Prepared by: ____________________________

ALAN G.FRANK, JR., ESQUIRE

DECLARATION

OF

COVENANTS, CONDITIONS AND RESTRICTIONS

FOR

YORKSHIRE WOODS

THIS DECLARATION, made on the date hereinafter set forth, by ROBERT F. JOHNSTON, with a mailing address at 181 Cherry Valley Road, Princeton, New Jersey 08540 (hereinafter referred to as "Declarant").

W I T N E S S E T H:

WHEREAS, on April 19, 1994 the Montgomery Township Zoning Board of Adjustment (hereinafter the 11ZBA11) granted final subdivision approval f or the development of that certain real estate described in Schedule "All attached hereto and made a part hereof and depicted on Schedule "B" attached hereto and made a part hereof, constituting a Project (defined below) known as "Yorkshire Woods" and said approval is set forth and memorialized in Resolution No. 3, Case No. BA-7-93 adopted by the ZBA on April 19, 1994 (the "Approval"); and

WHEREAS, the Approval of the ZBA authorizes the real estate described in Schedule "All to be subdivided into one hundred seventy-six (176) single family detached home building lots (the "Lots") , five (5) open space lots - two (2) of which are intended to contain, inter alia, storm water detention basins, one (1) of which is intended to contain certain recreational amenities and two (2) of which are intended to contain purely passive open space (the "Common Areas") and one (1) lot containing mostly "wetland" (so-called) areas to be dedicated to the Township of Montgomery (the "Township Lot") (collectively the "Project"), and further authorizes that the development and subdivision of the Project be done on a sectionalized basis in four (4) such development sections which shall hereinafter be referred to individually as "Section I", "Section IA", "Section IIB" and Section III" and shall be referred to collectively as the "Sections"; and

WHEREAS, the Approval contemplates and the Declarant intends that two (2) final subdivision maps respectively encompassing the real estate comprising Sections I and IIA ("Final Map ill') and Sections IIB and III ("Final Map #211) be filed in the Somerset County Clerk-Is Office at the appropriate times in the future in order to lawfully establish all of the various lots authorized by the Approval to constitute the Project; and

WHEREAS, the real estate comprising Sections I and IIA of the Project is described in Schedule "A-111 attached and the real estate comprising Sections IIB and III of the Project is described in Schedule "A-211 attached (the combination of the real estate described respectively in Schedules "A-111 and "A-211 being intended to comprise and be equal to all of the real estate described in Schedule 11 attached); and

WHEREAS, Declarant, for itself, its successors and assigns, intends to develop the one hundred seventy-six (176) single family detached home building Lots and Common Areas from among the real estate described in Schedule - "All in accordance with the Approval and to this end, desires to provide for the maintenance, preservation, upkeep and repairs or replacements (if necessary) of the Common Areas and their related improvements and for the means to fund such activities and further desires to subject the Lots and Common Areas from among the real estate described in Schedule "All to the covenants, restrictions, easements, charges and liens hereinafter to be set forth, each and all of which is and are hereby declared to be for the benefit of the Lots and Common Areas comprising the real estate described in Schedule "All and every owner (hereinafter defined) of any and all portions thereof; and

WHEREAS, Declarant has deemed it advisable to create an entity to which shall be delegated and assigned the power and authority to maintain and administer the Common Areas, to administer and enforce the covenants related to the real estate described in Schedule "All and to collect and disburse all assessments and charges necessary for such maintenance, administration, and enforcement, all as hereinafter provided; and

WHEREAS, in furtherance of the above, Declarant has caused or will cause to be created and incorporated a non-profit corporation known or to be known as "Yorkshire Woods Homeowners Association, Inc." for the purposes set forth above;

WHEREAS, it is specifically intended by Declarant that the legal operation and effect of the covenants, restrictions, easements, charges and liens hereinafter to be set forth shall be inchoate and shall be inoperative and without any legal effect whatsoever as to (i) the real estate described in Schedule "A-111, comprising Sections I and IIA of the Project, until such time as Final Map #1 shall have been filed in the Somerset County Clerk's Office and (ii) the real estate described in Schedule "A-211, comprising Sections IIB and III of the Project, until such time as Final Map #2 shall have been filed in the Somerset County Clerk's Office; and

NOW, THEREFORE, Declarant hereby declares that subject to the provisions of Article XI, Section 1 as set forth below in this Declaration, all of the real estate described in Schedule "All attached shall be held, sold and conveyed, leased, mortgaged, alienated or transferred subject to the following easements, charges, assessments, obligations, liens, restrictions, covenants and conditions, all of which shall run with the real property described in Schedule "All for the term of this Declaration.

ARTICLE I

DEFINITIONS

Section 1. "ANNUAL ASSESSMENTS" shall mean and refer to those fees or charges levied by the Association upon the owner of each Lot for the purpose of adequately meeting expenses for the improvement and maintenance of the Common Areas and for the promotion and maintenance of the recreation, health, safety and welfare of the residents of "Yorkshire Woods".

Section 2. "ARTICLES OF INCORPORATION" shall mean and refer to the Articles of Incorporation of YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC., a copy of which is attached as Schedule "D".

Section 3. "ASSOCIATION" shall mean and refer to YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC., a non-profit corporation of the State of New Jersey, its successors and assigns.

Section 4. "BOARD OF TRUSTEES" OR "BOARD" shall mean and refer to the Board of Trustees of the Association.

Section 5. "BY-LAWS" shall mean and refer to the By-Laws of the Association, a copy of which is attached hereto and made a part hereof as Schedule "C".

Section 6. "COMMON AREAS" shall mean and refer to all real property and

improvements in which the Association may hold a fee or other title interest for the common use of the Owners. Common Areas shall include the open spaces and any facilities and appurtenances therein provided and required by the Approval for the common use and enjoyment of Owners including, but not limited to, pipes, culverts, headwalls, low flow channels, outlets, drains, wood-chipped or black-topped pathways, black-topped overflow parking areas, tot-lot equipment and furniture, benches, a picnic pavilion (including all appurtenances thereto), the tennis courts (also usable as basketball courts) and appurtenances thereto, the landscaped area partially surrounding five (5) parking spaces in the right-of-way of Danby Court, the landscaped area partially surrounding four (4) parking spaces in the right-of -way of York Drive and other such similar items and the facilities as shown on or otherwise described in any plans or maps or other documents encompassed in the Approval. No changes to the Common Areas from what is contained in the Approval may be made without the approval of the ZBA or other authorized agency of Montgomery Township. The Common Areas are located on and comprise the real estate constituting proposed Lot 1, Block 34018 and proposed Lot 42.38, Block 34001 as shown on proposed Final Map #1 and on proposed Lot 42, Block 34001, proposed Lot 1, Block 34017 and proposed Lot 1, Block 34019 as shown on proposed Final Map #2, both of which such Final Maps have been prepared by Platz Engineering, 130 Wall Street, Princeton, NJ 08540 (Mark D. Platz, N.J.P.E., L.S. Lic. No. 32511).

