Bay Shore Villas C.O.A.,IncP.O. Box 436

Zionsville, IN 46077317-875-5600

Dear Homeowner:

The enclosed handbook is a summary of the Code of By-Lawsand the Rules and Regulations of Bay Shore Villas C.O.A., Inc..The handbook has been created to answer some of your questionsabout living in the community, which you must pass on to newowners. You should have received a complete legal copy of theAssociation By-Laws and Declaration during the closing of yournew home. If you did not, copies may be purchased, please call R& G Management Co., Inc. for these documents.

Please feel free to contact any of the Board members orR & G Management with any questions or comments.

IMPORTANT PHONE NUMBERS

R & G MANAGEMENT CO.

Fax

FRANKLIN TWP FIRE DEPARTMENT

Emergency

POLICEMarion County Sheriff

875-5600

879-8318

780-3855/Admin

911 /736-5111/ Admin

736-5155/ Admin911 / emergency

INDEX

SECTION

A_~CHITECTURAL CONTROLS & STANDARDS

4 o

5.

6.

7.

Ao

B.

C.

D.

E.

Purpose of architectural control

General guidelines

Request for change procedures

Corrective procedures

Exterior changes and modifications

ASSOCIATION ASSESSMENTS

A. Habitual offender

B. Delinquency procedures

COMMON GROUNDS REGULATIONS

A. Regulations regarding pets

B° Regulations for motor vehicles

C. Regulations regarding landscaping

D. Regulations regarding lake(s)

E. Regulations regarding children

F. Enforcement of regulations

INSUP~ANCE

MANAGEMENT CO.

CHANGE OF ADDRESS

PROBLEMS WITH YOUR HOME

A. Exterior

B. Interior

PAGE

4

4

5

5

5, 6, 7

8

8

9

I0, ii

Ii

Ii, 12

12

12 13

14 15

15

15 16

16

16

SNOW REMOVAL, FREEZING

A. Snow Removal

B. Freezing Temperatures and Plumbing

16

17

FORMS:NOTICE OF RESALECHANGE OPADDRESSARCHITECTUP3~L CH~/qGE REQUEST

1819

20, 21

3

SECTION 1ARCHITECTUB~L CONTROLS & STANDARDS

Purpose of Architectural Control

The purpose of Architectural Control, whether or not statedin the governing documents of a community association, aretwofold: (i) To establish and preserve a harmonious design forthe community and (2) to protect the value of property in thecommunity. Design..review or architectura! control has beendescribed as a way to enhance the quality of life, to promotethose qualities in the environment which bring value to thecommunity, to foster the attractiveness and functional utility ofthe community as a place to live, and even to raise the level ofcommunity expectations for the quality of its environment. Theseare but elaborations on a theme, deceptively simple to state, butwonderfully complex to live with: the basic purpose of designreview is to keep the community looking like a nice place tolive.

Approval of any project by the Board does not waive thenecessity of obtaining required building permits or otherapprova!; obtaining such permits and approvals does not waive theneed for Board approval.

B. General guidelines

~hny addition to an existing building, any exterioralteration] modification; or change to an existing building ~usthave the appr0val 0f the Board of Di~d~ BEFORE ~h~ ~rk isUndertaken.

Any addition, exterior alteration, modification, or changeto an existing building shall be compatible with the originaldesign. Only the exterior materials existing on the parentstructure or compatible with the architectural design characterof the community will be approved.

No changes in the exterior colors will be approved. Paintingof the exterior is not allowed. The front and garage doors can betouched up, but the color cannot be changed. When touch up isrequired contact the Management Company for proper colorinformation.

In general, only those areas that are painted will berepainted; only those areas that are to be stained will be re-stained; unpainted surfaces and unstained areas such as stoneshall remain unpainted and unstained.

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C. Request for Change, Procedures:

The following guide is to assist homeowners when requestingan exterior change, to the Board of Directors.

l.Only a written request for change, using theARCHITECTUR3kL CH3iNGE REQUEST FORM, will be considered.

2.The ARCHITECTURIiL CHANGE REQUEST FORM and necessaryattachments are to be sent to the Attention of theArchitectural.’Control Committee or the President of theBoard of Directors care of the Management Co.

3.The Architectural Control ~Committee (if established) willreview requests and make recommendations to the Board basedon the established guidelines within thirty (30) da_~.

4.The description of the project should include allnecessary information for the Committee to take action.A sketch or photograph should be submitted including thefollowing information: materials to be used, dimensions(height, width, length), color, location, etc. If thealteration affects the drainage pattern, a proposeddrainage solution must also be submitted. If this changeaffects neighboring unit(s) in any way, those unit(s)owners may be informed and may have to agree in writingto their acknowledgment and acceptance of the change ifdeemed necessary by the Board.

Corrective Procedure

Possible violations of the Architectural Change Processshould be submitted to the Board of Directors, c/oManagement Co. in writing. (The name of the complainant wil!remain confidential.)

Exterior Changes and Modifications The following items musthave Board approva! with an ACR form prior to installation__s

l.Storln DoorsFull view, white colored storm doors can be added. Securitydoors may be installed, subject to normal architecturalchange request approval process.

2.Satellite Dishes and Exterior Antennas are governed bythe following FCC Ruling: On August 6, 1996, the FCCreleased a rule regarding the preemption of communityassociation restrictions on satellite antennas less thanone meter in diameter, off-the-air television antennas,and multipoint distribution service (MDS) antennas lessthan one meter. This rule applies only to an individualwho owns or has exclusive use of the area in which he or

5

she wants to install one or more antennas. Under thisrule, association restrictions which prevent, unreasonablydelay, unreasonably increase the cost of antennainstallation, maintenance or use, or preclude reception ofan acceptable quality signal will no longer be enforceable.However, reasonable architectural guidelines which do notimpair signal reception will continue to be enforceable.Examples of permissible restrictions include: mandatorypainting or screening of antennas and requiring the minimalvisual intrusion possible. The rule appears to permit aprompt application process.

In addition, masts to which MDS antennas are to beattached may be prohibited if more than 12 feet above theroofline. Restrictions designed to implement a clearlydefined safety objective or maintain the nature of ahistoric district are exempt from the rule. Inexceptional circumstances, an association may petitionfor a waiver of this rule.

Guidelines for Satellite Dishes

(hereinafterreferred to a~!sh")shall---~e allowedp~0~ided they are insta!led in Such a !fashi0n that!the~ia~hidden from view by placement in the rear 0f the dwelling Orbeside heat up~p~ir---~ondit±cnirlg__cc~pi_ei~rs, iuti~ity~meters or mounted o~ in an inconspicD~L~i~ ~-f- a small dish has to be installed in the yard inYfS-n-~-~Ethe dwelling, the dish must be screened bylandscaping so as to insulate it from view from the street.If landscaping is used to secrete a small dish, thelandscaping shall be of such a design or nature that thedish shall not be visible throughout by landscaping so as toinsulate it from view from the street and shall be of such adesign or nature that the dish shall not be visiblethroughout the year. Mounting~cn the~bui!d±ng roof or thechimney above.the roof linelmay not be allowed: Requestsfor installation of small d~shes Shall be submltted ~ARCHITECTURAL CHANGE REQUEST and be approved by;the Board ofDireCtOrS!prior £oiinstallationit0 insure each installation~complies with the aesthetic requirementSThe owner will be responsible for all liability of the smalldish and if it is removed, will be responsible for allrepair to the common ground or building exterior.

3. Garage LightingGarage light fixture replacement/ maintenance will be theOwner’s responsibility. It is the responsibility of theowner to keep these lights on during evening hours.

4. Awnings/Sun Screens, as a general rule, do not enhancethe aesthetic qualities of a community and are,

6

therefore, not allowed.

5. Patio coverings (turf, carpeting) cannot be installedby the homeowner on the front or rear concrete pad.

6. Bug lights are not allowed.

7. Banners are not to be displayed. The national flag may bedisplayed on national holidays.

8. Storage of anything under elevated decks is prohibited.

9. Trash and garbage containers shall not be permitted toremain conspicuous, except the evening before or day oftrash collections.

10.Signage (for sale/rent, etc.) will not be allowed onthe property. Signs may be placed inside windows only. Alimit of three (3) "Open House" signs may be strategicallyplaced in the community the day of the open house only.

Ii. Porch Lights/Deck Lights Replacements of these lightsmust match existing lights. The Management Company canprovide fixture specifications upon request.

12. Landscaping Additionallandscaping or alterations toexisting bushes, trees, and shrubs must be submitted onthe Architecturai change Form for reVieW by the B0ard.Installation of Annual or Perennial flowers may beplanted in existing flower beds without prior approval.

13. Deck Expansion/Construction Is not permitted by theAssociation.

SECTION 2

ASSOCIATION ASSESSMENTS

As a Homeowner, you are obligated to pay an "Association~qn~h!ylassessment" which represents your share of the~commonexpenses. This monthly assessment is due~oni<thelfirst ofieach

monthl If the full payment of the monthly assessment is notreceived by the thirtieth (30th) of each month for which it isdue, a $20.00 late payment fee will be imposed. You will receivecoupons and pre-addressed envelopes for each month to be usedwhen remitting your fee payment. (It is your responsibility topay the monthly fee. If a change of ownership occurs, we requesta copy of the settlement sheet or a formal notice from thesettlement attorney.)

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W~IAT CONSTITUTES A DELINQUENCY

The By-Laws provide the ability that Assessments be paid inadvance either monthly, quarterly, semi-annually or annually. Atthe present time a unit-owner is responsible for making monthlypaywnents on the first of each month.

A. The Offender

If it is .necessary to involve any legal means for thesole purpose 6f maintaining up to date assessment payments,it will then be established that the unit’s assessmentswil! be changed to a yearly payment in advance for theremainder of the calendar year.

B. Delinquency Procedure

Delinquency Chronology

Ist Day Assessment fee due and payable

30th Day "REMINDER NOTICE" is sent to homeowner requiring fullpayment. A $20.00 late fee is assessed.

60th Day "OVERDUE NOTICE" is sent to homeowner requiring paymentin ful!, giving the homeowner 15 days to pay assessmentfee.

75th Day "FINAL NOTICE" is sent to homeowner requiring paymentin ful! within 15 days; if payment is not receivedwithin the allotted 15 days, the account is turned overto the Association Attorney for immediate legal actionand filing suit. The monthly fees will be acceleratedto the end of the calendar year. Therefore, now due infull.

HOMEOWNERS WILL BE RESPONSIBLE FOR ALL ATTORNEYFEES AND COURT COSTS!

NOTE: Legal action may/will result in acceleration of fees,garnishment of wages, a lien upon the property and foreclosure.If the Board of Directors has to send a homeowner’s account tothe Attorney for collection, the Board of Directors willaccelerate the Association fees remaining for the fiscal year, asprovided for in your documents. The Association will also chargea $95.00 administrative charge to the owner to absorb expensesrelated to handling the delinquent account.

8

SECTION 3

COM~ION GROUNDS REGULATIONS

The intent of these regulations is to avoid unnecessarymaintenance costs, to preserve the continuity and integrity ofthe community, and to retain HIGH standards of appearance,thereby protecting the investment of each homeowner.

A. Regulations R~garding Pets

i. Only customary house pets are permitted in thecommunity.

2. When pets are outside the house, they must beleashed and accompanied by the pet ow~@~ a~d th~ petmust NEVER be out of the sight of this person.

~3. Pet owners are responsible for seeing that allvaccinations required by law are up to date.

4. Any damage to the grounds will be the financialresponsibility of the owner.

5. NO pet shall be housed or chained outside anyresidence.

6. Owners are responsible for controlling the noiselevel of pets so that neighbors are not excessivelyannoyed.

7. The housing of more than three (3) pets in anyresidence is prohibited.

8. The owner will be responsible for picking up solidwastes left by their animal upon discharge.

9. The Board of Directors reserves the right to seekremoval of any pet that becomes a community nuisancedue to chronic disregard of established rules andregulations.

B. Regulations for Motor Vehicles

I. The parking of recreational vehicles, trailers,campers Or boats is prohibited on the streetS~!driveways and Common parking areas of th~ �ommunity~

2. Due to Fire Department Regulations the parking ofmotor vehicles on community streets or blocking afire hydrant at any time is prohibited.

3. Vehicles shall not be parked in such a way thatthey will restrict other homeowners from entering orleaving their garage.

4. Parking at the intersection of streets is notpermitted.

5. No overnight parking on streets.

~6. Any motor vehicle which is i~operative or notbeing used for normal transportatlon must be k~tWithin a closed ga_~rage.

7. The parking of motor vehicles on grassy orlandscaped areas is prohibited.

8. No boats, campers, trailers of any kind, buses,mobile homes, trucks, commercial vehicles,motorcycles, mini bikes, mopeds, or any othervehicles of any description other than normalpassenger automobiles shall be permitted to beparked or stored anywhere within the Property unlessthe Board determines otherwise. However, nothing shallprevent the parking or storage of such vehiclescompletely enclosed within a garage.

9. Damage to the grounds caused by motor vehicleswill be repaired at the owner’s expense. This includesdamage to streets and driveways resulting fromautomobile fluids leaking onto the asphalt.

i0. Automobile repairing shall be performed onlywithin the �onfines of a homeowners garage. Nowelding, construction or painting of vehicles isal!owed in the garage or anywhere in the complex.Only normal maintenance procedures should beperformed in the complex.

Ii. Any parked vehicle impeding the removal of snowfrom community streets may be removed immediately,withQut notice.

12. common area parking is for use by guests in thecommunity~

13. All vehicles must be moved within a 24 hourperiod.

~4. Violators receiving a combination of threeiolation letters or tagging of their vehicles w~ll beowed at the owner’s expense without further notice.

15. If three parking violation letters are sent to the

I0

same address in a successive six month period, anyadditiona! violation will be towed without furthernotice, at the owner’s expense. Please note that theseviolations need not be for the same vehicle,but for any vehicle, guest or otherwise, that theunit owner has allowed usage of the community’scommon area.

16. The Board of Directors reserves the right to havea vehicle removed at the owner’s expense due todisregard of the established rules and regulations.

Regulations Regarding Landscaping

I. The addition or removal of shrubs or trees must beapproved by the Board.

2. Residents are permitted to plant annual flowersandiperennial flowers in areas where iexisting mulch.beds border the home or patio: Vegetable gardens arenot permitted in these mulch beds. Potted plants arepermitted and encouraged; however, permanent soilfilled areas on patios or decks for the purpose ofgrowing vegetables or ornamentalplants is prohibited.

~. The application of fertilizer or chemicals to the~homeowners prohibited.~.~awns by is

4. Lawn decorations, such as statutes, stonework, orother ornamentation must be approved by the Board.

5. Firewood storage: Not more than one (i) rick perhome owner can be stored on the deck/patio or rearfoundation. Wood needs to be stored off the ground andin a meta! rack or box. No wood should be stored on thefront porches or have contact with the building.

Regulations Regarding Lakes

I. The lakes are for visual enjoyment only and NOfishing is allowed.

2. Swimming in the lakes is not permitted.

3. Boats, rafts, or other flotation devices areprohibited.

4. Docks, piers, or other structures may not beerected on the lake shores.

5. Residents may not introduce aquatic vegetation,

ii

fish or other aquatic species into the lakes.

6. Dams or other structures which prohibit the flowof water may not be erected in the spillways.

Regulations Regarding Children

i. Parents are responsible for controlling theactivities of their children so that other residentsare not ~nduly disturbed.

2. Children should not ride bicycles, mopeds, minibikes or go carts in those areas of the communitywhere they cannot be clearly seen by oncomingmotorists.

3. Children riding on tricycles, "Hot wheels" andother low profile vehicles are not easily noticed bymotorists. Therefore, these vehicles should beridden in the driveway areas only.

4. Bicycles and other vehicles shall not be ridden ongrassy or landscaped areas.

5. All toys, bicycles, etc., shall be kept in thehome or garage when not in use.

6. Any damage to the grounds caused by children willbecome the financial responsibility of the parenthomeowner.

7. NO permanent basketball goals are permitted.Portable goals must be stored in garage after eachuse.

Enforcement of Regulations

Enforcement of the regulations is one of the mostdelicate problems which the community, must handle.However, in the interest of the community as awhole, enforcement becomes a matter of necessity.Therefore, unless otherwise noted above, violations ofthe rules and regulations will be treated as follows:The Association is responsible to enforce the Covenants,Conditions and Restrictions as described in theDeclaration, the By-Laws and the Community Rules andRegulations as adopted by the Board. Please review thesedocuments to familiarize yourself with the scope of theAssociation’s responsibilities. Problems not illustratedin the documents most likely are the responsibility ofoutside agencies such as the Police, Department ofTransportation, Zoning, etc. and should be reported to

12

those entities. Maintenance concerns that are theAssociation’s responsibility should be submittedimmediately to the Management Company by telephone.

The Association requires that all rule violationcomplaints that fal! within the Association’sjurisdiction be submitted in writing (for a firstoffense) and identify the violation, date of occurrence,the address of the violating party and any detailsavailable...such as auto make and color, or the breed,size and/or color of offender’s animal to better definethe problem. This information will enable yourAssociation to have a written complaint on file tosubstantiate the complaint and action taken by the Board.

Once a written complaint is on file for a specificoffense we will accept any subsequent complaints verballyin regard to this offense from the party that lodged theoriginal written complaint. Complaints will be respondedto by sending the violating party a letter regardingcorrecting the infraction and consequences if the problempersists. In order for the complainant to know thattheir issues have been addressed an additiona! copy ofthe violation letter will be forwarded to him/her.Chronic disregard to the community rules may result incharges incurred to the homeowner.

The Association appreciates your cooperation infollowing the above policy in order to enable your Board ofDirectors to effectively enforce the community’s rules,regulations and restrictions.

The cost of repairing damage to the grounds caused bycars, dogs, children, or any other means is the soleresponsibility of the homeowner and will be subjected tothe same rules of enforcement as would any other problem.

Additionally, there will be a $35.00 charge to the unitowner for all violation letters in excess of three,regarding the same violation. This charge is to offsetthe expenses being incurred by the Assoc., and will beadded to the unit owner’s account. Collection will begoverned by the current account collection procedure.

There may be additional expenses incurred by theAssociation in pursuing correction of the violation thatwill also be charged to the violating unit owner.

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SECTION 4

INSURANCE

One of the many functions of your Board of Directors is thepurchase 0f an Insurance Policy to cover the buildings and common

liability of our Association. It is the intent of the Board toprovide coverage that would restore your unit to it’s originalcondition in the event of a loss.

As a unit owner, it is important that you understand certainaspects of the Association’s Master Policy, as it relates to yourown insurance program. You must cover your own personal propertyand personal liability. You are alsolrequired to cover floor andwal! c~v~rings and any improvements to the unit with a HO6condominium O~ner Policy as required by all mortgage holders.

The Association policy has a $250.00 deductible. When aclaim is made through the Association’s Master policy, it may benecessary for the unit-owner to pay this deductible. Thissituation would most commonly occur when the loss originates fromwithin a unit. In the event of a loss involving your unit it isyour responsibility to MINIMIZE THE LOSS and report it to R & GManagement Company. We wil! take the loss report, forward theinformation to the insurance company and advise you how toproceed in obtaining estimates and any emergency or temporaryrepairs needed. IT IS IMPORTANT THAT NO GENERAL REPAIR WORK BESTARTED BEFORE THE INSURANCE COMPANY HAS HAD THE OPPORTUNITY TOINSPECT THE PREMISES AND/OR APPROVE THE REPAIR ESTIMATE(S).

