pecuniary gain or profit of the members thereof, and the specific

purposes for which it is farmed are to provide for the care, main-

tenance, and preservation of the resident Units and Common Area

within that certain tract of property described as:

"FINAL lAP of THE VILLAGE SERRAMOUTE, A CondoniniUmProject, City of Daly City. California, a Condo-minium filed for record in the office of the CountyRecorder of the County of San Mateo. State of Cali-fornia on June Ii, 1974. in Volume 85 of Maps, atPages ito 17, inclusive."

and any additions thereto as hereafter may be brought within the

jurisdiction of this Association by annexation, all of which

property is herein referred to as the "subject property" and to

promote the health, safety and welfare of the residents within

the abovedescribed subject property.In furtherance of said purposes, this Association shall

have power to:

(a) exercise all of the powersand perform all of the

duties and obligationsof the Association as set forth

in

that certain Declaration ofCovenants, Conditions and Restric-

tions, applicableto the subject property and

recorded or

to be reccrde in the officeof the Recorder of San Matco

County, California,hereinafter referred to as the

"Oeclaratiori":

(b) fix, levy,collect and enforce payment by any

lawful means, all charges orassessments pursuant to the

terms of the Declaration; to payall expenses in connection

therewith and all office and otherexpenses

incident to the

conduct of the business of theAssociation, including l1

licenses, taxes or governmental chargeslevied or Imposed

against the property of the Association;

(c) acquire (by gift, purchase,lease or otherwise),

own, hold,improve, build upon, operate. maintath,

convey,

sell, lease, transfer, dedicateto public use or otherwise

dispose of real or personalproperty in

connection with the

affairs of the Association;

(ci) borrow money,and only with the assent (by

vote

or written consent) oftwothirds (2/3) of each

class of

Members, mortgage,pledge, deed n trust, or

hypothecate

any or all of its real orpersonal property as security

for money borrowed or debtsincurred;

Ce) dedfcate, sell or transferall or any part of

the Common Area owned bythe Association to any public

agency, authority,assesstert district, or utiflty

fer

such purposes andsubject to such cond tions as may b

agreed to by the flembers. ardas provided in the

Oecaratthn. flo such dedicationor transfer shall be

effective unless an instrument has beensigned by two

thirds (2/3) of each class of Members, agreeingto such

dedication,sale or transfer;

(f) participate in lergers and consolidations with

other non-pofit corporations organized for the same pur-poses or annex additional residential property and Common

Area, provided that any such plerger, consolidation or

annexation shall have the assent by a vote of twothirds

(2/3) of each class of Members or by the written consent of

all of the Members;

(g) have and to exercise any and all powers, rightsand privileges which a corporation organized under theGeneral NonProfit Corporation Law of the State of Californiaby law may now or hereafter have or exercise;

(Ii) to carry on any activity whatsoever, either as

principal agent or partner, which this corporation nay deem

proper: or convenient in connection with any of the fore-

going purposes or otherwise, or which may be calculated

directly or indirectly to promote the interests of this

corporation.

The foregoing statement of purposes shall be construed as

a statement of both purposes and powers, and the purposes and powers

stated in each clause shall, except where otherwise expressed, be

in no way limited or restricted by any reference to or inference from

the terms and provisions of any other clause, but shall be regarded as

independent purposes and powers. Notwithstanding any of the above

statements of purposes and powers, this corporation shall not engage

in activities which thernseves are not in furtherance of the purposes

set forth in this Article III and nothing contained in the foregoing

statement of purposes shall be construed to authorize this corpor-ation to carry on any activities for the profit of its tiembers orto distribute any gains, profits, or dividends to any of its Membersas such, except upon dissalution or winding up.

ARTICLE IV

MEN BE PS H I P

Every person or entity who is a record owner of a fee orundivided fee interest in any Unit, which is subject by the Declaratic

of record to assessment by the Association, including contract

sellers, shall be a Member of the Association. The foregoing is not

intended to include persons or entities who hold any interest merely

as sethirity for the performance of an obligation. F4embership shall

be appurtenant to and may not be separated from ownership of any

Unit which is subject to assessment by the Association.ARTICLE V

VOTI4G RIGHTS

The Association shall have two classes of voting membership:

CLASS A. Class A Members shall be all Owners, with the

exception of the Declarant, and shall be entitled to one (1)

vote for each Unit owned. When mare than one person holds an

interest in any Unit, all such persons shall be Members. The

vote for such Unit shall be exercised as they among themselves

determine, but in no event shall more than one (1) vote be

cast with respect to any Unit.

CLASS B. The Class B Member shall be the Declarant (as

defined in the Dec'aration) and shall be entitled to three (3)

votes far each lot owned. The Class B membership shall ceasc

and be converted to Class A membership on the happening of

either of the following events, whichever occurs earlier:

(a) when the total votes outstanding in the

Class A membership equal the total votes outstandingin the Class B membership; or

(b) on Oecember 31, 1976.

,*t(ILLLt Vi

BOARD OF DIRECTORS

The affairs of this Association shall be managed by a

Board of five (5) Directors who must be Members of the Association

in good standing. The number of Directors may be changed by amendment

of the ByLaws of the Association. The names and addresses of the

persons who are to act in the capacity of Directors until the

selection of their successors are:

NAME ADDRESS

CARL COVITZ 1815 Via El Prado

Redando Beach, California.

JACK SHINE 15130 Ventura Boulevard

Sherman Oaks. California

DAVID BOCK 15130 Ventura Boulevard

Sherman Oaks. California

DAVID DOREMUS 15130 Ventura BoulevardSherman Oaks. California

EARL THORNBURGH 15130 Ventura Boul evardSherrran Oaks. California

At the first annual meeting of the Association, the OwnerS")shall elect five (5) DirectorS for a term of one (1) year each.At the expiration of the tern of years for which each representativeDirector has been elected, his successor shall be elected to serve )for the sane tern of one (1) year each.

ARTICLE VII

DI S SO LU TI ON

The Association may be dissolved with the assent given In

power of the Association. This corporation is one which does not

contemplate pecuniary gain or profit to the Members thereof and it is

organized solely for nonprofit purposes. Upon the winding up and

dissolution of this corporation, after paying or adequately providing

for the debts and obligations of the corporation, the remaining assets

shall be distributed to an appropriate public agency to be used far

purposes similar to those for which this Association was created, in-

the event that such distribution is refused acceptance, such assetsshaH be granted. conveyed and assigned to any nonprofit corporation,

association, trust or other organization organized and aperated for

such similar purposes.

ARTICLE VtII

DURATION

TIe corporation shall exist perpetually.

ARTICLE IX

AMENDMENTS

Amendment of these Articles shall require the assent (by

vote or written consent) of Members representing seventyfive percent(75%) or more of the voting power.

1(1 WtTNESS WHEREOF, for the purpose of forming this

corporation under the laws of the State of Caflfornia. we, the

undersigned, constituting the incorporators of this Association, have

execute4 these Articles of Incorporation this /c day of

____________________

1974Crof

STATE OF CALIFORNIA) ss.