Section 7. "COMMON EASEMENT" shall mean and refer to an easement being ten (10) feet in width located adjacent to the side of any structure on a Lot which is located on the side property line of a Lot or within ten (10) feet of the side property line of a Lot. (See the Common Easement sketch attached hereto as (Exhibit "A"). The Common Easement shall be for the benefit of any affected Lot owner to allow for periodic maintenance of the exterior of the structure on such affected Owner's Lot. No structures, trees, shrubs or bushes shall be constructed or located within any Common Easement area. The Common Easement herein provided shall not be construed as to limit the use of any area burdened by such Common Easement provided the use is not inconsistent with the intent herein expressed.

Section 8. "DECLARANT" shall mean and refer to Robert F. Johnston, his heirs, executors, administrators, legal representatives, successors and assigns.

Section 9. "DECLARATION" shall mean and refer to this Declaration of Covenants, Conditions and Restrictions.

Section 10. "FINAL MAP #1" shall mean and refer to that final subdivision plat intended to be filed in the Somerset County Clerk's Office and entitled "Final Plat - Phases I & IIA, Yorkshire Woods - Major Subdivision, Lots 41, 42, 42.01, 42.02 & 49, Block 34001, Montgomery Township, Somerset County, New Jersey, prepared by Platz Engineering, dated November 18, 1993, last revised December 8, 1994 (1 sheet)".

Section 11. "FINAL MAP #2" shall mean and refer to that final subdivision plat intended to be filed in the Somerset County Clerk's Office and entitled "Final Plat - Phases IIB and III, Yorkshire Woods - Major Subdivision, Lots 41, 42, 42.01, 42.02 & 49, Block 34001, Montgomery Township, Somerset county, New Jersey, prepared by Platz Engineering, dated June 15, 1994, last revised November 28, 1994 (1 sheet)".

Section 12. "LOT" shall mean and refer to any individual lot or plot of land authorized by the Approval to be developed with a single-family detached dwelling, as shown on filed Final Map #1 or filed Final Map #2.

Section 13. "MEMBER" shall mean and refer to any owner who is a member of the Association.

Section 14. "OWNER" shall mean and refer to the record Owner, whether one or more persons or entities, of a fee simple title to any Lot, but excluding those having such interest merely as security for the performance of an obligation.

Section 15. "PROPERTIES" shall mean and refer to that certain real property and all scheduled improvements thereto that may be conveyed to the Association and such areas within the jurisdiction of the Association as are set forth herein and in the By-Laws of the Association.

Section 16. "SPECIAL ASSESSMENTS" shall mean and refer to those fees or charges levied by the Association in accordance with the provisions of this Declaration upon the Owner of each Lot.

ARTICLE II

PROPERTY SUBJECT TO THIS DECLARATION

Section 1. PROPERTY. The real estate which is and shall be held, transferred, sold, conveyed, leased, mortgaged and occupied subject to the covenants, easements, restrictions, conditions, charges and liens set forth in and imposed by this Declaration shall be that real estate which is more particularly described in Schedule-"A" annexed hereto.

Section 2. CONVEYANCE OF DECLARANTfS INTERESTS IN COMMON AREAS. Declarant reserves the right, without the consent of the other Owners, the other Members or the Association, to grant and/or convey or to cause the grant and/or conveyance to the Association, for the benefit of its Members and of the Owner of each Lot, all of Declarant's right, title and interest in and to the Common Areas, subject to the provisions of this Declaration.

Section 3. TIME OF CONVEYANCE. Declarant may retain legal title to the Common Areas until such time as it has completed all required improvements thereon, or until such time as, in the sole opinion of Declarant, the Association is able to maintain said Common Areas in accordance with the provisions of this Declaration.

ARTICLE III

PROPERTY RIGHTS, COMMON AREAS

Section 1. OWNERS' EASEMENTS OF ENJOYMENT. Every Owner shall have the right of enjoyment and use of, in and to the Common Areas described herein, which shall be appurtenant to and shall pass with the title to every Lot and which rights shall be subject to the following provisions:

(a) all the provisions of this Declaration, the Articles of Incorporation and By-Laws of the Association;

(b) the right of the Association to suspend the voting rights of any owner for any period during which there are any unpaid Assessments (defined below) against his Lot; and for a period not to exceed thirty (30) days for any infraction of its published rules and regulations after hearing by the Board;

(c) the right of Declarant and/or the Association to dedicate, grant, reserve or transfer all or any part of the Common Areas to any public agency, authority or utility for such purposes, including but not limited to the purposes of installing, maintaining, repairing, replacing and inspecting all lines, pumps and appurtenances for water, detention, drainage and other similar utilities, with the right of the grantees of such rights to have access over and across such portions of the Common Areas as are consistent with the full exercise of such grants;

(d) the right of the Association to borrow money for the purpose of performing its duties in respect of the Common Areas and, in aid thereof, to mortgage its Properties, if applicable;

(e) the right of the Association to take such steps as are reasonably necessary to protect its Properties against foreclosure, as may be applicable; and

(f) the right of Declarant and/or the Association to grant any part of the Common Areas described herein as a Common Easement.

Section 2. DELEGATION OF USE. Any Owner may delegate, in accordance with the By-Laws, his right to enjoyment of any Common Areas to members of his family, his tenants, or contract purchasers who reside at said Owner's Lot.

Section 3. RIGHT, TITLE AND INTEREST TO COMMON AREAS. It is intended that Declarant's right, title and interest in and to the Common Areas shall be conveyed to the Association in accordance with Section 2 above of this Article II.

Section 4. RULES AND REGULATIONS. The Association shall have the right to adopt and promulgate reasonable rules and regulations governing the use of the Common Areas, which shall be set forth in a Book of Regulations.

Section 5. MAINTENANCE OF COMMON AREAS. The Association shall be responsible for the maintenance, upkeep, care, repair and replacement, if necessary, of the Common Areas and the improvements therein or thereto and any facilities thereof, and, in particular, the Association shall be responsible to carry out, on an on-going basis, the maintenance features set forth in the Detention Basin Maintenance and Operations Guide attached hereto as Exhibit "B".

Section 6. FUTURE DEDICATION. If and when Montgomery Township requires future dedication of any property from among the real estate described in attached Schedule - "All and as may be required by the Approval and/or any plans upon which such Approval was based or as may be shown on either filed Final Map #1 or filed Final Map #2, Declarant shall so dedicate such property as is required by Montgomery Township, all at no cost to Montgomery Township.