INSUI~ANCE CLAIMS

If a claim on a master insurance policy is identified, theresponsibility of the deductible is as follows:

i.) Damage occurring outside of the exterior wall pane of theunit: the Association will be responsible for the deductible andwil! coordinate all repalrs and payment of invoices.

2.) Damage occurring inside the exterior wall plane of the unit,including under the unit and in the attic: the homeowner isresponsible for the deductible. Many times the unit owner’s HO6policy can be applied toward satisfylng the Association’sdeductible. The Association is the named insured on the policy.The homeowner will submit estimates and invoices )if there wereemergency repairs) to R & G Management who will issue any claimproceeds, less the deductible, co the association, which willthen disburse them to the homeowner and!or contractor uponreceiving invoices for work done.

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3.) Roof leaks and Interior Damages: if the roof leak andinterior damages (if any) are related to an external "act of God"(hail, wind, tree limb, ice jam, etc.) The Association willrepair the exterior and the drywall damage at no cost to theowner and submit a claim (if applicable). The owner wil! beresponsible to insure all wall and floor coverings (paint,wallpaper, carpet, tile, etc.) personal property and improvementsto the property. If the roof leak is not related to such a cause,but instead results from construction failure, normal wear andtear, the Association will repair the exterior damages. Ifinterior damage results from an owners neglect or failure tomaintain items within his unit, the owner must pay theAssociations deductible.

Please keep in mind that the Association is the namedinsured on the Master Policy and therefore the insurance companywill be responsible for coordinating the claim processing. Uponsatisfactory completion of any loss involving individual unitsthe insurance company will send the insurance proceeds less thedeductible to the Association for distribution to the contractorwho preformed the work.

We are doing our best to give you advice as to areas thatrequire your consideration as a unit owner. We cannot act as yourinsurance advisor; however, we strongly urge you to take steps toprotect your property with the very best possible coverage.

SECTION 5

MA!qAGEMENT COMPAIqY

R & G Management, our managing agent, is responsible forfinancial administration of the Association and for theadministration and maintenance of the common areas of yourcommunity. The~monthly Association assessments collected are usedto pay for common services (including maintenance of the grounds,snow removal, the Association’s master insurance policy, repairsto the common areas, etc.) Any questions or problems should bedirected to the managing agent.

SECTION 6

CHAiqGE OF ADDRESS

15

In this booklet you will find a "CHANGE OF ADDRESS" form,which should be completed and mailed to the Management Co. if yourelocate, but do NOT sell your home. Providing this informationto us is very important since, as an Owner, you will continue toreceive all pertinent information regarding the Association. If,however, you do sell your home, please complete the "NOTICE OFRESALE" form and mail it to the Management Co. Both of thesedocuments are extremely important to the Association and you as amember.

SECTION 7PROBLEMS WITH YOUR HOME

A. Exterior

If you notice a problem with the exterior of yourunit or anywhere on your building, please contact theManagement Company as soon as convenient by phone or inwriting so that the problem can be corrected before anyadditional damage can be done.

B. Interior

Each individual homeowner is responsible for allproblems with the interior as well as the windows, doors(garage, front and patio), including maintenance and repairon the skylight.

SECTION 8

A. Snow Removal, Freezing

Many of us like to see snow but few of us like the problemsthat can follow. Every effort will be made during the snowseason to remove the snow with as little inconvenience to you aspossible. There typically will not be any removal ~0nsidereduntil two (2) inch~s Of sn0W has fallen~ At that time thefollowing factors will be considered concerning removal:

A. Time of dayB. How much additional snow is expectedC. How hard the wind is blowing and if

there is a potential for driftingD. Contractor scheduling

What will be plowed:A. StreetsB. DrivewaysC. Sidewalks

The removal crews will normally NOT be able to come back toclear where cars were parked during the initial remova!, so

16

please park in your garage whenever possible. The contractor isexpected to remove snow, not ice. Occasiona! sanding can be doneat dangerous intersections. We would suggest you keep a bag ortwo of sand NOT SALT to use on your sidewalk when it is coveredwith ice. Salt will cause excessive damage to the concrete andasphalt.

B. Freezing Temperatures and Plumbing

The Associatiqn master insurance policy normally willprovide coverage f~r ruptures in water lines due to freezing;however, there are a few exceptions. Even if coverage isavailable, it is in everyone’s best interest to do all they canto prevent such a loss. As with any insurance, if the lossexperience is too high, your premium, will increase and/or it maybecome more difficult for the Association to obtain properinsurance coverage. Please take every available step to avoidfrozen popes this winter including leaving water running when thetemperature is forecasted to be in the single digits or below,particularly if there is going to be a substantial wind-chillfactor.

If a pipe freezes and/or ruptures. It will be yourresponsibility to thaw it out and stop the water to preventfurther loss. You will then need to report the loss to theManagement Company. (refer to Section #4 INSURANCE)

17

BAY SHORE VILLAS C.O.A., INC.NOTICE OF RESALE

Date

FORMER OWNER(S) OF PROPERTYNEW OWNER(S) OF PROPERTY(as shown on Deed)Lot No.

Address of Propert~Alternate Address, if applicableBusiness PhoneSettlement DateExpected Move-in Date

~ome Phone

Name of resident(s) (if different than Owner)

Business Phone

Additional Remarks or Information:

Sales Price

Home Phone

Mortgage Loan

Lender

Association Fees pro-rated: YesCheck Enclosed: Yes

INSTRUCTIONS: Contact the office of R & G Management Company at(317) 875-5600 to obtain a Certificate of Assessments, ifnecessary.

Please complete the above information as requested and mail to:R & G Management Co.P.O.Box 436Zionsville, IN 46077

18

BAY SHORE VILLAS C.O.A., INC.CHANGE OF ADDRESS NOTICE

HOMEOWNERS ASSOCIATION

HOMEOWNER

CURRENT ADDRESS

UNIT NIIMBER

NEW ADDRESS

NEW PHONE NUMBER

NOTE This form should be completed and mailed if yourelocate but do not sell your home to:

R & G Management CompanyP. O. Box 436Zionsville, IN 46077

If you have any questions, please call (317) 875-5600.

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ARCHITECTURAL CONTROL COMSIITTEEBay Shore Villas C.O.A., Inc.Homeowner Request for Change

Please complete items 1-6 only.

NameAddressMode! or Unit TypeBriefly describe the proposed change:

Phone

3. Will there be changes or modifications in basic utilityservices or existing structures to accommodate the proposedchange? Please indicate.

Yes No Yes No

Electric Exterior Walls

Telephone Patio Fencing

Gas Patio Slab

Water Sidewalks

Sewage Pavements

TV Cable Other4. Please list below the major construction materials whichwill be used in this project. Be as specific as possible.(Exterior materials must conform to those used on the originalbuilding or be sufficiently compatible.)

5. If the proposed project is an addition or alteration thatwould change the structural appearance of your residence,please attach the following information.

A. Plot plan indicating the location and dimensions of theproject.

B. Blueprints or working drawings indicating all necessarydimensions and elevations.

C. If available, a photograph or drawing of a similarcompleted project.

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6. Project schedule:

The project will be done by:Contractor(s) NameBoth

Homeowner

required.

Please indicate the approximate time needed to completethe project, subsequent to the Board approval.Please indicate any building permits that wil! be

NOTE: All submitted materials shall remain the property of theAssociation. You may wish to make a copy for your personalrecords.

I hereby acknowledge that I have read and understand theARCHITECTURAL CONTROL STAIqDARDS set forth by the Board, as wel!as the Declaration of Covenants and Restrictions.Homeowner’s SignatureDO NOT WRITE BELOW

Committee Action:( ) Approved as submitted( ) Deferred

( ) Additional information required:

( ) Other:

( ) DeniedComments:

SignedDate

21

DECT~TION OF HORIZONT~L PROPERLY! OWNERSHIP

BAYSHORE VILI~

HORIZONTAL PROPERTY REGIME

TABLE OF CONTENTS

RECITALS

DEFINITIONS .

DESCRIPTION OF BUILDINGS.

LEGAL DESCRIPTION & PERCENTAGE INTEREST

DESCRIPTION OF CONDOMINIUM UNITS

COM~ON A!~E/~ & FACILITIES .

LIMITED /d~EAS & FACILITIES.

OWNERSHIP OF COMMON

ENCROACH~4ENTS & EASEMENTS

REAL ESTATE TAXES ....

UTILITIES’. ¯

ASSOCIATION OF OWNERS .....

USE OF COMMON A!~EAS .......

MAINTENANCE, DECORATION, REPAIRS & REPLACEMENTS

I%LTERATIONS, ADDITIONS & IMPROVEMENTS

PERCENTAGE INTEREST

INSURANCE .......................

CASUALTY & RESTORATION; CONDEMNATION; & TERMINATION

COV~NAIqTS & RESTRICTIONS .........

SALE, LEASE OR OTHER TBANSFER .

Ins% ~ ~OOO-OO1~696

PAGE NUMBER

1

2

5

5

5

7

7

8

9

¯ 9

ii

12

14

14

15

2O

26

27

AMENDMENT OF DECLARATION

ACCEPTANCE& RATIFICATION ¯

NEGLIGENCE ¯ ¯

GRANTING OF EASEMENTS .....

RIGHTS TO USE OF COMMON AREAS

INITIAL MANAGEMENT

COSTS & ATTORNEY’S FEES

FAILURE TO PAY ASSESSMENTS

SEVERABILITY CLAUSE .

PRONOUNS

28

31

32

33

33

34

35

35

35

36

DECIJh~u~TION OF HORIZONTi%L PROPERTY OWNERSHIP

BAYSHOREVILLAS

HORIZONTAL PROPERTY REGIME

THIS DECLARATION of Bayshore Villas Horizontal Property Regime

("Declaration") made this Z~~ day of ~-~ , 2000 by

Rottlund Homes of Indiana Limited Partnership, a Minnesota Limited

Partnership, an agent and subsidiary of The Rottlund Company

Incorporated, a Minnesota Corporation, (the "Declarant").

WITNESSETH:

WHEREAS, Declarant is the purchaser of certain real estate and

improvements thereon, !ocated in Marion County, Indiana, more

particularly described in

the "Real Estate"); and

Exhibit "A" hereto (hereinafter called

WHEREAS, Declarant, by execution of this Declaration, hereby

creates a Horizontal Property Regime (the "Regime") upon the Real

Estate, subject to the provisions of the Horizontal Property Law of

the State of Indiana, (the ’~Act") and the terms and conditions of

this Declaration.

NOW, THEREFORE Declarant hereby makes this Declaration, and

declares that the Rea! Estate shall be a "Horizontal Property

Regime" as provided in the Act, subject to and in accordance with

the following terms and conditions:

SECTION I. Definitions. The following terms, as used in this

Declaration, unless the context clearly requires otherwise, shal!

mean the fol!owing:

(a) ~Act" means the Horizontal Property Law of theState of State of Indiana, Acts 1963, Chapter349, Sections 1 through 31, as amended. TheAct is incorporated herein by reference, andidentifie~ in the Indiana Code as 32-1-6 etseq.

(b) ~Association" means Bayshore Villas Co-OwnersAssociation, Inc., an Indiana not-for-profitCorporation, being the Association of the Co-Owners of Bayshore Villas, more particularlydescribed in Section ii hereof.

(c) "Board of Managers, means the governing bodyof the Association, being the initial Board ofManagers referred<i to<~¢&n~i the By-Laws orsubsequent Board of Managers elected by theCo-Owners in accordance with the By-Laws~ Theterm "Board of Managers", as used herein andin the By-laws, shall be synonymous with theterm "Board of Directors" as used in the Act.

(d) .... ~Building" means any structure on the RealEstate in which Common Areas, Limited Areas orone or more Condominium Units are located.The buildings are more particularly describedand identified on the Plans and in Section 2of this Declaration.

(e) ~By-Laws" means the Code of By-Laws ofBayshore Villas Co-Owners Association, Inc.,providing for the administration andmanagement of the Association as required byand in conformity with the provisions of theAct. A true copy of the By-Laws is attachedto this Declaration and incorporated herein byreference.

"Common Areas" and "Limited Areas" mean [hecommon areas, limited common areas andfacilities as defined in Sections 5 and 6 ofthis Declaration.

2

(g)

(h)

(i)

(j)

(k)

"Common Expenses" means expenses ofadministrati0~ 0f the Association, expensesfoE the upkeep, mainten~nce~ ~ePa~r andreplacement of the common Areas and LimitedAreas ahd all other ~osts and expensesincurred by the Associati0n for the benefit ofCommon Areas and Limited Areas or for thecommon benefit of all Owners; provided,h~e~4~ ~hat Common Expenses Shall notinclUde any costs of ini~tial construction orinitiai r~n0vati0n of any Building or otherP~0perty Or improvements or any portion Of theTract, nor any costs of repairs covered by anyWarranty of Declarant as builder of theCondominium Units, nor to any costs or repairsarising out of construction, renovation orother activities on any portion of the RealEstate.

~Condominium Units" means any one of theliving units constituting Bayshore Villas,each individual living unit being moreparticularly described and identified on thePlans and in Sections 3 and 4 of thisDeclaration. "Condominium Unit" includes theundivided interest in the Common Areas andLimited Areas pertaining to such unit.

~’Co-Owners" means all of the Owners of all ofthe Condominium Units in the Regime.

~Declarant" shal! mean and refer to RottlundHomes of Indiana Limited Partnership and anysuccessors and assigns of Rottlund Homes ofIndiana Limited Partnership, whom itdesignates in one or more recorded instrumentsto have the rights of Declarant hereunder,including, but not limited to, any mortgageeacquiring title to any portion of the Propertypursuant to the exercise of the rights under,or foreclosure of, a mortgage executed byDeclarant.

"Drainage System" means the storm sewers,subsurface drainage tiles, pipes andstructures, and other structures, fixtures,properties, equipment and facilities locatedin, upon, or under the Common Areas,Easements, or Streets and designed for thepurpose of expediting the drainage of surface

(m)

(n)

(o)

and subsurface waters from, over and acrossBayshere Villas.

~Mortgagee" means the holder, insurer orguarantor of a first mortgage loan on aCondominium Unit.

’~Owner" means a person, firm, corporation,partnership, association, trust or other legalentity or any combination thereof who or whichowns the "fee simple title to a CondominiumUnit; provided, however, that persons orentities owning a single Condominium Unit astenants-in-common, joint tenants, tenants bythe entireties, or any form of joint ordivided ownership, shall be deemed one Ownerfor purposes of this Declaration. Persons orentities owning more than one Condominium Unitshall have the status of an Owner for eachCondominium Unit owned.

~Percentage Interest" means that percentage ofthe total undivided interest accruing to al!the Condominium Units which is appurtenant toeach Condominium Unit and accrues to the Ownerthereof. The formula for determining"Percentage Interest" is set forth in Section15 hereof.

"Plans" means the floor and building plans ofthe Buildings and Condominium Units preparedand certified by Mark A. Smith, of M_ASAssociates, LLC, registered architects, dated

/~ .~ /q , 1999, and the site plans,surveys, and elevation plans of the Rea!Estate and Buildings prepared by Maurer &Associates, Inc., a registered engineer underdate of .~ -~ , 1999, all of which areincorporated herein by reference. Amd made apart of the Regime by such references.

"Property" means the Real Estate andappurtenant easements, the Condominium Units,the Buildings, improvements, and Property ofevery kind and nature whatsoever, real,personal or mixed, located upon the RealEstate and used in connection with theoperation, use and enjoyment of BayshoreVillas, but does not include the personalproperty of the Owners.

4

SECTION

~Bayshore Villas" means the name by which theHorizontal Property Regime shall be known.

~Tract" means the Real Estate as hereindefined.

2. Description of Buildinqs. There are or will be

built, Buildings containing Condominium Units on the Real Estate as

shown on the Plans. As of the date of this Declaration,

construction is not completed on the Condominium Units. A

description of the Buildings and the Condominium Units contained or

to be contained therein is set forth in Exhibit "B" attached hereto

and hereby made a part hereof by this reference.

SECTION 3. Leqal Description and Percentage Interest. Each

Condominium Unit is identified on the Plans by a number. The Legal

Description for each Condominium Unit shall consist of the

identifying number for such Condom±nium Units as shown on the

Plans, and shall be stated as ’~Condominium Unit" (with identifying

number) in Bayshore Villas Horizontal Property Regime. The

Percentage Interest of each Owner in the Common Areas and Limited

Areas as hereinafter defined shall be the same percentage of

interest as each Condominium Unit as set forth on Exhibit "C"

attached hereto and hereby made a part hereof.

SECTION 4. Description Of Condominium Units.

(a) "Appurtenants". Each Condominium Unit shallconsist of all space within the boundariesthereof, as hereinafter defined, and allportions of the Building situated within suchboundaries, including, but not limited to, allfixtures, facilities, utilities, equipment,appliances, and structura! components designedand intended solely and exclusively for the

enjoyment, use~ and benefit of the CondominiumUnits wherein the same are located, or towhich they are attached, but excludingtherefrom that designed or intended for theuse, benefit, support, safety or enjoyment ofany other Condominium Unit or which may benecessary for the safety, support,maintenance, use, and operation of any of theBuildings, or which are normally designed forcommon use; provided, however, that allfixtures,..equipment and appliances designed orintended for the exclusive enjoyment, use andbenefit of a Condominium Unit shall constitutea part of such a Condominium Unit, whether ornot the same are located within or partlywithin the boundaries of such CondominiumUnit. Also, the interior sides and surfacesof all doors and interior and exterior or sizeand frames of all windows in the perimeterwalls of the Condominium Unit, whether or notlocated within or partly within the boundariesof the Condominium Unit, and all interiorwalls and al! floors and ceilings within theboundaries of the Condominium Unit, areconsidered part of the Condominium Unit.

(b) "Boundaries". The boundaries of eachCondominium Unit shall be as shown on thePlans and shall be measured between theinterior unfinished surface of the floors,ceilings and perimeter walls of eachCondominium Unit. In the event any horizontalor vertical or other boundary line as shown onthe Plans does not coincide with the actuallocation of the respective wall, floor, orceiling surface of the Condominium Unitbecause of inexactness of construction,settling after construction or for any otherreason, the boundary lines of each CondominiumUnit shall be deemed to be and treated forpurposes of ownership, occupancy, possession,maintenance, declaration, use and enjoyment,as in accordance with the actual existingconstruction. In such case~ permanentappurtenance easements for exclusive use shallexist in favor of the Owner of eachCondominium Unit in and to such space lyingoutside of the actual boundary lines of theCondominium Unit, but within the appropriatewall, floor or ceiling surfaces of the

Condominium Unit.

SECTION 5. Common Areas And Facilities. "Common Areas" shall

include the following, except to the extent otherwise specifically

designated in this Declaration as being within a Condominium Unit

or as a Limited Area:

(a) The Real.. Estate, excluding the CondominiumUnits;

(b) The foundations, columns, girders, beams,supports and exterior surfaces of roofs of theBuildings;

(c)

(d)

The yards, sidewalks, parks, pathways, ponds,lakes, trails, interior and exteriordriveways, parking areas, entrances and exits;

Central electricity, gas, water, airconditioning and sanitary sewer mains servingthe Buildings unless separately metered to aparticular Condominium Unit;

(e)

(f)

Exterior lighting fixtures and electricalservice lighting to the exterior of theBuildings unless separately metered to aparticular Condominium Unit; and

Pipes, ducts, electrical wiring and conduitsand public floors, roofs and exteriorpermanent walls of the Buildings, except tothe extent the same are otherwise classifiedand defined herein as Limited Areas or as partof a Condominium Unit.