COUNTY CF Los AngelesOn this 1th day of jury , 1974, personally

appeared beforerne, the undersigned, a Notary Public,_____________Carl 0. Covitz, Jack Shine. David Bock, David Dorerutis and

Zari Thornburhknown to me to be the persons whose names are subscribed to the withininstrument, and they acknowledged to me that they executed the same.

III JITESS WHEREOF, I have hereunto set nly hand and affixedny official seal the day and year first above written.

+..OflICIAL SEAL 4' 1: SlIMY BENIF1ELD : g Ltt6-, ',JetLLrU S NOTAAYPUBLJC.CALIFORNLA l1ntrv7)PiIb1 -PWI?CIPM. OFFtCE IN '

LOS ANGELIS C. Sliary Beutfield: MI Cemi.iujoiiEnS. jaiway 31. 1973 : 4e

Bylaws (Required Civil Code Sec. 4525)The Village Serramonte Homeowners Association

BYLAWS OFTIlE VILLAGE SERRAMONTEHOMEOWNERS ASSOCIATION

(As Amended in 1995)TABLE OF CONTENTS

ARTICLE I - ASSOCIATION GENERALLY 1Section 1. Name and Location 1Section 2. Purpose 1

ARTICLE H - MEMIBERSITAP 1

ARTICLE ifi - MEMBERSHIP VOTING 1Section 1. Member Voting RightsSection 2. Cumulative Voting 2Section 3. Proxies 2

Proxies Generally 2Effectiveness of Proxies 2Validity of Proxies With Respect to Certain MaterialTransactions 2Limited Proxies 3Restriction or Elimination of Proxy Rights: Limitation onAuthority 3

(fl Proxy Rules for Memberships Held by More Than One Person . 3No Proxy Voting in Connection With Written Ballots (cast withoutameeting) 3Toward Quorum 4Proxy Given to the Board 4

U) Proxy Given to Any Director 4Section 4. Action Without a Meeting 4Section 5. Contract Purchasers 4

ARTICLE IV- MEMBERSHIP MEETINGS 4

Section 1. Types of Meetings 4Annual Meetings 4Special Meetings 4

Section 2. Conducting Meetings 5Section 3. Meeting Notices 5

lime of Notice 5Conveyance of Notice 5Content of Notice 5

Section 4. Quorum Requirements 5Section 5. Inspectors of Election 5

ARTICLE V- BOAR]) OF DIRECTORS 5

Section 1. General Association Powers 5Section 2. Directors 6

Number 6Term of Office 6Compensation 6

(h)Section 3.

U)

ARTICLE VISectionSectionSectionSectionSectionSectionSection

ARTICLE VII- COMMITTEES 11Section 1. Generally 11Section 2. Nominating Committee 11Section 3. Other Committees 11ARTICLE VIII -

Section 1.Section 2.Section 3.Section 4.

Section 5.

BYLAWS OFTHE VILLAGE SERRAMONTEHOMEOWNERS ASSOCIATION


- Continued

Determination of Election Results and Succession to Office 6Vacancies Generally 6U) Resignation 6(g) Removal 6By Board 6By Members 7Filling Vacancies 7Officers 7Election 7Term of Office 7Special Appointments 7Resignation 8Removal 8Vacancies 8Multiple Offices 8Duties of Officers 8President 8Vice President 8Secretary 8Treasurer

- 8

- BOARD MEETINGS. 9Regular Meetings. 9Special Meetings 9Notice 9Quorum Requirements 9Action Without Meeting 10

Participation by Members. 10Executive Session 10

DUTIES AND POWERS OF THE BOARD 11Generally 11Association Finances 13Limitations on Power of Board 13Inspection of Books and Records 14Member Inspection Rights 14Director Inspection Rights 14Adoption of Reasonable Inspection Rules 14

Rules 14

11

ARTICLE IXSectionSection

SectionSectionSection

ARTICLE x -SectionSection

ARTICLE XISectionSectionSectionSectionSection

BYLAWS OF[HE VILLAGE SERRAMONTEHOMEOWNERS ASSOCIATION


- ContinuedSection 6. Manager 14Section 7 Enforcement 14

- INDEMNIFICATION 15Indemnification of Association 15

Indemnification by Association of Directors, Officers, Employees, andOther Agents 15Advancement of Expenses 15Insurance 15Limitations on Personal Liability of Individual Directors 15

TAX EXEMPT STATUS 15I. Tax-Exempt Status 152. Filing 15- MISCELLANEOUS 15

Amendment of Bylaws 15Tape Recording 16Conflict 16Corporate Seal 16Fiscal Year 16SECRETART5 CERTIFICATION 16

lii

BYLAWS OFTIlE VILLAGE SERRAMONTEHOMEOwNEis ASSOCIATION(As Amended in 1995)

These Amended Bylaws of The Village Serramonte Homeowners Association ("Bylaws")supersede any and all earlier Bylaws and amendments thereto ("Former Bylaws"). These Bylawsare a companion document to the Declaration and defined terms (in bold) in these Bylaws havethe same meaning as in the Declaration.

ARTICLE IASSOCIATION GENERALLY

Section 1. Name and Location. The name of this Nonprofit Mutual Benefit Corporationis "THE VILLAGE SERRAMoq HOMEOWNERS ASSOCIATION," (hereinafter referredto as the "Association"). The principal location of the office of the Association is in the Countyof San Mateo, State of California.Section 2. Purpose The Owners of the Condorniniun constitute the Association.The purposes of the Association are:

to own, repair, maintain and/or manage the Common Areas and commonfacilities;

to enforce the rules adopted from time to time by the Board of Directors,and the terms and conditions of the Declaraflon of Covenants,. Conditions andRestrictions of the Village Serramonte Homeowners Association;to enhance and promote the use and enjoyment of the Common Areas andcommon facilities by the Owners in common;to maintain the aesthetic architectural standards of Village Serramonte; andto enhance and protect the quality of life of residents.

ARTICLE IIMEMBERSHIP

Every Owner of a Unit within Village Serramonte is a Member of the Association.Membership in the Association is linked to, and may not be separated from, ownership of anyUnit. Upon the sale, conveyance or other transfer of an Owner's interest in a Unit, theOwner's membership interest shall automatically transfer to the Unit's new Owner(s).ARTICLE III

MEMBERSHIP VOTINGSection 1. Member Voting Rights. On each matter submitted to a vote of theMembers, each Member shall be entitled to cast one vote for each Unit owned by suchMember. When more than one (1) person owns an interest in a single Unit, the vote for each

Feingold & Youngling. PLC810 Fifth Ave., San Rafael, CA 94901(415) 454-1090

1

2ARTICLE m - MEMBERSHIP VcXnNG

Unit must be cast as a majority of co-owners of the Unit shall determine. Any vote cast by asingle Member shall be deemed the authorized vote for that Unit. If conflicting votes are castfor the Unit, no vote shall be counted except a single vote shall be counted for purposes of aquorum.

Section 2. Cumulative Voting. Cumulative voting shall not be permitted.Section 3. Proxies.

