EN ERED

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DECLARATIONS OF RESTRICTIONS
OF ROUND TREE ESTATES ASSOCIATION
(COVENANTS, CONDITIONS & RESTRICTIONS)

Table of Contents

ARTICLE 1 DEFINITIONS        3

ARTICLE 2 — PROPERTY SUBJECT TO THIS DECLARATION        5

ARTICLE 3 — OWNERSHIP AND EASEMENTS        6

ARTICLE 4 — LOTS AND HOMES        8

ARTICLE 5 COMMON AREA        15

ARTICLE 6 — ARCHITECTUAL REVIEW COMMITTEE        16

ARTICLE 7 — ROUND TREE ESTATES HOMEOWNERS ASSOCIATION        19

ARTICLE 8 — DECLARANT CONTROL        20

ARTICLE 9 — DECLARANT'S SPECIAL RIGHTS        20

ARTICLE 10 — FUNDS AND ASSESSMENTS        22

ARTICLE 11 — GENERAL PROVISIONS        27

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ARTICLE 1-- DEFINITIONS

Wherever used in this Declaration, the following terms shall have the following meanings:

1.1        "Additional Definitions" — Except as otherwise provided in this Declaration,

unless the context clearly requires otherwise, terms used in this Declaration that are defined in ORS 94.550 have the meanings set forth in ORS 94.550.

1.2        "Architectural Review Committee" or "ARC" shall mean the Declarant until

turnover and thereafter shall refer to the Board of Directors unless the Board has appointed a separate body to carry out the functions described in Article 6 in which case "ARC" shall refer to this body.

13        "Articles" shall mean the Articles of Incorporation for the mutual benefit

corporation, Round Tree Estates Association, or such similar name approved by and filed with the Oregon Secretary of State.

1.4        "Association" shall mean and refer to Round Tree Estates Association, its

successors and assigns.

1.5        "Board" or "Board of Directors" shall mean the Board of Directors of Round Tree

Estates Homeowners Association.

1.6        "Bylaws" shall mean and refer to the Bylaws of the Association, which shall be

properly adopted and recorded in the County of Crook.

1.7        "Common Property" means any real property or interest in real property that is

owned or leased by the Association or owned as tenants in common by the Owners, and specifically includes the private roadway, gate, and culvert area.

1.8        "Declarant" shall mean and refer to Round Tree Estates, LLC, its successors or

assigns, or assign to any of its interests in the development of the Property. "Declarant" shall not refer to any other subsequent purchaser of a Lot.

1.9        "Dwelling house" and "garage" shall include both the main portion of such

structures and all projections therefrom but shall not include the eaves of such structures, nor uncovered front porches or steps.

1.10 "General Common Expenses" shall mean those expenditures made or liabilities incurred by the Association, including reserves. Such definition should also apply to the words, "Common Expenses" as used in this Declaration.

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1.11 "Improvement" means any structure or improvement of any kind, including, without limitation, decks, porches, awnings, fences, garages, carports, driveways, sheds, or other product of construction efforts on or in respect to the Lot.

1.12 "Lot" means one of the numbered parcels on the Plat.

1.13 "Members" shall mean and refer to the Owners of Lots in Round Tree Estates Association and who are members of the Round Tree Estates Homeowners Association.

1.14 "Occupant" means any individual residing on a Lot, including Owners, tenants, guests, and family members.

1.15 "Owner" means the person or persons owning any Lot and who is listed as the record owner in the county records. The foregoing does not include persons or entities that hold an interest in any Lot merely as security for the performance of an obligation.

1.16 "Plat" means the plat of Round Tree Estates Association and all subsequent phases recorded in Crook County, Oregon.

1.17 "Property" means all real property depicted on the Plat.

1.18 "Round Tree Estates" shall mean the real property described in the Plat of Round Tree Estates, and any annexations of additional lands to Round Tree Estates Association and all Common Area included within the Plat of Round Tree Estates.

1.19 "Rules and Regulations" shall mean and refer to the documents containing rules and regulations and policies adopted by the Board of the Association or the Architectural Review Committee and as may be from time to time amended by the Board and/or Architectural Review Committee.

1.20 "Setback" means the minimum distance between the dwelling house or other structure referred to and a given street or line.

             1.21 "Street" means any street, highway, or other thoroughfare as shown on said plats.

1.22 "Street frontage" means that portion of a lot or building site which borders on a

street.

1.23 "Turnover Meeting" shall mean the meeting called by the Declarant to turn over control of the Association to the Class A members.

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ARTICLE 2 — PROPERTY SUBJECT TO THIS DECLARATION

        2.1        The real property which is and shall be held, transferred, sold, conveyed, and

occupied subject to this Declaration and is located in County of Crook, Oregon, in that certain plat map entitled "ROUND TREE PLANNED DEVELOPEMENT" filed in the plat records of Crook County, Oregon.

        2.2        At any time during the initial term of this Declaration, the Declarant

may, at its sole option, annex additional property into the Association to be subject to the terms hereof to the same extent as if originally included herein and subject to such other terms, covenants, conditions, easements and restrictions as may be imposed thereon by Declarant. Declarant shall have no obligation of any kind to annex any additional land to the Property.

2.2.1 Eligible Property. There is no limitation on the number of Lots, which Declarant may annex to the Property, or the right of Declarant to annex common property, except as may be established by applicable ordinances, agreements, or land use approvals.

2.2.2 Consent or Joinder Not Required. No consent or joinder of any Class A member as defined in this Declaration or other party except the record owner of the land being annexed shall be necessary to effect any annexation made pursuant to this Section.

2.2.3 Declaration of Annexation. Annexation shall be evidenced by a written Declaration of Annexation executed by Declarant, or (in the case of an annexation by action of members) by the Board and the owners of the property being annexed, setting forth the legal description of the property being annexed and any additional covenants, conditions, and restrictions to applied to such annexed property. Notwithstanding any provision apparently to the contrary, a declaration with respect to any annexed property may:

        2.2.3.1        establish such new land classifications and Types of Lots and such

limitations, uses, restrictions, covenants, and conditions with respect thereto as Declarant may deem to be appropriate for the development of the annexed property;

        2.2.1.2        with respect to existing land classifications, establish additional or

different limitations, uses, restrictions, covenants and conditions with respect thereto as Declarant may deem to be appropriate for the development of such annexed property; and/or

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2.2.3.3        contain provisions necessary or appropriate to comply with any

condition, requirement, or imposition of any governmental or regulatory authority.

Without limitation of the meaning of the foregoing provisions of this Section, in any Declaration of Annexation the Declarant may, but shall not be obligated to, establish different Types of Lots and have particular rights and obligations pertain to different Types of Lots, establish easements particular to different Lots, establish assessments that

pertain only to certain Types of Lots, establish maintenance, obligations of the Association or of Owners that vary in accordance with different Types of Lots, establish insurance and casualty provisions that-relate to certain Types of Lots and not others, and establish limited common areas that benefit particular Lots to the exclusions of other Lots and provisions particular to such limited common areas.

2.2.4 Voting Rights; Allocation of Assessments. Upon annexation, additional Lots so annexed shall be entitled to voting rights and shall be responsible for payment of assessments as required for that fiscal year. At the beginning of the next fiscal year, assessments for the general common areas shall be apportioned equally based upon the total number of Lots following such annexation, but assessments that are relative to a specific product type will be spread equally over only the units of that type.