ARTICLE IV

MEMBERSHIP AND VOTING RIGHTS

Section 1. MEMBERSHIP. Every Owner of a Lot (including the Declarant, its successors and assigns) shall be a Member of the Association and such membership shall be appurtenant to and shall not be separated from ownership of any Lot.

The Owner of a Lot shall become subject to this Declaration immediately upon such Owner's acquisition of fee title to his Lot.

Section 2. VOTING RIGHTS. Each Lot shall be entitled to one (1) vote. When more than one person holds an interest in any Lot, the vote f or such Lot shall be exercised by the persons holding such interest as they among themselves shall determine, but in no event shall more than one (1) vote be cast with respect to any Lot.

ARTICLE V

COVENANT FOR ASSESSMENTS

Section 1. CREATION OF THE LIEN AND PERSONAL OBLIGATION FOR PAYMENT OF ASSESSMENTS. Except for Declarant, by acceptance of a deed to a Lot, whether or not it shall be so expressed in such deed, any Owner, for each Lot owned by said Owner, hereby covenants and is deemed to covenant and agree to pay to the Association: (a) Annual Assessments, (b) Special Assessments, and (c) such other assessments, charges or costs as may be established and become collectible as hereinafter provided. Declarant shall not be obligated to pay any of the aforementioned Assessments, charges or costs. The Annual Assessments and Special Assessments (individually "Assessment" and collectively "Assessments") , together with interest, costs and reasonable attorneys' fees, shall be a charge on the land and shall be a continuing lien upon the Lot against which each such Assessment is made. Any such Assessments, together with interest, costs and reasonable attorneys' fees, shall also be the personal obligation of the person(s) who was or were the Owner(s) of such Lot at the time when the Assessment fell due. The obligation for delinquent Assessments shall pass to such Lot Owner's successor(s) in title, said Assessments being a charge against a Lot in favor of the Association. The Association shall 'provide f or the issuance to every Owner or mortgagee of a Lot, upon reasonable request and at no charge, a statement of such amounts due. A person other than a Lot Owner may rely upon such statement and such person's liability shall be limited to the amount set forth therein. Liability for the payment of said amount to the Association shall not attach to the purchaser of the Lot following a mortgage foreclosure sale, provided the Association has been joined as a party to the foreclosure suit. Such unpaid share shall be deemed to be expenses collectible from the remaining owners, including the purchaser of the Lot following a mortgage foreclosure sale.

Section 2. PURPOSE OF ASSESSMENTS. The Assessments levied by the Association shall be exclusively utilized for the purpose of the improvement and maintenance of the Common Areas and the services and facilities devoted to this purpose and related to the use of the Common Areas including, but not limited to, the following:

(a) the maintenance, repair, improvement and replacement of the storm water detention facilities and appurtenances, landscaped areas (including the landscaped islands in Danby court and York Drive as referred in Section 6 of Article I above), paved areas and open space areas as applicable;

(b) the maintenance, repair, improvement and replacement of recreation facilities as applicable;

(c) compliance with ordinances, regulations, government rules and regulations affecting such Common Areas;

(d) the supervision and/or management costs for the activities of the Association;

(e) professional fees such as auditing, legal and other such consulting services required by the Association;

(f) real estate taxes, if applicable;

(g) insurance; and

(h) any other items typically and reasonably associated with the costs attributed to or incurred by the Association.

Section 3. ANNUAL ASSESSMENTS. The amount of the Annual Assessment shall be fixed by the Board of the Association on an annual basis in a sum sufficient to meet the expenses necessary for the repair, maintenance, and replacement, if necessary, of the Common Areas and their installed features. Each Lot shall be treated equally with regard to the Annual Assessment. The Annual Assessment shall be determined by dividing the Association's estimated expenses by the number of Lots subject to this Declaration. The amount of the Annual Assessment may be changed from time to time by action of the Board, but such action shall be taken only when justified by changes in circumstances.

Section 4. DATE OF COMMENCEMENT OF ANNUAL ASSESSMENTS; DUE DATES; PAYMENTS.

(a) The Annual Assessments provided for herein shall commence as to all Lots on the conveyance of the first Lot to the first Member of the Association who is not the Declarant, its successors or assigns. The Board shall establish by resolution the annual period of the Annual Assessment, either on a calendar or a fiscal year basis, and shall fix the amount of the Annual Assessment against each Lot at least thirty (30) days in advance of each Annual Assessment period. The due dates of installments on account of Annual Assessments shall be established by the Board. The Annual Assessment shall be adjusted according to the number of days remaining in the first annual period established by the Board.

(b) Except for Declarant, the obligation of each Member to pay the Annual Assessment with respect to his Lot shall commence upon such Member's acquisition of fee title to his Lot and such Member shall thereafter be obligated to pay so much of the Annual Assessment with respect to his Lot as shall be applicably due.

(c) Declarant shall not be obligated to pay any Annual Assessment made with respect to any Lot owned by it, except upon the occupancy of the single-family detached home situated on any such Lot by a tenant of Declarant pursuant to a lease or other right of possession. Declarant shall thereafter be obligated to pay so much of the Annual Assessment for said Lot as shall be applicably due.

(d) If the obligation to pay all or a portion of an Annual Assessment pursuant to sub-sections (a) or (b) above commences at a time other than the beginning of the period for which such Annual Assessment was made, then such obligation shall be adjusted pro-rata according to the number of days remaining in such period.

(e) If Declarant is subject to payment of an Annual Assessment for a Lot which it owns, the Annual Assessment shall not exceed the amount which is assessed to any Owner who is not the Declarant. Additionally, Declarant shall be entitled to a credit against any obligation for payment of Annual Assessments for all funds expended by it for maintenance of the Common Areas during the year when the Annual Assessment is collected.

Section 5. SPECIAL ASSESSMENTS. In addition to the Annual Assessments authorized above, the Board may levy, in any Assessment year, a Special Assessment applicable to that year only for the purpose of defraying, in whole or in part, the cost of any construction, reconstruction, repair or replacement of a capital improvement upon the Common Areas, including fixtures and personal property related thereto, provided that before the Board levies any such Special Assessment it shall have the vote of the majority of Members at a duly held meeting of the membership at which a quorum must be present, except for emergency repairs to the stormwater management facilities in the Common Areas in which case the Board shall have the authority to levy a Special Assessment without the required vote of the Members.

Section 6. COMPUTATION OF ASSESSMENTS. All Assessments shall be computed by dividing the total number of Lots subject to this Declaration into the total Assessment. All Assessments must be fixed at a uniform rate for all Lots. Notwithstanding the foregoing, Declarant shall be entitled to relief from payment of Assessments and credits which are provided in other Sections of this Declaration.