(a) Proxies Generally. Any Member entitled to vote may do so either inperson or by one or more agents authorized by a written proxy signed by the Memberand filed with the Secretary of the Association. Aproxy may specify a specific durationsuch as an annual meeting or specify up to three years from the date of execution. If noterm is specified, it shall be valid for 11 months from the date of execution. To be valid,a proxy must be signed and dated.

(b) Effectiveness of Proxies. A proxy continues in force until revoked by theissuing Member prior to the vote or on expiration. Any proxy may be revoked by theMember at any time prior to the vote by:

delivery to the Secretary of a signed, dated, written notice ofrevocation,

a later proxy signed and dated by the Member and presented at themeeting, or

by attendance at any meeting and voting in person by the Member.

A proxy shall be deemed revoked when the Secretary receives actual notice of thedeath or judicially declared incompetence of the Member issuing the proxy, Or upontermination of such Member's status as an Owner.

(c) Validity of Proxies With Respect to Certain Material Transactions.Any proxy given with respect to any of the matters described in this subparagraph (c)shall be valid only if the proxy form sets forth a general description of the nature of thematter to be voted on. The matters subject to this requirement are:

Removal of Directors without cause;

Filling of vacancies on the Board;

Approval of contracts or transactions between the Association andone or more of its Directors, or between the Association and a corporation, firmor association in which one or more of the Directors has a material financialinterest;

Amendment of the Articles of Incorporation, these Bylaws, or theDeclaration;

ARTICLE ifi - MatBERsiup V(ynnc

Action to change any Association Assessments in a mannerrequiring membership approval under the Declaration;

Sale, lease, exchange, transfer or other disposition of all orsubstantially all of the Association's assets otherwise than in the regular courseof the Association's activities;

Merger of the Association or an amendment to an agreement ofmerger; and

Voluntary dissolution of the Association.(d) Limited Proxies.

I. Any proxy distributed to 10 or more Members must afford anopportunity on the proxy to specgy a choice between approval or disapproval ofany matter or group of related matters intended, at the time the proxy isdistributed, to be acted upon at the meeting for which the proxy is solicited. Ifthe proxy lists one or more matters to be acted upon and the issuer of the proxyhas specified a choice with respect to any such matter (including a preference invoting for candidates for election to the Board), the proxy holder shall beobligated to cast, the vote represented by the proxy in accordance with the issuer'sdesignated preference.

2. Proxies distributed in connectionwith the election of Directors shallset forth the names of all individuals who are candidates for election to the Boardof Directors at the time the proxy is issued: The proxy form shall contain boxesor lines where the issuing Member can express his or her voting preference. Ifthe proxy directs that the authority to vote for the election of Directors iswithheld, the proxy holder shall not vote the proxy either for or against theelection of a Dir6ctor. If any proxy issued in connection with the election ofDirectors is marked so as to direct the proxy holder to vote the proxy for oragainst. 1a specified candidate or candidates, the proxy holder shall vote inaccordance with the direction of the proxy issuer.

Restriction or Elimination of Proxy Rights: Limitation on Authority.No amendment of the Articlesor Bylaws repealing, ietxicling, or expanding proxy rightsmay be adopted without approval by the affirmative vote of a majority of Members (89votes) represented and voting at a duly held meeting at which a quorum is present, or bythe affirmative vote of a majority of Members (89 votes) by written ballot.Proxy Rules for Memberships Held by More Than One Person. Wherea membership is held by more than one person, any proxy signed by a single Membershall be deemed the authothed proxy for that Unit. In the event of conflicting proxiesfor a single Unit, no proxy shall be counted for that Unit except for purposes ofachieving a quorum.

No Proycy Voting in COnnection With WrittenBallots (cast without ameeting). Proxy voting shall not be allowed when Members' votes are solicited bywritten ballot to be cast without a meeting.

4AWHCLE ifi - MEMBERSHIP Vormic

(h). Toward Ouorum. If noted on the proxy, a proxy may be counted solelytoward achieving a quorum and with instructions to abstain on all substantive votes.

(i) Proxy Given to the Board. If a proxy is given to the Board generallywithout direction as to how any vote shall be cast, the proxy shall be counted as amajority of the Board directs.

U) Proxy Given to Any Director. If a proxy is given to any individualDirector, without direction as to how to vote, the vote may be cast as that Directordeems appropriate.

Section 4. Action Without a Meeting. Any action which may be taken by the vote ofMembers at a regular or special meeting, may be taken without a meeting if:

the Association distributes a written ballot to every Member entitled tovote on the matter (no proxies are distributed in this process);

the ballot sets forth the proposed action, provides an opportunity to specifyapproval or disapproval of any proposal and specifies a reasonable time within which toreturn the ballot to the Association in order for it to be counted; and

the solicitation indicates the number of responses necessary to meet thequorum requirement and, as to ballots other than for the election of Directors, states thepercentage of approvals necessary to pass the proposal.

Approval by written ballot is valid only when the number ofvotes cast by ballot withinthe applicable time period equals or exceeds the quorum required to be present at a meetingauthorizing the action, and the number of approvals equals or exceeds the number of votes thatwould be required to approve at a meeting at which the total number of votes cast was the sameas the number of votes cast by ballot. The Board may, at its sole option, extend the time fixedfor return of the ballots.

Section 5. Contract Purchasers. A Member who has sold his or her Unit to a contractpurchaser under an agreement to purchase may delegate to such contract purchaser his or hermembership rights in the Association. Any such delegation shall be in writing and shall bedelivered to the Board before such contract purchaser may vote. However, the contract sellershall remain personally liable for all charges and: Assessments. until fee title tothe Unit istransferred to the contract purchaser. Notice of the transfer of title shall be delivered to theAssociation.

ARTICLE IVMEMBERSHiP MEETINGS

Section 1. Types of MeetinEs.

Annual MeetinEs. Annual meetings of the Association shall be held inFebruary of each calendar year. Meetings shall be held in the Recreation Building orsuch location as close to Village Serramonte as reasonably possible.

special Meetings. Special Meetings of the Members may be called at anytime by the President or by two Directors. Additionally, a Special Meeting of the

Aicrza.E IV - MSmER5IUP Mn'wcs

Members of the Association shall be promptly called upon receipt of a written requestfor such a Special Meeting signed by Members representing five percent (5%) of the totalvoting power of the Association.

Section 2. Conducting Meetings. Meetings of Members shall be conducted inaccordance with a recognized system of parliamentary procedures or such parliamentaryprocedures as the Board may adopt.

Section 3. Meeting Notices. Written notice of regular and special meetings of theMembers shall be given as follows:

Time of Notice. Notice for a meeting shall be given not less than 10 normore than 90-days before the date of the meeting. A meeting called pursuant to petitionof the Members shall be set at least 35 but not more than 90 days after receipt by theBoard. of the request.

Conveyance of Notice. Notice of each meeting shall be given to eachMember at either (i) the address of theUnit or (ii) the address supplied by such Memberto the Association for the purpose of notice.

