VILLAGES HOMEOWNER'S ASSOCIATION #2 RULES

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VILLAGES HOMEOWNER'S ASSOCIATION #2 RULES This revision of the Association Rules was formally adopted by the Villages Homeowners Association #2 Board of Directors during its regularly scheduled monthly meeting of April 3, 2012. Robert Segelbaum, President Throughout these rules, the use of the term "Board" shall mean the Board of Directors or its appointees. I. Recreation Area Rules: Our community features several recreational amenities, most notably a swimming pool, tennis court and volleyball area. We encourage your use of these facilities, keeping the following rules in mind 1. Pool, tennis court, basketball court and volleyball areas are restricted to Villages Homeowners Association No. 2 homeowners who are current in paying their dues, and their guests. 2. Resident families are permitted a maximum of 8 guests, (infants, children and adults). Larger parties require prior authorization by the Board plus a $100.00 damage deposit, which is refunded if the area is left clean and undamaged. 3. No littering allowed. Each party is required to clean up its own litter and place disposables in the large green garbage container before leaving area. 4. Persons under the age of 14 must be accompanied by an adult. An adult is an individual age 18 years or older. Individuals under the age of 18 are not permitted to supervise younger persons. 5. For safety reasons, a supervision ratio of no more than 5 children under age 14 per adult must be maintained in the pool area. 6. No glass containers are allowed in the pool, tennis, or volleyball areas. 7. No pets are allowed in the pool, tennis, or volleyball areas. 8. The life preserver is to be visible at all times, as required by city regulation. 9. Recreation area gates are to remain locked at all times. They may not be left propped open (even during a reserved event), since this could enable a young child to wander into the pool area without supervision. 10. Children with disposable diapers are not allowed in the pool. Fibers clog the pool filter and pose a health hazard 11. Proper swimming attire must be worn in the pool. Shower before entering the pool, and turn off the shower! 1

when finished.! 2

12. When the pool is reserved, it may still be used by other residents but is not available for other parties during the reserved time. 13. Pool parties and time requests shall be at the discretion of the Board or its appointee. Parking arrangements should be discussed at the time of reservation. 14. The tennis court and volleyball court usage is on a first come first served basis. Play is limited to 1 hour if other players are waiting 15. Written tennis reservations are limited to one 1 hour period per day per household for singles play and one 2 hour period per day per household for doubles play. Reservations are deemed canceled 10 minutes after the sign up time. Reservations may not be made more than 7 days in advance. 16. The tennis court may not be used for any purpose other than playing tennis with proper equipment and attire, which includes white soled tennis shoes. No skateboards, bicycles, scooters, roller skates, etc. are allowed on the court. 17. The volleyball area is on a first come, first served basis, however, it can be reserved by calling the Board. 18. Entering over the recreation area fence is strictly prohibited. 19. Residents who fail to maintain a current Association dues account may be denied pool and recreation area privileges (as well as subject to late fees), and may not be admitted as guests of other homeowners while account is in arrears. 20. Violation of Recreation Area Rules can result in revocation of recreation area privileges, repossession of key, or other disciplinary action, including fines. II. Common Area Rules: 1. Speed limit on all roads shall be 20 mph, 2. There will be stop signs at the 2 entrances to the Association. Other appropriate road signage shall be at the discretion of the Board. 3. Parking shall be on paved surfaces only, unless previously approved in writing by the Board for a specific purpose and duration. Parking on unpaved yard areas is prohibited, as is parking on common area grounds. 4. The Board may give prior approval to homeowners allowing the parking of vehicles as defined in Article II Section 5 of the CC&R's. If written permission is not granted, the parking shall be deemed an annoyance. 5. Pool backwashing is only permitted to a homeowners backyard, and must not be done through the fence to common area or roads. 6. Homeowners may not pile or store materials of any kind, including firewood, on the outside or street side of the fence/wall.! 3