Section 7. EFFECT OF NONPAYMENT OF ASSESSMENT: REMEDIES OF THE ASSOCIATION. Any Assessment not paid within thirty (30) days after the due date shall bear interest from the due date at the rate of eighteen (18%) percent per annum. The Association may bring an action at law against the Owner personally obligated to pay the same, or foreclose the lien against such Owner's Lot. No Owner may waive or otherwise escape liability for any Assessment provided for herein by non-use of the Common Areas or abandonment of his Lot.

Section 8. ALLOCATION OF DELINQUENT ASSESSMENTS. The Association shall have the right to allocate among all of the owners the obligation for payment of delinquent Assessments that remain unpaid for ninety (90) days after the due date thereof, such allocation to be made pro-rata in accordance with the proportion by which each Owner's obligation to pay Assessments bears to the total obligation of all Owners (other than delinquent owners) to pay Assessments. Such allocation shall not in any event relieve the delinquent Owner of his or her obligation to make such payment.

Section 9. SUBORDINATION OF THE LIEN TO MORTGAGES AND OTHE

PRIOR LIENS. The lien relating to Assessments provided for herein shall be subordinate to the lien of any purchase money mortgage on any Lot and to any past due and unpaid real estate taxes and any other liens recorded prior to the recordation of the Assessments lien. The sale or the transfer of any Lot shall not affect the Assessment lien. However, the sale or transfer of any Lot pursuant to mortgage foreclosure or any proceeding in lieu thereof, shall extinguish the lien of such Assessments as to payments which became due prior to such sale or transfer except for claims for a share of such Assessments resulting from a reallocation thereof among all Owners and Lots including any Lot sold pursuant to foreclosure or any proceeding in lieu thereof. No sale or transfer of any such Lot shall relieve such Lot from liability for any Assessment thereafter becoming due or from any subsequent lien therefor.

Section 10. EFFECTIVENESS OF LIEN; DISCHARGE. No lien of the Association for non-payment of an Assessment shall become effective as to the Lot of any non-paying owner until a Claim of Lien has been filed or recorded in the Somerset County Clerk's office pursuant to a form which shall identify the Lot, the name of the Owner, the amount due and the date from which said amount due first became delinquent, and which such information shall be verified or certified to by an officer of the Association. No lien shall be filed or recorded against a Lot until the Association shall have sent written notice to an Owner of any such delinquency in payment of an Assessment or installment thereof and if the Association's intention to file or record a lien if payment is not forthcoming. After a lien is filed or recorded the Owner of the Lot shall be notified of such filing or recordation. Upon full payment to the Association of the sum secured by the lien, the affected Owner shall be entitled to receive from the Association a satisfaction of such lien in recordable form.

ARTICLE VI

PROTECTIVE COVENANTS

Section 1. RESTRICTIONS. The following restrictions are imposed as a common scheme upon all Lots. To the extent permitted by law, the restrictions set forth herein may be waived or modified by the Board on a case-by-case basis.

(a) No animals, livestock or poultry of any kind shall be raised, bred or kept in any dwelling or on any Lot, except that dogs, cats or other domesticated household pets may be kept, provided that they are not kept, bred or maintained for any commercial purpose and provided that not more than two (2) pets in the aggregate may be kept on any Lot, other than fish, birds, and other similar small pets for indoor enjoyment. In addition, the pets must be either leashed, fenced, caged or otherwise reasonably restrained and shall not cause a nuisance to other owners, their families and guests.

(b) No garbage, or refuse, shall be deposited on any Lot, street, sidewalk, driveway or parking area, unless placed in an appropriate closed container. Containers provided by the Lot Owners shall not be placed on any street, sidewalk, driveway, or parking area, except when necessary for collection.

(c) Weeds and grass shall be kept cut to reasonable standards on all Lots.

(d) only one single-family detached house, including an attached garage, may be constructed on any Lot f or living purposes. Metal tool sheds which are separate structures from the house and/or garage are specifically prohibited, unless approved by the Board .

(e) Except during the original development of and dwelling construction on a Lot, the existing slope or configuration of any Lot shall not be altered nor shall any structure, retaining wall, planting or other activity be undertaken which retards, changes or otherwise interferes with the natural flow of surface or drainage waters to the actual or threatened injury of any Lot or to the Common Areas, or which creates erosion or sliding problems.

(f) Fencing shall only be allowed in the rear yard of any Lot and shall only be permitted to extend up to the rear building corner on adjacent Lots. (See the Fencing Alignments attached as Exhibit IICII for typical sketches of permitted fence configurations). Any and all such fencing shall be constructed only of cedar, redwood or pressure treated lumber; shall be four (41) feet in height; shall be designed and constructed for privacy of the area enclosed in only a shadow-box configuration and shall only have a finished top which is straight. Nothing herein precludes the need for any Montgomery Township or other governmental approval that may be required in conjunction with fence installations.

(g) The exterior of all dwellings on Lots, including lawn areas, must be properly maintained so as to present a well-cared-for appearance.

(h) There shall be no free-standing antennae, aerials or satellite dishes permitted to be erected on a dwelling or a Lot.

(i) The Lots have been approved to be improved with structures and shall be developed in accordance with the Zoning ordinances of Montgomery Township (the "Ordinances"). The referenced ordinances limit the extent of construction on a Lot by providing building setback requirements and limits on the amount of floor area and impervious area that may be provided on each Lot. By recording of this Declaration, each Owner shall be deemed to be aware that certain Lots approved to be developed by Declarant approach the maximum limits of allowed construction as per the Ordinances. Lot owners anticipating the installation of additional improvements to their Lot or the dwelling thereon beyond those improvements initially constructed by Declarant ("Future Owner Improvements") , including decks, swimming pools, hot tubs, etc., are deemed to be aware of these limitations set forth in the Ordinances. Future Owner Improvements which exceed the then-applicable requirements of the Ordinances will require a variance from the ZBA.

(j) Wooded, open areas of the Common Areas shall remain in their natural state, with the exception of any improvements therein or thereto which shall have been approved for installation by the ZBA or Montgomery Township, including recreation facilities, mulched walking paths with benches, etc. Any clearing of wooded areas of the Common Areas is strictly prohibited. Further, the use of any part of the Common Areas for composting, storage of materials (including firewood) or any other use not intended by this Declaration or the Approval granted by the ZBA is prohibited. Within the open areas of the Common Areas are areas of "wetlands" (so-called) as delineated by the New Jersey Department of Environmental Protection (11DEP11). All wetlands are important in protecting supplies of fresh water and providing storage areas for this fresh water. Wetlands areas are regulated by DEPE and the United States Army Corp of Engineers. Further, certain conservation easements in favor of Montgomery Township and buffer easements around such wetlands areas in favor of DEP have been placed on these wetlands areas and their surrounding buffers to insure their protection. Any and all use of wetlands areas in Common Areas shall be in accordance with the requirements of those agencies regulating wetlands and the referenced conservation easements. Limitations and guidelines on and for the use and maintenance of the wetlands and wooded portions of the Common Areas may be appended hereto and made a part hereof in the future.