Content of Notice. Notice of a meeting shall specify the place, thy andhour of the meeting. Notice of a special meeting shall also state the purpose of thespecial meeting.

Section 4. Ouorum Requirements. The presence at the meeting of fifty percent (50%)of the voting power shall constitute, a quorum for any action. (Based on 177 Units, this is 89votes.) If a quorum is not represented a. majority of the Members present, in person or byproxy, may adjourn the meeting, without notice other than announcement at the meeting; toanother time not less than five (5) nor more than thirty (30) days from the date of the originalmeeting. The quorum for any such adjourned meeting shall be twenty-five percent (25%) of thetotal voting power of the Members. (Based on 177 Units, this is 45 votes.) Ifa time and placefor the adjourned meeting is not fixed by those in attendance at the original meeting or if for anyreason a new date is fixed for the adjourned meeting after adjournment, notice of the time andplace of the adjourned .meeting shall be given to Members in the manner prescribed for regularmeetings.

Section 5. Inspectors of Election. The Board may appoint one or three inspectors ofelection to act at any membership meeting to determine the number of memberships representedat the meeting, the existence of a quorum, the authenticity, validity and effect of proxies orballots, receive votes or ballots, hear and determine all challenges and questions in any wayarising in connection with voting, count and tabulate all votes, determine when the voting shallclose, determine the result and do such other acts as may be proper to conduct the election orvote with fairness to all Members.

ARTICLE VBOARD OF DIRECTORS

Section 1. General Association Powers. The Board of Directors shall have the powerand authority to conduct the business and affairs of the Association in any lawful manner,consistent with the Governing Documents.

ARTICLE V - BOARD OF DDECWRS

Section 2. Directors.

(a) Number. The affairs of the Association shall be managed by a Board offive (5) Directors who shall be Members of the Association with all Assessments currentand who are not subject to any suspension of membership rights.

(b) Tenn of Office. The term for all Directors shall be two (2) years. Three(3) positions shall be elected in even years, and two (2) positions shall be elected in oddyears. Each Director, including a Director elected to fill a vacancy Or elected at aspecial meeting of Members, shall hold office until the expiration of the term for whichelected and until a successor has been elected and qualified.

(c) Compensation. No Director shall receive compensation for any servicesrendered to the Association as a Director; provided, however, that a Director may bereimbursed for his or her reasonable expenses actually incurred in the performance of hisor her duties as a Director of the Association. Expenses for which reimbursement issought shall be supported by a proper receipt or invoice signed and dated by the Directorclaiming the expense.

(d) Determination of Election Results and Succession to Office. Electionto the Board shall be by confidential written ballot. At such election the Members ortheir proxies may cast, in respect to each vacancy, as manyvotes as they are entitled toexercise under provisions of the Declaration and these Bylaws. The persons receivingthe largest number of votes, up to the number of Directors to be elected, shall be electedand, if present, shall take office at the conclusion of voting. If not present, he or sheshall take office after notification of the election results and on the first thy of the nextmonth.

(e) Vacancies Generally. A vacancy on the Board of Directors shall bedeemed to exist on the occurrence of any of the following:

the disqualification, death, resignation, or removal of a Directorunder sections (1) and (g) below;

the bilure of the Members, at any meeting of the Members (andwhere a quorum is reached) at which a Director or Directors are to be elected,to elect the number of Directors to be elected at such meeting;

if a vacancy is declared by the Board of Directors for any reasonpermitted. by law.

(f) Resignation. Except as provided in this paragraph, any Director mayresign, and such resignation shall be effective on giving written notice to the Presidentor Secretary, unless the notice specifies a later time for the resignation to becomeeffective. If the resignation of a Director is effective at a future time, the Board ofDirectors may elect a successor to take office when the resignation becomes effective.

(g) Removal.

(i) By Board. The Board of Directors shall have the power andauthority to remove a Director and declare his or her office vacant if he or she

6

7ARTICLE V - BOARD OF OIRECmRS

has been declared, of unsound mind by a final order ofcourt;

has been convicted of a felony;

fails to attend 3 consecutive regular meetings of the Boardof Directors that have been duly noticed or regularly scheduled. (Seegenerally Corporations Code Section 7221)In the event there is a final judgment or order of any court concluding that

a Director has breached his or her duties, the Board of Directors shall consultwith counsel as to whether or not that court determination requires a declarationof vacancy.

(ii) By Members. Except as otherwise provided herein, a Directormay be removed from office prior to expiration of his or her term only by theaffirmative vote of a majority of the voting power of the Members representedand voting at a duly held meeting at which a quorum is present (which affirmativevotes also constitute a majority of the required quorum) or by written ballotconducted in accordance with the terms herein and the Corporations Code.

(h) Filling Vacancies. The President shall nominate a candidate to fill anyvacancy on the Board of Directors. The Board of Directors shall elect or reject thenomination by a majority vote of the remaining Directors (even if less than a quorum orby the sole remaining Director unless the vacancy is created through removal of aDirector by the Members, in which case the vacancy shall be filled (by election) by theaffirmativevote of a majority of the Members, represented. in person orby proxy at aduly held meeting of the Members at which a quorum is present. The Members mayelect a Director or Directors at any time to fill any vacancy or vacancies not filled bythe Directors by an election at a duly held meeting of the Membersor written ballot andshall require the approval of a majority of the voting power. The new Director shallhold office until the expiration of the term for the Director he or she replaces and untila successor has been elected and qualified.

Section 3. Officers. The Officers of the Association shall be a President and a VicePresident, Secretary and Treasurer. At least two Officers shall also be Directors. The Boardof Directors may, by resolution, appoint such other Officers as the Board deems necessary.

Election. The election of Officers shall take place at the first meeting ofthe newly elected Board following each annual meeting of the Members.

Term of Office. The Officers of this Association shall be elected annuallyby the Board. Each Officer shall hold office for one (1) year unless he or she shallsooner resign, be removed or otherwise be disqualified to serve.

Special Appointments. The Board may appoint, and may empower thePresident to appoint, such other Officers as the affairs of the Association may require,each of whom shall hold office for such period, have such authority and perform suchduties as the'Board may from time to time determine.

AicncLE V - Bosiw oF DtEcroRs

Resignation. Any Officer may resign from the position of Officer at anytime by giving written notice to the President or to the Secretary. Any such resignationshall take effect on the date of receipt of such notice or at any later time specified therein,and unless otherwise specified therein, acceptance of such resignation shall not benecessary to make it effective.

Removal. Any Officer may be removed and/or reassigned by the Boardwith or without cause, at any regular or special meeting.

(1) Vacancies. A vacancy in any office may be filled by appointment by theremaining Director(s). The Officer appointed to such vacancy shall serve the remainderof the term of the Officer he or she replaces.

Multiple Offices. One person may hold two or more offices, except thatneither the Secretary nor the Treasurer may serve concurrently as President.