2.2.5 No Duty to Annex. Nothing herein contained shall establish any duty or obligation on the part of the Declarant or any member to annex any property into the Association and no owner of property excluded from the Association shall have any right to have such property annexed thereto. Declarant is under no obligation to build any Dwelling houses or garages on any or all of the Lots contained in the original Plat.

ARTICLE 3 — OWNERSHIP AND EASEMENTS

3.1        Non-Severability. The interest of each Owner in the use and benefit of the

Common Area shall be appurtenant to the Lot owned by the Owner. No Lot shall be conveyed by the Owner separately from the interest in the Common Area, subject to the provisions of Section 3.3. Any conveyance of any Lot shall automatically transfer the right to use the Common Area without the necessity of express reference in the instrument of conveyance. There shall be no judicial partition of the Common Area. Each Owner, whether by deed, gift, devise or operation of law, for his/her own benefit and for the benefit of all other Owners, specifically waives and abandons all rights, interests and causes of action for judicial partition of any interest in the Common Area and does further agree that no action for judicial partition shall be instituted, prosecuted or reduced to judgment. The ownership interest in the Common Area and Lots described in this Article are subject to the casements granted and reserved in this Declaration for

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drainage, needed maintenance support and maintenance of the exterior appearance for the Building Structures. Each of the easements reserved or granted herein shall be deemed to be established upon the recordation of this Declaration and shall forever be deemed to be covenants running with the land for the use and benefit of the Owners and their Lots and shall be superior to all other encumbrances applied against or in favor of any portion of Round Tree Estates.

        3.2        Ownership of Lots. Title to each Lot in Round Tree Estates shall be conveyed in

fee to an Owner. If more than one person and/or entity owns an undivided interest in the same Lot, such person and/or entities shall constitute one Owner.

        3.3        Ownership of Common Areas. Title to the Common Area, if any, shall be

conveyed to the Association not later than sixty (60) days after seventy-five percent (75%) of the Lots have been conveyed to purchasers or seven years from the date this Declaration is recorded, whichever is earlier. The Board of Directors may convey title to any present or future Common Area Tracts, if any, to a City, County or other Government agency. The Association, with the approval of 75% of the Association membership, may sell, convey or mortgage the Common Area.

        3.4        Easements. Individual deeds to the Lots may, but shall not be required to, set forth

the easements specified in this Article.

3.4.1 Easements on Plat. The Common Area and Lots subject to the easements and rights of way shown on, or noted, on the plat of Round Tree Estates.

3.4.2 Easement for Common Area. Every Owner shall have a nonexclusive right and easement of use and enjoyment in and to the Common Area, which shall be appurtenant to and shall pass with the title to every Lot.

3.4.3 Easements Reserved by Declarant. So long as Declarant owns any Lot, Declarant reserves an easement over, under and across the Common Areas in order to carry out sales activities necessary or convenient for the sale of Lots. In addition, Declarant hereby reserves to itself; and for its successors and assigns, a perpetual easement and right-of-way for access over, upon and across the Common Areas for construction, utilities, communication lines, drainage, and ingress and egress for the benefit of the Lots or other property owned by Declarant. Declarant, for itself and its successors and assigns, hereby retains a right and easement of ingress and egress over, in, upon, under and across the Common Area and the right to store materials thereon and to make such other use thereof as may be reasonably necessary or incident to the construction of the improvements on the Property or other real property owned by Declarant in such a way as to not unreasonably interfere with the occupancy, use, enjoyment or access to an Owner's Lot by that Owner or his/her family, tenants, guests, or invitees.

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3.4.4 Additional Easements. Notwithstanding anything expressed or implied to the contrary, this Declaration shall be subject to all easements granted by Declarant for the installation and maintenance of utilities and drainage facilities necessary for the development of Round Tree Estates. No structure, planting or other material shall be placed or permitted to remain within any easement area which may damage or interfere with the installation or maintenance of utilities, or which may change the direction of flow of drainage channels in the easements, or which may obstruct or retard the flow or water through drainage channels in the easements. The easement area of each Lot and all improvements thereon shall be maintained continuously by the Owner of the Lot, except for those improvements for which a public authority, utility company or the Association is responsible. In addition, an easement is specifically reserved to the Owners of any contiguous Home in each structure, and the Association, as their interests may exist, for access to, and right of repair or service to utility and/or drainage lines and facilities which exist on each Lot for common use of Owners in said structure.

3.4.5 Association's Easements. There are hereby reserved to the Association and its duly authorized agents and representatives such easements as are necessary to perform the duties and obligations of the Association set forth in this Declaration, Bylaws, and Articles.

3.4.6 Easement to Governmental Entities. There is hereby reserved and granted a non-exclusive easement over the Common Area to all governmental and quasi-governmental entities, agencies, utilities, and their agents for the purposes of performing their duties within Round Tree Estates. Where applicable, however, Association may be subject to compensation for the taking or use of such easement rights.

3.4.7 Maintenance Easement. An easement is hereby reserved in favor of the Association and its successors, assigns, contractors, agents, and employees over, across, and under each Lot, the exterior portions of the dwelling units on each Lot, the Common Areas, and any other areas of the Property necessary or appropriate for the purposes of accomplishing the maintenance, repair, and replacement of Improvements.

                ARTICLE 4 — LOTS AND HOMES

4.1        Residential Use. Lots shall be used for residential purposes only. Except with the

consent of the Board of Directors of the Association, no trade, craft, business, profession, commercial or similar activity of any kind shall be conducted on any Lot, nor shall any goods, equipment, vehicles, materials or supplies used in connection with any trade, service or business be kept or stored on any Lot. Nothing in this paragraph shall be deemed to prohibit (a) activities relating to the sale of residences, (b) the right of Declarant or any contractor or homebuilder to construct residences on any Lot, to store construction materials and equipment on such Lots in

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the normal course of construction, and to use any residence as a sales office or model home for purposes of sales, to maintain on site a temporary construction office or trailer, and (c) the right of the Owner of a Lot to maintain his/her professional or personal library, keep his/her personal business or professional records or accounts, handle his/her personal business or professional

telephone calls or confer with business or professional associates, clients or customers, in his/her residence, so long as such activity is not observable outside of the residence, does not significantly increase parking or vehicular traffic, or is in violation of applicable local government ordinances. The Board of Directors shall not approve commercial activities otherwise prohibited by this paragraph unless the Board determines that only normal residential activities would be observable outside of the residence and that the activities would not be in violation of applicable local government ordinances.

        4.2        Construction. Except for construction performed by or contracted for by

Declarant, no construction, reconstruction or exterior alterations shall occur on any Lot, unless the approval of the ARC is first obtained pursuant to Article 6. Consideration such as siting, shape, size, color, design, height, solar access, or material may be taken into account by the ARC in determining whether or not to consent to any proposed work. Such work includes, but is not limited to homes, storage shelters, swimming pools, spas, landscaping, greenhouses, patios, fencing, basketball hoops or remodeling. The intent of this covenant is to ensure quality of workmanship and material, harmony of external design with the existing and planned structures as to location and visual compatibility and finish grade elevations. Original construction designs, materials and product specifications by Declarant may vary from any or all specified in this document. All construction performed by or contracted for by Declarant, shall be presumed to have met these minimum requirements or have been granted a variance thereto.

        4.3        Minimum Restrictions. The following restrictions are minimum standards

applicable to all Lots:

4.3.1 Types of Structures. No mobile home, manufactured home, modular home, trailer, tent, or shack be erected or constructed on any Lot.

4.3.2 Height. No Dwelling house shall exceed two (2) stories in height above the ground at street level.

4.3.3 Floor Area. The total square footage area of a residence shall not be less than sixteen hundred (1,600) square feet exclusive of patios, decks, porches, balconies, and garages.