(k) owners and the Association shall be prohibited from altering any landscaping originally installed in the Common Areas by Declarant but may add landscaping to the Common Areas provided such additional landscaping has been reviewed and approved by the Association. Any such additional landscaping may not be added to those portions of the Common Areas that have been subjected to recorded conservation easements or restrictions unless such proposed, additional landscaping has been explicitly reviewed and approved by the Township and/or its designated landscape architect and any other approving authority as the circumstance may require.

(1) No snowmobiles or all-terrain vehicles (ATV's) or similar motorized vehicles shall be permitted to be operated or used on or about the Common Areas.

(m) Any home on a Lot may be conveyed or leased by a Member except that no Member shall convey, mortgage, pledge, sell or lease his home on a Lot unless and until all unpaid and then-due Association Assessments against the Lot shall have been paid as directed by the Board. However, such unpaid and then-due Association Assessments may be paid out of the proceeds of the sale of the Lot or by the grantee. The provisions of this sub-Section shall not apply to the acquisition of a Lot by a mortgagee who shall acquire title to such Lot by foreclosure or by deed in lieu of foreclosure. In such event, the unpaid and then-due Assessments against the Lot which were assessed and became due prior to the acquisition of title to such Lot by such mortgagee shall be deemed waived by the Association and shall be charged to all other Members of the Association as a common expense. Such provisions shall, however, apply to any Assessments which are assessed and become due after the acquisition of title to such Lot by the mortgagee and to any purchaser from such mortgagee.

(n) Any Member may convey or transfer his Lot by gift during his lifetime or devise his Lot or will or pass the same by intestacy without restriction.

(o) All Owners shall comply with the following regarding windows in dwellings on Lots: (i) on the first floor of a dwelling on a Lot, within five (5) feet of any side Lot line, no windows shall be permitted; (ii), on the first floor of a dwelling on a Lot, on a wall located less than ten (10) feet but more than five (5) feet from a Lot line, windows shall be a minimum of five (5) feet above the outside grade directly adjacent to the window; (iii) on the second floor of a dwelling on a Lot, on walls located within ten (10) feet of a Lot line, window areas shall not exceed 20% of the wall area on any individual room, however windows will be at a minimum where feasible, and (iv) on walls of a dwelling on a Lot, greater than ten (10) feet from a Lot line, no restrictions shall apply.

(p) By the municipal Approval granted, certain landscaping is to be placed on individual Lots for the benefit of the Owner and the overall "Yorkshire Woods" community. Each Owner is responsible for the maintenance of this landscaping (including watering) upon acquisition of title by such Owner. Removal of this landscaping without written authorization of the Association is prohibited.

Section 2. MODIFICATION: INVALIDATION; ENFORCEMENT.

(a) The restrictions contained in this Article, the sizes of the Lots, the descriptions of the Lots and the courses of the Lots may be changed or amended by Declarant or its successors and assigns, and with the approval of the ZBA, in order to correct or protect any condition which in its opinion, would be beneficial to the Project.

(b) The invalidation of any one of these restrictions by judgment, court order or otherwise shall in no way affect any of the other restrictions which shall remain in full force and effect.

(c) It is understood and agreed that in the event any of the covenants or restrictions herein set forth are violated, unless the same have been released or changed as herein set forth, Declarant or any other Owners of Lots shall have the lawful right to prosecute an action at law or in equity against the person or persons violating or attempting to violate any such covenants or restrictions either to prevent such violation or recover damages for the same.

ARTICLE VII

COMMON SERVICE ENTRANCE LINES

In order to provide the Lot Owners within "Yorkshire Woods" with underground utility lines, it may be required from time to time that two or more Lots be served with a common service entrance line. Owners of Lots with such lines agree to cooperate fully with the utility companies concerned therewith for all maintenance, repair and other measures as may be necessary to provide adequate and proper service to the Owners served thereby.

ARTICLE VIII

REMEDY OF THE TOWNSHIP OF MONTGOMERY

In the event the Association shall fail to maintain the Common Areas in reasonable order and condition, the appropriate municipal body or officer of Montgomery Township may serve written notice upon the Association or upon the Owners setting forth the manner in which the Association has failed to maintain the Common Areas in reasonable condition, and said notice shall include a demand that such deficiencies of maintenance be cured within thirty-five (35) days thereof, and shall state the date and place of a hearing thereon which shall be held within fifteen (15) days of the notice. At such hearing, the designated Montgomery Township body or officer, as the case may be, may modify the terms of the original notice as to deficiencies and may give a reasonable extension of time not to exceed sixty-five (65) days within which they shall be cured. If the said deficiencies set forth in the original notice or in the modification thereof shall not be cured within thirty-five (35) days or any permitted extension thereof, Montgomery Township, in order to preserve the Common Areas and maintain the same for a period of one (1) year may enter upon and maintain such land. Said entry and maintenance shall not vest in the public any rights to use the Common Areas except when the same is voluntarily dedicated to the public by the Owners. Before the expiration of said year, the designated Montgomery Township body or officer, as the case may be, shall, upon its initiative or upon the request of the Association theretofore responsible for the maintenance of the Common Areas, call a public hearing upon fifteen (15) days written notice to such Association and to the owners, to be held by Montgomery Township or such officer, at which hearing such Association and the Owners shall show cause why such maintenance by Montgomery Township shall not, at the election of Montgomery Township, continue for a succeeding year. If Montgomery Township or the designated municipal officer, as the case may be, shall determine that the Association is ready and able to maintain said Common Areas in reasonable condition, Montgomery Township shall cease to maintain said Common Areas at the end of said year. If Montgomery Township or its officer, as the case may be, shall determine that the Association is not ready and able to maintain said Common Areas in a reasonable condition, Montgomery Township may, in its discretion, continue to maintain said Common Areas during the next succeeding year, subject to a similar hearing and determination, in each year thereafter. The decision of Montgomery Township or its officer in any such case shall constitute a final administrative decision subject to judicial review. If a municipal body or officer of Montgomery Township is not designated by ordinance to administer this provision, the governing body of Montgomery Township shall have the same powers and be subject to the same restrictions as provided herein. The cost of such maintenance by Montgomery Township shall be assessed pro rata against the Lots within the Project that then have a right of enjoyment of the Common Areas in accordance with assessed value at the time of imposition of the lien, and shall become a lien and tax on said Lots and be added to and be a part of the taxes to be levied and assessed thereon, and enforced and collected with interest by the same officers and in the same manner as other taxes. Nothing contained in this Section shall in any way be construed so as to in any way limit the ability of Montgomery Township to continue to assess and collect such real estate taxes against the Common Areas as may be applicable and in the same manner as other real estate taxes levied against other property situated in Montgomery Township'.

