(continued from previous page) policy, such Association policy shall be primary insurance not contributing with any of such other insurance. An Owner shall be liable to the Association for the amount of any diminution off insurance proceeds to the Association as a result of policies of insurance of an Owner, and the Association may collect the amount from said Owner in the same manner as any monthly assessment. Any such Owners policy shall also contain waivers of subrogation.

Section 4. Insurance to be Maintained by Owners: Each Owner shall obtain and keep 10 full force and effect at all times casualty insurance covering al.' insurable improvements on such Owner's Lot, including coverage for fire and extended coverage, vandalism and malicious mischief.

ARTICLE VII

DAMAGE OR DESTRUCTION

Section 1. Damage to Maintenance Property: In the event of damage or destruction to all or a portion of the Maintenance Property owned by the Association, due to fire or other adversity or disaster, the insurance proceeds, if sufficient to reconstruct or repair the damage, shall be applied by the Association to such reconstruction and repair. If the insurance proceeds with respect to such damage or destruction are insufficient to repair and reconstruct the damaged or destroyed area, the Association shall levy a special assessment in the aggregate amount of such insufficiency pursuant to Article IV, Section 4 hereof and shall proceed to make such repairs or reconstruction, unless the Owners and First Mortgagees agree not to repair and reconstruct such damage in accordance with the terms and provisions of Article X hereof. No distributions of insurance proceeds shall be made unless made jointly payable to the Owners and First Mortgagees of their respective Lots, if any.

Section 2. Destruction of Improvements on Lot: In the event of damage to or destruction of any improvement located on a Lot, due to fire or other adversity or disaster, the Owner of such Lot shall have the Improvement repaired and reconstructed as soon as is reasonably possible after the occurrence of such damage or destruction. 'Repair and reconstruction" of any Improvement, as used in this Section 2, shall mean restoring the Improvement(s) to substantially the same condition in which they existed immediately prior to such damage or destruction, with each such structure having the same boundaries as before.

ARTICLE VIII

EXTERIOR MAINTENANCE

Section 1. General: The Association shall maintain the Maintenance Property and all improvements thereto and thereon. (continued next page)


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