4.3.4 Garages. A garage must be constructed on each Lot. Garages may be used

as a sales office by Declarant, but must be converted to a garage before permanent occupancy. Garages are to be maintained primarily • for the storage of automobiles or similar vehicles. No garage may be enclosed or otherwise used for habitation, nor may

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any garage door be removed except when necessary to repair or replace a garage door with the same type of garage door.

4.3.5 Driveways. All Lots shall include a driveway, and each driveway shall be made of asphalt for the first ten feet from any public or private roadway, and shall have culverts where required to prevent drainage onto Common Areas and other Lots.

4.3.6 Roofs. All roofs of all structures on Lots must be constructed of one of the following Class A fire-retardant materials:

4.3.6.1 Class A fire-retardant asphalt or fiberglass shingles;

4.3.6.2 Class A metal roofing;

4.3.6.3 Class A concrete, fired clay, fiberglass, or other fire retardant tile.

4.3.7 Security Doors/Windows and Screen Doors. No exterior security bars on windows and doors shall be installed without the prior written approval of the ARC. If the ARC approves any type window security, such approval shall encourage or require a single style for all homes so they will maintain a uniform and aesthetic appearance.

        4.4        Completion of Construction. The construction of any building on any Lot,

including painting and all exterior finish, shall be completed within twenty-four (24) months from the beginning of the construction so as to present a finished appearance when viewed from any angle. In the event of undue hardship due to weather conditions, this provision may be extended for a reasonable length of time upon written approval from the ARC. The Lot and building area shall be kept reasonably clean and in workmanlike order, free of litter, during the construction period with a garbage disposal facility located on site during such construction period. If construction has not commenced within three (3) months after the project has been approved by the ARC, the approval shall be deemed revoked unless the Owner has applied for and received an extension of time from the ARC. All provisions of this Article 4 shall exclude any construction by Declarant.

        4.5        Rental of Homes. An Owner shall be entitled to rent or lease his/her residence if

4.5.1 Written Rental Agreement Required. There is a written rental or lease agreement specifying that: (i) the tenant shall be subject to all provisions of the

Declaration, Bylaws and Rules and Regulations, and (ii) failure to comply with any provision of the Declaration, Bylaws and Rules and Regulations shall constitute a default under the rental agreement.

4.5.2 Minimum Rental Period. The period of the rental or lease is not less than thirty (30) days; and

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4.5.3 Tenants Must Be Given Documents. The Owner gives each tenant a copy of the Declaration, Bylaws, and Rules and Regulations.

4.5.4 Owner Responsibility. Owner shall be responsible for any violations by tenants and shall be solely responsible for either correcting or eliminating such violations, or getting tenant to do same.

        4.6        Shooting. No Owner nor any of his/her Occupants, guests, tenants, licensees,

agents or members of his/her family may engage in recreational hunting or shooting on any Lot or anywhere in the Common Area.

        4.7        Animals. No animals, livestock, or poultry of any kind shall be raised, bred, kept

or permitted within any Lot other than a reasonable number of domestic house hold pets which are not kept, bred, or raised for commercial purposes which are reasonably controlled so as not to be a nuisance. Any inconvenience, damage or unpleasantness caused by such pets, including noise, shall be the responsibility of the respective Owners thereof. No dogs shall be permitted to roam the Property unattended and all dogs shall be kept on a leash while outside a Lot. An Owner may be required to remove a pet from the property upon the receipt of the third notice in writing from the Association Board of Directors of violation any rule, regulation or restriction governing pets within the Property. A "reasonable number of domestic household pets" and the definition of "domestic household pets" shall be subject to rules adopted and approved by the Board in its sole discretion.

        4.8        Horses. Notwithstanding Section 4.6 above, Lots 11, 12, 13, 14, and 15 shall be

considered "Horse Lots." Each Horse Lot shall be allowed up to two (2) horses, llamas, burros, or mules (collectively, for the purposes of this Section, "Horses") on each Lot, subject to the following restrictions:

4.8.1 Location. The Horses shall not be permitted to roam the Property

unattended and shall be kept within a trailer or similar such device while not on the Property. No horseback activities shall be allowed anywhere other than on the Owner's Horse Lot.

4.8.2 Facilities. No accommodations for Horses, including fencing and paddock areas, shall be allowed in the front of any home as viewed from the main access roadway nor shall be closer than 5 feet from the property line. Such accommodations with bare dirt will be required to be covered with mulch, wood chips, or other appropriate materials to prevent soil erosion. No arenas shall be built except with the express permission of the ARC.

4.8.3 Rubbish. Horse rubbish and manure piles shall be located at the furthest point from the nearest home and shall not exceed 4 cubic yards in size.

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4.8.4 Easement. The Association is expressly given an easement to ensure compliance with this Section.

4.9        Nuisance. No noxious, harmful or offensive activities shall be carried on upon any

Lot or Common Area, nor shall anything be done or placed on any Lot or Common Area which interferes with or jeopardizes the enjoyment, or which is a source of annoyance to the other Owners or Occupants.

4.10 Parking. Parking of boats, trailers, commercial vehicles, mobile homes, campers, other recreational vehicles or equipment regardless of weight shall not be allowed in any part of the Common Area. In addition, parking of vehicles is prohibited on any public or private street or Common Area within the Property unless so designated as a parking area.

4.11 Signs. No signs shall be erected or maintained on any Lot except that not more than one "For Sale" or "'For Rent" sign placed by the Owner, or by a licensed real estate agent. The restrictions contained in this paragraph shall not prohibit the temporary placement of "'political" signs on any Lot by the Owner or Occupant, or construction and marketing related signage by the Declarant or its contractors. No signs of any kind, other than Declarant's marketing signs, and any Association signs for the common good of the community, which have been previously approved by the Board of Directors, will be allowed on Common Areas. Welcome signs on any lot shall require the approval of the ARC.

4.12 Rubbish and Trash. No Lot or part of the Common Area shall be used as a dumping ground for trash or rubbish of any kind. All garbage and other waste shall be kept in appropriate containers for timely and proper disposal, out of public view. Yard rakings, dirt and other material resulting from landscaping work shall not be dumped onto streets, the Common Areas or any other Lots. Should any Owner fail to remove any trash, rubbish, garbage, yard rakings or any such materials from any Lot, any roadways or Common Area where deposited by him/her within five (5) days following the date on which notice is mailed to him/herby the Board of Directors, the Association may have such materials removed and charge the expense of such removal to the Owner. Each Owner is responsible for trash disposal, and shall remove individual trash containers within 24 hours of collection.

4.13 Fences and Hedges. No fences or boundary hedges shall be installed without prior written approval of the ARC. Any fencing installed on Owner's Lots either by Owner, or by Declarant, will be Owner's maintenance responsibility. All fences that are Owner's responsibility are to be maintained in condition acceptable to Board and ARC. Fences on any Common Area properties and along the perimeter boundaries of the plat will be maintained by the Association. All side yard fencing shall maintain a five (5) foot setback from the front of the house. Further

no fencing will be allowed in the front yard. All fence materials, designs, and colors subject to prior approval of the ARC. All chain link fencing, including dog runs, which are visible from the street or Common Area must be approved by the ARC.

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4.14 Grades. There shall be no interference with the established drainage patterns or systems over or through any Lot within the Property so as to affect any other Lot or Common Area or any areas outside the Property unless adequate alternative provisions are made for proper drainage and are approved by the ARC. The term "established drainage" shall mean any wall, drainage swales, conduits, inlets and outlets designed and constructed on the Property.