SECTION 6. Limited Areas and Facilities. Limited Areas and

those Condominium Units to which use thegeof is limited are as

fol!ows:

(a) The front entrance ways, patios, porches, andall exterior sides and surfaces of doors andframes surrounding the same on eachCondominium Unit shall be limited to theexclusive use of the Condominium Unit to whichthey appertain.

7

(b) Any other areas designated and shown on thePlans as Limited Areas shal! be limited to theCondominium Unit or Condominium Units to whichthey appertain as shown on the Plans.

SECTION 7. OwnershiD Of Common Areas and Percentaqe Interest.

Each Owner shall have an undivided interest in the Common Areas and

Limited Areas, as tenants-in-common with all the other Owners,

equal to his or he~r Condominium Units Percentage Interest. The

Percentage Interest in the Common Areas applicable to each

Condominium Unit shall be determined in accordance with the formula

set forth in Section 15 hereof. The Percentage Interest in the

Common Areas and Limited Areas presently pertaining to each

Condominium Unit is specified in Exhibit "C" hereto. In any

computation of Percentage Interests, the figure obtained shal! be

rounded to the nearest one-thousandth of a percent, and shall be so

presented for all purposes of conveyance and for a!l purposes

contemplated under this Declaration.

SECTION 8. Encroachments, Easements For Common Areas and

Ingress and Eqress Easements. If, by reason of the location, the

construction, settling or shifting of a Building, any Common Area

or Limited Area now encroaches or shall hereafter encroach upon any

Condominium Unit, then in such event an easement shall be deemed to

exist and run to the Co-Owners and the Association for the

maintenance, use and enjoyment of such Common Area or Limited Area.

Each Owner shall have an easement in common with each other Owner

to use all pipes, wires, ducts, cables, conduits, utility lines and

other common facilities located in any of the other Condominium

Units and serving his Condominium Unit. Each Owner shall have an

easement over the Common Areas for the purpose of ingress and

egress from his Condominium Unit, and to use all Common Areas

wherever located, and such easement shall be perpetual and

appurtenant to the Condominium Unit.

SECTION 9. R~al Estate Taxes. Real Estate taxes are to be

separately assessed and taxed to each Condominium Unit as provided

in the Act. In the event that for any year Real Estate taxes are

not separately assessed and taxed to each Condominium Unit, but are

assessed and taxed on the property as a whole, then each Owner

shall pay his or her proportionate share of such taxes to the

extent attributable to the Property in accordance with his

respective Percentage Interest.

SECTION I0. Utilities. Each Owner shal! pay those utilities

which are separately metered to his or her Condominium Unit.

Utilities which are not separately metered shall be treated as and

paid as a part of the Common Expenses unless otherwise agreed by

the majority of the Percentage Interest.

SECTION II. Association of Owners. Subject to the rights of

Declarant reserved in Section 24 hereof, maintenance, repair,

upkeep, replacement, administration, management and operation of

the Property shall be by Bayshore Villas Co-Owners Association

Inc., (the "Association"), a not-for-profit Corporation organized

under the laws of the State of Indiana. Each Owner of a

Condominium Unit shall, automatically upon becoming an Owner of a

9

Condominium Unit, be and become

shall remain a member until such time as

ceases, the membership shal! terminate when

a member of the Association and

his or her ownership

such person ceases to

be an Owner, and shall be transferred to the new Owner.

The Association shall elect a Board Of Managers annually

(except for an initial Board of Managers defined in the By-Laws)

in accordance with and as prescribed by the By-Laws. Each Owner

shall be en~itled to cast a vote commensurate with the number of

Condominium Units owned by that Owner for the election of th~ Board

of Managers, except for such initial Board of Managers who shall

serve on the initial Board of Managers, whether as an original

member thereof or as a member thereof appointed by Declarant to

fil! a vacancy, and who shall be deemed a member of the Association

and an Owner sqlely for the purpose of qualifying to. act as a

member of the Board of Managers and for no other purpose. A person

serving on the initial Board of Managers shall not be deemed or

Considered

Condominium

Owner of a

Association.

The

a member of the Association nor an Owner of a

Unit for any other purpose unless he is actually a

Condominium Unit and thereby is a member of the

Board of Managers shall be the governing body of the

Association, representing all the Owners in providing for the

management, administration, operation, maintenance, repair,

replacement and upkeep of the Property exclusive of the Condominium

Units.

I0

The Association and any aggrieved Condominium Unit Owner shall

have a right to action against any Condominium Unit Owner for

failure to comply with the provisions of the Declaration, By-Laws

or decisions of the Association which are made pursuant to

authority granted the Association in such documents. Condominium

Unit Owners shall..have a similar right of action against the

Association.

SECTION 12. Use of Common Areas. The Board of Managers shall

adopt rules and regulations concerning maintenance, repairs, use

and enjoyment of the Common Areas and Limited Areas as it deems

appropriate, and may amend and modify the same from time to time as

it deems advisable, necessary or appropriate.-

The Board of Managers or their designated agents shall have

the right at reasonable times and upon reasonable prior notice

Common Areas

SECTION

Replacements.

(a)

(except in cases of emergency in which ~case no notice shall

required), to enter into each individual Condominium Unit for the

purpose of inspection of the Common Areas and Limited Areas

appurtenant thereto and replacement, repair and maintenance of such

and Limited Areas.

13. Maintenance, Decoration, Repairs And

Common Areas. The Association will beresponsible for the maintenance, repair,decoration, restoration, and replacement ofthe Common Areas. Maintenance, decoration,repairs, and replacements of the Common Areasshall be furnished by the Association and thecosts thereof shall be part of the CommonExpenses. The Association may elect to

delegate such duties to a Managing Agent andmay enter into a management contract for suchpurpose, provided that such agent and theterms of such contract are approved by amajority of the vote present or represented atany meeting of the Association. Declarant oran entity affiliated with Declarant may serveas the Managing Agent for the Association solong as Declarant retains control of theAssociation, and may perform all propertymanagemen~ functions on behalf of theAssociatfon. Any management contract made orwhich is deemed to arise between theAssociation and Declarant (or any a~filiate)shall be terminable by the Association withoutcause and without penalty upon thirty (30)days’ written notice at any time afterDeclarant relinquishes control of theAssociation. The Board of Managers has theright to adopt such rules and regulationsconcerning the maintenance, repairs, use andenjoyment of the Common Areas as it deemsappropriate, including the appointment of ~committees to oversee the same. The Board ofManagers shall have the exclusive right todetermine the outside decor of each Building,including without limitation the color andtype of paint and other decor pertinent to theexterior of each Building.

Condominium Units. Each Owner shall controland have the right to determine the interiordecor of his or her Condominium Unit, but thisshall not include the right to make structuralchanges to the Unit, nor the right to useinterior decor which in the discretion of theBoard of Managers adversely affects theexternal appearance of the Condominium Unit,as more particularly set forth in the By-Lawsof the Association. No act or omission whichconstitutes waste shall be Committed orsuffered in or upon any Condominium Unit, theCommon Areas, or Limited Areas. Each Ownershal! maintain and repair at his or her solecost and expense all fixtures, appliances,equipment, and other improvements constitutinga part of his or her Condominium Unit underSection 4 hereof, and each Owner shallpromptly repair any condition or defectexisting or occurring in his or her

Condominium Unit which, if not repaired, mightadversely affect any Condominium Unit, CommonArea or Limited Area. The Board of Managersand the Managing Agent Shall have the right atreasonable times and upon reasonable priornotice (except in cases ~of emergency in whichcase no notice shall be required) to enter inthe Condominium Units and Common Areasadjacent to each Condominium Unit to replace,repair, and maintain such Common Areas, Inthe event that any Owner fails or is unable tomaintain Or repair any condition or defect forwhich he or she is responsible and the Boardof Managers or the Managing Agent have areasonable basis for believing that suchcondition or defect has caused or threatens tocause immediate and/or substantial harm to anyperson or to any property outside such Owner’sCondominium Unit, the Board of Managers andthe Managing Agent shall each have the rightto enter such Owner’s Condominium Unit toremedy or repair such condition or defect, andany costs or expenses incurred in connectiontherewith (including attorney’s fees) shall bepayable by such Owner upon demand by the Boardof Managers or the Managing Agent. Nothingherein contained shall be construed torepresent a contractual liability to any Owneron the part of the Declarant, the Association,or the Board of Managers for maintenance,repair, or replacement of any CondominiumUnit, Common Areas, or Limited Areas, and theliability of the Association, the Board ofManagers and Managing Agent in this regardshall be limited to damages resulting fromgross negligence, recklessness, or intentionalmisconduct, unless otherwise provided in themanagement contract in the case of theManaging Agent.

SECTION 14. Alterations, Additions and ImDrovements. No

Owner shall make any alterations or additions to or which would

affect, the Common Areas or Limited Areas without the prior written

approval of the Board of Managers, nor shall any Owner make any

alteration in or to his respective Condominium Unit and within the

13

boundaries thereof which would affect the safety and structura!

integrity of the Building in which Condominium Unit is located.

Declarant reserves the right to change the interior design and

arrangement of all Condominium Units and alter the boundaries

between Condominium Units so long as Declarant owns the Condominium

Units so altered. ~. No such change shall increase the number of

~Condominium Units or change the Percentage Interest applicable to

such Condominium Unit. If Declarant shall make any changes in the

Condominium Units so authorized, such changes shall be reflected by

a supplement to the Plans and such Supplement to the Plans need not

be approved by the Association or any other Owners.

Section 1.5. PercentaGe Interest~ The Owner of each

Condominium Unit shall have a Percentage Interest appurtenant to

his Condominium Unit Ownership based upon the number of Condominium

Units owned by that Owner divided by the total number of all of the

Condominium Units existing in the Regime at that time in accordance

with Section 7(a) (3) of the Act (hereinafter called the ~Formula")

In order to determine the Percentage Interests in accordance with

the Formula, the total number of all of the Condominium Units in

the Regime shall be taken from the Plans, which are filed herewith,

as such Plans may be amended from time to’time. This method of

calculating Percentage Interest shall result in an equal Percentage

Interest to each Condominium Unit. The total Percentage Interests

shall at all times equal one hundred percent (100%), or as close to

one hundred percent (100%) as is mathematically possible, after

taking into account the rounding thereof as required by Section

7(a) of the Act.

Section 16. Insurance.

(a) The Co-Owners, through the Association, shall purchase amaster casualty insurance policy issued in the name ofthe iAssociation for the use and benefit of the Ownersaffording fire and extended coverage insurance insuringthe Propgrty in an amount Consonant with the fullreplacementvalue of the Property and improvementsincluding the individual Condominium Units, the CommonAreas and Limited Areas and facilities, and furtherincluding fixtures, building service equipment and commonpersonal property and supplies belonging to theAssociation. For all Condominium Units which are subjectto a first mortgage, the insurance must cover fixtures,equipment and other personal property inside individualCondominium Units if they are secured by a firstmortgage~i A Certificate of Insurance shall be issued toeach Condominium Unit Owner and each Mortgagee uponrequest~ iand no such policy shall be canceled orsubstantially modified without at least thirty (30) daysprior!written notice to the Association and to eachMortgagee listed as Mortgagee in the policies. Theinsurance policy must contain the standard m~rtgageclause and must name the Mortgagee or the servicer of theMortgagee. If a servicer is named as Mortgagee, its nameshall be followed by the phrase "Its successors andassigns." The Board of Managers shall also obtain "allrisk" coverage if available. The Board of Managers shal!be responsible for reviewigg at least annually the amountand type of such insurance and shall purchase suchadditional insurance as is necessary to provide theinsurance required above. If deemed advisable by theBoard of Managers, the Board may cause such fullreplacement value to be determined by a qualifiedappraiser. The cost of any such appraisal shall be aCommon Expense. Such insurance coverage shall be for thebenefit of each Owner, and if applicable, the Mortgageeof each Owner upon the following terms and conditions:

(i) All proceeds payable as a result ofcasualty losses sustained which arecovered by insurance purchased bythe Association as hereinabove setforth shall be paid to it or to theBoard of Managers, who shal! act asthe insurance trustees and hold such

(b)

proceeds for the benefit of theinsured parties. In the event thatthe Board of Managers has not postedsurety bonds for the faithfulperformance of its duties as suchManagers or if such bonds do notexceed the funds which will comeinto its hands, and there is adamage to a part or all of theProperty resulting in a loss, theBoard of Managers shall obtain andpost a bond for the faithfulperformance of its duties asinsurance trustee in an amount to bedetermined by the majority of theOwners but not to exceed one hundredtwenty-five percent (125%) of theloss, before the Board of Managersshall be entitled to receive theproceeds of the insurance payable asa result of such !oss. The soleduty of the insurance trustee shallbe to receive such proceeds as arepaid and to hold the same in trustfor the purpose elsewhere statedherein, and for the benefit of theOwners and their respectiveMortgagees. The proceeds shall beused or disbursed by the Associationor Board of Managers, asappropriate, only in accordance withthe provisions of this Declaration.

(ii) The interestof each damaged Ownerin the trust fund of insuranceproceeds shall be the ratio of thedirect damage of each damaged Ownerto the damages of all Ownersdirectly damaged by any eventinsured under said master casualtyinsurance policy.

Such master casualty insurance policy, and~all risk" coverage if obtained, shall (to theextent the same are obtainable) containprovisions that the insurer (i) waives itsright to subrogation as to any claim againstthe Association, the Board of Managers, itsagents and employees, Owners, their respectiveagents and guests, and (ii) waives any defense

16

based on invalidity arising from the acts oromissions of the individual Condominium UnitOwners that are not under the control of theAssociation, and providing further, (iii) thatthe insurer shall not be entitled tocontribution against casualty insurance whichmaybe purchased by individual Owners ashereinafter permitted and (iv) thatnotwithstanding any provision thereof givingthe insurer an election to restore damage inlieu of a cash settlement, such option shallnot be exercisable in the event the Owners donot elect to restore pursuant to Section 17 ofthis Declaration.

The Co-Owners, through the Association shallalso purchase a master comprehensive publicliability insurance policy in such amount oramounts as the Board of Managers shall deemappropriate from time to time; however, suchcoverage shall be for at least Two MillionDollars ($2,000,000.00) for bodily injury,including deaths of persons and propertydamage arising out of a single occurrence.Such compensation public liability insurancepolicy shall cover the Association, the Boardof Managers, any committee or organ of theAssociation or Board of Managers, any ManagingAgent appointed or employed by theAssociation, all persons acting or who maycome to act as agents or employees of any ofthe foregoing with respect to Bayshore Villas,~all Owners of Condominium Units and all otherportions of Bayshore Villas. Coverage underthis policy shall include, without limitation,legal liability of the insureds for theproperty damage, bodily injuries and deaths ofthe persons in connection with the operation,maintenance or the use of the Common Areas andLimited Areas, and if available, legalliability arising out of law suits related toemployment contracts of the Association. Noinsurance coverage as described hereinaboveshall be prejudiced by the act or neglect ofan individual Condominium Unit Owner who wasnot in control of the Owners collectively.Such policies shall also provide that it maynot be canceled or substantially modified byany party without at least thirty (30) daysprior written notice to the Association and to

17

(e)

(f)

(g)

each holder of a first mortgage on anyCondominium Unit in the Property which islisted as a scheduled holder of a firstmortgage in the insurance policy.

The Co-Owners, through the Association, shallalso obtain any other insurance required bylaw to be maintained, including but notlimited to, worker’s compensation insurance,flood insurance, and such other insurance asthe Board. of Managers shall from time to timedeem necessary, advisable or appropriate,including but not limited to, comprehensiveliability insurance on vehicles owned by theAssociation, officers’ and directors’liability policies, contractual and all-written contract insurance, and employer’sliability insurance. Such insurance coverageshall also provide for and cover cross

~liability claims of one insured party againstanother insured party. Such insurance shallinure to the benefit of each Owner, theAssociation, the Board of Managers and anyManaging Agent acting on behalf of theAssociation.

Each Owner shall be deemed to have appointedthe Board of Managers to represent each Ownerin any proceedings, negotiations, settlementsor agreements with the insurance companies tbadjust al! losses under policies purchased bythe Board of Managers.

The premiums for all such insurancehereinabove described shall be paid by theAssociation as part of Common Expenses. Whenany such policy of insurance hereinabove.described has been obtained by or on behalf ofthe Association, written notice of theattainment thereof and of any subsequentchanges therein or termination thereof shallbe promptly furnished to each Owner orMortgagee whose interest may be affectedthereby which notice shall be furnished by theofficer of the Association who is required tosend notices of meetings of the Association.

In no event shall any distribution of proceedsbe made by the Board of Managers directly toan Owner where there is a mortgage endorsement

]8

(h)

on the Certificates of Insurance. In suchevent any remittance shall be to such Ownerand Mortgagee jointly.

Each Owner shall be solely responsible for,and may obtain, such additional insurance asthe Owner deems necessary or desirable at theOwner’s own expense affording coverage uponhis personal property, contents of the Owner’sCondominium Unit (including, but not limitedto, all f~oor, ceiling and wall coverings andfixtures,~ betterments and improvementsinst~lled by the Owner) and the Owner’spersbna! property stored elsewhere on theProperty, and for the Owner’s personal

liability, but all such insurance shalllcontein the same provisions for waiver ofsubrogation as referred to in the foregoingprovisions of the master casualty insurancepolicy to be obtained by the A~s0~iatlon.Each Owner may obtain casualty insurance atthe Owner’s own expense upon the Owner’sCondominium Unit but such insurance shallprovide that it shal! be without contributionas against the casualty insurance purchased bythe Association. If a casualty loss issustained and there is a reduction in theamount of the proceeds which would otherwisebe payable in the insurance purchased by theAssociation pursuant to this paragraph, due toproration of insurance purchased by an Ownerunder this paragraph the Owner agrees toassign the proceeds of this latter insurance,to the extent of the amount of such reduction,to the Association to be distributed as hereinprovided. Notwithstanding any other foregoingprovisions and requirements relating toproperty or liability insurance, there may benamed as an insured on behalf of theAssociation, an authorized representative,including any trustee with " whom theAssociation may enter into an insurance trustagreement or any successor to such trustee whoshall have exclus±ve authority to negotiatelosses under any policy providing suchproperty or liability insurance and to performsuch other functions as are necessary toaccomplish this purpose. Each CondominiumUnit 0wnerhereby appoints the Association asattorney-in-fact for the purpose of purchasing

and maintainfng such insurance, and thefol!owing additional purposes: the collectionand appropriate disposition of the proceedsthereof; the negotiation of losses andexecution of releases of liability relatedthereto; the execution of all documentsnecessary in connection therewith; and theperformance of all other acts necessary toaccomplish such purposes.

(i) All of t~9 aforedescribed insurance shall beprocured by generally acceptable insurancecarriers.

SECTION 17. Casualtv and Restoration; Condemnation; and

Termination..