Duties of Officers. The duties of the Officers are as follows:

President. The President shall be the Chief Executive Officer ofthe Association and shall, subject to the control of the Board, have generalsupervision, direction and control of the affairs and Officers of the Association.He or she shall (1) preside atall meetings of the Board of Directors; (2) see thatorders and resolutions of the Board are carried out; (3) have the power to signall contracts and other written instruments; nd (4) have the power to co-sign allchecks and promissory notes. He or she shall have such other powers and dutiesas may be prescribed by the Board or the Bylaws.

Vice President. In the unavailability, absence or disability of thePresident, the Vice President shall perform all the duties of the President andwhen so acting shall have all the powers of, and be subject to all the restrictionsupon, the President. He or she shall have such other powers and perform suchother duties, including co-signatory powers on accounts, as from time to time maybe prescribed by the BoArd or the Bylaws.

Secretary. The Secretary shall keep or cause to be kept at theprincipal office or such other place as the Board may order, a book of minutesof all meetings of the Board of Directors and Members, with the time andplaceof holding same, whether regular or special, and if special, how authorized, thenotice thereof given, the names f those present at Board of Director? meetings,the number of Members present (iii person or by proxy) at Members' meetings,and the proceedings thereoL The Secretary shall keep, or cause to be kept,appropriate current records showing the Members of the Association, togetherwith their addresses. He or she shall give, or cause to be given, notice of allmeetings of the Board required by the Bylaws or bylaw, and he or she shall keepthe seal of the Association (if any) in safe custody, and shall have such otherpowers and perform such other duties, including co-signatory powers on accounts,as may be prescribed by the Board or by the Bylaws.

Treasurer. TheTreasurer shall keep and maintain, or cause to bekept and maintained, adequate and correct accounts of the properties and businesstransactions of the Association, including accounts of its assets, liabilities,

8

9ARTiCLE V - Bo*PD OF DutEerogs

receipts, disbursements, gains; losses, capital, reserves, and other matterscustomarily included in homeowner association financial statements. The financialrecords shall at all times be open to inspection by any Director.

The Treasurer shall deposit, or cause to be deposited, all monies and othervaluables in the name of and to the credit of the Association with suchdepositories as may be designated by the Board of Directors. The Treasurershall disburse or cause to be disbursed, the fundsof the Association as may beordered by the Board of Directors, shall render to the President and Directors,whenever they request it, an account of all of his or her transactions as Treasurerand of the financial condition of the Association and shall have such otherpowersand perform such other duties, including co-signatory powers on accounts, as maybe prescribed by the Board of Directors, the President or these Bylaws.

The Treasurer shall be responsible for annually reviewing the provisionsof the Davis-Stirling Common Interest Development Act (Civil Code Section1350, et seq.) and inaldng recommendations to the Board of Directors of anychanges in financial procedures and/or reporting practices that may be requiredby new or amended sections. The Treasurer may consult 'with the Association'sattorney, certified public accountant, and/or manager on these matters.

ARTICLE VIBOARD MIEETJNGS

Section 1. RegularMeetinc's Regular meetings of the Board of Directors shall be heldmonthly; provided, however, that if the Board shall determine that the business to be transactedby the Board does not reasonably justify monthly meetings, regular meetings of the Board shallbe held at such intervals as the Board may determine, but not less frequently than once everythree (3) months. Regular meetings shall be held at Village Serranionte and the time and placefixed by the Board.

Section 2. Special Meetings. Special meetings of the Board shall be held when calledby the President of the Association, or by two Directors.

Section 3. Notice.

The Board shall adopt reasonable procedures and time frames to conveynotice to the Directors and permit attendance by Members at meetings of the Board ofDirectors. This may include adopting a routine thy of the month, time and place.

Nothing contained in subsection (a) above shall be construed to prohibittelephone meetings which are convened to address emergency or other urgent matters.

Section 4. Ouorum Requirements. Three (3) Directors shall constitute a quorum forthe transaction of business. Every act done or decision made by the Directors present at a dulyheld meeting at which a quorum is present shall be regarded as the act of the Board (seeflhifornia Nonprofit Mutual Benefit Corporation Law, especially those provisions relating to (a)approval of contracts or transactions in which a Director has a direct or indirect materialfinancial interest, (b) appointment of committees, and (c) indemnification of Directors). Ameeting at which a quorum is initially present may continue to transact business, notwithstanding

Section 7.following:

employees,funds;

AirncLE VI- BoARD Mgnncs

the departure of Directors below a quorum, if any action taken is approved by at least the samenumber of Directors as would have been required at the outset of the meeting.

Section 5. Action Without Meeting. On an urgency basis, the Board shall have theright to take any action that may be required for the efficient and expeditious operation andconduct of the Association's business without a meeting (including by consequtive or groupconference telephone call) if (i) the Board would have the power and authority to act at ameeting and (ii) the written consent of all Directors to such action is obtained before or aftersuch action. Any action taken by written consent shall have the same effect as if it were takenat a duly noticed meeting of the Board. The consents and a summary of decisions.made shallbe ified with the minutes or other documentation of Board activity. Such action without ameeting is, however, generally discouraged because it is inconsistent with the general rights ofMembers to attend meetings.

Section 6. Participation by Members. With the exception of executive sessions of theBoard (see Section 7 below) and any meetings conducted by conference telephone or in a judicialproceeding, all meetings of the Board shall be open to attendance by Members of theAssociation; provided, however, that Members of the Association who are not Directors shallhave no -right to participate in any deliberations or discussions of the Board unless expressly soauthorized by theBoard. The Board may, at its discretion, exclude any person not a Memberfrom the meeting. The agenda for Board meetings may include a specific time for Memberquestions and comments. The chair shall be authorized to impose reasonable time limitations onMember questions and comments.

known or suspected failure of an Officer or Director to fulfill theresponsibilities set forth in the Governing Documents;

unsatisfactory performance of contractors and vendors;

emergency situations or circumstances demanding immediate or promptattention;

any business in which maintenance of the confidentiality of Boarddeliberations is consistent with the best interests of the Association and its Members.

The Board may, with the approval of two of the Directors, adjourn any regular or specialmeeting for purposes of reconvening an executive session to discuss matters described above.Before adjourning into executive session at any open meeting, the topic(s) to be discussed in suchsession shall be announced, in general terms, to the Members in attendance at the meeting.

10

Executive Session. The Board may meet in executive session to discuss the

litigation in which the Association is or may become a party;

personnel matters regarding employees;

known or suspected violations of the Governing Documents;

known or suspected financial wrongdoings of Officers, Directors,managing agent (if any), or any Person or organization handling Association

11

AItTICLE VII- COMMrflrs

ARTICLE VIICOMMFfltES

Section 1. Generally. Notwithstanding any grant of authority from the Board, nocommittee shall have the power to:

take any final action on any matter that, under California Nonprofit MutualBenefit Corporation Law or these Bylaws, also requires the approval of the Members,fill vacancies on the Board or any committee,amend or repeal Bylaws or adopt new Bylaws,amend or repeal any resolution of the Board orappoint committees of the Board or Members thereot

Section 2. Nominating Committee. The Board shall appoint a Nominating Committeewhich shall consist of a Chairperson, and two (2) or more Members of the Association none ofwhom are members of the Board of Directors. The Nominating Committee shall be appointedby the Board of Directors prior to each annual meeting of the Members, and shall serve fromthe close of such annual meeting until the close of the next annual meeting. The Nominatingcomnuttee shall make as many nominations for election to thefl Board of Directors as it shall,in its discretion, determine; but not less than one more than the number of vacancies that are tobe filled.Section 3. Other Committees. The Board may appoint such other committees as itdeems appropriate in carrying out the purposes of the Association.