4.15 Wildfire Prevention. The following wildfire preventions measures shall be taken by all Occupants:

4.15.1 A thirty (30) foot wide noncombustible area, excluding trees, shall be maintained around the perimeter of all homes. Occupants must ensure that all Lots are maintained in a fire safe manner with all noxious weeds and dead vegetation (including tree branches and limbs) removed from the Lot.

4.15.2 Tree branches that rest on or near a roof or wall shall be removed creating a clearance of five (5) feet between the roof and any vegetation. Tree limbs within fifteen (15) feet of a chimney and/or chimney outlet shall be removed.

4.15.3 Lawns and other low vegetation shall be kept mowed and shall be watered on a regular basis.

4.15.4 All wood, building debris, and other burnable materials shall be kept at least thirty (30) feet from the residence or other buildings.

4.15.5 Tree needles, leaves, and other debris shall be cleaned on a regular basis from roof and gutters of all buildings on all Lots.

4.15.6 Driveways shall be trimmed of peripheral vegetation to allow emergency access to the residence.

4.15.7 Spark arresters shall be installed on any chimney for a fireplace or woodstove.

4.16 Damage or Destruction to home and/or Lot. If all, or any portion of a Lot or Home, is damaged by fire or other casualty the Owner shall restore the damaged improvements subject to the provisions of any applicable insurance policies. Restoration must be performed so that the improvements are in substantially the same condition in which they existed prior to the damage, subject to current governmental regulations, building codes, and provisions of Article 6 of this Declaration. The Owner must commence such work within sixty (60) days after the damage occurs and must complete the work within six (6) months thereafter.

4.17 Detached Buildings. Detached accessory buildings, including, but not limited to, detached garages, storage buildings, greenhouses, children's playhouse qnri cimilar qtnintures,

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shall not be built without the prior written consent of the ARC. Every outbuilding shall be compatible with the dwelling to which it is appurtenant in terms of its design and material composition.

4.18 Exterior Lighting or Noise making Devices. Except with the consent of the ARC, no exterior lighting or noisemaking devices shall be installed or maintained on any Lot, other than security and fire alarms. However, false alarms of security and fire systems will not be allowed to repeatedly occur. This provision shall not apply to seasonal lighting (e.g., Christmas lights) or low-wattage walkway lighting.

4.19 Owner's Maintenance Obligations. All improvements upon any Lot, not maintained by the Association, shall at all times be maintained by the Owner in a clean and attractive condition, painted and in good repair, and in such a fashion as not to create a hazard of any kind. All work on such items is subject to ARC review and approval prior to commencement of work.

4.20 Well Maintenance. For all Lots that share a well with one or more Lots, the Owners of such Lots shall share all costs associated with: (i) drilling the well, installing pipe, pump, and equipment necessary to operate the well, and a small well shed; and (ii) upkeep and maintenance of a such well equally among the shared well Lot Owners. In the event a Lot Owner wishes to access a functioning shared well, the costs associated with (i) shall apply retroactively. In addition, the Owners of such Lots shall also share the costs of monthly electricity to operate the shared water system includes separate meters for each lot, and the costs of electricity shall be divided based on actual water usage.

4.21 Right of Maintenance and Entry by Association. If an Owner fails to perform maintenance and/or repair which he/she is obligated to perform pursuant to this Declaration for buildings or landscaping, and if the Board determines, after notice and a hearing (given pursuant to the provisions of the Bylaws), that such maintenance and/or repair is necessary to preserve the attractiveness, quality, nature and/or value of Round Tree Estates, the Board may cause such maintenance and/or repair in connection therewith to be performed and may enter any such Lot whenever entry is necessary in connection with the performance of any maintenance or construction which the Board is authorized to undertake. Entry shall be made with as little inconvenience to an Owner as practicable and only after advance written notice of not less than forty-eight (48) hours, except in emergency situations. All costs in carry out this work shall be paid by the Owner to the Association.

4.22 Association Rules and Regulations. The Board of Directors, from time to time, may adopt, modify or revoke Rules and Regulations governing the conduct of persons and the operation or use of Lots and Common Areas, as it may deem necessary or appropriate in order to assure the peaceful and orderly use and enjoyment of the Property. A copy of any Rules and Regulations, upon adoption, amendment, modification or revocation thereof, shall be delivered

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by the Board of Directors promptly to each Owner and shall be binding upon all Owners and Occupants of all Lots upon the date of delivery or actual notice thereof. The method of adoption of such Rules and Regulations shall be provided in the Bylaws of the Association.

4.23 Ordinances and Regulations. The standards and restrictions of Article 4 shall be the minimum required. To the extent the ordinances and regulations of the city, Crook County, or the State of Oregon are more restrictive, or provide for a higher or different standard, the ordinances and regulations of the city, Crook County, or the State of Oregon, and any jurisdiction Property may be annexed into, shall prevail.

4.24 Violation. The Association may impose a fine, charge, or penalty for any violation of this Declaration, the Bylaws and Rules and Regulations after reasonable notice of the violation and a reasonable opportunity for a hearing. Additionally, the Association may seek injunctions or other equitable relief or may file an action for money damages owing from such violations.

4.25 Security. The Association is not responsible for security of the neighborhood or any Homes. The Owners are exclusively responsible for security of their home and Property.

ARTICLE 5 — COMMON AREA

        5.1        Use of Common Areas. Use of Common Areas is subject to the provisions of the

Declaration, Bylaws, Articles .and Rules and Regulations promulgated by the Board of Directors. There shall be no use of the Common Area except by Owners and their invitees. There shall be no obstruction of any part of the Common Area. Nothing shall be stored or kept in the Common Area without the prior written consent of the Board of Directors. No alterations or additions to the Common Area shall be permitted without the prior written approval by the Board of Directors. Any work so authorized by the Association's Board of Directors shall be considered a temporary easement over the Common Area. Nothing shall be stored or kept in the Homes or Common Area, which will increase the rate of insurance on the Common Area, or other Association insurance, without the prior written consent of the Board. At the Owner's sole expense, written approval from the Association's insurance carrier for such work in the Common Area must be obtained. If there are any insurance settlement claims or condemnation awards paid to the Association, a portion of the entire proceeds may be directed to the Lot Owner for said improvements.

        5.2        Maintenance of Common Area. The Association shall be responsible for

maintenance, repair, replacement, and upkeep of the Common Area, including, but not by way of limitation, all drainage systems, landscaping, common area lighting not maintained by a public agency, fencing, pathways and any other improvements that may be included in Common Area. The Association shall keep the Common Area and improvements thereon in good condition and

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repair, provide for all necessary services and cause all acts to be done which may be necessary or proper to assure the maintenance of the Common Area first class condition.

        5.3        Alternations to Common Area. Only the Association shall construct, reconstruct,

or alter any improvement situated upon the Common Area. A proposal for any construction of or alteration, maintenance or repair to an improvement may be made at any meeting. A proposal may be adopted by the Board, subject to the limitations contained in the Bylaws and the Declaration.

        5.4        Funding. Expenditures for alterations, maintenance or repairs to an existing

capital improvement for which a reserve has been collected shall be made from the reserve account. As provided in Section 10.6, the Board may levy a special assessment to fund any construction, alteration, repair or maintenance of an improvement (or any other portions of the Common Area) for which no reserve has been collected or for which the reserve account is insufficient to cover the cost of the proposed improvement.