ARTICLE IX

INSURANCE

Section 1. COVERAGES. The Association shall maintain, to the extent obtainable, at all times, insurance in the following types and amounts:

(a) Property insurance covering all improvements erected upon and comprising part of the Common Areas. Such insurance shall be in an amount equal to the full replacement value of such improvements (that is, one hundred (100%) percent of current "replacement cost" exclusive of land and other items normally excluded from coverage) with an "agreed amount endorsement," such insurance to afford protection against at least the following: (i) loss or damage by hazards covered by the standard extended coverage endorsement, and by debris removal, cost of demolition, vandalism, malicious mischief, wind, storm and water damage; and (ii) such other risks as shall customarily be covered with respect to similar improvements in projects similar in construction, location and use. Such insurance shall name the Association as the insured for the benefit of the Lot Owners.

(b) Comprehensive general liability insurance covering the Common Areas and the activities of the Association, its officers, agents and employees in connection with the maintenance thereof, in an amount not less than $1,000,000.00, or such greater amount as the Board of Trustees of the Association shall deem necessary, covering all claims for personal injury and/or property damage arising out of a single occurrence. Such insurance policy shall contain a 11severability of interest" clause or endorsement which shall preclude the insurer from denying a claim of an owner because of the negligent acts of the Association or other owners and shall name the Association as insured for the benefits.

(c) Worker's compensation and employer's liability insurance as required by law; and

(d) Comprehensive disappearance and dishonesty bond or equivalent insurance coverage against dishonest acts on the part of trustees, officers, managers and employees of the Association and all others who handle or are responsible for the handling of funds of the Association. Such bond or insurance shall maintain waivers of any defense based upon the exclusion of persons who serve without compensation from any definition of "employee" or similar expression. Such bond or insurance shall provide that it may not be cancelled or substantially modified (including cancellation for non-payment of premium) without at least thirty (30) days prior written notice to the Association and to the first mortgagees of Lots who have given notice to the Association of their interest pursuant to this Declaration. The insurance set forth in this Article shall be maintained with reputable insurance companies authorized to transact business within the State of New Jersey.

ARTICLE X

EASEMENTS

Section 1. DECLARANTIS EASEMENTS TO CORRECT AND MAINTAIN DRAINAGE. Declarant reserves an easement for two (2) years after Declarant is released from all bonds posted with Montgomery Township including, but not limited to, Performance and Maintenance Bonds, to go on, over and under the ground within any Lot to maintain and to correct drainage of surface water in order to maintain reasonable standards of health, safety and appearance. Such reserved easement right expressly includes the right to cut any trees, bushes or shrubbery, to make any gradings of the soil or to take any other similar action reasonably necessary, following which Declarant shall restore the affected Lot by grading and seeding disturbed areas. Declarant shall give timely notice of its intent to take such action to any affected Owners, unless in the opinion of Declarant an emergency exists which precludes such notice. To the extent required by the Montgomery Township Zoning Officer, any such change shall receive site plan and related municipal approvals.

Section 2. CONSTRUCTION EASEMENTS AND RIGHTS. Notwithstanding any provision of this Declaration, for a period of two (2) years after Declarant is released from all bonds posted with Montgomery Township including, but not limited to, Performance and Maintenance Bonds, Declarant, its agents and employees, shall have

an easement of ingress, egress and use over any Lot conveyed by it to an owner f or (i) movement and storage of building materials and equipment, (ii) erection and maintenance of direction and promotional signs, (iii) conduct of sales activities, including maintenance of model residences and (iv) construction and/or maintenance of homes on adjacent Lots. In addition, Declarant shall also have an easement over all of the land described in Schedule _"A", including Lots and Common Areas, to make any repairs and conduct any maintenance which may be necessary to fulfill any of its obligations to complete the improvements in accordance with the Approval until Declarant is relieved from responsibility and/or liability under any of its Maintenance Bonds with Montgomery Township. In addition, Declarant reserves the right to record an easement, to the extent that same is necessary for any purpose consistent with this Declaration, for a period of up to one (1) year after the last sale of any Lot in "Yorkshire Woods" by Declarant to a bona fide, third party purchaser. Such easement shall be subject to such rules as may be established by Declarant to maintain reasonable standards of safety, cleanliness and general appearance of the Properties.

Section 3. EASEMENT FOR GOVERNMENTAL AND OTHER PERSONNEL. A right of entry on the Common Areas is hereby granted to all law enforcement officers, all officers, agents and employees of Montgomery Township and all governmental or volunteer fire and rescue personnel as are needed by any of the foregoing to carry out their lawful duties.

Section 4. EASEMENTS AND LICENSES FOR SECTIONS IIB AND III. Notwithstanding any provision of this Declaration, until such time as land development and housing construction upon the real estate described in Schedule "A-211 is completed in accordance with valid governmental development approvals applicable thereto, whether presently existing or hereinafter to be obtained, Declarant reserves the right to grant to the developer of the real estate described in Schedule "A-211, without the consent of Montgomery Township, the other Owners, the Other Members, the Association or any applicable mortgagees of such Owners, Members of Association, such easements, licenses and consents with respect to any of the real estate described in Schedule "A", including, without limitation, construction, roadway, ingress and egress, stormwater and utility easements, as shall be required by such a developer in the reasonable exercise of its discretion to complete, in accordance with valid governmental development approvals, the installation and/or construction of site and building improvements upon the real estate described in Schedule "A-2111 including, without limitation, infrastructure improvements located upon the real estate described in Schedule "A-111. Any construction or site improvements installations performed upon the real estate described in Schedule "A-111 pursuant to the aforementioned easements, licenses or consents shall be completed in a professional and workmanlike manner and any such real estate disturbed but not the actual subject of improvements shall be restored by said developer of the real estate described in Schedule "A-211, at its sole cost and expense, as nearly as possible to the condition existing prior to such disturbance.

ARTICLE XI

GENERAL PROVISIONS

Section 1. EFFECTIVENESS OF DECLARATION; TERMINATION AS TO SPECIFIC PROPERTY.