ARTICLE VIIIDUTIES AND POWERS OF THE BOMth

Section 1. Generally, The Board shall have the power to:Exercise all powers vested in the Board under the Governing Documentsand under the laws of the State of California.

Appoint, remove and/or reassign all Officers of the Association, theManager of the Association, if any, and other Association employees; prescribe anypowers and duties for such persons that are consistent with law and the GoverningDocuments- and fix their compensation

Appoint such agents and employ such other employees, including attorneysand accountants, as it sees fit to assist in the operation of the Association, and to fix theirduties and to establish their compensation

Enforce all applicable provisions of the Governing Documents relating tothe control, management and use of the Units within Village Serramonte and theCommon Areas and parking areas within Village Serramonte.

ARTicLE VIII- Duns & POWERS OF ThE Boc1u)

(e) Contract for and pay premiums for fir; casualty, liability, and otherinsurance and bonds cmcluding indemnity bonds) that may be required from time to timeby the Association.

(1) Contract and pay for maintenance, landscaping, utilities, materials,supplies, labor, and services that may be required from time to time in relation to theCommon Areas and other portions of ViIbge Serrainonte which the Association isobligated to maintain.

Pay all taxes, special assessments and other assessments, and charges thatare or would become a lien on any portion of the Common Areas.

Contract and pay for construction or reconstruction of any portion orportions of Village Serramonte that have been damaged or destroyed and that are to berebuilt by the Association.

Delegate its duties and powers hereunder to one or more Officers of theAssociation or to committees established by the Board, subject to the limitationsexpressed in Article VII entitled Committees.

Q) Levy and collect Assessments from the Members of the Association inaccordance with the Declaration.

(k) Perform all acts required of the Board under the Declaration.(1) Prepare budgets and maintain a full set of books and records showing the

financial condition of the affairs of the Association in a manner consistent with the Davis-Stirling Act and generally accepted accounting principles, and prepare an annual financialreport, a copy of which shall be delivered to each Member as provided in theDeclaration.

Appoint a nominating committee for the nomination of persons to beelected to the Board and prescribe rules under which said nominating committee is to act.

Appoint such other committees as it deems necessary from time to time inconnection with the affairs of the Association.

Fill vacancies on the Board of Directors or in any committee, except avacancy created by the removal of a Director by the Members.

Open bank accounts and borrow money on behalf of the Association anddesignate the signatories to such bank accounts.

Bring and defend actions on behalf of more than one Member or theAssociation to protect the interests of the Members or the Association, as such, as longas the action is pertinent to the operations of the Association, and assess the Membersfor the cost of such litigation. Any disciplinary action againsta Member shall be subjectto the hearing and procedural requirements set forth in the Declaration.

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13

Anw VIII- DuTms & Powats OF ThE

(r) Enter Units as necessary, subject to the notice requirements of theDeclaration, in cozmectj with constiuctj maintenajice or emergency repairs for thebenefit of the Common Areas or the Owners in common.(s) Adopt parliaznentaiy procedures for conducting meetings and make a copyof such procedures available to Members upon request.(t) Negotiate, settle and/or otherwise dispose of disputes and litigation.(u) After consultation with the Association's certified public accountant and/orcounsel, at its discretion and/or in conjunction with a vote of theMembers, establish andmaintain an earthquake contingency fund which shall be accounted for in such similarmanner as a reserve account. Such funds may be in conjunction with or in lieu ofearthquake insurance.

In addition to the terms of the Bylaws and theDeclaration the Association is governed by the Davis-Stirling Common Interest DevelopmentAct (Civil Code Section 1350, et seq.), including provisions related to financial documents,operating and reserve accounts and regular and special Assessments. Because the legislatureperiodically amends the Davis-Stfr&g Act, the Board of Directors shall annually consult withthe Treasurer as to any changes in financial procedures and reporting that may be required bynew or amended sections and shall conform the Association's practices accordingly.Power of Board. Without the vote or written assent of fifty-one percent (51 %)of the Members (91 votes), the Board of Directors shall not take any of thefollowing actions:

(a) Enter into a contract with a third party for the furnishing of goods orservices to the Connuon Area or the Association for a term longer than one year. Thisrestriction shall not apply to:

public utility contracts in which the rates charged for materials orservices are regulated by the Public Utilities Commission, provided that the termof the contract may not exceed the shortest term for which the supplier willcontract at the regulated rate;

prepaid casualty or liability insumnce policies not to exceed threeyears' duration, provided that the policies provide for short-rate cancellation bythe insured;

agreements for cable television services and equipment or satellitedish television services and equipment not to exceed five years' duration;agreements for sale or lease of burglar alarm and fire alarmequipment, installation and services not to exceed five years' duration; or

(v) agreements that may be terminated without cause upon thirty (30)days notice.(b) Sell during any fiscal year property of the Association having an aggregatefair market value greater than .5 percent of the budgeted gross expenses of the Association

14

ARncz Vifi - DunEs & PowERs OF Ti 30Mw

for that fiscal year, provided, however, that this limitation shall not apply to the sale orother disposition of Units acquired by the Association in foreclosure proceedings or byway of collection of a judgment.

Fill any vacancy on the Board of Directors created by the removal of aDirector by the Members.

Section 4. Inspection of Books and Records.

Member Inspection Rights. Annual reports, adopted budgets, reservestudies, minutes of proceedings of the Members, the Board and committees of theBoard, and the membership list of the Association shall, during reasonable businesshours, be subject to the inspection of any Member or his or her duly appointedrepresentative at the offices of the Association for any proper business purposereasonably related to the Member's interest in the Association. Members' rights ofinspection shall be exercisable on ten days' written demand on the Association, whichdemand shall state the purpose for which the inspection rights are requested. In the caseof the demand to inspect the Association's membership list, aMember's inspection rightsshall be subject to the Association's right to offer areasonalile alternative to inspectionwithin ten days after receiving the Member's written demand.

Director Inspection RiEhts. Every Director shall have an absolute rightat any reasonable time to inspect ali books, records, documents, and minutes of theAssociation and the physical properties owned or controlled by the Association. Theright of inspection by a Director includes the right to make extracts and copies ofdocuments.

(c)- Adoption Of Reasonable Inspection Rules. The Board of Directors mayestablish reasonable rules with respect to (i) notice of inspection, (ii) hours and days ofthe week when inspection may be made, (iii) location of the documents to be inspectedand (iv) payment of the cost of reproducing copies of documents requested by theMember.Section 5. Rules. The Board shall have the power to adopt and establish Rules subjectto the provisions oftheJ)ecjaratjon governing the use of the Common Areas, including parking

areas within Village Serramonte, and the personal conduct of the Members and their guests,tenants or others on the premises.