7. No owner shall permit a dog or animal to create unsanitary conditions anywhere on the common properties or other Units. When such conditions are created, the Owner will be assessed a $10.00 fee for clean-up expenses by the Board. The Board may seek other satisfaction as permitted by law. 8. Pellet guns, air rifles and similar projectile devices are not permitted for use on common area or streets. Violation shall result in a warning, followed by a fine of $25 plus the cost of any damages incurred for each subsequent violation. Notification of authorities will occur for shooting of any birds or wildlife. 9. The golf course shall be considered part of the common area of the Association per our agreement with the Point. Visibility into enclosed yards adjacent to common area shall be subject to landscape rules. 10. All homeowner's property existing on common area, including but not limited to sewers, other utilities, Association approved landscape improvements, etc., shall constitute only an easement against the Association for the sole benefit of the homeowner and shall remain the sole responsibility of the homeowner. The sole liability of the Association shall be for Association owned and maintained flora. 11. Any homeowner who defaces, changes or modifies the landscape terrain or removes vegetation from VHA common area property without prior written approval of the HOA Board shall be responsible for all costs to return the property to its original condition, or a condition as approved by the Board, within a time frame specified by the Board. The homeowner shall be required to compensate the HOA for the cost of replacement vegetation with a similar or comparable plant or tree. If a homeowner, without prior written approval of the Board, modifies the terrain of HOA property, the Board may at its sole discretion demand monetary compensation to return the land to its original or similar condition. If the homeowner cannot immediately afford to make restitution to the HOA, the Board shall require the signing of a promissory note by the offending homeowner to the HOA with a 1.5% per month finance charge on the unpaid balance, with the full amount due one year for the date of signing of the note. A lien may be registered against the homeowner s property to secure the HOA claim. In addition, if necessary the HOA may request a court order to demand payment and restitution for the defacing of HOA property. 12. The CC&R s allow parking on the streets temporarily. Temporary is defined as without intent to continue. Therefore, routine or consistent on-street parking is not allowed. This applies to both day and/or night parking. Vehicles are to be parked in garages, carports, or driveways. Written notice of parking violation will be placed on the vehicle, and a copy will also be mailed to the homeowner. After the homeowner has received two notices, fines will be applied as listed in rules Section V, Item 9. III. Architecture Rules: The purpose of these rules are to maintain the harmony of the subdivision and to protect and enhance the value every home. The granting of a building permit by the City of phoenix does not supersede the provisions of the CC&R s or the Architecture Rules, which now follow. 1. No new construction of any building, fence, wall, patio, pool, residence or other structure shall be commenced, erected, maintained, improved, altered, made or done without the prior written approval of the Board. The Board will require from the owner or his agent, submission of two sets of plans and! 4

specifications, including a plot showing the nature, kind, shape, height, materials, and location of the proposed construction, addition or alteration. No work shall start until such submission has been approved in writing by the Board to the harmony of external design and location in relation to the surrounding structures' topography. Approval is considered to be two signatures of current Board members. Any decision of the Board may be altered, modified, amended or reversed by a meeting of the whole Board of Directors. In the event that the Board fails to approve or disapprove a matter within thirty days after a regularly scheduled monthly Board meeting, approval will not be required and the provisions of Article II, Section 4 of the CC&R's will be deemed to have been fully met. Two story dwellings are specifically prohibited. All subsequent additions to, or changes/alterations, in any building, fence, or other structure, including exterior color scheme, shall be subject to the prior approval of the Board. No changes or deviations from such plans and specifications, once approved, shall be made without the prior written approval of the Board. All decisions of the Board of Directors shall be final and no Owner or other party shall have recourse against the Board for its refusal to approve any such plans and specifications. The Board recommends, as to any of the requirements above, that preliminary plans for complex changes be submitted prior to the development of final working drawings. 2. New construction of conventional television antennas and satellite dishes less than 24 inches in diameter are acceptable when placed on the roof, to the rear of the house, no higher than 8 feet from the highest point of the roof. All other electromagnetic transmission and reception devices, including radio signals, require prior written approval of the Board. 3. Plans and specifications for changes to the exterior surface shall include color schemes for all exterior surfaces. The color scheme shall be generally compatible with other homes, and consistent with a southwest natural desert palette. Two sets of plans and color samples shall be submitted to the Board. One set will be returned upon approval. Repainting in existing color does not require approval. 4. Changes to roofing materials and colors shall be submitted to the Board for approval. 5. Construction rubbish and debris shall not be allowed to accumulate. The owner shall be responsible for the area immediately fronting his lot. Debris and other materials shall not be deposited on adjoining lots, streets or common areas. 6. All laundry drying facilities shall be placed and maintained exclusively within a fenced service yard or otherwise concealed, and shall not be visible from the neighboring property. 7. Walls and/or fencing shall be constructed with all masonry block, rough sawed wood stake, white cedar or "wrought iron" with masonry pilasters, maximum twelve feet on center. Property lines are to be verified prior to construction. In the event of a dispute between owners with respect to the sharing of the cost thereof, such adjoining owners shall submit the dispute to the Board of Directors of the Villages Homeowner's Association No. 2, the decision of which shall be binding on all parties. The following fencing materials are specifically prohibited. 1. plastic! 5