(a) Except as hereinafter provided, damage to ordestruction of any Building due to fire or anyother casualty or disaster shall be promptlyrepaired and reconstructed by the Associationand the proceeds of insurance, if any, shallbe applied for that purpose; provided,however, that repair and reconstruction shal!not be compulsory in the event of "complete

~destruction of all the Buildings" (hereinafterdefined) it shal! only be done in accordancewith provisions hereinafter set forth. Asused herein, the term "complete destruction ofal! the Buildings" means a determination, madeby a vote of two-thirds of all Co-Owners at a,special meeting of the Association called forthe purpose of making such determination, thattotal destruction of all of the Building hasoccurred. A specia! meeting of theAssociation shall be called and held withinninety (90) days after any fire or any othercasualty or disaster damaging or destroyingany of the Buildings. If such a meeting isnot called and held within such ninety (90)day period, or if the determination of whetheror not there has b~en a complete destructionof all the Buildings has not been made withinsuch ninety (90) day period, then it shall beconclusively presumed that the Co-Ownersdetermined that there was not a completedestruction of all the Buildings, and theAssociation shall proceed with repair andreconstruction as herein provided.

2O

(b) If the insurance proceeds, if any, received bythe Association as a result of any such fireor any other casualty disaster are notadequate to cover the costs of repair andreconstruction, or in the event there are noinsurance proceeds, and if the Property is notto be removed from the Horizontal PropertyRegime, the costs for restoring the damage,repairing or reconstructing the Building orBuildings so damaged or destroyed (or thecosts thgreof in excess of the insuranceproceed~ received, if any) shall be paid by.all of the Owners of Condominium Units inproportion to the ratio that the PercentageInterest of each Condominium Unit bears to thetota! Percentage Interest of all CondominiumUnits. ~hny such amounts payable by the Co-Owners shall be assessed as part of the CommonExpenses and shal! constitute a lien from thetime of assessment as provided herein the Act.

(c) For purposes of Subsections (a) and (b) above,repair, reconstruction and restoration shallmean construction or rebuilding of theCondominium Units as near as possible the samecondition as they existed immediately prior tothe damage or destruction and with the sametype of architecture.

(d) If, under Subsection (a) above, it isdetermined by the Co-Owners at the specialmeeting of the Association referred to thereinthat there has been a complete destruction ofall the Buildings, the Co-Owners shall, atsuch same special meeting, vote to determinewhether or not such complete destruction ofall the Buildings shall be repaired andreconstructed. The Buildings shall not bereconstructed or repaired if it is thedetermination of the Co-Owners at said specialmeeting that there has been a completedestruction of all of the Buildings, unless bya vote of two-thirds of all the Co-Owners adecision is made to rebuild, reconstruct andrepair the Buildings. If two-thirds of all ofthe Co-Owners vote and decide that theBuildings are to be rebuilt, reconstructed andrepaired, insurance proceeds, if any, receivedby the Association shall be applied and anyexcess of construction costs over insurance

(e)

proceeds, if any received by the Associationshall be contributed and paid as hereinaboveprovided in Subsections (a) and (b).

If, in the case of the complete destruction ofall of the Buildings, less than two-thirds ofall of the Co-Owners vote in favor of therebuilding, reconstruction and repair of theBuildings, the Buildings shall not be rebuilt,reconstructed and repaired, and, in suchevent, ~be Property shall be deemed andconsidered as to be removed from theprovisions of the Act under Section 28 of theAct and in accordance with Section 21 of theAct:

(i) The property shall be deemed to beowned in common by the CondominiumUnit Owners;

(ii)

(iii)

The undivided interest in theProperty owned in common which shal!appertain to eadh Condominium UnitOwner shal! be the percentage ofundivided interest previously ownedby such Owner in the Common Areasand facilities; ~

Any liens affecting the CondominiumUnits shall ~be deemed to betransferred in accordance with theexisting priorities to thepercentage of the undivided interestof the Condominium Unit Owner in theProperty; and

(iv) The Property shall be subject to anaction for partition at the suit ofany Condominium Unit Owner, in whichevent the net proceeds of sale,together with the net proceeds ofinsurance on the Property, if any,shall be considered as one fund andshall be divided among allCondominium Unit Owners in apercentage equal to the percentageof undivided interest owned by eachOwner of the Property after firstpaying out of the respective shares

22

of Condominium Unit Owners to theextent sufficient for the purpose,all liens on the undivided interestin the Property owned by eachCondominium Unit Owner.

(f) Immediately after a fire or other casualty ordisaster causing damage to any Property forwhich the Board of Managers or Association hasthe responsibility of maintenance and repair,the Board of Managers shall obtain reliableand detaf~ed estimates of the cost to placethe damaged Property in condition as good asthat before the casualty. Such costs mayinclude professional fees and premiums forsuch bonds as the Board of Managers desires.

The proceeds of insurance collected on accountof any Such casualty, and the sums received bythe Board of Managers from collections ofassessments against Owners on account of suchcasualty, shall constitute a construction fundwhich shall be disbursed, if the Building tobe reconstructed and repaired, in payment ofthe costs of reconstruction and repair in thefollowing manner:

If the amount of th~ estimated costof reconstruction repair is lessthan Five Thousand Dollars($5,000.00) then the constructionfund shall be disbursed in paymentof such costs upon order of theBoard of Managers; provided,however, that upon request of theMortgagee which is a beneficiary ofan insurance policy, the proceeds ofwhich are included in theconstruction fund, such fund shallbe disbursed in the mannerhereinafter provided in thefollowing Subsection (ii).

(ii) If the estimated costs ofreconstruction and repair of theBuilding or other improvement ismore than Five Thousand Dollars($5,000.00), then the constructionfund shall be disbursed in paymentof such costs upon approval of an

23

(h)

(i)

architect qualified to practice inIndiana and employed by the Board ofManagers to supervise such work,payment to be made from time to timeas the work progresses. Thearchitect shall be required tofurnish a certificate giving a briefdescription of the services andmaterials furnished by variouscontractors, subcontractors,mate[ialmen, the architect, or otherpersons who have rendered servicesor furnished materials in connectionwith the work, (I) that the sumsrequested by them in payment arejustly due and owing and that saidsums do not exceed the value of theservices or materials furnished; (2)that there is no other outstandingindebtedness known to the architectfor services and materialsdescribed; and (3) that the costsestimated by the architect for thework remaining to be done subsequentto the date of such certificate, donot exceed the amount of theconstruction fund remaining afterpayment of the sum requested.

Encroachments upon or in favor of CondominiumUnits which may be created as a result of suchreconstruction or repair shall not constitutea claim or basis of a proceeding or action bythe Owner upon which property suchencroachment exists, provided that suchreconstruction was either substantially inaccordance with the plans and specificationsor as the Building was originally constructed.Such encroachments shall be al!owed tocontinue in existence for so long as theBuilding stands.

In the event that there is any surplus ofmonies in the construction fund or thereconstruction or repair of the damage hasbeen fully completed and all costs paid, suchsums may be retained by the Board of Managersas a reserve or may be used in the maintenanceor operation of the Common Areas, or, in thediscretion of the Board of Managers, it may be

24

distributed to the Owners in the Buildingsaffected and their Mortgagees who are thebeneficial Owners of the fund. The action ofthe Board of Managers in proceeding to repairor reconstruction damage shall not constitutea waiver of any rights against an Owner forcommitting willful or malicious damage.

(J) In the event of the condemnation of all or anypart of the Common Areas or all or any part ofthe Building(s), Condominium Unit(s) orlot(s), the Board of Managers is herebyauthorized to negotiate with the condemningauthority and/or to contest an award made forthe appropriation of such Common Areas,Buildings or Condominium Units. For thepurpose of such negotiation and/or contest ofsuch award to the Board of Managers as toBuildings and Condominium Units and lots, theBoard of Managers is hereby declared to be theagent and attorney-in-fact of any Ownersaffected by the condemnation. Thisappointment of the Board of Managers shall bedeemed coupled with an interest and shal! beirrevocable. Nothing contained herein,however, shall preclude any Owner fromasserting any rights or claims to compensationwhich cannot be legally asse~ted by the Boardof Managers.

Awards for the taking of all or part of a Building,

Condominium Unit or !ot shall be collected by the Board of Managers

and distributed to the affected Owner(s). To the extent possible,

negotiated awards or awards resulting from a contest shall specify

the allocation of the award among the Owner(s) affected. In the

event that an Owner does not agree with [he distribution of an

award, said Owner shall be entitled to have the dispute settled by

arbitration. The protesting Owner shall appoint one arbitrator,

the Board of Managers acting as agent for all other affected Owners

shall appoint one arbitrator and the two appointed arbitrators

shall appoint a third arbitrator. The majority decision of the

arbitrators shall be binding on all Owners and shall be enforceable

in a court of competent jurisdiction. The Association shall pay

the costs and expenses incurred as a result of such arbitration.

The Association shall then bill each Owner involved in the

arbitration separa~ely for his or her share of the costs and

expenses which share shall be calculated by dividing the sum of the

costs and expenses by a numerator which numerator will equal the

number of Owners involved in the arbitration plus one for the

Association. The Association shall be entitled to file and

foreclose upon a lien against the Condominium Unit of any Owner

who, within thirty (30) days of having been billed for same by the

Association, shall fail to pay his or her share of the costs and

expenses.

SECTION 18. Covenants and Restrictions. The covenants and

restrictions applicable to the use and enjoyment of the Condominium

Units and the Common Areas and Limited Areas are set forth in the

By-Laws, including the limitation that each of the Condominium

Units shall be limited to residential use. These covenants and

restrictions are for the mutual benefit and protection of the

present and future Owner or Owners. Present Or future Owners or

the Association shall be entitled to injunctive relief against any

violation or attempted violation of these provisions and shal! be

entitled to damages for any injuries resulting from any violations

thereof, but there shal! be no right of reversion or forfeiture of

title resulting from such violation.

Notwithstanding anything to the contrary contained herein or

in the By-Laws, including but not limited to, any covenants and

restrictions set forth in the By-Laws, Declarant shall have, until

the applicable date as defined in Article III of the By-Laws, the

right to use and maintain any Condominium Unit owned by Declarant,

such other portions of the Property (other than individual

Condominium Units owned by persons other than Declarant) and any

portions of the additional Real Estate not then part of the Regime,

all of such number and size and at such locations as Declarant in

its sole discretion may determine and as Declarant may deem

advisable or necessary in its sole discretion to aid in the

construction, reconstruction or rehabilitation of Condominium Units

and sale of Condominium Units or for the conducting of any business

or activity attendant thereto, including, but not limited to, model

sales offices, management offices and business offices. At no time

shall any facility so used or maintained by Declarant be or become

part of the Common Areas, unless so designated by Declarant, and

Declarant shall have the right to remove the same from the property

at any time.

SECTION 19.

BV Owner. For

Sale, Lease or Other Transfer of Condominium Unit

the purpose of maintaining the congenial and

residential character of Bayshore Villas, and for the protection of

the Owners with regard to insuring having financially responsible

residents, the lease of any Condominium Unit by an Owner shall be

27

subject to the following conditions and restrictions:

Lease. No Owner shall lease his or herCondominium Unit or enter into any otherrenta! or letting agreement for his or herCondominium Unit for a term of less than onehundred eighty (180) days. In any event,Owner shall use a lease form which has beenapproved by the Board of Managers, and a copyof such lease shal! be provided by Owner tothe Board.’of Managers promptly after executionthereof.

(b) Sale. The Association shall have no right offirst refusal to purchase any Condominium Unitwhich an Owner wishes to sell and an Owner maysell his or her Condominium Unit free of anysuch restriction.

SECTION 20. Amendment of Declaration. Except as otherwise

provided in this Declaration, amendments to this Declaration shall

be proposed and adopted in the following manner:

(a) Notice. Notice of the subject matter of theproposed amendment shall be included in thenotice of any meeting at which the proposedamendment is considered, including any annualmeetings.

(b) Resolution. A resolution to adopt a proposedamendment may be proposed by the Board ofManagers or Owners having in the aggregate atleast a majority of the Percentage Interest.

(c) Meetinq. The resolution concerning a proposedamendment must be adopted by the designatedvote at a meeting duly called and held inaccordance with the provisions of the By-Laws.

(d) AdoDtion. Any proposed Material Amendment (ashereinafter defined) to this Declaration must~be approved by a vote of not less than two-thirds of the Owners. In the event anyCondominium Unit is subject to a firstmortgage, the Mortgagee (hereinafter referredto as "Eligible Mortgagee") shall be notifiedof the meeting and the proposed Materia!Amendment in the same manner as an Owner if

the Eligible Mortgagee has given prior noticeof its mortgage interest to the Board ofManagers in accordance with the By-Laws, andany pf0poSed Material Amendment must beapproved by a vote of not less than a majorityof the Eligible Mortgagees. An EligibleMortgagee who receives a written request toapprove amendments and does not deliver orpost to the requesting party a negativeresponse within thirty (30) days shall bedeemed tQ~have approved such request.

A change zo any

Material Amendment:

(i)

(ii)

(iii)

(vi)

(vii)

(viii)

of the following shal! be deemed to be a

Voting rights;

Assessments, assessment liens or subordinationof ~ssessment liens;

Reserves for maintenance, repair andreplacement of Common Areas;

(iv) Responsibility for maintenance andrepalr;

(v) Reallocation of interests in CommonAreas or Limited Areas, or rights Eotheir use;

Boundaries of any. Condominium Unit;

Convertibility of Condominium Unitsinto Common Areas or vice versa;

Expansion or contraction of theProper~y, or the addition,annexation or withdrawal of propertyto or from the Property;

(ix) Insurance or fidelity bonds;

(x) Leasing of Condominium Units;

(xi) Imposition of any restrictions on aCondominium Unit Owner’s right tosell or transfer his or herCondominium Unit;

(e)

(f)

(xii) A decision by the Association toestablish self-management when aprofessiona! management agent hadbeen required previously by anEligible Mortgagee;

(xiii) Restoration or repair of theProperty (after a hazard damage orpartial condemnation) in a mannerother than that specified in theDeclaration;

(xiv) Any action to terminate the legalstatus of the Property aftersubstantial destruction orcondemnation occurs; or

(xv) Any provision that expresslybenefits mortgage holders, insurersor guarantors.

Recordinq. Each amendment to the Declarationshall be executed by the President andSecretary of the Association, or theDeclarant, if required, and shall be recordedin the Office of the Recorder of MarionCounty, Indiana, and such amendment shall notbecome effective until so recorded.

Amendments BV Declarant Onlv. Notwithstandingthe foregoing or anything elsewhere containedherein, the Declarant shall have the rightacting alone and without the consent orapproval of the Co-Owners, the Association,the Board of Managers, any Mortgagees or anyother persons, to amend or supplement thisDeclaration, the By-Laws or other documentsfrom time to time if (i) such amendment orsupplement is necessary to conform thisDeclaration to the Act, as amended from timeto time, (ii) such amendment or supplement ismade to comply with requirements of theFederal National Mortgage Association, theGovernment Nationa! Mortgage Association, theFederal Home Loan Mortgage Corporation, theDepartment of Housing and Urban Deve!opment,the Veterans Administration or any othergovernmental agency or any other public, quasipublic or private entity which performs (ormay in the future perform) functions similar

3O

to those currently performed by such entities,(iii) to induce any such agencies or entitiesto make, purchase, sell, insure or guaranteefirst mortgages, or, (iv) if such amendment orsupplem~nt is made to correct clerical ortypographical errors. In furtherance of theforegoing, a power coupled with an interest ishereby reserved and granted to the Declarantto vote in favor of, make, or consent to anyamendments described in this Section 20 onbehalf of..each Owner as proxy or attorney-in-fact, as the case may be. Each deed,mortgage, or other instrument affecting aCondominium Unit and acceptance thereof shallbe deemed to be grant and acknowledgment of,~nd a consent to the reservation of, the powerof the Declarant to vote in favor of, make,execute and record any such amendments. Theright of the Declarant to act pursuant torights reserved or granted under this Section20 shall terminate at such time as Declarantno longer holds or controls title to any partor portion of the Real Estate.

(g) Additional Restrictions On Amendments.

(1) The consent of Owners of CondominiumUnits to which at least sixty-sevenpercent (67%) of the votes in theAssociation are allocated and theapproval of the eligible holders offirst mortgages on Condominium Unitsto which at least sixty-sevenpercent (67%) of the votes of theCondominium Units subject to amortgage appertain shall be requiredto terminate the Condominium Regimefor reasons other than substantialdestruction or condemnation of theProperty.

(2) As used in this Section, the term"eligible holder" shall mean aholder, insurer or guarantor of afirst mortgage on the CondominiumUnit who has requested notice inaccordance with the provisions ofSection 8.03(a) of the By-Laws.

31

SECTION 21. AcceDtance and Ratification. All present and

future Owners, mortgagees, tenants and occupants of the Condominium

Units shall be subject to and shal! comply with the provisions of

this Declaration, the Act~ the By-Laws appended hereto, and the

rules and regulations as adopted by the Board of Managers as each

may be amended or s~pplemented from time to time. The acceptance

of a deed of conveyance or the act of occupancy of any Condominium

Unit shall constitute an agreement that the provisions of this

Declaration, the Act, the By-Laws and rules and regulations as each

may be amended or supplemented from time to time are accepted and

ratified by each such Owner, tenant or occupant, and all such

provisions shall be covenants running with the land and shall bind

any person having at any time any interest or estate in a

Condominium Unit or the Property as though such provisions were

recited and stipulated at length in each and every deed,

conveyance, mortgage or lease thereof. Al! persons, corporations,

partnerships, trusts, associations, or other legal entities who may

occupy, use, enjoy or control a Condominium Unit or Condominium

Units or any part of the Property in any manner shall be subject to

the Declaration, the Act, the

regulations applicable thereto

supplemented from time to time.

SECTION 22. Negligence.

expense of any maintenance,

By-Laws, and the rules and

as each may be amended or

Each Owner shall be liable for the

repair or replacement rendered

necessary by the Owner’s own negligence or by that of any member of

32

the Owner’s family,

the extent that

insurance

their guests, employees, agents or lessees, to

such expense is not covered by the proceeds of

carried by the Association. An Owner shall pay the

increase in insurance premiums occasioned by suchamount of any

Owner’s use, misuse, occupancy or abandonment

Condominium Unit om its appurtenants or of the

Limited Areas.

of the Owner’s

Common Areas or

SECTION 23. Granting of Easements. The Board of Managers of

the Association is granted the authority to grant easements to

utility companies (excluding transportation companies) upon such

terms and conditions and for such consideration as it deems

appropriate.

SECTION 24. Reservation of Rights to Use the Common Areas.

Declarant shall have, and hereby reserbes, an easement over,

across, upon, along, in, through and under the Common Areas and, to

the extent necessary, the Limited Areas, for the purposes of

installing, maintaining, repairing, replacing,~ relocating and

otherwise servicing utility equipment, facilities and installations

to serve the Real Estate, to provide access to and ingress and

egress to and from the Real Estate, to make improvements to and

within the Rea! Estate, and to provide for hhe rendering of public

and quasi public services to the Real Estate. The foregoing

easement shall be a transferable easement and Declarant may at any

time and from time to time grant similar easements, rights or

privileges to other persons and parties for the same purposes. By

33

way of example, but not in limitation of the generality of the

foregoing, Declarant, and others to whom Declarant may grant such

similar easement, easements or rights or privileges, may so use the

Common Areas and, to the extent necessary, the Limited Areas, to

supply utility services to the Real Estate and any portions of the

Regime which are not part of the Real Estate and to permit public

and quasi public vehicles, including, but not limited to, police,

fire and other emergency vehicles,

post office vehicles and privately

their personnel to enter upon and

Areas, and to the extent necessary,

trash and garbage collection,

owned delivery vehicles, and

use the streets, the Common

the Limited Areas Of Bayshore

Villas in the performance of their duties.