Section 6. Manager. The Board may employ the services of a manager to manage theaffairs of the Association and upon such conditions as are otherwise deemed advisable by theBoard, the Board may delegate to the manager any of its day-to-day management andmaintenance duties and powers under these Bylaws and the Declaration, provided that themanager shall at all times remain subject to the general control of the Board.

Section 7. Enforcement. The Association shall have the power to enforce theprovisions of the Governing Documents in any manner provided by law or in equity and in anymanner provided in the Governing Documents in accordance with the procedures therein.

AnnE IX - JNDEMNIFICXfl0u

ARTICLE IXINDEMNIFICATION

Section 1. Indemnification of Association. Each Member shall be liable to theAssociation for any damage to the Common Areas or areas which the Association mustmaintain, repair and replace caused by the negligence or willful misconduct of the Member orhis or her fniily, guests, invitees, tenants or lessees.Section 2. Indemnification by Association of Directors. Officers, Employees, andOther Agents. The Association's duty to protect, defend and indetungy its volunteers forpotential liability for their activity while engaged in Association business is largely provided forin (a) the Association's insurance, including the liability insurance in the case of damage toperson or property, or (b) by the Corporations Code, specifically section 7237. In the event thatany claim of indemnification is made to the Association by such individual, the Associationshall, in a timely way, tender the claim to its broker and/or insurance carriers. To the extentthat the individual seeking indemnjflcjon has exposure to any uninsured loss, the Associationshall also submit the matter to its counsel for a legal opinion as to Association obligations.

Section 3. Advancement of Expenses. To the extent that there may be some uninsuredexposure and costs of defense incurred, the Board shall have the discretion to advance thosecosts on behalf of the accused volunteer, however, it must be noted that the Corporations CodeSection 7237(f) requires a posting of a bond or other assurance to cover such expenses.Section 4. Insurance. The Association shall have the power to purchase and maintainthat insurance commonly known as Directors and Officers Liability.Insurance. It should be notedthat this is separate and distinct from general liability insurance which covers damage to personsand property.

Section 5. Limitaflon on Personal Liability of Individual Directors.No action shall be brought against an individual Director unless expresslypernutted by the provisions of Civil Code Section 13653.No suit or action againg a Director or officer of the Association personally shallbe sustainable in any court unless commenced within twelve months of the date claimant knewor should have known of alleged misconduct and/or the inception of damage or injury.

ARTICLE XTAX EXEMVF STATUS

Section 1. Tax-Exempt Status. The Board of Directors shall take all steps reasonablypossible to insure the continued tax exempt status of the Association.Section 2. Fiqg. The Board shall cause to be timely filed an annual designation fortax-exempt status as may be required under federal or state law, and shall undertake to cause theAssociation to comply with the statutes, rules and regulations adopted by federal and stateagencies pertaining to such exemptions.

ARTICLE XIMISCELLANEOUS

Section 1. Amendment of Bylaws. These Bylaws may by adopted, amended, orrepealed only by the affirmative vote of a majority of a quorum of the membership representedand voting at a duly held meeting at which a quorum is present or by written ballot. Any15

NOTICE

"If this document contains any restrictions based onrace, color, religion, sex, familial status, marital status,disability, national origin or ancestry, that restrictionviolates state and federal fair-housing laws and is void,and may be removed pursuant to subdivision ofSection 12956.1 of the Government Code. Lawfulrestrictions under state and federal law on the age ofoccupants in senior housing or housing for olderpersons shall not be construed as restrictions based onfamilial status."

CC&Rs (Required Civil Code Sec. 4525)The Village Serramonte Homeowners Association

DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS

OF THE VILLAGE SERRAMONTE

HOMEOWNERS ASSOCIATION (As Amended in 1995)

TABLE OF CONTENTS RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 1. Legal Description . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 2. The Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 3. This Amended Declaration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 4. Applicability of Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE I DEFINITIONS Section 1. Articles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2. Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 3. Association . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 4. Balcony . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 5. Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 6. Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 7. Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 8. Condominium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 9. Declaration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 10. Exclusive Use Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 11. Family . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 12. Garage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 13. Governing Documents . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 14. Member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 15. Owner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 16. Parking Stall . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 17. Patio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 18. Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 19. Property or Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 20. Townhouse Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 21. Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 22. Village Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Feingold & Youngling, PLC (415) 454-1090 i

DECLARATION OF COVENANTS,

CONDITIONS AND RESTRICTIONS OF THE

VILLAGE SERRAMONTE HOMEOWNERS ASSOCIATION

(As Amended in 1995)

TABLE OF CONTENTS Continued ARTICLE II NO PARTITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 1. Waiver of Partition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 (a) Prohibition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 (b) Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 2. Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 ARTICLE III POWERS AND DUTIES OF THE ASSOCIATION . . . . . . . . . . . . . . . . . . . 5 Section 1. Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 2. Common Area Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 3. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 4. Legal and Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 5. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 6. Discharge of Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 7. Other Obligations of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 8. Authority for Reasonable Entry for Maintenance or Construction . . . . . . 6 Section 9. Manager . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 10. Consolidation and Mergers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 11. Dedication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 12. Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 (a) Rulemaking and Policy Making Power . . . . . . . . . . . . . . . . . . . . . . . . 6 (b) Amendment of Rules and Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 (c) Distribution of Rules and Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 (d) Breach of Rules, Policies or Restrictions . . . . . . . . . . . . . . . . . . . . . . . 7 Section 13. Limitations on Authority of Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 ARTICLE IV ASSESSMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 1. Assessments Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 (a) Regular Assessments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 (b) Special Assessments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 (i) Non-Emergency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 (ii) Emergency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

ii




TABLE OF CONTENTS Continued (c) Reimbursement Assessments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (i) Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (ii) Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (iii) Collection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 2. Assessment Level Increases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (a) Approval of Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (b) Approval of the Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 3. Enforcement of Assessments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (a) Delinquency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 (b) Bounced Checks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 (c) Acceleration of Annual Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . 10 (d) Lien . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 (e) Nonjudicial Foreclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 (f) Other Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Section 4. Grantee Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 (a) Voluntary Conveyance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 (b) Conveyance by Foreclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 (c) Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5. No Waiver or Offset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 ARTICLE V RESPONSIBILITIES FOR MAINTENANCE, REPAIR AND REPLACEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 1. Association and Owner Responsibilities for Maintenance, Repair and Replacement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 (a) Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 (b) Unit Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 (c) Exclusive Use Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 (i) Decks and Balconies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 (ii) Village Unit Parking Stalls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 (iii) Fireplace and Chimney Flue . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 (v) Planters and Pots . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 (vi) HVAC Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 (d) Landscaping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 (i) Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

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TABLE OF CONTENTS Continued (ii) Exclusive Use Common Area . . . . . . . . . . . . . . . . . . . . . . . . . 14

(e) Wood Destroying Organisms (Including Decay, Dryrot and Termites) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14