        5.5        Condemnation of Common Area. If all or any portion of the Common Area is

taken for any public or quasi-public use under any statute, by right of eminent domain or by purchase in lieu of eminent domain, the entire award shall be received by and expended by the Board of Directors in a manner which in their discretion is in the best interest of the Association. The Association shall represent the interest of all Owners in any negotiations, suit or action or settlement in connection with such matters.

        5.6        Damage or Destruction of Common Area. In the event any Common Area is

damaged or destroyed by an Owner or any of his/her Occupants, guests, tenants, licensees, agents or members of his/her family in a manner that would subject such Owner to liability for such damage under Oregon law, such Owner does hereby authorize the Association to repair such damage. The Association shall repair the damage and restore the area in workmanlike manner as originally constituted or as may be modified or altered subsequently by the Association in the discretion of the Board of Directors. The reasonable cost necessary for such repairs shall become a special assessment upon the Lot of the Owner who caused or is responsible for such damage.

ARTICLE 6 — ARCHITECTUAL REVIEW COMMITTEE

        6.1        Architectural Review. No improvement shall be commenced, erected, placed or

altered on any Lot until the construction plans and specifications showing the nature, shape, heights, materials, colors, and proposed location of the improvement have been submitted to and approved in writing by the ARC. The ARC will only have authority to make decisions related to the Lots and not the Common Area Tracts. Any architectural or design considerations on the Common Area Tracts will be solely within the power of the Board of Directors. It is the intent

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and purpose of this Declaration to assure quality of workmanship and materials and to assure harmony of exterior design with the existing improvements and landscaping. The ARC is not responsible for determining compliance with structural and building codes, zoning codes, or other governmental regulations, all of which are the responsibility of the Lot Owners. The

procedure and specific requirements for review and approval of construction may be set forth in design guidelines initially adopted concurrently with the Rules and Regulations, and from time to time by the ARC. Construction by the Declarant is presumed to have been approved and is thereby exempt from this review. In all cases, which the ARC consent is required by this Declaration, the provision of this Article shall apply. The ARC and the Board of Directors are hereby granted an easement over the Lots to enable the ARC to carry out its designated functions.

        6.2        Appointment and Removal. The ARC shall consist of three (3) members, as the

Board may appoint from time to time. The Declarant reserves the right to appoint all members of the ARC and all replacements thereto until turnover. The Declarant may appoint a single person to serve as the ARC. After turnover, the Declarant shall delegate the right to appoint and remove members of the ARC to the Board of Directors. The terms of office for each member of the ARC shall be for one (1) year unless the Board serves as the ARC in which event the terms of the ARC members shall be the same as their terms as Board members. The Board may appoint any or all of its members for the ARC and there should be no requirement for non-Board members on the ARC.

        6.3        Majority Action. Except as otherwise provided in this Declaration, a majority of

the members of the ARC shall have the power to act on behalf of the ARC, without the necessity of a meeting and without the necessity of consulting the remaining member of the ARC. The ARC may render its decision only by written instrument setting forth the action taken by the members consenting thereto.

        6.4        Duties. The ARC shall consider and act upon the proposals and/or plans

submitted pursuant to this Article. The ARC, from time to time and at its sole discretion, may adopt architectural rules, regulations and guidelines ("Architectural Standards"). The Architectural Standards shall interpret and implement the provisions of this Declaration for architectural review and guidelines for architectural design, placement of buildings, color schemes, exterior finishes and materials and similar features which may be used within the Property; provided, however that the Architectural Standards shall not be in derogation of the minimum standards established by this Declaration.

        6.5        ARC Decision. The ARC shall render its approval or denial decision with respect

to the construction proposal within twenty (20) business days after it has received all material required by it with respect to the application. All decisions shall be in writing. In the event the ARC fails to render its decision of approval or denial in writing within sixty (60) days of

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receiving all material required by it with respect to the proposal, the application shall be deemed approved. Approval by the ARC does not imply government approval which is solely the responsibility of the Owner.

        6.6        Appeal. At any time after Declarant has delegated appointment of the members of

the ARC to the Board of Directors pursuant to Section 6.2, any Owner adversely impacted by action of the ARC may appeal such action to the Board of Directors. Appeals shall be made in writing within ten (10) days of the ARC's action and shall contain specific objections or mitigating circumstances justifying the appeal. If the Board is already acting as the ARC, the appeal shall be treated as a request for a rehearing, but in such case the Board must actually meet and receive evidence and argument. A final, conclusive decision shall be made by the Board of Directors within fifteen (15) days after receipt of such notification. The determination of the Board shall be final.

        6.7        Determination of Compliance. The ARC shall inspect, from time to time, all work

performed and determine whether it is in substantial compliance with the approval granted. If the ARC finds that the work was. not performed in substantial conformance with the approval granted; or if the ARC finds that the approval required was not obtained, the ARC shall notify the Owner in writing of the noncompliance. The notice shall specify the particulars of any noncompliance and shall require the Owner to take the necessary action to bring the work into compliance with the approved project.

        6.8        Non-compliance. If the ARC determines that an Owner has not constructed an

improvement consistent with the specifications on which approval is based, and if the Owner fails to diligently commence to remedy such non-compliance in accordance with the provisions of the notice of noncompliance, then at the expiration of the tenth (10th) day from the date of such notification, the ARC shall provide a notice of a hearing to consider the Owner's continuing non-compliance. The hearing shall be set not more than thirty (30) days from the date of the notice of non-compliance. At the hearing, if the ARC finds that there is no valid reason for the continuing non-compliance, the ARC shall determine the estimated costs of correcting it. The ARC shall then require the Owner to remedy or remove the same within a period of not more than ten (10) days from the date of the ARC's determination. If the Owner does not comply with the ARC's ruling within such period or within any extension of such period as the ARC, at its discretion, may grant, the Association may (a) remove the non-complying improvement, (b) remedy the non-compliance, or (c) file suit to compel compliance. The costs of such action shall be assessed against the Owner and his/her Lot, including all attorneys' fees and other costs expended and incurred to enforce compliance before suit or action is filed and at trial or on any appeal or review of therefrom.

        6.9        Liability. Neither the ARC, the Board, their agents, nor any member thereof shall

be liable to any Owner, Occupant, or builder for any damage, loss or prejudice suffered or

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claimed or claimed to be suffered arising from any action by the ARC or a member thereof or failure of the ARC or a member thereof, provided only that the member has acted in good faith in accordance with the actual knowledge possessed by him.

6.10 Estoppel Certificate. Within fifteen (15) business days after written request is delivered to the ARC by an Owner; and upon payment to the ARC of a reasonable fee fixed by the ARC to cover costs, the ARC shall provide such Owner with a certificate executed by a member of the ARC, and acknowledged, certifying with respect to any Lot owned by the Owner, that as of the date thereof either (a) all improvements made or done upon or within such Lot by the Owner comply with this Declaration or any Rules and Regulations either promulgated by the Board or the ARC, or (b) such improvements do not so comply, in which event, the certificate shall also identify the non-complying improvements and set forth with particularity the nature of such noncompliance. The Owner, his/her heirs, devisees, successors and assigns shall be entitled to rely on the certificate with respect to the matters set forth. The certificate shall be conclusive as between the Declarant, the ARC, the Association and all Owners, and all such persons deriving an interest through any of them.

ARTICLE 7 — ROUND TREE ESTATES ASSOCIATION

        7.1        Members. Each Owner shall be a mandatory member of the Association.

Membership in the Association shall be appurtenant to, and may not be separated from, ownership of any Lot. Transfer of ownership of a Lot automatically transfers membership in the Association. Without any other act or acknowledgement, Occupants and Owners shall be governed and controlled by this Declaration the Articles, Bylaws, and Rules and Regulations and any amendments thereof.