SECTION 25. Initial Manaqement. As set forth in the By-Laws,

the initial Board of Managers shall consist of persons selected by

Declarant. Prior to the Applicable Date, as defined in Article III

of the By-Laws, all contracts or leases including any management

agreement entered into by the Board of Managers shall provide a

right of termination without cause or penalty, at any ~time after

the Applicable Date upon no more than sixty (60) days notice to the

other party. The Board of Managers has entered or will hereafter

enter into a management agreement with R and G Management Company,

Inc. (the "Managing Agent") for a term beginning April I, 2000 and

which will expire not later than Magch 31, 2001, unless earlier

terminated or extended by agreement of the parties under which the

Managing Agent will provide supervision, fisca! and general

34

management and maintenance of the Common Areas, and, to the extent

the same is not otherwise the responsibility of Owners of

individua! Condominium Units, the Limited Areas, and, in general,

perform all the duties and obligations of the Association. Such

Management Agreement is or will be subject to termination by

Declar~nt at any ti~e prior to the expiration of its term, in which

event the Association shall upon and thereafter resume performance

of all of its duties and obligations and functions.

Notwithstanding anything to the contrary contained herein, so !ong

as such management agreement remains in effect, Declarant shall

have, ’and Declarant hereby reserves to itself, the exclusive right

to oversee the Managing

Agent and if necessary manage the Property and to perform all the

functions of the Association.

SECTION 26. Costs and Attorneys’ Fees. In any proceeding

arising because of failure of an Owner to make any payments

required by this Declaration, the By-Laws or the Act, or to comply

with any provision of the Declaration, the Act, the By-Laws, or the

rules and regulations adopted pursuant thereto as each may be

amended from time to time, the Association shall be entitled to

recover its costs and reasonable attorneys’ fees incurred in

connection with the default or failure.

SECTION 27. Failure of Owner to Pav Assessments.

(a) No Owner may become exempt from liability forcontribution toward the’ Common Expenses bywaiver Of the use or enjoyment of any of theCommon Areas or Limited Areas or byabandonment of the Owner’s Condominium Unit.

35

Each Owner shal! be personally liable for thepayment of all assessments by the Association.

(b) Upon failure by any Owner to make any paymentof assessment on the date when due, the lienagainst the Owner’s Condominium Unit may beforeclosed against as provided for by Section5.06 of the By-Laws and applicable law. Anylien for assessments becoming payable afterthe recordation of a first mortgage on Owner’sCondominium Unit shall be subordinate to thefirst mortgage on the Owner’s Condominium Unitas more fully set forth in Section 5.06(b) ofthe By-Laws.

SECTION 28. Severabilit¥ Clause. The invalidity of any

covenant, restriction, condition, limitation or other provision of

this Declaration or by the By-Laws filed herewith shall not impair

or affect in any manner the validity, enforceability or effect of

the rest of this Declaration or the attached By-Laws.

SECTION 29. Pronouns. Any reference to the masculine,

feminine or neuter gender herein shall, unless the context clearly

requires the contrary, be deemed to refer to and include the

masculine, feminine and neuter genders. Words in the singular

shall include and refer to the plural, and vice versa, as

appropriate.

IN WITNESSETH WHEREOF, the undersigned has caused this

Declaration to be executed the date and year first above written.

BY: ROTTLUND HOMES OF INDIANA LIMITEDPARTNERSHIP, A MINNESOTA LIMITEDPARTNERSHIP

Dennis Yov~hovich, President

36

STATE OF INDIANA )) SS:

CO~T¥ )

Subscribed and sworn to before me, a Notary Public in and forsaid County and State, personally appeared ~Ni~ l~\/~n~\l~ ,who first having been sworn upon his oath, states the foregoingstatements are true and accurate, this 2~_~ day of ~[~_OJ~lat~l_,2O0O.

~tary Public

Printed

County of Residence:

/V~r~onMy Commission Expires:

This instrument prepared by Cameron F. Clark, Attorney an Law,Clark, Quinn, Moses & Clark, One Indiana Square, Suite 2200,Indianapolis, Indiana 46204-2011, (317) 637-1321.

cf c\doc\BayShoreVill as. DEC

37

EXHIBIT A

Legal Description

A part of the East half o~the Northeast Quarter of Section 22, Township 14 North, Range4 East of the Second Principal Meridian, Franldin Township, Marion County, Indiana,more particularly described as follows:

Beginning at the Northeast comer of the East Half of the Northeast Quarter of saidSection 22, thence South 00 degrees 26 minutes 13 seconds West on and along the Eastline of said Half Quarter Section a distance of 1150.00 feet; thence South 88 degrees 14minutes 50 seconds West parallel to the North line of said Half Quarter Section a distanceof 550.00 feet; thence north 00 degrees 26 minutes 13 seconds East parallel to the saidEast line a distance of 600.00 feet; thence South 88 degrees 14 minutes 58 seconds Westparallel to the said North line a distance of 440.00 feet; thence north 00 degrees 26minutes 13 seconds East parallel to the said East line a distance of 550.00 feet to a pointon the North line of said Quarter Section; thence North 88 degrees 14 minutes 58 secondsEast on and aiong the said North line a distance of 990.00 feet to the Point of Beginning,containing 20.061 acres more or less.

Subject to ail easements, highways, rights-of-ways and other restrictions of record.

EXHIBIT B

1 1 Aspen 5847 Shipwatch Lane2 Breckenridge 5843 Shipwatch Lane3’ Breckenridge 5839 Shipwatch Lane

¯ 4 As=~enr_ 5835 Shinwafch Lane5 Aspen 5836 Shipwatch Place6 Breckenridge 5840 Shipwatch Place7 Breckenridge 5844Shipwatch Place8 Aspen 5848 Shipwatch Place

2 9 Aspen 5825 Shipwatch Lane10 Dunhill 5821 Shipwatch Lane11 Dunhill 5817 Shipwatch Lane12 Aspen 5813 Shipwatch Lane13 Aspen 5814 Shipwatch Place~4 Dunhill 5818 Shipwatch Place15 Dunhill 5822 Shipwatch Place16 Aspen 5826 Shipwatch Place

3 17 Aspen 5849 Shipwatch Place18 Breckenridge 5845 shipwatch Place19 Breckenridge 5841 Shipwatch Place20 Aspen 5837 Shipwatch Place21 Aspen 5838 Beacon Cove Way22 Breckenridge 5842 Beacon Cove Way23 Breckenridge 5846 Beacon CoveWay

¯ 24 Aspen 5850 Beacon Cove WayAsl~en 5827 Shil~watch Place4 25

26 Dunhill 5823 Shipwatch Place27 Dunhill 5819 Shipwatch Place28 Aspen 5815 Shipwatch Place29 Aspen 5816 Beacon Cove Way30 Dunhill 5820 Beacon Cove Way31 Dunhill 5824 Beacon Cove Way32 Aspen 5828 Beacon Cove Way

~ 33 Aspen 5847 Beacon Cove Way34 Breckenridge 5843 Beacon Cove Way35 Breckenridge ~839 Beacon Cove Way36 Aspen 5835 Beacon Cove Way37 Aspen 5836 Beacon Cove Place38 Breckenridge 5840 Beacon Cove Place39 Breckenridge 5844 Beacon Cove Place40 Aspen 8848 Beacon Cove Place

EXHIBIT B

BAYSHORE VILLASADDRESSES

6

7

8

9

lO

4142434~45464748495O51525354595657585960616263646566676869707172737475767778798O

AspenDunhillDunhillAspenAspenDunhillDunhillAspenAspen

BreckenridgeBreckenridge

AspenAspen

BreckenridgeBreckenridge

AspenAspen

BreckenridgeBreckenridge

AspenAspen

BreckenridgeBreckenridge

AspenAspen

BreckenridgeBreckenridge

AspenAspen

BreckenridgeBreckenridge

AspenAspen

BreckenridgeE]reckenridge

AspenAspen

BreckenridgeBreckenridge

Aspen

5825 Beacon Cove Way5821 Beacon Cove Way5817 Beacon Cove Way5813 Beacon Cove Way5814 Beacon Cove Place5818 Beacon Cove Place5822 Beacon Cove Place5826 Beacon Cove Place8017 Harbor Walk Lane8021 Harbor Walk Lane8025 Harbor Walk Lane8029 Harbor Walk Lane8030 Harbor Walk Place8026 Harbor Walk Place8022 Harbor Walk Place8018 Harbor Walk Place8015 Seabrook Drive8019 Seabrook Drive8023 Seabrook Drive8027 Seabmok Drive8028 Harbor Walk Lane8024 Harbor Walk Lane8020 Harbor Walk Lane8016 Harbor Walk Lane8039 Harbor Walk Lane8043 Harbor Walk Lane8047 Harbor Walk Lane8051 Harbor Walk Lane8052 Harbor Walk Place8048 Harbor Walk Place8044 Harbor Walk Place8040 Harbor Walk Place8037 Seabrook Drive8041 Seabrook Drive8045 Seabrook Drive8049 Seabrook Drive8050 Harbor Walk Place8046 HarborWalk Place8042 Harbor Walk Place8038 Harbor Walk Place

EXHIBIT B

BAYSHORE VILLASADDRESSES

11

12

13

14

15

81 Aspen82 Breckenridge83 Breckenridge84 Aspen85 Aspen "86 Breckenridge87 Breckenridge88 Aspen89 Aspen

5919 Seabrook Lane5915 Seabrook Lane5911 Seabrook Lane5907_ Seabrook Lane5908 Marina View Drive5912 Marina View Drive5916 Marina View Drive5920 Marina View Drive,5945 Marina View Drive

90 Breckenridge 5941 MarinaView Drive91 Breckenridge 5937 Marina View Drive

92 Aspen93 Aspen94 Breckenridge95 Breckenridge96 Aspen97 Aspen98 Dunhill

99 .... Dunhill100 Aspen101 ...........Aspen102 Dunhillt03 Dunhill104, Aspen105 Aspen106 Dunhill107 Dunhill108 Aspen109 Aspen110 Dunhill111 Dunhill112 Aspen113 Aspen114 Dunhill115 Dunhill116 Aspen117 Aspen118 Dunhill119 Dunhill120 Aspen

5933 Marina View Drive5934 Marina View Lane5938 Marina View Lane5942 Marina View Lane5946 Marina View Lane5921 Marina View Drive5917 Marina View Drive5913 Marina View Drive5909 Marina View Drive5910 Marina View Lane5914 Marina View Lane5918 Marina View Lane5922 Marina View Lane5943 Marina View Lane5939 Marina View Lane5935 Marina View Lane5931 Marina View Lane5932 Streamwood Lane5936 Streamwood Lane5940 Streamwood Lane5944 Streamwood Lane5919 Marina View Lane5915 Marina View Lane5911 Marina View Lane5907 Marina View Lane5908 Streamwood Lane5912 Streamwood Lane59t6 Streamwood Lane5920 Streamwood Lane

EXHIBIT B

BAYSHORE VILLAS

16

17

18

121122123124125126127128129130131132133134135136137138139140141142143144

AspenDunhillDunhillAspenAspenDunhillDunhillAspenAspenDunhillDunhillAspenAspenDunhillDunhillAspenAspenDunhillDunhillAspenAspenDunhillDunhillAspen

8147 River Mist Lane8151 River Mist Lane8155 River Mist Lane8159 River Mist Lane8160 River Mist Place8156 River Mist Place8152 River Mist Place8148 River Mist Place8149 Shores Edge Way8153 Shores Edge Way8157 Shores Edge Way8161 Shores Edge Way8162 River Mist Lane8158 River Mist Lane8154 River Mist Lane8150 River Mist Lane8147 Shores Edge Place8151 Shores .Edge Place8155 Shores Edge Place8159 Shores Edge Place8160 Shores Edge Way8156 Shores Edge Way8152 Shores Edge Way8148 Shores Edge Way

EXHIBIT C

Percen~qe Interest

All,units have 1/144th percentage interest.

CODE OF BY-LAWSOF

BAYSHORE VILLASHORIZONTAL PROPERTY REGIME

AND OFBAYSHORE VILLAS CO-OWNERS ASSOCIATION,

ARTICLE I

INC.

Identification and APDlicabilitV

Section 1.01 Identification andAdoDtion. These By-Laws areadopted simultaneously with the execution of a certain ~eclarationcreating Bayshore Villas Horizontal Property Regime (hereinaftersometimes referred to ks "Bayshore Villas") to which these By-Lawsare attached and made a part thereof. The Declaration isincorporated herein by reference, and all of the covenanrs, rights,restrictions and liabilities therein contained shall apply to andgovern the interpretation of these By-Laws. The definitions andterms as defined and used in the Declaration shall have the samemeanlng in these By-Laws. The provlslons of these By~Laws shallapply to the Property and the administration and conduct of theaffairs of the Association. These By-Laws shall also constitutethe By-Laws of the Association.

Section 1.02 Individual Application. All of the Owners,future owners, tenants, future tenants, or their gueszs andinvitees, or any other person who might use or occupy a CondominlumUnit or any part of the Property, shall be subject to therestrictions, terms and conditions set forth in the Declaration,these By-Laws and the Act, and to any rules and regulations adoptedby the Board of Managers as herein provided.

ARTICLE II.

Meetinqs of the Association

Section 2.01 Purpose of Meetin~s. At least annually, and atsuch other times as may be necessary, a meeting of the Co-Ownersshall be held for the purpose of electing the Board of Managers(subject to the provisions of Section 3.02 hereof), approving the

~nnual budget, providing for the collection of Common Expenses andor such other purposes as may be required by the Declaration,these By-Laws or the Act.

Section 2.02 Annua! Meetinqs. The first annual meeting of

the members of the Association shall be held within one year afterthe recording of the Declaration on a date established by the firstBoard of Managers. Each subsequent regular annua! meeting of themembers shall be held at least once each year on the same day ofthe same month of each yea9 thereafter (unless the Board ofManagers designates a different date for annual meetings), at suchhour as may be designated by the Secretary in the notice of saidmeeting, as hereafter provided. At the annual meeting the Ownersshall (subject to the provisions of Section 3.02 hereof) elect theBoard of Managers ~.of the Association in accordance with theprovisions of these By-Laws and transact such other business as mayproperly come before the meeting.

.~ection 2.03 Special Meetings. A special meeting of themembers of the Association may be called by resolution of the Boardof Managers or upon a written petition of Owners who ha~e not lessthan a majority of the Percentage Interest. The resolution orpetition shall be presented to the President or Secretary of theAssociation and shall state the purpose or purposes for which themeeting is to be called. No business shall be transacted at asPecial meeting except as Stated in the petition or resolution’

Section 2.04 Notic~ and Place of Meetin sq_~. All meetings ofthe members of the Association shall be held at any suitable placein Marion County, Indiana, as may be designated by the Board ofManagers. Written notice stating the date, time and place of anym~eti~g and, in the case of a specia! meeting, the purpose orpurposes for which the meeting: is called~ shall! be delivered ormailed by the Secretary of the Association to e’ach member entitledto vote thereat not less than ten (i0) days ~ior to the date ofsuch meeting. The notice shall be mailed or delivered to theOwners at their designated addresses. A copy of each such writtennotice shall als0 be delivered or mailed simultaneously by theSecretary of the Association to each Mortgagee (a) which requestsin writing that such notices be delivered to it, and (b) which hasfurnished the Association with its name and address in accordancewith Section 8.01 of these By-Laws.

Section 2.05 Waiver of Notice. A member, either before orafter a meeting of the members of the Association, may waive noticeof the meeting, and his waiver shal! be deemed the equivalent ofgiving notice. Attendance at a meeting of the members, either inperson or by proxy, of a person entitled to notice shall constitutea waiver of notice of the meeting unless he attends expressly forthe purpose of objecting to the transaction of business on theground that the meeting was not properly called in accordance withthese By-Laws.

Section 2.06 Voting~.

(a) Nu!nber of Votes. Each Owner shall be allocatedvotes commensurate with the number of Condominium Unitsowned by that Owner and shall be enEitled to cast saidnumber of votes on each matter coming before the meetingas to which he is entitled to vote.

(b) MultiDle Owner. Where the Owner of a CondominiumUnit constitutes or consists of more than one person, oris a partnership, there shall be only one votingrepresent~tive entitled to cast the vote allocable tothat Condominium Unit. At the time of the acquisition oftitle to a Condominium Unit by a multiple Owner or apartnership, those persons constituting such Owner or thepartners shall file with the Secretary of the Associationan irrevocable proxy appointing one of such persons orpartners as the voting representative for suchCondominium Unit, which shall remain in effect until allof such parties constituting such multiple Owner or thepartners in such partnership designate another votingrepresentative in writing, or such appointedrepresentative relinquishes such appointment in writing,becomes incompetent, dies or such appointment isotherwise rescinded by order of a court of competentjurisdiction or the Owner no longer owns such CondominiumUnit. Such appointed voting representative may grant aproxy ~o another to vote in his place at a particularmeeting or meetings pursuant to paragraph (d) of thisSection 2.06, which shall not constitute a permanentrelinquishment of his rlght ~o ac~ as votingrepresentative for the Condominium Unit.

(c) Voting bv CorDoration or Trust. Where a corporationor trust ~s an Owner or ~s otherwise entitled to vote,the trustee may cast the vote on behalf of a trust andthe agent or other representative of a corporation dulyempowered by the board of directors of such corporationmay cast the vote to which the corporation is entitled.The secretary of the corporation or trustee of the trustso entitled to vote shall deliver or cause ~o bedelivered, prior to the commencement of the meeting, acertificate signed by such person no the Secretary of theAssociation stating who is authorized to vone on behalfof said corporation or trust.

(d) Proxy. 7kn Owner may vote either in person or byhis duly authorized and designated attorney-in-fact.Where voting is by proxy, the owner shall duly designatehis attorney-in-fact in writing, which writing shall bedelivered to the Secretary of the Association prior tothe commencement of any meeting at which such proxy shallbe effective.

Section 2.07 Q_~grum. Except where otherwise expresslyprovided in the Declaration, these By-laws, the Act or the IndianaNot-For Profit Corpa~ation Act of 1971 (hereinafter referred to asthe "Statute"), the Owners representing a majority of thePercentage Interest shall constitute a quorum at all meetings. Theterm "majority of Owners" or "majority of Percentage Interest", asused in these By-Laws, shal! mean the Owners entitled to more thanfifty percent (50%) of the Percentage Interest in accordance withthe applicable percentage set forth in the Declaration, as such maybe amended from time to time.

Section 2.08 Conduct of 7hnnual Meeting.. The President ofthe Association shal! act as the Chair of al! annual meetings ofthe Association if he or she is present. At all annua! meetings,the Chair shal! cal! the meeting to order at the duly designatedtime and business wil! be conducted in the fol!owing order:

(a) Ouorum. The Secretary shall present the votingregister and proxy certifications and thereafterdetermine if a quorum is established.

(b) Readin~ of the Minutes. The Secretary shall readthe minutes of the last annual meeting and the minutes ofany special meeting held subsequent thereto, unless suchreading is waived by a majority of the PercentageInterest.

(c) Reports. Officers and any special com/aittees shallgive their reports.

(d) Treasurer’s ReDort. The Treasurer shall report tothe Owners concerning the financial condition of theAssociation and answer relevant questions of the Ownersconcerning the Common Expenses and financia! report forthe prior year and the proposed budget for the currentyear.