2. plywood 3. bamboo 4. corrugated metal Any fences, walls or structures previously installed in The Villages shall not be removed, altered or painted without prior written approval of the Board. 8. Any structure added to the property, whether attached or detached and regardless of construction, shall require prior written approval of the Board. 9. Signatures for approval for any of the above items shall include the head of the architecture/landscape committee as one of the two required signatures. IV. Landscape Rules: The landscape rules are established to enhance the beauty of the Association. 1. Two sets of landscape plans shall be submitted to the Board for approval, for all fronting and visible enclosed property. Signatures for approval shall include the head of the architecture/landscape committee as one of the two required signatures. 2. Landscape shall be compatible with surrounding common area and consistent with low water usage. 3. The owner shall be responsible for landscape and maintenance of property fronting his lot, including the common area up to the road surface and consistent with side property lines. If homeowners cannot come to agreement regarding the design and maintenance of adjoining property, the dispute shall be brought to the Board for resolution. In general, landscape shall be equitably divided so as not to obscure neighboring property. 4. Any homeowner, having assumed landscaping of common area, becomes responsible for maintenance. The homeowner recognizes the utility rights of way and that the Association has no responsibility for replacement. Responsibility is conveyed with the transfer of property. Homeowners may request that the Association resume maintenance, but the Association reserves the right to restore the landscape to a condition consistent with other common areas at homeowner expense. 5. Artificially colored rock is specifically prohibited. V. Board Rules: 1. The Board has the right to levy fines for violation of Association Rules. In all cases, the homeowner shall be informed of the fine in writing and shall have an opportunity to appeal at the next regularly scheduled Board! 6

meeting. 2. Late fees for non-payment of dues shall be $10 after the first ten days, and $1 per day after that. 3. It shall be a policy of the Association that all new homeowners sign a statement acknowledging receipt and acceptance of CC&R's, Association Rules and By-Laws. 4. Transfer fees for sale of homes shall be $100. 5. Where the Association CC&R's, By-Laws and other rules are not precedent or are silent, the Association acknowledges state, local, and other governmental agencies statutes and regulations as a basis for enforcement. 6. The homeowner assumes all responsibility for themselves and their households for their actions in the community. We have an obligation to each other to report violation of community rules as well as civil and criminal laws. Violation of community rules should be reported to the Board. Violations of government laws should be reported to the appropriate legal authorities. 7. No homeowner may represent himself as speaking for the Association without specific Board approval. Normally, the Association is represented as being the Board of Directors. Those individuals that may legally or financially obligate the Association are limited to the Board officers. 8. In the event of a violation of Rules or CC&R s which do not state a specific penalty: Homeowners will receive a letter on a form approved by the Board describing the violation and encouraging its remedy. In the event that the problem is not corrected, a second letter on a form approved by the board will be mailed 15 days after the first letter. The board may elect, by a majority vote of the Board, to impose a fine of $5/day at a regularly scheduled Board meeting held at least 21 days after the second letter is mailed. Any fine approved by the Board shall be applicable from the date of its approval to the date that the problem is rectified. A Homeowner receiving a (first or second) violation letter shall have the right to appear before the Board at its regularly scheduled meeting if they believe a situation exists that merits other consideration. The Homeowner will be advised of that right, the time and location of the next regularly scheduled Board meeting, and the possibility of a fine, in the text of or attachment to each violation. 9. Some recurring violations have been the source of many complaints and concerns. Accordingly, the following penalties shall apply after a homeowner has been previously notified of a violation: a) Parking: $50 for first occurrence $100 for second occurrence $250 for third and subsequent occurrences b) Trash or recycling cans left on street: $25 per week c) Carport condition: $100 per week Prior notification will exist if the homeowner has received two written notices, as described in Rules Sec. V Item 8, at any time within a calendar year for any of the above listed violations. The fine will apply immediately, and written notice of the fine will be sent to the homeowner.! 7