        7.2        Proxy. Each Owner may cast their vote in person, pursuant to a proxy executed by

the Owner, or by written ballot, as provided by ORS 94.647. An Owner may not revoke a proxy given pursuant to this section except by actual notice or revocation to the person presiding over a meeting of the Association. A proxy shall not be valid if it is undated or purports to be revocable without notice. A proxy shall terminate one (1) year after its date, unless the proxy specifies a shorter term.

        7.3        Procedure. All meetings of the Association, the Board of Directors, the ARC, and

Association committees shall be conducted with such rules of order as may from time to time be adopted by the Board of Directors. Notwithstanding which rule of order is adopted, the chairman shall be entitled to vote on all matters, not merely to break a tie vote. A tie vote does not constitute a majority or approval of any motion or resolution.

        7.4        Contracts Entered into by Declarant or Before Turnover Meeting.

Notwithstanding any other provision of this Declaration, any management contracts, service

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contracts or employment contracts entered into by Declarant or the Board of Directors on behalf of the Association before the Turnover Meeting shall have a term of not more than three (3) years. In addition, any such contract shall provide that it may be terminated without cause or penalty by the Association or Board of Directors upon not less than thirty (30) days' notice to the other party given not later than sixty (60) days after the Turnover Meeting.

ARTICLE 8 — DECLARANT CONTROL

        8.1        Interim Board and Officers. Declarant or the Owners shall four a transitional

advisory committee {the "Transitional Advisory Committee") to provide for the• transition from administrative responsibility by Declarant for the Property to administrative responsibility by the Association, .in accordance with the provisions in the Bylaws.

        8.2        Turnover Meeting. The Declarant shall call a meeting for the purpose of turning

over administrative control of the Association from the Declarant to the Class A members within ninety (90) days of the earlier of:

8.2.1 Upon Sale of Lots. The date that Lots representing seventy-five percent (75%) of Lots subject to this Declaration, plus any recorded annexation of additional Lots, have been conveyed to persons other than the Declarant; or

8.2.2 Declarant's Earlier Declaration. At such earlier time as Declarant may elect in writing to terminate Class B membership. The Declarant shall give notice of the

meeting to each Owner as provided in the Bylaws. If the Declarant does not call the meeting required under this Section, any Owner may do so.

        8.3        Board of Directors. At and following Turnover, the Board of Directors of the

Association shall be comprised of three (3) directors. The directors will be elected by a plurality of the total membership of the Round Tree Estates Association. In the event of a vacancy occurring on the Board, the position of such director(s) shall be filled in accordance with the terms and provisions of the Bylaws through appointment by the Board of Directors. The Directors elected at the Turnover Meeting shall serve until the first annual meeting of the Corporation. The term of office for elected Directors will be one (1) year.

ARTICLE 9 — DECLARANT'S SPECIAL RIGHTS

        9.1        General. Declarant is undertaking the work of developing Lots and improvements

within Round Tree Estates. The completion of the development work and the marketing and sale

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of the Lots is essential to the establishment and welfare of the Property as a residential community. Until the Homes on all Lots on the Property have been constructed, fully completed and sold, with respect to the Common Areas and each Lot on the Property, the Declarant shall have the special rights set for in this Article 9.

        9.2        Voting Rights. The Association shall have two (2) classes of voting members:

9.2.1 Class A. Class A members shall be all Owners of Lots other than the Declarant, and each Class A member shall be entitled to one (1) vote for each Lot owned with respect to all matters upon which Owners are entitled to vote.

9.2.2 Class B. The Class B member shall be Declarant, their successors and assigns. The Class B member shall have three (3) votes for each Lot owned. The Class B membership shall cease and be converted to Class A membership upon the earlier of:

9.2.2.1 When seventy-five percent (75%) of the Lots have been sold and

conveyed to Owners other than Declarant ("Termination Date"); or

9.2.2.2 At such earlier time as Declarant may elect in writing to terminate Class B membership.

Thereafter, each Owner, including the Declarant, shall be entitled to one (1) vote for each Lot owned with respect to all matters upon which Owners are entitled to vote, and the total number of votes shall be equal to the total number of Lots. When more than one (1) person or entity owns a Lot, the vote for such Lot may be cast as they shall determine, but in no event will fractional voting be allowed. Fractional or split votes shall be disregarded, except for purposes of determining a quorum. The total number of votes as of the Termination Date and thereafter shall be equal to the total number of Lots.

        9.3        Marketing Rights. Declarant shall have the right to maintain a sales office and

model on one or more of the Lots which the Declarant may or may not own, to be staffed by the employees of the Declarant or any licensed real estate sales agents. The Declarant and prospective purchasers and their agents shall have the right to use and occupy the sales office and models during reasonable hours any day of the week. The Declarant may maintain a reasonable number of "For Sale" signs at reasonable locations of the Property, including, without limitation, the Common Area.

        9.4        Declarant's Easements. The Declarant has reserved easements over the Property

as more fully described in Article 3.4 hereof.

        9.5        Appearance and Design. Declarant shall not be prevented from changing the

exterior appearance of the Common Area, including the landscaping or any other matter directly or indirectly connected with project in any manner deemed desirable by Declarant, provided that

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the Declarant obtain governmental consents required by law. The construction and material standards of Article 4 notwithstanding, Declarant may change exterior and/or interior designs from initial plans and provisions in this document, without notice. This may include designs, colors, and type of materials, provided Declarant obtains any necessary governmental consent.

9.6        Construction by Declarant. All construction by Declarant establishes the standards

for the ARC and meets any Design Guidelines of the Association.

ARTICLE 10 — FUNDS AND ASSESSMENTS

10.1 Purpose of Assessment. The assessments levied by the Association shall be used exclusively to promote the recreation, health, safety, and welfare of the Owners and Occupants, and for the improvement, operation and maintenance of the Common Area, including maintenance and administrative costs, and insurance for Association.

10.1.1 Common Expense Designations. Common Expenses of the nature described in Section 10.1 which are to be, or are, incurred by the Association for the benefit of all of the Owners of Lots within the Property shall be separately budgeted for allocation among all such Owners and shall be designated "General Common Expenses."

10.1.2 Insurance by the Association. The Board shall obtain, and maintain in effect, from reputable insurance companies authorized to do business in the State of Oregon, public liability insurance with respect to all the Common Area in such amounts and in such forms as the Board deems advisable to provide adequate protection for bodily injury, including deaths of persons, and property damage, whether caused by the negligence of the Association or otherwise; provided, however, that such policy(ies) shall not be for an amount of less than $1,000,000.00 per person, per occurrence, and that such policy(ies) shall provide that the coverage there under cannot be canceled or substantially modified without at least 10 days written notice to the Association. At the discretion of the Board, the Corporation may purchase and maintain insurance on behalf of any person who is or was a Director, Officer, employee, or agent of the Association, against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Association would have the power to indemnify him or her against such liability under the provisions of the Articles of Organization.

10.1.3 Insurance by the Owners. The insurance described in paragraph 10.1.2 above does not provide personal liability coverage for the Owners, nor fire or extended coverage casualty insurance for the Owners' personal property, the inside surfaces of the Building Structure, and all other improvements including, but not limited to, appliances, heaters and air conditioners, cabinets, flooring, wall and window coverings, light fixtures

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and personal property nor the Lot or land on which the structure resides. The responsibility for obtaining insurance that covers at least these items rests solely with the individual Owners, except as noted herein.