(e) Bud_B~t. The proposed budget for the current fiscalyear shall be presented to the Owners for approval or

4

amendment.

(f) Elecfiion of Board of Managers. Nominations for theBOard of Managers may be made by any Owner from thosepersons eligible to serve. Such nominations must be inwriting and presented to the Secretary of the Associationat least seven (7) days prior to the date of the annual ....meeting. Voting for the Board of Managers will be bypaper ballot. The ballot shall contain the name of eachperson nominated to serve as a Board member. Each Ownermay cast the total number of votes to which he isentitled for as many nominees as are to be elected;however, Owners shall not be entitled to cumulate theirvotes. Those persons receiving the highest number ofvotes shall be elected. Each voting Owner shall sign his

ballot. The foregoing provisions are subject to theprovisions of Section 3.02 hereof.

(g) Other Business. Other business may be brought’i~before the meeting only upon a written request submitted

to the Secretary of the Association at least seven (7)days prior to the date of the meeting; provided, however,that such written request may be waived at the meeting ifagreed by a majority of the Percentage Interest .........

~(h) Adjournment. Any meeting of the Association may beadjourned. Notice of the adjourned meeting, or thebusiness to be transacted there, other than byiannouncement at the meeting at which the adjournment istaken, shall not be necessary. At any adjourned meetingat which a quorum is present or represented, any businessmay be transacted which could have been transacted at themeeting originally called.

Section 2.09 Conduct of SDecial Meetings. The President ofthe Association shall act as Chair of any special meetings of theAssociation if he or she is present. The Chair shall call themeeting to order at the duly designated time and the only businessto be considered at such meeting shall be consideration of thematters for which such meeting was called, as set forth in thenotice of such special meeting.

Section 2.10 Power of Attornev. Each Owner, by acceptanceof a deed to a Condominium Unit, or by acquisition of any interestin a Condominium Unit by any type of juridic act inter vivos orcausa mortis, or otherwise, shall be deemed to have appointedDeclarant as such Owner’s agent, attorney-in-fact and proxy, which

5

shall be deemed coupled with an interest and be irrevocable untilthe Applicable Date determined as provided below, to exercise allof said Owner’s right to vote, and to vote as Declarant determineson all matters as to which members are entitled to vote under theDeclaration, these By-Laws, the Act, the Statute or otherwise.This appointment of Declarant as such Owner’s agent, attorney-in-fact and proxy shall not be affected by the subsequent incompetenceof the Owner granting the same.

ARTICLE III

The Board of Managers

Section 3.01 ManaGement. The affairs of the Association ofBayshore Villas shal! be governed and managed by a Board ofManagers (herein collectively called "Board" or "Managers" andindividually called "Manager"). The Board of Managers shall becomposed of six (6) persons. No person shall be eligible to serveas a Manager unless he or she is, or is deemed in accordance_withthe Declaration to be, an Owner, including a person appointed byDeclarant as provided in Section 3.02 hereof.

Section 3.02 Initial Board of Managers. The members of theInitial Board of Managers (hereinafter referred to as the "InitialBoard"), have been appointed by Declarant. Notwithstandinganything to the contrary contained in, or any other provisions of,these By-Laws, the Declaration, the Act or the Statute (a) theInitial Board shall hold office from the date of the firstconveyance of a Condominium Unit to an Owner other than Declarantuntil that date which is five (5) years later; or until that datewhich is sixty (60) days after the conveyance of seventy-fivepercent (75%) of the Condominium Units designated on the Plan toOwners other than Declarant; or a recording of a written surrenderof contro! of the Association by the Declarant, which ever occursfirst (the applicable date being herein referred to as the"Applicable Date"), and (b) in the event of any vacancy orvacancies occurring in the Initial Board for any reason or causewhatsoever, prior to the Applicable Date determined as providedabove, each such vacancy shall be filled by a person appointed byDeclarant, who shall thereafter be deemed a member of the InitialBoard.

The Initial Board<shall consist of three (3) members, thosepersons being Dennis Yovanovich, President; Matthew Ochs; VicePresident; and Jan Vollmer, Secretary/Treasurer.

6

Section 3.03 Additional Qualification. Where an Ownerconsists of more than one person, or is a partnership, corporation,trust or other legal entity, then one of the persons constitutingthe multiple Owner, or a partner, officer or trustee (asapplicable) shall be eligible to serve on the Board of Managers,except that no single Condominium Unit may be represented on theBoard of Managers by more than one person at a time.

Section 3.04 Term of Office and Vacancv. Subject to theprovisions of Section 3.02 hereof, two (2) members of the Board ofManagers shall be’ elected at each annua! meeting of theAssociation. The Initial Board shall be deemed to be elected andre-elected as the Board of Managers at each annual meeting untilthe Applicable Date provided in Section 3.02 hereof. After theApplicable Date, eachi member of the Board of Managers shall beelected~ifor a term of~ three (3) years, except that at-ithe ~firstelection after the Applicable Date, two (2) members of the Board ofManagers shall be elected for a three (3) year term, two (2) for atwo (2) year term,~and two for a one (I) year term, so that theterms of:one-third (1/3) of the Managers shall expire annually.There shall be separate nominations for the office of each Managerto be elected at such first election after the Applicable Date.Each Manager shall hold office throughout the term of his electionand until his successor is elected and qualified. Subject to theprovisions of Section 3.02 hereof as to the Initial Board, anyvacancy or vacancies occurring in the Board shall be filled by avote of a majority of the remaining Managers, or by vote of theOwners if a Manager is ~emoved in accordance with Section 3.05 ofthis Amticle III. The Manager so filling a vacancy shall serveuntil the next annual meeting of the members and until hissuccessor is elected and qualified. At the first annual meetingfollowing any such vacancy, a Manager shall be elected for thebalance of the term of the Manager so removed or in respect to whomthere has otherwise been a vacancy.

Section 3.05 Removal of Managers. A Manager or Managers,except the members of the Initial Board, may be removed with orwithout cause by vote of a majority of the Owners at a specialmeeting of the Owners duly called and constituted for such purpose.In such case, his successor shall be elected at the same meetingfrom eligible Owners nominated at the meeting. A Manager soelected shall serve until the next annual meeting of the Owners anduntil his successor is duly elected and qualified.

Section 3.06 Duties of the Board of Managers. The Board ofManagers shall provide for the administration of Bayshore VillasHorizontal Property Regime, the maintenance, upkeep and replacement

7

of the Common Areas and Limited Areas and the collection anddisbursement of the Common Expenses. The Board shall, on behalf ofthe Association, be entitled to employ a reputable and recognizedprofessional property management agent (herein called the "ManagingAgent") upon such terms as the Board shall find, in its discretion,reasonable and customary. The Managing Agent, if employed, shallassist the Board in carrying out its duties, which include, but arenot limited to:

(a) protection, surveillance and replacement of theCommon Areas ~nd Limited Areas, unless the same areotherwise the responsibility or duty of Owners ofCondominium Units; provided, however, that this dutyshall not include or be deemed or interpreted as arequirement that the Association, the Board or anyManaging Agent provide any on-site or roving gnards,security service or security system for protection orsurveillance, and the same need not be furnished;

(b) procuring of utilities used in connection withBayshore Villas, removal of garbage and waste, and snowremova! from the Common’Areas;

(c) landscaping, painting, decorating, furnishing,maintenance and upkeep of the Common Areas and, whereapplicable, the Limited Areas;

(d) surfacing, paving and maintaining private streets,common driveways, parking areas and sidewalks to theextent the same are not included in a Condominium Unit orconstitute Limited Areas;

(e) assessment and collection from each Owner of theOwner’s share of the Common Expenses;

(f) preparation of the proposed annual budget, a copy ofwhich will be mailed or delivered to each Owner at thesame time as the notice of annual meeting is mailed ordelivered;

(g) preparing and delivering annually to the Owners afull accounting of all receipts and expenses incurred inthe prior year; such accounting shall be delivered toeach Owner simultaneously with delivery of the proposedannual budget for the current year; .......

(h) keeping a current, accurate and detailed record of

8

receipts and expenditures affecting the Property,specifying and itemizing the Common Expenses; all recordsand vouchers shall be available for examination by anOwner at any time during normal business hours; paymentvouchers for all expenditures shall, prior to payment, beapproved by a member of the Board or such other person(which may include the Managing Agent) as the Board maydelegate;

(i) procuring and maintaining for the benefit of theOwners, the A~sociation and the Board all insurancecoverage required under the Declaration and such otherinsurance coverage as the Board, in its sole discretion,may deem necessary or advisable; and

(j) making available to Owners and Mortgagees currentcopies of the Declaration, By-Laws and other rulesgoverning the Regime and any other books, records and

¯ financial statements of the Association. The Associationshall also make available to prospective purchaserscurrent copies of the Declaration, By-Laws, other rulesgoverning the Regime, and the most recent annual auditedfinancial statement, if such statement has been prepared."Available" shal! mean available for inspection uponrequest, during normal business hours or under otherreasonable circumstances. Upon written request by theUnited States Department of Housing and Urban Deve!opmentthe Veterans Administration or Federal National MortgageAssociation, the Association shall also prepare andfurnish within a reasonable time an audited financialstatement of the Association for the immediatelypreceding fiscal year.

section 3.07 Powers of the Board of Manaqers. The Board OfManag~rs s-~-al~ have such powers as are reasonable and necessary toaccomplish the performance of their duties. These powers include,but are not limited to, the power:

(a) to employ a Managing Agent to assist the Board inperforming its duties; provided, that after theApplicable Date any employment agreement with theDeclarant (or a corporation or other entity affiliatedwith the Declarant) either as Managing Agent or for anyother service shall be subject to termination by eitherparty without cause and without payment of a terminationfee, upon sixty (60) days prior written notice to theother party, and shall be terminable for cause by the

Association on thirty (30) days written notice;

(b) to purchase for the benefit of the Owners suchequipment, materials, labor and services as may benecessary in the judgment of the Board of Managers;

(c) to employ legal counsel, architects, contractors,accountants and others as in the judgment of the Board ofManagers may be necessary or desirable in connection withthe business and affairs of Bayshore Villas;

(d) to employ, designate, discharge and remove suchpersonnel as in the judgment of the Board of Managers maybe necessary for the maintenance, upkeep, repair andreplacement of the Common Areas and, where applicable,the Limited Areas;

(e) to include the cost of all of the above andforegoing as Common Expenses and to pay all of such coststherefrom;

(f) to open and maintain a bank account or accounts inthe name of the Association; and

(g) to adopt, revise, amend and alter from time to timerules and regulations with respect to use, occupancy,operation and enjoyment of the Property.

Section 3.08 Limitation on Board Action. Prior to theApplicable Date all contracts or leases entered into by the Boardof Managers shall provide a right of termination withou~cause orpenalty at any time after the Applicable Date upon sixty (60) dayswritten notice to the other party. After the Applicable Date, theauthority of the Board of Managers to enter into a contract shallbe limited to contracts involving a total expenditure of less thanFive Thousand Dollars ($5,000) without obtaining the prior approvalof a majority of the Owners, except that in the following casessuch approval shal! not be necessary:

(a) contracts for replacing or restoring portions of theCommon Areas or Limited Areas damaged or destroyed byfire or other casualty where cost thereof is payable outof insurance proceeds actually received;

(b) proposed contracts and proposed expendituresexpressly set forth in the proposed annual budget asapproved by the Owners at the annual meeting; and

i0

(c) expenditures necessary to deal with emergencyconditions in which the Board of Managers reasonablybelieves there is insufficient time to call a meeting ofthe Owners.

~ 3.09 ComDensation. No Manager sha!l receive anyc0mp~n~t~n for h~S 0r h~r services ~ a M~, except to suchextent as may be expressly authorized by a majority of the Owners.The Managing Agent, if one is employed, shall be entitled toreasonable compensation for its services, the cost of which shallbe a Common Expense~

Section 3.10 Meetings. Regular meetings of the Board ofManagers may be held at such time and place as shall be determinedfrom time to time by a majority of the Managers. The Secretaryshall give notice of regular meetings of the Board to each Managerpersonally or by United States mail at least five (5) days prior tothe date of such meeting.

Special meetings of the Board may be called by the Presidentor any two members of the Board. The person or persons callingsuch meeting shall give written notice thereof to the Secretary whoshall either personally or by mail, and at least three (3) daysprior to the date of such special meeting, give notice to the Boardmembers. The notice of the meeting shall contain a statement ofthe purpose or purposes for which the meeting is called. Suchmeeting shall be held at such place and at such time within orwithout Marion County, Indiana, as shall be designated in thenotice.

Section 3.11 Waiver of Notice. Before any meeting of theBoard, any Manager may, in writing, waive notice of such meetingand such waiver shall be deemed equivalent to the giving of suchnotice. The presence of any Manager at a meeting or his subsequentconsent to the actions taken thereat, shal!, as to such Manager,constitute a waiver of notice of the time, place and purposethereof. If all Managers are present at any meeting of the Board,no notice shall be required and any business may be transacted assuch meeting.

Section 3.12 ~uorum. At all meetings of the Board, amajority of the Managers shall constitute a quorum for thetransaction of business and the votes of the majority of theManagers present at a meeting at which a quorum is present shall bethe decision of the Board.

ii

Section 3.13 Non-Liability of Managers. The Managers shallnot be liable to the Owners or any other persons for any error ormistake of judgment exercised in carrying out their duties andresponsibilities as Managers, except for their own individua!willful misconduct, bad faith or gross negligence. The Associationshall indemnify and hold harmless and defend each of the Managersagainst any and all liability to any person, firm or corporationarising out of contracts made by the Board on behalf of BayshoreVillas or the Association, unless any such contract shall have beenmade in bad faith or contrary to the provisions of the Declarationor By-Laws. It ±~ intended that the Managers shall have nopersona! liability with respect to any contract made by them onbehalf of Bayshore Villas or the Association and that in allmatters the Board is acting for and on behalf of the Owners astheir agent. The liability of any Owner arising out of anycontract made by the Board or out of the aforesaid indemnity infavor of the Managers shall be limited to such percentage of thetotal liability or obligation thereunder as is equal to hisPercentage Interest. Every contract made by the Board or ManagingAgent on behalf of Bayshore Vil.las shall provide that the Board ofManagers and the Managing Agent, as the case may be, are acting asagent for the Owners and shall have no personal liabilitythereunder, except in their capacity as Owner (if applicable) andthen only to the extent of their Percentage Interest.

Section 3.14 Additiona! Indemnity of Managers. TheAssociation shall indemnify, hold harmless and defend any person,his heirs, assigns and legal representatives, made a party to anyaction, suit or proceeding by reason of the fact that he or she isor was a Manager of the Association, against the .reasonableexpenses, including attorneys’ fees, actually and necessarilyincurred by him or her in connection with the defense of suchaction, suit or proceeding, or in connection with any appealtherein, except as otherwise specifically provided herein inrelating to matters as to which it shall be adjudged in suchaction, suit or proceeding that such Manager is liable for grossnegligence or misconduct in the performance of his or her duties.The Association shall also reimburse to any such Manager thereasonable costs of settlement of or judgment rendered in anyaction, suit or proceeding, if it shall be found by a majority ofthe Owners that such Manager was not guilty of gross negligence ormisconduct. In making such findings and notwithstanding theadjudication in any action, suit or proceeding against a Manager,no Manager shall be considered or deemed to be guilty of or liablefor negligence or misconduct in the performance of his or herduties where, acting in good faith, such Manager relies on thebooks and records of the Association or statements or advice made

12

by or prepared by the Managing Agent of Bayshore Villas or anyofficer or employee thereof, or any accountant, attorney or otherperson, firm or corporation employed by the Association to renderadvice or service, unless such Manager had actua! knowledge of thefalsity or incorrectness thereof; nor shall a misconduct by virtueof the fact that he or she failed or neglected to attend a meetingor meetings of the Board of Managers.

Section 3.15 Bond. The Board of Managers shall provideblanket fidelity bonds for all officers, directors, trustees andemployees of the AsSociation and shall require the Managing Agent,its officers, employees and agents handling or responsible forfunds of or administered on behalf of the Association and suchother persons handling or responsible for funds of or administeredby the Association, indemnifying the Association against larceny,theft, embezzlement, forgery, misappropriation, - wrongfulabstraction, willful misapplication, and other acts of fraud ordishonesty, in such sum and with such sureties as may be approvedby the Board of Managers, and any such bond shall specificallyinclude protection for any insurance proceeds received for anyreason by the Board. The premium of any such bonds (except forpremiums on fidelity bonds maintained by a management agent for itsofficers, emp!oyees and agents) shall be paid by the Association asa Common Expense. Such fidelity bonds shall name the Associationas a obligee and shal! not be less than the estimated maximum offunds, including reserve funds, in custody of the Association orthe Managing Agent, as the case may be, at any given time duringthe term of each bond. However, in no event may the aggregateamount of such fidelity bonds be less than a sum equal to three (3)months’ aggregate assessments on all Units plus reserve funds. Thebonds shall contain waivers by the issuers of the Bonds of alldefenses based upon the definition of "employees", or similar termsor expressions. The bonds shal! also provide that they may not becanceled or substantially modified (including cancellation fornonpayment of premium) without at least ten (I0) days prior writtennotice to the Association, and any insurance trustee and to eachholder of a first mortgage, or its mortgage servicer.

ARTICLE IV

Officers

Section 4.01 Officers of the Association. The principalofficers of the Association shall be the President, Vice President,Secretary and Treasurer, all of whom shall be elected by the Board.The Managers may appoint an assistant Treasurer and an AssistantSecretary and such other officers as in their judgment may be

13

necessary. Any two or more offices may be held by the samepersons, except that the duties of the President and Secretaryshall not be performed by the same person.

Section 4.02 Election of Officers. The officers of theAssociation shall be elected annually by the Board at the initialmeeting of each new Board. Upon an affirmative vote of a majorityof all members of the Board, any officer may be removed either withor without cause, and his successor elected at any regular meetingof the Board or at any special meeting of the Board called for suchpurpose. ~’

Section 4.03 ~ The President. The President shall be electedfrom among the Managers and shall be the chief executive officer ofthe Association. The President shal! preside at all meetings ofthe Association and of the Board, and shall have and discharge allthe general powers and duties usually vested in the office of thePresident or Chief Executive Officer of an association or a stockcorporation organized under the laws of Indiana, including but notlimited to the power to appoint committees from among the Owners ashe or she may deem necessary to assist in the affairs of theAssociation and to perform such other duties as the Board may fromtime to time prescribe.

Section 4.04 The Vice President. The Vice President shallbe elected from among the Managers and shal! perform all dutiesincumbent upon the President during the absence or disability ofthe President. The Vice President shall also perform such otherduties as these By-Laws may prescribe or as shall, from time totime, be imposed upon him or her by the Board or by the President.

Section 4.05 The Secretary. The Secretary shall be electedfrom among the Managers. The Secretary shall attend all meetingsof the Association and of the Board and shall keep or cause to bekept a true and complete record of the proceedings of suchmeetings, shall perform all other duties incident to the office ofthe Secretary, and such other duties as from time to time may beprescribed by the Board. The Secretary shal! specifically see thatall notices of the Association or the Board are duly given, mailedor delivered, !n accordance with the provisions of these By-Laws.