(a) The Approval generally contemplates that the covenants, restrictions, easements, charges and liens created by this Declaration (collectively the "Encumbrances") shall burden the real estate described in Schedule "All attached and further generally contemplates that such Encumbrances shall only become effective at such times as portions of the real estate described in Schedule "All attached have become the subjects of the respective Final Map #1 and Final Map #2 filings in the Somerset County Clerk's Office, with such effectiveness being limited to the areas shown as lawfully subdivided, new lots on such Final Map #1 and Final Map #2 filings. The Declarant specifically contemplates that the Final Map #1 filing shall comprise all of the real estate described in Schedule "A-111 attached and the Final Map #2 filing shall comprise all of the real estate described in Schedule "A-211 attached. As per the Approval, Final Map #I is proposed by Declarant to create one hundred eight (108) new single family detached home building Lots, two (2) new lots containing Common Areas and the new Township Lot and Final Map #2 is proposed by Declarant to create sixty-eight (68) new single family detached home building Lots and three (3) new lots containing Common Areas, all of said new, proposed lots being enumerated as follows:

Final Map #1:

Proposed BlockProposed Lot

NumbersNumbersLot Type

3400142.01 - 42.06Building Lots

3400142.30 - 42.37Building Lots

340173 - 6Building Lots

3401715 - 17Building Lots

340182 - 41Building Lots

3401928 - 74Building Lots

3400142.38Common Area

340181Common Area

3400142.39Township Lot

Final Map #2:

Proposed BlockProposed Lot

NumbersNumbersLot Type

3400142.07 - 42.29Building Lots

340177 - 14Building Lots

340192 - 27Building Lots

3401975 - 85Building Lots

3400142Common Area

340171Common Area

340191Common Area

(b) It is specifically provided that the legal effect of this Declaration, notwithstanding the recording hereof, shall be inoperative and without any force or effect whatsoever as to any of the real estate constituting the lots comprising Final Map #1 and described in Schedule "A-111 until such time as Final Map #1 is filed in the Somerset County Clerk's Office and upon such filing, the effectiveness of this Declaration shall cease to be inchoate as to the real estate described in Schedule "A-111 and shall become fully operative and legally effective thereto and only thereto.

(c) It is specifically further provided that the legal effect of this Declaration, notwithstanding the recording hereof, shall be inoperative and without any force or effect whatsoever as to any of the real estate constituting the lots comprising Final Map #2 and described in Schedule "A-211 until such time as Final Map #2 is filed in the Somerset County Clerk's Office and upon such filing, the effectiveness of this Declaration shall cease to be inchoate as to the real estate described in Schedule "A-211 and shall become fully operative and legally effective thereto.

(d) Anything herein to the contrary notwithstanding, it is specifically provided that if the Approval shall cease to be without legal effect for any reason whatsoever (and whether by operation of law or otherwise) prior to the time that either Final Map #1 and/or Final Map #2 shall have been filed in the Somerset County Clerk's Office, the effect of the Encumbrances shall cease and be deemed absolutely null and void and without any force or effect whatsoever as to any real estate from among the real estate described in Schedule "All attached which was not the subject of a filing in the Somerset County Clerk's Office of either Final Map #1 and/or Final Map #2 prior to the legal cessation of the effectiveness of the Approval.

(e) In the event that any of the real estate from among that real estate described in Schedule "All attached shall cease to become subject to the Encumbrances by reason of the operation of subSection (d) above (the "Affected Premises"), Declarant or any other fee owner of the entirety of the Affected Premises shall have the right to record an instrument in the Somerset County Clerk's Office canceling and discharging the effect of the Encumbrances as to the Affected Premises.

(f) Anything elsewhere contained in this Declaration or the By-Laws to the contrary notwithstanding, the right reserved herein to permit the owner of fee title to the Affected Premises to record the instrument described in sub-Section (e) above in the Somerset County Clerk's Office under the circumstance described in sub-Section (d) above shall not require the consent, approval, agreement, affirmative vote or other acquiescence whatsoever of any of the owners, any mortgagees of any owners, the Township of Montgomery or any of its boards or departments, any of the Members, the Association or any of the Association's mortgagees, if applicable.

Section 2. ENFORCEMENT. Te Association, Declarant or any Owner shall have the right to enforce, by any proceeding at law or in equity, all restrictions, conditions, covenants, reservations, liens and charges now or hereafter imposed by the provisions of this Declaration. Failure by the Association or by any Owner to enforce any covenant or restriction erein contained shall in no event be deemed a waiver of the right to do so thereafter.

Section 3. SEVERABILITY. Invalidation of any one of these covenants or restrictions by judgment or Court order shall in no way affect any other provisions which shall remain in full force and effect.

Section 4. DURATION OF DECLARATION. Subject to the provisions of Section 1 above, the Encumbrances of this Declaration shall run with and bind the land described in Schedule "A", for a term of twenty (20) years from the date this Declaration is recorded in the Somerset County Clerk's Office, after which time they shall be automatically extended for successive periods of ten (10) years in perpetuity.

Section 5. AMENDMENT OF DECLARATION BY OWNERS. This Declaration may be amended by an instrument containing such amendment signed by Members who hold not less than three-quarters of all of the outstanding votes of all Members. Declarant shall not be permitted to cast any votes attributable to Lots owned by Declarant at any meeting at which any vote to amend this Declaration shall have been properly noticed and agendized if the purpose of such amendment is to either change the permitted uses of Lots or reduce the Common Areas. Any amendment by the owners to change permitted uses of Lots or reduce the size of Common Areas shall require the prior approval of the ZBA. No amendment shall be effective unless and until recorded in the Office of the Clerk of Somerset County. No such amendment may alter the aforesaid Map recorded in the office of the Clerk of Somerset County, nor may it alter or diminish any of the obligations assumed by the Declarant in conjunction with the Approval or any other obligations which may now or later exist by law, without the approval of the ZBA or other appropriate municipal entity of Montgomery Township. No amendment, in the sole judgment of Declarant, shall impair or adversely affect the rights of Declarant or cause Declarant to suffer any financial, legal or other detriment, including, but not limited to any direct or indirect interference with the sale of Lots by Declarant.

Section 6. AMENDMENT OF DECLARATION BY DECLARANT. This Declaration may be amended in whole or in part, without the approval of other Members, by the Declarant at any time prior to the first conveyance of the title to any Lot to a non-Declarant purchaser; provided, however, that no such amendment which effects a reduction in the size of or improvements to the Common Areas shall be made without the approval of the ZBA. Such amendment shall not be effective unless and until recorded in the Of f ice of the Clerk of Somerset County. For a period of two (2) years following the sale of the last Lot by the Declarant to a bona fide, third party purchaser, the Declarant may make any amendment to this Declaration, by its own action, without the approval of other Members, for the purpose of complying with the rules or requirements of any governmental or quasi-governmental body having jurisdiction or any institution purchasing, holding or insuring a security interest in any portion of the Properties.