(f) Hazardous Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 (g) Protection from Freeze Damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 (h) Earthquake Damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Section 2. Enforcement . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 (a) Common Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 (b) Unit and Exclusive Use Common Area . . . . . . . . . . . . . . . . . . . . . 15 (c) Entry for Repairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 (d) Continuing Nuisance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 (e) Other Options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 ARTICLE VI USE OF UNITS AND COMMON AREA . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Section 1. Use of Units. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Section 2. Use of Common Area. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Section 3. Vehicle Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 4. Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 5. Animals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 6. Attics and Crawl Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 7. Antennae, External Fixtures, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 8. Restriction on Businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 9. Exterior Wiring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 10. Variances . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 11. Illegal Acts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 ARTICLE VII SALE OR LEASE OR UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Section 1. Sale or Lease of Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Section 2. Obligations of Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

(a) Owners Duty to Notify Association of Tenant and Contract Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19

(b) Contract Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 (c) Notification Regarding Governing Documents . . . . . . . . . . . . . . . . 19

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TABLE OF CONTENTS Continued Section 3. Termination and Commencement of Obligations . . . . . . . . . . . . . . . . . 20 Section 4. Notice of Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 ARTICLE VIII INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Section 1. Types of Insurance Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 (a) Fire and Casualty lnsurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 (b) Liability Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 (c) Other Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 (d) Provisions and Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 (e) Fidelity Bond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 2. Additional Insurance by Unit Owner . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 3. Earthquake Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 4. Association Insurance Deductible . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 5. Insurance Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 ARTICLE IX EASEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 1. Utility Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 2. Encroachment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 3. Maintenance and Repair. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 4. Ingress and Egress. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 5. Balconies and Patios . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 6. Village Unit Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 7. Emergency Vehicle Easements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 ARTICLE X DAMAGE, DESTRUCTION OR CONDEMNATION . . . . . . . . . . . . . . . . . 23 Section 1. Restoration Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 2. Insured Casualty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 3. Restoration Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 4. Additional Special Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 5. Alternative Reconstruction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 6. Sale of Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 7. Rebuilding Contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Section 8. Authority to Effect Changes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

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TABLE OF CONTENTS Continued

ARTICLE XI - ARCHITECTURAL CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Section l. Architectural Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Section 2. Architectural Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Section 3. Meetings; Action; Compensation; Expenses . . . . . . . . . . . . . . . . . . . . . . . 26 Section 4. Architectural Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Section 5. Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Section 6. Determination of Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Section 7. Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Section 8. Architectural Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 (a) Notice and Opportunity for Hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 (b) Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 (c) Association Options for Continuing Nuisance . . . . . . . . . . . . . . . . . . . . 27 Section 9. Notice of Record . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 ARTICLE XII - ENFORCEMENT OF GOVERNING DOCUMENTS . . . . . . . . . . . . . . . . . 28 Section 1. Violation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 (a) Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 (b) Forum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Section 2. Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Section 3. Enforcement Options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 (a) Suspension of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 (b) Fines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 (c) Alternative Dispute Resolution (ADR) . . . . . . . . . . . . . . . . . . . . . . . . . 28 (d) Legal Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 (e) Self Help . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 (i) Maintenance, Repair and Replacement . . . . . . . . . . . . . . . . . . . 29 (ii) Removal of Nuisance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 (f) Imposition of Reimbursement Assessment . . . . . . . . . . . . . . . . . . . . . . 29 Section 4. Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 (a) The Association Sets a Hearing Date . . . . . . . . . . . . . . . . . . . . . . . . . 29 (b) The Party Requests a Hearing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 (c) Pressing Circumstances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 (d) Due Process Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

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TABLE OF CONTENTS Continued (i) Findings of Fact and Determination . . . . . . . . . . . . . . . . . . . 30 (ii) Right to Appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 (e) Referral to Governmental Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 (f) Owner Standing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Section 5. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (a) Content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (b) Conveying . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Section 6. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (a) Cumulative Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (b) Non-Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (c) Rules re: Disciplinary Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (d) Recording with Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (e) Notices to Mortgagees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 (f) Noncompliance with Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

(g) Fees and Costs of Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 ARTICLE XIII - GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Section 1. Mechanics' Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Section 2. Term of Declaration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Section 3. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Section 4. Right of City to Compel Performance . . . . . . . . . . . . . . . . . . . . . . . . . . 32 (a) City's Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 (b) Costs of Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 (c) Amendment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Section 5. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Section 6. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Section 7. Gender, Number, and Captions.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Section 8. Prior Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Section 9. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Section 10. Davis-Stirling Common Interest Development Act . . . . . . . . . . . . . . . . 34

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DECLARATION OF COVENANTS,

CONDITIONS AND RESTRICTIONS OF THE

VILLAGE SERRAMONTE HOMEOWNERS ASSOCIATION

(As Amended in 1995)

This Declaration of Covenants, Conditions and Restrictions of THE VILLAGE SERRAMONTE HOMEOWNERS ASSOCIATION ("Declaration" or "CC&Rs") is an amended version of the original Declaration entitled "Declaration of Covenants, Conditions and Restrictions of Village Serramonte, A Condominium Project" which was recorded in the Office of the San Mateo County Recorder on August 15, 1974, in Volume 6678, Page 313, et seq. File 73050AH, and as may have been subsequently amended (hereinafter "Former Declaration ").

RECITALS

1. Legal Description: This Declaration governs all of the real property and improvements

thereon located in the City of Daly City, County of San Mateo, State of California, and more particularly described as follows:

Units 1 through 177, inclusive, and the Common Area all as shown on that certain Final Subdivision Map entitled Map of Village Serramonte, A Condominium Project, on Lot 1 on the Map of Serramonte Village recorded in Book 83 of Maps at Pages 21 through 24, San Mateo County Records, City of Daly City, California, recorded in the Office of the Recorder of San Mateo County, State of California, on the 11th day of June, 1974, in Book 85 of Maps at Pages 1-17 (hereinafter referred to as "the Subdivision Map" or "the Map"). 2. The Property. There are 177 Condominiums in Village Serramonte which is a

Condominium Project within the meaning of the provisions of the California Davis-Stirling Common Interest Development Act (commencing at California Civil Code Sections 1350). There are two different types of units at Village Serramonte: those described as "Townhouse Units", defined below, and depicted on the site map attached hereto as Exhibit B as buildings C2 and D5; and those described as "Village Units", defined below, and depicted on the site map attached hereto as Exhibit B as buildings A4, Al, E9, E8, E7, and E6. The site map attached is for general depiction of the Property and as a convenient reference. It is not part of any legal description.

3. This Amended Declaration. The Association determined that its Former Declaration, filed

in 1974, is outdated. Therefore, in 1995 the Members caused this Declaration to supersede the Former Declaration. This Declaration is for the purpose of enhancing and protecting the value, desirability and attractiveness of Village Serramonte, as well as the quality of life of the residents.

4. Applicability of Restrictions. As amended, these covenants, conditions and restrictions

shall run with the Properties and shall be binding on all parties having or acquiring any right, title or interest in any portion of the Properties in the same manner as the Former Declaration, and shall be for the benefit of all Owners.

ARTICLE I

DEFINITIONS