Section 4.06 The Treasurer. The Board shall elect fromamong the Managers a Treasurer who shall maintain a correct andcomplete record of account showing accurately at all times thefinancia! condition of the Association and who shall perform suchother duties incident to the office of the Treasurer. TheTreasurer shall be the legal custodian of all monies, notes,

14

securities and other valuables which may from time to time comeinto possession of the Association, and shall immediately depositall funds of the Association coming into his or her hands in areliable bank or other depository to be designated by the Board andshall keep such bank account or accounts in the name of theAssociation. The Treasurer may permit the Managing Agent to handleand account for monies and other assets of the Association to theextent appropriate as part of its duties.

SeCtion 4.07 Assistant Officers. The Board of Managers may,from time to time, designate and elect from among the Managers anAssistant Secretary and an Assistant Treasurer who shall have suchPowers and duties as the officers whom they are elected to assistshall delegate to them and such other powers and duties as theseBy-Laws or the Board of Managers may prescribe.

ARTICLE V

Assessments and Maintenance and Repairs

Section 5.01 Annual Ac~�ountinq. Annually, after the closeof each fiscal year of the Association and prior to the date of theannual meeting of the Association next following the end of suchfiscal year, the Board shall cause to be prepared and furnished toeach Owner an unaudited financial statement, which statement shal!show all receipts and expenses received, incurred and paid duringthe preceding fiscal year. Any Mortgagee or guarantor of amortgage shall be entitled to have an audited financial statementprepared at its own expense. ~

Section 5.02 Proposed Annual Budqet. Annually, on or beforethe date of the annua! meeting of the Association, the Board ofManagers shall cause to be prepared a proposed annua! budget forthe current fiscal year, estimating the total amount of the CommonExpenses for the current fiscal year, and shall furnish a copy ofsuch proposed budget to each Owner at or prior to the time thenotice of such annual meeting is mailed or delivered to suchOwners. The annual budget shall be submitted to the Owners foradoption at the annual meeting of the Association and, ±f soadopted, shall be the basis for the Regular Assessments(hereinafter defined) for the current fisca! year. At the annual

meeting of the Own@rs, the budget may be approved in whole or inpart or may be amended in whole or in part by a vote of a majorityof the Owners; provided, however, that in no event shall the annualmeeting of the Owners be adjourned until an annual budget isapproved and adopted at such meeting, either the proposed annualbudget or the proposed annual budget as amended. The annual

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budget, the Regular Assessments and all sLu~s assessed by theAssociation shall be established by using generally acceptedaccounting principles, applied on a consistent basis. The annualbudget and the Regular Assessments shall, in addition, include theestablishment and maintenance of a replacement reserve fund forcapita! expenditures and replacement and repair of the Common Areasand LimitedAreas, which replacement reserve fund shal! be used forthose purposes and not for usual and ordinary repair expenses ofthe Common Areas and Limited Areas. An amount of Two HundredDollars ($200.00) shall be collected at the time the sale of aCondominium Unit is closed to fund that Unit’s initia! share of thereplacement reserve fund. Such replacement reserve fund forcapital expenditures and replacement and repair of the Common Areasand Limited Areas shall be maintained by the Association in aseparate interest bearing account or accounts with one or morebanks or savings and loan associations authorized ko conductbusiness in Marion County, Indiana, selected from time to time bythe Board. The annual budget and the Regular Assessments shallalso be established to include an allowance or reserve to meetunforeseen contingencies or expenditures. Any amounts paid intothis fund shall not be considered as advance payment of RegularAssessments. Each Condominium Unit’s share of the working capitalfund will be 9ollected at the time the sale of the Unit is closedand transferred to the Association for deposit to a segregatedfund. The failure or delay of the Board of Managers to prepare aproposed annua! budget and to furnish a copy thereof to the Ownersshall not constitute a waiver or release in any manner of theobligations of the Owners to pay the Common Expenses as hereinprovided, whenever determined. Whenever, whether before or afterthe annual meeting of the Association, there is no annual budgetapproved by the Owners as herein provided for such current fiscalyear, the Owners shall continue to pay Regular Assessments based onthe last approved budget or, at the option of the Board, based uponone hundred ten percent (110%) of such last approved budget, as atemporary budget.

Section 5.03 ReGular Assessments. The annual budget asadopted by the Owners shall, based on the estimated cashrequirement for Common Expenses in the current fiscal year as setforth in said budget, contain a proposed assessment against eachCondominio/n Unit based on the Percentage Interest of eachCondominillmUnit. Immediately following the adoption of the annualbudget, each Owner shall be given written notice of such assessmentagainst his respective Condominium Unit (herein called the "RegularAssessment"). In the event the Regular Assessment for a particularfiscal year is initially based upon a temporary budget, suchRegular Assessment shall be revised, within fifteen (15) days

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fol!owing adoption of the final annual budget by the Owners, toreflect the assessment against each Condominium Unit based uponsuch annual budget as finally adopted by the Owners. The aggregateamount of the Regular Assessments shall be equal to the totalamount of expenses provided and included in the final annualbudget, including reserve funds as hereinabove provided. TheRegular Assessment against each Condominium Unit shall be paid inadvance in equal monthly installments, commencing on the first dayof the first month of each fiscal year and monthly thereafterthrough and including the first day of the last month of eachfiscal year. Payment of the monthly installments of the RegularAssessment shall be made to the Board of Managers or the ManagingAgent, as directed by the Board of Managers; provided, however,Owners may elect to pay monthly assessments semi-annually orannually, in advance. In the event the Regular Assessment for aparticular fisca! year of the Association was initially-based upona temporary budget,

(a) if the Regular Assessment based upon the finalannual budget adopted by the Owners exceeds the amount ofthe Regular Assessment based upon the temporary budget,that portion of such excess applicable to the period fromthe first day of the current fiscal year to the date ofthe next payment of the Regular Assessment which is dueshall be paid with such next payment and such next

payment, and all payments thereafter during such fiscalyear shall be increased so that the Regular Assessment asfinally determined shall be paid in full by the remainingpayments due in such fiscal year, or

(b) if the Regular Assessment based upon thetemporary budget exceed the Regular Assessment based uponthe final annual budget adopted by the Owners, suchexcess shall be credited against the next payment orpayments of the Regular Assessment coming due until theentire amount of such excess has been so credited;provided, however, that if an Owner had paid his or herRegular Assessment either semi-annually or annually inadvance, then the adjustments set forth under (a) or (b)above shall be made by a cash payment by, or refund to,the Owner on the first day of the second month followingthe determination of the Regular Assessment based uponthe annual budget finally adopted by the Owners.

The Regular Assessment for the current fiscal year of theAssociation shall become a lien on each separate Condominium Unitas of the first day of each fiscal year of the Association, even

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though the final determination of the amount of such RegularAssessment may not have been made by that date. The fact that anOwner has paid his Regular Assessment for the current fiscal yearin whole or in part based upon a temporary budget and thereafter,before the annual budget and adjusted as herein provided, sells,conveys or transfers his Condominiu-~ Unit or any interest therein,shall not relieve or release such Owner or his successor as Ownerof such Condominiux~ Unit from payment of the Regular Assessment forsuch Condominium Unit as finally determined, and such Owner and hissuccessor as Owner of such Condominiu/~ Unit shall be jointly andseverally liable fo~ the Regular Assessment as finally determined.~hny statement of unpaid assessments furnished by the Associationpursuant to Section 8.02 hereof prior to the fina! determinationand adoption of the annual budget and Regular Assessment for theyear in which such statement is made shal! state that the mattersset forth therein are subject to adjustment upon determination andadoption of the final budget and Regular Assessment for such year,and all parties to whom any such statement may be delivered or whomay rely thereon shall be bound by such final determinations.Monthly installments of the Regular Assessments shall be due andpayable automatically on their respective due dates without anynotice from the Board or the Association, and neither the Board northe Association shall be responsible for providing any notice orstatements to Owners for the same.

Section 5.04 Special Assessments. From time to ti~-~ CommonExpenses of an unusual or extraordinary nature or not otherwiseanticipated may arise. At such time and without the approval ofthe Ow~lers, unless otherwise provided in these By-Laws, theDeclaration or the Act, the Board of Managers shall have the fullright, power and authority to make special assessments which, uponresolution of the Board, shal! become a lien on each CondominiumUnit, prorated in accordance with the Percentage Interest of eachCondominium Unit (herein called "Specia! Assessment"). Withoutlimiting the generality of the Board of Managers from time to timeto pay for capital expenditures, to pay for the cost of any repairor reconstruction of damage caused by fire or other casualty ordisaster to the extent insurance proceeds are insufficient thereforunder the circumstances described in the Declaration.

Section 5.05 Declarant Excused. If the Declarant is theOwner of an unoccupied Condominiu!~ Unit offered for the first timefor sale, then the Declarant is excused from contributing towardthe Cormmon Expenses for those Units during the period of time thatshall begin on the date of the recordation of the Declaration andshall terminate twenty-three (23) months and one (I) day fol!owingthe month in which the closing of the sale of the first Condominium

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Unit within Bayshore Villas Horizontal Property Regime occurs.However, if the Common Expenses incurred during a fiscal year whilethe Declarant is excused from contributing towards same exceed theamount assessed against the other Owners, then the Declarant shallpay the excess.

Section 5.06 Failure of Owner to PaV Assessments.

(a) No Owner may become exempt from paying RegularAssessments and Special Assessments, or from contributingtoward the expenses of administration and of maintenanceand-repair of the Common ~_reas and, in the proper case,of the Limited Areas, of the Buildings, and toward anyother expenses lawfully agreed upon, by waiver of the useor enjoyment of the Common Areas or by abandonment of hisor her Condominium Unit. Each Owner shall be personallyliable for the payment of all Regular and Specia!Assessments. Where the Owner constitutes more than oneperson, the liability of such persons shall be joint andseveral. The Board shal! cause to be notified in writingany ~mortgage holder, insurer or guarantor of aCondominium Unit which has a ~delinquency of sixty (60)days or more.of the assessments or charges. If any Ownershall fail, refuse or neglect to make any payment of anyRegular Assessments or Special Assessments when due, thelien for such Assessments on the Owner’s Condominium Unitmay be filed and foreclosed by the Board for and onbehalf of the Association as provided by law. Upon thefailure of an Owner to make timely payment of any RegularAssessments or Special Assessments, when due, the Boardmay, in its discretion, accelerate the entire balanceofthe unpaid Assessments and declare the same immediatelydue and payable, notwithstanding any other provisionshereof to the contrary. In any action to foreclose thelien for any Assessments, the Owner and any occupant ofthe Condominium Unit shall be jointly and severallyliable for the payment to the Association of reasonablerental for such Condominium Unit, and the Board shall beentitled to the appointment of a receiver for the purposeor preserving the Condominium Unit and to collect therentals and other profits therefrom for the benefit ofthe Association to be applied to the unpaid RegularAssessments or Special Assessments. The Board may, atits option, bring a suit to recover a money judgment forany unpaid Regular Assessment or Special Assessmentwithout foreclosing or waiving the lien securing thesame. In any action to recover a Regular Assessment or

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Special Assessment, whether by foreclosure or otherwise,the Board, for and on behalf of the Association, shal! beentitled to recover interest at a rate of eight percent(8%) per annum from the due date, costs and expenses ofsuch action incurred, including but not limited toreasonable attorneys’ fees, from the Owner of therespective Condominium Unit.

(b) Notwithstanding anything contained in thisSection or elsewhere in the Declaration and these By-Laws, any liin for Common Expenses and Assessmentsbecoming payable after the recordation of a firstmortgage on a Condominium Unit shall be subordinate tothe first mortgage on the Condominium Unit, and any saleor transfer of a Condominium Unit to a Mortgagee pursuantto a foreclosure on its mortgage or conveyance in lieuthereof, or a conveyance to any person at a public salein the manner provided by law with respect to mortgageforeclosures, shall extinguish the lien of any unpaidinstallment of any Regular Assessment or SpecialAssessment as to such installments which become due priorto such sale, transfer or conveyance; provided, however,that the extinguishment of such lien shall not relievethe prior owner from persona! liability therefor. Nosuch sale, transfer or conveyance shall relieve theCondominium Unit or the purchaser at such foreclosuresale, or grantee in the event of conveyance in lieuthereof, from liability for any installments of RegularAssessments or Special Assessment thereafter becoming dueor from the lien therefor. Such unpaid share of anyRegular Assessments or Special Assessments, the lien forwhich has been divested as aforesaid, shall be deemed tobe a Common Expense, collectible from all Owners(including the party acquiring the subject CondominiumUnit from which it arose), as provided in the Act.

Section 5.07 Initial Budgets and Assessments. Notwithstand-ing anything to the contrary contained herein, in the Declaration,in the Act, in the Statute or otherwise, until the Applicable Date,the annual budget and all Regular Assessments and SpecialAssessments shal! be established by the Initial Bo~rd withoutmeetings with or the concurrence of the Co-Owners. The agency,power of attorney and proxy granted to. the Declarant by each Ownerpursuant to Section 2.10 hereof shal! be deemed to cover andinclude each Owner’s right to vote on and approve the annual budgetand any Regular Assessments and Special Assessments until theApplicable Date.

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Sectio____~n 5.08 Maintenance and ReDairs. Every Owner shallpromptly perform all maintenance and repair within hisowncondominium Unit which, if neglected, would affect the value of theP~operty, In addition, each Owner shall furnish, and shall beresponsible at his own expense for, the maintenance, repairs andreplacements of his Condominium Unit and certain portions of theLimited Areas as may be established by rules. Such maintenance,repairs and replacements which each Owner is responsible to makepersonally and at his own expense include, but are not necessarilylimited to, water lines, gas lines, plumbing and electric lineswhich service the Owner’s Condominium Unit only and are locatedwithin exterior walls of the Condominium Unit, including any linesin the area from below the floor to above the roof if they arewithin an extension of the exterior walls of the Condominium Unit;all partitions and interior walls, ceiling and floors; appliances,to include garbage disposal, dishwashers, stove, ranges andrefrigerators, telephones, air conditioning and heatingequipment(whether located wholly or partially inside or outside theCondominium Unit), doors, screens and windows (including windowframes, casings, and the exterior and interior of all glass andscreen surfaces), lamps and interior and exterior grouting and/orcaulking, and all other accessories appurtenant to the CondominiumUnit or belonging to the Owner thereof.

If due to the willful, intentional or negligent acts oromissions of an Owner or of a member of his family or of a guest,tenant or other occupant or visitor of such Owner, damage shall becaused to the~Common Areas or to a Condominium Unit or Limited Areaowned by or reserved for the use of others, or if maintenance,repairs or replacements shall be required thereby which wouldotherwise be at the Common Expense, then such Owner shall pay forsuch damage and such maintenance, repairs and replacements, as maybe determined by the Association, unless such loss is covered bythe Association’s insurance with such policy having a waiver ofsubrogation clause. Maintenance, repairs and replacements to theCommon Areas or the Condominium Units or Limited Areas shall besubject to the rules and regulations adopted from time to time bythe Board.

To the extent that equipment facilities and fixtures withinany Condominium Unit shal! be connected to similar equipment,facilities or fixtures affecting or serving other Condominium Unitsor any Common Areas or Limited Areas, then the use thereof by theOwner of such Condominium Unit shall be subject to the rules andregulations adopted from time to time by the Board. The authorizedrepresentatives of the Association or Board of Managers or theManaging Agent for the Association, shal! be entitled to reasonable

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access to any Condominium Unit as may be required in connectionwith maintenance, repairs or replacements of or to the Common Areasor Limited Areas or any parts thereof, or any equipment facilitiesor fixtures affecting or serving other Condominium Units or anyCommon Areas or Limited Areas.

ARTICLE Vl

Restrictions, Entry and Rules and ReGulations

Section 6.01 "Restriction on Use. The following restrictionson the use and enjoyment of the Condominium Units, Common Areas,Limited Areas and the Property shall be applicable to BayshoreVillas in addition to those set forth in the Declaration. Theseare as fol!ows:

(a) All Condominium Units shall be used exclusivelyfor residential purposes and no Condominium Unit may bepartitioned or subdivided.

(b) No additional buildings shall be erected orlocated on the Tract other than the Buildings designatedin the Declaration without the consent of the Board ofManagers.

(c) Nothing shall be done or kept in anyCondominium Unit or in the Common Areas or Limited Areaswhich wil! cause an increase in the rate of insurance onany Building or the contents thereof. No Owner shallpermit anything to be done or kept in his CondominiumUnit or the Common Areas or Limited Areas which wil!result in a cancellation of insurance on any Building orany part of the Common Areas or contents thereof, orwhich would be in violation of any law or ordinance orother requirements of any insurance underwriting orrating bureau.

(d) No nuisance shall be permitted and no wasteshall be committed in any Condominium Unit, Common Areas,or Limited Areas.

(e) No Owner shall cause or permit anything to behung or displayed on the outside of the windows or placed

on the outside walls of any Building, and no sign,awning, canopy, shutter or radio or television antenna orother attachment or thing shal! be affixed to or placedupon the exterior walls or roofs or any other parts of

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any Building without the prior consent of the Board.This restriction shall not apply to any seasonal orholiday display or decoration so placed at theappropriate time of the year and so located on temporaryand/or limited basis.

(f) No animals, livestock or poultry of any kindshall be raised bred or kept in any Condominium Unit orin the Common Areas or Limited Areas or on the Property,except that pet dogs, cats or customary household petsmay be kept in~ Condominium Unit, provided that such petis not kept, bred or maintained for any commercialpurpose, or does not create a nuisance. Pets shall betaken outdoors only under leash or other restraint andwhile attended by its owner and an Owner shall be fullyliable for any injury or damage to persons or property,including~the Common Areas or Limited Areas, caused byhis!~pet. The tethering of pets in any area outside anOwner’s Condominium Unit does not constitute "attended".~Pets shall be walked only in an area not common toresidents and pet leavings on the main ground and walksshall be picked up immediately by the pet’s owner anddisposed of in a proper receptacle. The Board may adoptsuch other rules and regulations regarding pets as it maydeem necessary from time to time including, but notlimited to, a requirement that any Owner desiring tobring a pet on the Property shall deposit with the Boarda security deposi~ in an amount to be determined by theBoard to cover any damage that may be caused by such pet.Any requirement for the depositing of such a securitydeposit shall not be deemed to release or in any waylimit an Owner’s responsibility and liability for injuryand damage caused by his pets. Any pet which, in thejudgment of the Board, is causing or creating a nuisanceor unreasonable disturbance or noise, shall bepermanently removed from the Property within ten (I0)days after written notice from the Board to therespective Owner to do so.

(g) Nothing shall be done or permitted in anyCondominium Unit which will impair the structuralintegrity of any Building or which would structurallychange any Building or which would affect the exteriorappearance of any Condominium Unit, except as otherwiseprovided in the Declaration or these By-Laws. NoCondominium Unit shall be used in any unlawful manner orin any manner which might cause injury to the reputation

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of Bayshore Villas or which might be a nuisance,annoyance, inconvenience or damage to other Owners andoccupants or Condominium Units or neighboring property,including without limitation the generality of theforegoing, noise by the use of any musica! instruments,radio, television, loud speakers, electrical equipment,amplifiers or other equipment or machines or loudpersons.

(h) No clothes, sheets, blankets, rugs, laundry orother things s~all be hung out or exposed on, or so as tobe visible from any part of the Common Areas. The CommonAreas shall be kept free and clear of rubbish, debris andother unsightly materials.

(i) No industry, trade, or other commercial orreligious activity, educational or otherwise, designedfor profit, altruism or otherwise, shall be conducted,practiced or permitted on the Property.