10. Capital improvements over $2,500 shall have community input prior to implementation. Included in the community input shall be a solicitation of firm estimates of both immediate capital costs as well as recurring costs for the improvement. 11. A committee consisting of the President, Vice President and Treasurer will develop a five-year financial plan for the community. Each year this same group will update the plan. Included shall be information regarding landscape, architecture and general maintenance for the community. 12. Solicitation for Board members shall be sent out each January in order to report to members in February and new Board members to take office on the first of April. 13. The bid process shall consist of soliciting a minimum of 3 (three) quotes for any non-line items in excess of $1,000. 14. The President may, without a Board vote, authorize expenditures not exceed five hundred dollars ($500), with the cumulative total of such expenditures not to exceed one thousand dollars ($1,000) between Board meetings. 15. The Rules may be amended by a majority vote of all Board members 16. Debt collection policy: It is the policy of the association that all homeowners carry their fair share of the financial responsibilities of membership. When all members do not pay their share of assessments, it is a burden on the rest. In order to ensure that all homeowners meet their responsibility and to enable the association to meet its financial obligations, the following policy is adopted: a) Delinquent homeowners will be notified by a statement each quarter as to the amount of delinquency. b) When the amount of delinquency, including assessment, penalties, and late fees amount to $300.00 the treasurer shall send a first notice notifying the homeowner of the delinquency requiring the homeowner to pay or make satisfactory arrangements to pay the amount due within ten days of the date of the letter. (First Notice) c) In the event that the homeowner fails to pay or make satisfactory arrangements to pay the treasurer shall send to the delinquent homeowner a second notice indicating that legal action will be pursued if the homeowner fails to pay or make satisfactory arrangement to pay the amount due within ten days of the date of the second notice. (Second Notice) d) In the event that the homeowner fails to pay or make satisfactory arrangements to pay the treasurer shall notify the board and obtain the authorization of the board before taking any legal action in the name of the association. e) Any legal action shall be filed, if possible, in the Small Claims Part of the Justice Court. In the event that a judgment is obtained, the board may enforce such judgment by any remedy available, including, but not limited to garnishment proceedings or through a property execution. f) When the amount of delinquency reaches $300.00 the treasurer shall file a lien with the County Recorder without having to obtain board authorization.! 8

17. Homeowners who rent or lease their homes shall provide to the Association treasurer the name and telephone number of the tenant and/or renter. In addition homeowners who rent or lease their homes shall provide the Association treasurer with a current address and contact information, including telephone. This provision shall take effect immediately and apply to any current or future leases or rentals. 18. Before any living tree on common area is removed by decision of the board, the board shall obtain an impartial third-party expert opinion, in writing, to determine if the tree is viable and is not an undo liability to human safety or property; if the tree is viable and not a liability, the tree shall not be removed, and it shall continue to be cared for by the association. If practicable, it shall be the policy of the board that whenever a common area tree is removed, a desert-compatible tree be planted as close as possible to the place the removed tree occupied. If the tree is viable but poses an undo liability to human safety or property, the board or its designee shall contact the homeowner(s) having an interest in the tree (that is, the tree abuts the homeowner s property or is readily visible from the homeowner s property) to determine if said homeowner(s) agrees in writing to be responsible for its care and liability, in which case the tree shall not be removed and shall become the responsibility of said homeowner(s). In the event said homeowner(s) abrogates responsibility for care of the tree, the decision to remove the tree shall revert to the board.! 9