10.2 Covenants to Pay. Declarant, on behalf of each and every subsequent Owner of any Lot, covenants and agrees that each Lot will pay the Association the assessments and any additional charges levied pursuant to this Article 10. The assessments collected by the Association shall be held by the Association for and on behalf of each Owner and shall be used solely for the operation, care and maintenance of Round Tree Estates as provided by this Declaration. Upon the sale or transfer of any Lot, the Owner's interest in the funds shall be deemed automatically transferred to the successor in interest of such Owner, and is not refundable.

10.3 Basis of Assessments and Commencement of Assessments. Assessments are to be levied against all Lots, except those owned by the Declarant, whether or not such Lots have been improved with a substantially completed home. Provided, however, that no Assessment shall be levied against any Lot until such time as it is first sold to a purchaser other than Declarant or Declarant assignee. Assessments for all Lots conveyed by the Declarant to purchaser/Owner, either by deed or land sales contract, shall begin on the day of the recording of the deed or land sale contract conveying or contracting to convey the Lot of the new Owner. In accordance with ORS 94.704 (1), Declarant shall pay all common expenses of the Association that exceed the operating assessments received from non-Declarant Owners, exclusive of the reserve assessments. As of the first of the month following the date of the Turnover Meeting, all Declarant Lots will pay operating and reserve assessments under the payment provisions contained in this Declaration.

10.4 Annual Assessments. Annual assessments for each fiscal year shall be established when the Board approves the budget for that fiscal year. Annual assessments shall be levied on a fiscal year basis. The fiscal year shall be from March 31 through March 31 unless another year is adopted by vote of the Board members. Unless otherwise specified by the Board, annual

assessments shall be due and payable in monthly installments on the first day of each month during the term of this Declaration.

10.4.1 Budget. Regardless of the number of Members or the amount of assets of the Association, each year the Board shall prepare, approve and make available to each Member a pro forma operating statement (budget) containing; (i) estimated revenue and expenses on an accrual basis; (ii) the amount of the total cash reserves of the Association currently available for replacement or major repair of the Common Area and for contingencies; (iii) an itemized estimate for the remaining life of, and the methods of funding to defray repair, replacement or additions to major components of the Common Area; and (iv) a general statement setting forth the procedures used by the Board in the

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calculation and establishment of reserves to defray the costs and repair, replacement or additions to major components of the Common Area. For the first fiscal year, the budget shall be approved by the Board no later than the date on which annual assessments are scheduled to commence. Thereafter, the Board shall annually prepare and approve the budget and distribute a copy thereof to each Member, together with written notice of the amount of the annual assessments to be levied against the Owner's Lot, not less than thirty (30) days and not more than ninety (90) days prior to the beginning of the fiscal year. The assessments in the budget to be collected at intervals as determined by the Board of Directors, may include both operating and maintenance costs and the reserve assessments, all as defined in the Association documents.

10.4.2 Allocation of Assessments. The total amount in the budget shall be charged equally against all sold Lots as annual assessments.

10.4.3 Non-Waiver of Assessments. If before the expiration of any fiscal year the Association fails to fix annual assessments for the next fiscal year, the annual assessments established for the preceding year shall continue until a new annual assessment is fixed. The provisions of this section are subject to the provisions of the Oregon Planned Community Act.

10.5 Reserve Funds.

10.5.1 Reserve Fund for Replacing Common Elements. Declarant shall establish a reserve fund in the name of the Association for replacement, in whole or in part, of any

completed improvements located in, on, or under the Common Area for which the Association is responsible pursuant to this Declaration, that will normally require replacement in more than three (3) and fewer than thirty (30) years, and for other items for which reserves are required by the Declaration or Bylaws ("Reserve Fund"). The Reserve Fund need not include those items that could reasonably be funded from the

maintenance fund or operating assessments, or for which one or more Owners are responsible for maintenance and replacement under the provisions of this Declaration or

the Bylaws. For purposes of funding the Reserve Fund, the Declarant initially, and thereafter the Association, shall impose an assessment to be called the "Reserve Fund Assessment' equally against each Lot. The Reserve Fund shall be kept separate from other funds and may be used only for the purposes for which reserves have been established as specified in this Section, although the Board may borrow funds with a specified repayment program, in accordance with the Oregon Planned Community Act. Required Reserve Fund Assessments for completed improvements shall begin accruing from the date the first lot assessed is conveyed Declarant may elect to defer payment of 

the Reserve Fund Assessments due on Lots it owns until the date of the conveyance of the Lot to an Owner. The book and records of the Association shall reflect the amount

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owing from the Declarant for all Reserve Fund Assessments. The amount of the Reserve Fund shall constitute an asset of the Association and shall not be refunded or distributed to any Owner.

10.5.2 Reserve Study. The Board of Directors shall annually conduct a reserve study, or review and update an existing study, of the Common Area, and Common Home Exterior components to determine the requirements of the reserve fund described in Section 10.5.1 above. The reserve study shall include (a) identification of all items for which reserves are required to be established; (b) the estimated remaining useful life of

each item as of the date of the reserve study; (c) the estimated cost of maintenance, repair, or replacement of each item at the end of its useful life; and (d) a thirty (30) year plan with regular and adequate contributions, adjusted by estimated inflation and interest earned on the reserve fund, to meet the maintenance, repair, and replacement schedule.

10.6 Special Assessments. The Board of Directors shall have the power to levy special assessments against an Owner or all Owners in the following manner for the following purposes:

10.6.1 Deficits in Operating Budget. To correct a deficit in the operating budget, by vote of a majority of the Board;

10.6.2 Breach of Documents. To collect amounts due to the Association from an Owner for breach of the Owner's obligations under the Declaration, the Bylaws, or the Rules and Regulations, by vote of a majority of the Board. All provisions of this Section 10.6.2 shall be interpreted by the provisions of the Oregon Planned Community Act relative to the imposition of fines and penalties;

10.6.3 Repairs. To make repairs or renovations to the Common Area if sufficient funds are not available from the operating budget or Reserve Fund by vote of a majority of the Board; or

10.6.4 Capital Additions. To make capital acquisitions, additions, or improvements, by vote of at least seventy-five percent of all votes allocated to the Lots.

Any special assessments shall be owned solely by the Association regardless of their purpose and the individual Owners so assessed shall have no rights or interests in said funds.

10.7 Default in Payment of Assessments.

10.7.1 Personal Obligation. All assessments properly imposed under this Declaration or the Bylaws shall be the joint and several personal obligation of all Owners of the Lot to which such assessment pertains. In a voluntary conveyance (that is, one

other than through foreclosure or a deed in lieu of foreclosure) the grantees shall be

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jointly and severally liable with the grantor(s) for all Association assessments imposed through the recording date of the instrument affecting the conveyance. Said provisions shall be in accordance with the provisions of the Oregon Planned Community Act A suit for a money judgment may be initiated by the Association to recover such assessments without either waiving or foreclosing the Association's lien.