(j) No "for sale", "for rent" or "for lease" signs,or other signs, or other window or advertising displayshall be maintained or permitted on any part of theProperty or any Condominium Unit without the priorconsent of the Board; provided, however, that the rightis reserved by the Declarant and the Board to place orallow to be placed "for sale" or "for lease" signs on orabout the Property in connection with any unsold orunoccupied Condominium Units.

(k) Al! Owners and members of their families, theirguests, or invitees, and all occupants of any CondominiumUnit or other persons entitled to use the same and to useand enjoy the Common Areas and the Limited Areas or anypart thereof, shall observe and be governed by such_rulesand regulations as may from time to time be promulgatedand issued by the Board governing the operation, use andenjoyment of the Condominium Units, the Common Areas, andLimited Areas.

(i) No boats, campers, trailers of any kind, buses,mobile homes, trucks, or any other vehicles of anydescription other than normal passenger automobiles,shall be permitted, parked or stored anywhere within theProperty. No repair work shall be done on the Propertyon any vehicles, including passenger automobiles.

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(m) No Owner shall be allowed to plant trees,landscape or do any gardening in any of the Common Areasor Limited Areas, except with express permission from theBoard.

(n) All garbage, trash, and refuse shall be storedin appropriate containers inside the Condominium Unit andshall be kept therein unti! not earlier than sundown ofthe evening before scheduled trash collection. Garbage,trash and refuse shall be placed in sealed disposableplastic bags o~ other containers approved by the Boardfor scheduled trash collection and shall be placed atsuch locations for trash collection as are designated bythe Board.

(o) Common Areas and Limited Areas shall be usedonly for the purposes for which they are designed andintended, and shall be used subject to the rules andregulations from time to time adopted by the Board.

Section 6.02 Right of Entrv. All Owners and occupants of aCondominium Unit shall be deemed to have granted the right of entrythereto to the Managing Agent or any other person authorized by theBoard in case of any emergency originating in or threatening his orher Condominium Unit or the Building in which it is located,whether the Owner is present at the time or not. Any Owner shallpermit other persons, or their representatives when so required, toenter his or her Condominium Unit for the purpose of performinginstallations, alterations or repairs to the mechanical orelectrical services, or to make structural repairs, provided thatrequest for entry are made in advance and that such entry is at atime reasonably convenient to the Owner. In case of emergencies,such right of entry shall be immediate.

Section 6.03 Right of Board to AdoDt Rules and Regulations.The Board may promulgate such additional rules and regulationsregarding the operation of the Property, including but not limitedto the use of the Common Areas and Limited Areas, as it may deemnecessary from time to time and such rules as are adopted may beamended by a vote of a majority of the Board, and the Board shallcause copies of such rules and regulations and al! amendmentsthereto to be delivered or mailed promptly to all Owners .......

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ARTICLE VII

Amendment to Bv-Laws.

Section 7.01 Subject to any contrary, overriding orsuperseding provisions set forth herein or in the Declaration,these By-Laws may be amended in the same manner, and subject to thesame limitations and requirements, as amendments to theDeclaration, as set forth in Section 20 of the Declaration.Amendment to these ~y-Laws shall be considered as amendments of theDeclaration and shal! be recorded in the office of the Recorder ofMarion County, Indiana, as required by the Declaration and the Act.Notwithstanding anything to the contrary contained herein or in theDeclaration, there shall be no amendment of the Declaration orthese By-Laws prior to the Applicable Date without the Consent andapproval of the Declarant.

ARTICLE VIII

Mort~aqes

Section 8.01 Notice to Association. Any Owner who places afirst mortgage lien upon his Condominium Unit shall notify theSecretary of the Association thereof and provide the name andaddress of the Mortgagee. A record of such Mortgagee and name andaddress shall be maintained by the .Secretary and any noticerequired to be given to the Mortgagee pursuant to the terms of theDeclaration, these By-Laws or the Act shall be deemed effectivelygiven if mailed to such Mortgagee at the address shown in suchrecord within the time provided. Unless notification of any suchmortgage and the name and address of Mortgagee are furnished to theSecretary, either by the Owner or the Mortgagee, no notice to theMortgagee as may otherwise be required by the Declaration, theseBy-Laws or the Act shall be required, and no Mortgagee shall beentitled to vote on any matter to which he or she otherwise may beentitled by virtue of the Declaration, these By-Laws, the Act, orany proxy granted to such Mortgagee in connection with themortgage.

Section 8.02 Notice of UnDaid Assessments. The Associationshal!, upon request of a Mortgagee, a proposed mortgagee, or aproposed purchaser who has a contractual right to purchase aCondominium Unit, furnish to such Mortgagee or purchaser astatement setting forth the amount of the unpaid RegularAssessments or Special Assessments against the Condominium Unit,which statement shal! be binding upon the Association and theOwners, and any Mortgagee or grantee of the Condominium Unit shal!

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not be liable for nor shall the Condominium Unit conveyed besubject to a lien for any unpaid assessments in excess of theamount set forth in such statement or as such assessments may beadjusted upon adoption of the final annual budget, as referred toin Section 5.03 hereof.

Section 8.03 Mort~a~ee’s RiGhts.

(a) An eligible holder of a first mortgage, uponwritten request to the Association, (such request tostate the nameand address of the eligible holder and theCondominium Unit number), shall be entitled to timelywritten notice of:

(i) any proposed amendment of theDeclaration or By-Laws effecting a change in(i) the boundaries of any Condominium Unit orthe exclusive easement rights appertaining

thereto, (ii) the interests in the CommonAreas or Limited Areas appertaining to any

Condominium Unit or the liability for CommonExpenses appertaining thereto, (iii) thenumber of votes in the Associationappertaining to any Condominium Unit or (iv)the purposes to which any Condominium Unit orthe Common Areas are restricted;

(2) any proposed termination of theRegime;

(3) any condemnation loss or anycasualty !oss which affects a material portionof the Property or which affects anyCondominium Unit on Which there is a firstmortgage;

(4) any delinquency in the payment ofassessments or charges owed by an Owner of aCondominium Unit subject to the mortgage,where such delinquency has continued for aperiod of sixty (60) days;

(5) any lapse, cancellation or materialmodification of any insurance policymaintained by the Association pursuant to theDeclaration; and

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(6) any proposed action that requiresthe consent of a specified percentage ofeligible mortgage holders.

Other Provisions for Mortqaqes.

(i) Any restoration or repair of theProperty after a partial condemnation ordamage due to an insurable hazard shall besubstantially in accordance with theDeclaratibn and the original Plans andspecifications, unless the approva! of theeligible holders of first mortgages onCondominium Units to which at least fifty-onepercent (51%) of the votes of CondominiumUnits subject to mortgages held by sucheligible holders are al!ocated is obtained. ~

(2) Any election to terminate theCondominium Regime after substantia!destruction or a substantial taking incondemnation of the Property must require theapproval of the eligible holders of firstmortgages on Condominium Units to which atleast fifty-one percent (51%) of the votes ofCondominium Units subject to mortgages held bysuch eligible holders are allocated.

(3) No reallocation of interests in theCommon Areas resulting from a partialcondemnation or partial destruction of theProperty may be affected without the approvalof the eligible holders of first mortgages onCondominium Units to which at least fifty-onepercent (51%) of the votes of the CondominiumUnits subject to mortgages held by sucheligible holders are al!ocated.

(4) As used in this Section, the term"eligible holder" shall mean a holder, insureror guarantor of a first mortgage on aCondominium Unit who has requested notice inaccordance with the provisions of Section8.03(a) above.

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ARTICLE IX

Miscellaneous

Section 9.01 Fiscal Year. The fiscal year of theAssociation shall begin on the first day of January in each yearand end on the last day of December next following.

Section 9.02seal.

Seal. The Association shall have no corporate

Section 9.03 MembershiD Certificates. Each member of theAssociation shall receive a certificate ! from the Association,signed by the ~President or Vice President, and ~Secretary orAssistant Secretary !thereof, stating that he or she is a member ofthe Association. Such certificates shall be non-transferable, anda member’s certificate shall become void and of no force and effectupon sale by a member of his or her Condominium Unit. Suchmembership~certificate shall be in a form and style determined bythe Board.~

Section 9.04 Personal Interest. No member of theAssociation shall have or receive any earnings from theAssociation, except that a member who is an officer, director oremployee of the Association may. receive fair and reasonablecompensation for his or her services as officer, director oremployee, and a member may also receive principal and interest onmonies loaned or advanced to the Association as provided in theStatute.

Section 9.05 CaDtions. The captions herein are insertedonly as a matter of convenience and for reference and in no waydefine, limit or describe the scope of these By-Laws or the intentof any provision hereof.

Section 9.06 Waiver. No restriction, condition, obligationor provision contained in these By-Laws shall be deemed to havebeen abrogated or waived by reason of any failure to enforce thesame, irrespective of the number of violations or breaches thereofwhich may Occur.

Section 9.07 Election Under Internal Revenue Code. TheBoard shall make and file all elections and documents requiredpursuant to the Internal Revenue Code, and any other applicablestatute or regulation, in order to exempt from taxation, insofar aspossible, the income of the Association consisting of assessmentspaid by Unit Owners.

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Section 9.08 Invalidity. The invalidity of any part ofthese By-Laws shal! not impair or affect in any manner thevalidity, enforceability or effect of the balance of these By-Laws.

The undersigne~ hereby certifies that the foregoing Code ofBy-Laws were adopted as the By-Laws of Bayshore Villas Co-OwnersAssociation, a not-for-profit corporation under the laws of theState of Indiana, by action of the Board of M~ ers at the firstmeeting thereof, effective this ~!~day of

SI zretary

cfc\doc\BayShoreVillasBYLAWS

3O

STATE OF INDI~L~OFFICE OF ~ SECRETAEY OF ST!~E

BAYSHORE VILLAS C0-0WNERS ASSOCIATION~ INC.

SUE ANNE GILROY, Secretary of State of Indiana, hereby certify that~rtlcles of Incorporation of the above corporation have been presented tome at my office accompa~ed by the fees prescribed by law; that I havefound such Artlcles conform to law; all as prescribed by the provisions ofthe Indiana Nonprofit Corporation Act of 1991, as amended.

NOW, THEREFORE, I hereby issue to such corporation this Certificate ofIncorporation, and further certify that its corporate existence ~-Iii beginOctober 01, 1999.

In Witness Whereof, I have hereunto set my

hand and affixed the seal of the State of

Indiana, at the City of Indlanapolls, this

First day of October , 1999.

SUE ANNE GILROY, S~State

ARTICLES OF INCORPORATION / NONPROFIT CORPORATIONS I SUEANNE GILROYCORPORATIONS DIVISION302 W. Washington St., Rm. E018

INS~UCRONS: 7. Nonprefi~ co~o~tlons must quafl~ with the ln~emal Revenue Semite Indiana Code ~-17~2and ~e indiana Depa~ment of Revenue, I~ Is s~ng~ suggestad you donot complete or file this fo~ befom contacting both agencies,

2. Filing Fee $30.00 made payable to Indiana Secretary of State

3. Article VII must be completed appropriately. Please see (1) above.

ARTICLES OF INCORPORATION

The undersigned incorporator or incorporators, desidng to form a corporation (hereinafter referred to as the "Corporation") pursuant to theprovisions of the Indiana Nonprofit Corporation Act of 1991 (hereinafter referred to as the "Act"), execute the following Articles ofIncorporation. .’

Name of the Corporation: (the name must include the word "Corporation", "Incorporated", "Limited", "Company" or one Of the abbrevfaZions thereoO :

BAYSHORE VILLAS CO-OWNERS ASSOCIATION, INC.Principal Office: The address of the pdnclpal office of the Corporation Is:Post office address

11350 N. Meridian Street, Suite 150 C~carmel IndianaZIP ~de

46032

The purposes [or which the Corporation is formed are:

Not-For-Profit operation and management of a residential horizontal

property regime homeowners association.

The Corporation is a:

[] public benefit corporation, which is organized for a public or charitable purpose;[] religious corporation, which is organized primarily or exclusively for religious purposes; Or~mutual benefit corporation (aft others).

Registered Agent: The name and skeet address or’the Corporation’s Registered Agent and Registered Office for service of process are:Name of Registered Agent

Dennis Yovanovich

Address of Registered Office (street or building)

11350 N. Meridian Street, Suite 150 CI~carmel IndianaZlP~de

46032

~dlcate if Corporation will have members:[~Yes E]No (a.k.a. Co-Owners)I

(Continued on the reverse side)

Name(s) and sdd~s(es) of the incorporator(s) is/am as follows:Number and Street or Building c~ State ZIP code

Janice P. Vollmer 11350 N. Meridian Carmel 46032

Street, Suite 150

Refar to Indiana Code 23-17-22-5 for permitted actJvi~es following Dissolution.

Assets shall be distributed after all debts and obligations of theCorporation have been satisfied. The distribution of the assets shallbe made to all the Co-0wners of Bayshore Villas Co-Owners Association,

Inc. The amount received by each Co-Owner shall be determined by thepercentage interest of the total undivided interest each Co-Owner shallhave in the Corporation.

THiS DOCUMENT MUST BE SIGNED BY ALL INCORPORATORS.

I (we) hereby vedfy, subject to penalties of perjury, that the facts contoined herein are ~Je, (Notorizatlon not necessao/)Slgna Pdnfad name

Janice P. VollmerSignature~ Pdnted name

Signature P~int~d name

t~isinstrume~wsspreparadby:(name)

Janice P. Vollmerddra~ ,.

1~11350 N. Merzdlan Street, Suite CarmelSate ZiP code

IN 46032

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Bayshore VillasHomeowner Association Fee Services

÷:÷ Grass cutting and lawn treatments

÷:* Landscape beds care

%% Flowers, tree and shrub care

°:o Sprinkler system maintenance (turf areas 100% irrigated)

o:° Snow Removal

%% Exterior buildings components, driveways and sidewalksmaintenance and replacement (see documents)

%% Water and sewer service (a +/- $45.00 monthly benefi!!)

÷:÷Master insurance coverage (a +/- $45.00 monthly benefit) ((Ownersstill need Condo Owner’s Policy))

%% Professional Association management, accounting and legal services

All this and more for one low monthly fee (~That’s

the Augusta Group benefit of Associa~on livin~ whileenjoying a beautiful new home and the careff~e-lffestyle thatit will bring to your active life.

09/26100

BAY SHORE VILLAS2001 APPROVED BUDGET

18 Unit Basis 56 Unit Basis12 Month Fiscal "12 Month Fisc~

2000 2001Dist Per Budget 2000 Description Budget Dist. Per

UniUMnth 2000 Actual* 2001 Unit/Mnth,

RECEIPTS

135.00 29,160.00 5,960,00 TotalAsssciationFees0,12 25.00 0,00 Non-Sufficient Funds Charge0.00 0,00 0.00 Legal Fee Reimbursement0.74 160.00 160.00 Late Fees0.00 0.00 0,00 Collection Cost Reimbursement0.00 0.00 0,00 Insurance Claim income

54.81 11,839,00 200.00 Developer Funding50.00 10,800.00 2,0~0.00 Reserve Start Up Fee

1.16 250,00 0.00 Reserve Intsrest0.00 0.00 0.00 Miscellaneous

90,720.00 135.000.00 0.000.00 0.00

200.00 0,30125.00 0.19

0.00 0.000.00 0.00

9,600.00 14.290.00 0.000.00 0.00

(10.00) (2,160.00) (450.00) (Less Reserve Income) (6,720,00) (10.00)(1.16) (250.00) 0.00 (Less Reserve Interest) 0,00 0.00

(80,00) (10,800.00) (2,000.00) (Less ReserveStsrt Up Fee) (9,600.00) (14,29)

GENERAL OPERATING EXPENSES

12,25 2,647.00 2,275.00 Management Fees 4,200,00 6~250,93 290,00 0,00 Legal Fees 200.00 0.300.00 0o00 0.00 Accounting Fees 250.00 0,37

10,90 2,354.00 0,00 Insurance Premiums 12,500.00 18,600.00 0.00 0,00 Insurance Claim/Deductible 0,00 0.000.00 0,00 0.00 Colle~on Costs 125,00 0.194.41 95,3.00 297.00 Administ, r’atJve 737,00 1.10

84.21 18,190,00 0.00 Common Utilities 10,000,00 14.8829.17 6,300,00 0.00 Lawn Care 10,370,00 15.43

1.62 350.00 0.00 Tree/Shrub Care 0.00 0,006.71 1,450.00 0.00 Common Area Maintenance 0,00 0,00

12.73 2,750.00 0.00 !rtigation 2,000.00 2.980.00 0.00 340,00 Lake Care 675,00 1.009,26 2,000.00 1,000.00 Snow Removal 2,000.00 2,981.16 250,00 0.00 Miscellaneous 100.00 0.152.31 500.00 0.00 General Operating Reserve 0.00

5.00 1,080.00 1,958.00 Excess/(Deficlt) 41,168,00

Pdor Years0.00 0.90 0.00 Excess/(Deficit) 1,958.00 2.91

1,00~ O00Z:%oSpn8 len~ov

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ProjectedActual, Budget2000 2001

Tree & Shrub Care:Plant Replacement 0.00 0,00Pruning 0,00 0.00Mature Tree Removal/Care 0.00 0.00Fe~llzatlonllnsect & Disease Contro~ 0.00 0.00Miscellaneous 0.00 0.00

Common Area MaintJImprevemants: .....Building Maintenance 0.00 0.00Common Ground Maintenance 0,00 0 00

0.00 0.00 ’ ....~Gutter Cleaning/Repairs

Roof RepairsCfittedPest ControlMiscellaneous

0.00 0.000.00 0.00

0.00 0.00

Lake Care: Weed and Algae control treatments

Irrigation: Maintenance and water used

Lake Care: Lake care maintenance

Snow Removal: Streets, drives & walks @ 2" accumulation + sand as needed

Miscellaneous: For expenses which do not relate to any existing catsgor[es "

General Operating Reserve: For budget deficits and/or unfomeen expenses

2000

,GenemlOpereting&lnsuranee Reserve Total$125.00 $10.00 135.00

2001

,,,General OpereUng & nsurance Reserve Total$125,00 $10.00 135,00

NOTE: Make Checks Payable to YourHomeowner’s Association - Please.

THANK-¥OUI

18 Unit Basis12 Month Fiscal

2000DisL PerUnifJMnth

2001 RESERVE BUDGET ¯

20002000 Projected 2001

Budget Actual Description Budget

INCOME

56 Unit Basis12 Month Fiscal

2001Dist. PerUniUMnth

10.00 2,160.00 450.00 Reserve1.16 250.00 0,60 Reservelnterest

50.00 10,800.00 2,000.00 Reserve Start Up Fee

6,720.00 10.000.00

9,600.00 14.29

EXPENSES

0.00 0.00 0.00 Income Taxes - Federal 0.00 0.000.00 0,00 0.00 Income Taxes- State 0,00 0.000.00 0.00 0.00 Siding 0.00 0,000.00 0,00 0.00 Miscellaneous 0.00 0.00

61.16 13,210.00 2,460.00 Excass/(Def~c~t) 16,320.00 24.29

P~lor Yeers61.16 13,210.00 0.00 Excess/(Deficit) 0.00 0.00

*Reserves are set aside yearly to accumulate enough monies to ensureto have adequate funds for capital repaire/replacements In thefuture (le: roof replacement, gutter replacement, painting, asphaltend concrete replacement).