a condemning authority for acquisition of the Common Area or part thereof, but the Association shall not enter into any such proceedings, settlement, or agreements, pursuant to which the Common Area or any part thereof or any interest therein, or any improvement thereon or any part thereof or interest therein, s relinquished, without giving all First Mortgagees, all members and Declarant at least 15 days' prior written notice thereof.

7.4.2 In the event, following such proceedings, there is such a taking in condemnation or by eminent domain of a part of all of the Common Area, the award made for such taking, if such award is sufficient to repair and restore the Common Area, shall be applied by the Association to such repair and restoration. If such award is insufficient to repair and restore the Common Area, or if the full amount of such award is not expended to repair or restore the Common Area, the Association shall disburse the net proceeds of such award to the owners, the Owner of each Lot receiving one (1) equal share, provided that the Association shall first pay out of the share of each owner the amount of any unpaid liens or encumbrances on his Lot in the order of the priority of such liens or encumbrances. No provision of this Declaration or of any other document relating to the Property shall be deemed to give an owner or any other party priority over the rights of a First Mortgagee pursuant to a First Mortgage in the case of a distribution to an owner of insurance proceeds or condemnation award for losses to or taking of Lots, Common Area, or any combination thereof.

7.4.3 If a Lot is acquired by eminent domain or part of a Lot is acquired by eminent domain leaving the Lot Owner with a remnant which may not practically or lawfully be used for any purpose permitted by the Declaration, the award must include compensation to the Owner for that Lot and its allocated interests whether or not any Common Areas are acquired. Upon acquisition, unless the decree otherwise provides, that Lot's allocated interest are automatically reallocated to the remaining Lots in proportion to the respective allocated interests of those Lots before the taking. Any remnant of a Lot remaining after part of a Lot is taken under this section 7.4.3 is thereafter a Common Area.

7.4.4 Except as provided in Section 7.4.3, if part of a Lot is acquired by eminent domain, the award must compensate the owner for the reduction in value of the Lot whether or not any Common Areas are acquired. Upon acquisition, unless the decree otherwise provides that Lot's allocated interests shall not be modified; and

7.4.5 If part of the Common Areas is acquired by eminent domain, that portion of any award attributable to the Common Areas taken must be paid to the Association. For the purposes of acquisition of a part of the Common Areas, service of process on the Association shall constitute sufficient notice to all owners, and service of process on each individual owner shall not be necessary.

7.4.6 The court decree shall be recorded in every county in which any portion of the Property is located.

7.4.7 The reallocations of allocated interests pursuant to this Section shall be confirmed by an amendment to the Declaration prepared, executed, and recorded by the Association.

7.5 Governing Law: This Declaration shall be governed by, and construed under, the laws of the State of Colorado in existence as of the date of Recording of this Declaration in the Records.

7.6 Exhibits: All exhibits and riders attached hereto shall be deemed incorporated herein by this reference. (continued next page)

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