10.7.2 Association Lien. At any time any assessment (of any type provided for by this Declaration or the Bylaws) or installment thereof is delinquent, the Association, by and through its Board or any management agent, may file a notice of lien in the deed records of Crook County, Oregon against the Lot in respect to which the delinquency pertains. Once filed, such lien shall accumulate all future assessments or installments, interest, late fees, penalties, fines, attorneys' fees (whether or not suit or action is instituted) and other appropriate costs properly chargeable to an Owner by the Association, until such amounts are fully paid. The provisions regarding the attachment, notice, recordation and duration of liens established on real property under ORS 94.704

to 94. 716, as the same may be amended, shall apply to the Association's lien. The lien shall be foreclosed in accordance with the provisions regarding the foreclosure of liens under ORS Chapter 88. The lien of the Association shall be superior to all other liens and encumbrances except property taxes and assessments, any first mortgage; deed of trust or land sale contract recorded previously to the Association's notice of lien and any mortgage or deed of trust granted to an institutional lender which is recorded previously to the Association's notice of lien.

10.7.3 Interest, Fines, Late Fees, Penalties. The Board in its reasonable discretion may from time to time adopt resolutions to set the rate of interest, and to impose late fees, fines and penalties on delinquent assessments or for violations of the provisions of this

Declaration, the Bylaws, any Rules and Regulations, and any rules and regulations adopted by the ARC. The adoption of such impositions shall be communicated to all

Owners in writing not less than thirty (30) days before the effective date by a notice mailed to the assessment billing addresses of such Owners. Such impositions shall be considered assessments which are lienable and collectible in the same manner as any other assessments. Provided, however, no fine or penalty for violation of this Declaration, the Bylaws or any Rules and Regulations (other than late fees, fines or interest arising from an Owner's failure to pay regular or special assessments) may be imposed against an Owner or his/her Lot until such Owner is given an opportunity for a hearing.

10.7.4 Acceleration of Assessments. In the event an Owner is delinquent in payment of any assessment or installment on any assessment, the Association, upon not less than ten (10) days written notice to the Owner, any accelerate the due date of the full annual assessment for that fiscal year and all future installments of any special assessments.

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10.7.5 Association's Right to Rents/Receiver. In any foreclosure suit by the Association with respect to such lien, the Association shall be entitled to collect reasonable rent from the defaulting Owner for the use of his/her Lot or shall be entitled to

the appointment of a Receiver. Any default by the Owner in any provisions of the Declaration or Bylaws shall be deemed to be a default by the owner of any mortgage to which the Owner is party or to which the Lot is subject.

ARTICLE II — GENERAL PROVISIONS

11.1 Records. The Board of Directors shall preserve and maintain minutes of the meetings of the Association, the Board and any committees. The Board of Directors shall also keep detailed and accurate financial records including individual assessment accounts of Owners, the balance sheet, and income and expense statements. Individual assessment accounts shall designate the name and address of the Owner or Owners of the Lot, the amount of each assessment as it becomes due, the amounts paid upon the account, and the balance due on the assessments. The minutes Of the Association, the Board and committees, and the Association's financial records shall be reasonably available for review and copying by the Owners. A reasonable charge may be imposed by the Association for labor and materials relative to providing copies. Owners can obtain copies of this information within I 0-days of receipt of a written request.

11.2 Indemnification of Directors, Officers, Employees, and Agents. The Association shall indemnify any Director, officer, employee or agent who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by the Association) by reason of the fact that he/she is or was a Director, officer, employee or agent of the Association or is or was serving at the request of the Association as a Director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, • against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by said person in connection with such suit, action or proceeding if he/she acted in good faith and in a manner he/she reasonably believed to be in, or not opposed to, the best interest of the Association, and, with respect to any criminal action or proceedings, had no reasonable cause to believe his/her conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or with a plea of nolo contendere or its equivalent, shall not of itself create a presumption that a person did not act in good faith and in a manner which he/she reasonably believed to be in, or not opposed to, the best interest of the Association, and with respect to any criminal action or proceedings, had reasonable cause to believe his/her conduct was unlawful. Payment under this clause may be made during the pendency of such claim, action, suit or proceeding as and when incurred, subject only to the right of the Association to reimbursement of such payment from such person, should it be proven at a later

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time that such person had no right to such payments. All persons who are ultimately held liable for their actions on behalf of the Association as a Director, officer, employee or agent shall have a right of contribution over and against all other Directors, officers, employees or agents and members of the Association who participated with or benefited from the acts which created said liability.

11.3 Enforcement, Attorneys' Fees. The Association and the Owners within the Property or any mortgagee on any Lot shall have the right to enforce all of the covenants, conditions, restrictions, reservations, easements, liens and charges now or hereinafter imposed by any of the provisions of this Declaration as may pertain specifically to such parties or owners by any proceeding at law or in equity. Failure by either the Association or by any Owner or mortgagee to enforce any covenant, condition or restriction herein contained shall in no event be deemed a waiver of their right to do so thereafter.

11.4 Severability. Invalidation of any one of these covenants, conditions or restrictions by judgment or court order shall not affect the other provisions hereof and the same shall remain in full force and effect.

11.5 Duration. The covenants, conditions and restrictions of this Declaration shall run with and bind the land for a term of thirty-five (35) years from the date of this Declaration being recorded, after which time they shall be automatically extended for successive periods often (10) years, unless rescinded by a vote of at least ninety percent (90%) of the Owners and ninety

percent (90%) of the first mortgagees. Provided however, amendments, which do not constitute rescission of the planned development, may be adopted as provided in Section 11.6 below. Additionally, any such rescission that affects the Common Area shall require the prior written consent of the County of Crook, Oregon.

11.6 Amendment. Except as otherwise provided in Sections 11.5, 11.9, and the restrictions set forth elsewhere herein, this Declaration may be amended at any time by an instrument approved by not less than seventy-five percent (75%) of the total votes for all Lots subject to this Declaration, of each class of members that are eligible to vote. Any amendment must be executed, recorded and certified as provided by law. Provided, however, that no amendment of this Declaration shall affect an amendment of the Bylaws or Articles without compliance with the provisions of such documents. Provided further, so long as the Declarant .own any Lot, no amendment affecting the general plan and development or any other right of the Declarant herein contained may be affected without the express written consent of the Declarant or its successors and assigns.

11.7 Release of Right of Control. The Declarant may give up their right of control in writing at any time by notice to the Association, subject to the provisions of the Oregon Planned Community Act.

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11.8 Personal Pronouns. All personal pronouns used in this Declaration, whether used in the masculine, feminine or neuter gender, shall include all other genders; the singular shall apply to the plural and vice versa.

11.9 Unilateral Amendment by Declarant. The Declarant may amend this Declaration in order. to comply with the requirements of the Federal Housing Administration of the United States, the Federal National Mortgage Association, the Government National Mortgage Association, the Federal Home Mortgage Loan Corporation, any department, bureau, board, commission or agency of the United States or the State of Oregon, or any other state in which the Lots are marketed and sold; or any corporation wholly owned, directly or indirectly, by the United States or the State of Oregon, or such other state, the approval of which entity is required in order for it to insure, guarantee or provide financing in connection with development of the Property and sale of Lots. Prior to the Turnover Meeting, no Declarant amendment shall require notice to or approval by any Class A member.

11.10 Resolution of Document Conflicts. In the event of a conflict among any of the provisions in the documents governing Round Tree Estates, such conflict shall be resolved by looking to the following documents in the order shown below:

1. Declaration of Covenants, Conditions, and Restrictions;
2. Articles of Organization;
3. Bylaws;
4. Rules and Regulations.

IN WITNESS WHEREOF, the undersigned being the Declarant herein, has executed this instrument this 23rd day of January, 2015.

ROUND TREE ESTATES, LLC

An Oregon Limited Liability Company

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STATE OF OREGON

) ss.

County of Washington

PERSONALLY appeared before me this 23rd day of January, 2015, Randy Reese, Member of Round Tree Estates, LLC.