Section 7. CONVEYANCES. Declarant reserves the right, prior to any conveyance of title to an individual Lot herein described, to determine, in Declarant's sole discretion, the type of improvements to be constructed upon such Lot, provided, however, that any such improvements shall comply with any applicable requirements and approvals of governmental authorities having jurisdiction over such Lot, including the Approval, and Declarant further reserves the right, prior to the conveyance of any such Lot, to apply for and obtain any applicable, additional governmental approvals affecting such Lot, including but not limited to modifications of, supplements to and amendments of any prior governmental approvals, including the Approval.

Section 8. NOTICES. Any notice required to be sent to any Member or owner, including Declarant, under the provisions of this Declaration shall be deemed to have been properly sent when mailed, postage paid, to the last known address of the person who appears as Member or Owner on the records of the Association at the time of such mailing.

Section 9. ENCROACHMENTS. In the event any portion of any structure erected on a Lot shall encroach upon the Common Areas, or vice versa, as a result of the construction, reconstruction, repair, shifting, settlement or movement thereof, a valid easement for the encroachment and for the maintenance thereof shall exist so long as the encroachment exists.

Section 10. MANAGEMENT AGREEMENTS. Any management agreement entered into by the Association with respect to the Common Areas shall be terminable by the Association for cause upon ten (10) days written notice thereof, and the terms of any such agreement may not exceed one (1) year, renewable by agreement of the parties for successive one-year periods.

Section 11. CERTAIN RIGHTS OF DECLARANT. For such time as Declarant shall own any Lot, Declarant's rights and interests shall not be prejudiced, in the sole judgment of Declarant, by any of the following actions unless it shall, in writing, join in such actions. There shall be no amendments to this Declaration or the Articles of Incorporation or By-Laws of the Association which:

(a) discriminate or tend to discriminate against Declarant's rights as an Owner or Member;

(b) change the definitions appearing in Article I of this Declaration in a manner which alters Declarant's rights or status;

(c) alter the character and rights of membership (including but not limited to voting rights) or the rights of the Declarant as set forth in this Declaration;

(d) alter previously recorded or written agreements with public or quasi-public agencies as regards easements and rights of way;

(e) denies Declarant's right to convey Common Areas to the Association;

(f) change the provisions of Article IV in a manner that increases the obligation of Declarant with respect to the payment of Assessments.

Section 12. CONFLICT. In the event of any conflict among the provisions of the Declaration, the Articles of Incorporation, the By-Laws or the Book of Regulations, if applicable, this Declaration shall first control; the Articles of Incorporation of the Association shall then control; then the By-Laws and, lastly, the Book of Regulations; except that in all cases where the aforesaid governing documents of the Association may be found to be in conflict with statute, the statute shall control.

Section 13. INTERPRETATION. Unless the context otherwise requires the use herein, the singular shall include the plural and vice versa; the use of one gender shall include all genders; and the use of the term "including" shall mean "including, without limitation." The headings used herein are for indexing purposes only and shall not be used as a means of interpreting or construing the substantive provisions thereof.

Section 14. EFFECTIVE DATE. This Declaration shall become effective upon its recordation in the Office of the Clerk of Somerset County, New Jersey.

Section 15. TRANSFER; ASSUMPTION. Declarant shall have the right to transfer, convey or otherwise dispose of all of its rights and obligations hereunder to any other person or legal entity and, upon such transfer and the assumption of any obligations of Declarant by such transferee, Declarant shall have no further obligations of any kind or nature whatsoever hereunder.

IN WITNESS WHEREOF, the undersigned, being the Declarant

SCHEDULE "C"

BY-LAWS

OF

YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC.

The name of the association is YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC., (hereinafter referred to as the "Association"). The initial principal office of the Association shall be located c/o Trafalgar House Property, Inc., 375 Phillips Boulevard, Trenton, New Jersey 08618, but meetings of the Members and Board may be held at the principal office or such other places as may be provided herein and as designated by the Board.

ARTICLE I

DEFINITIONS

All definitions herein shall have the same meanings as are set forth in the Declaration to which these By-Laws are attached.

ARTICLE II

VOTING

Section 1. MEMBERSHIP. Every Owner of a Lot which is subject to Assessments shall be a member of the Association, and such membership shall be appurtenant to and shall not be separated from ownership of any Lot which is subject to Assessments. Such Owners of Lots shall become subject to the Declaration immediately upon the conveyance of said Lots to them.

Section 2. VOTING RIGHTS. Each Lot shall be entitled to one (1) vote. When more than one person holds an interest in any Lot, the vote for such Lot shall be exercised by the persons holding such interest as they among themselves determine, but in no event shall more than one (1) vote be cast with respect to any one Lot.

ARTICLE III

MEETING OF MEMBERS

Section 1. ANNUAL MEETINGS.

The first annual meeting of the Members shall be held within three (3) years from the date of incorporation of the Association. Subsequent regular annual meetings of the Members shall be held on or about the same day of the same month of each year thereafter (or as close thereto as possible). The Association's Board shall initially be designated and controlled by the Declarant who shall surrender control thereof to the Members as follows:

(1) within sixty (60) days after conveyance of 25% of the Lots subject to the Declaration has been made by Declarant to Owners in the ordinary course of Declarant's business, not less than 25% of the membership of the Board shall be elected by the Members other than Declarant.

(2) within sixty (60) days after conveyance of 50% of the Lots subject to the Declaration has been made by Declarant to Owners in the ordinary course of Declarant's business, not less than 40% of the membership of the Board shall be elected by the Members other than Declarant.

(3) within sixty (60) days after conveyance of 75% of the Lots subject to the Declaration has been made by Declarant to Owners in the ordinary course of Declarant's business, Declarant's control of the Board shall terminate, at which time, except to the extent provided below, the Members shall elect the entire Board.

Upon each such occasion when any of the above shall become applicable, a special meeting shall be called for the purpose of electing such Trustees as may be necessary.

Notwithstanding the above, Declarant may retain one (1) membership on the Board so long as there are any Lots remaining unsold by Declarant, its successors and assigns, to bona fide third party purchasers in the regular course of Declarant's business.

Section 2. SPECIAL MEETINGS. Special meetings of the Members may be called at any time by the President or by the Board, or upon written request of the Members who are entitled to vote one-fourth (1/4) of all of the votes incident to membership.

Section 3. NOTICE OF MEETINGS. Written notice of each meeting of the Members shall be given by, or at the discretion of, the secretary or person authorized to call the meeting, by mailing a copy of such notice postage prepaid, at least fifteen (15) days before such meeting to each Member entitled to vote thereat addressed to the Member's address last appearing on the books of the Association, or supplied by such Member to the Association for the purpose of notice. Such notice shall specify the place, day and hour of the meeting, and, in the case of a special meeting, the purpose of the special meeting.

Section 4. QUORUM. The presence at the meeting of Members entitled to cast, or of proxies entitled to cast, at least twenty-five (25%) percent for any action except as otherwise provided in the Articles of Incorporation, the Declaration, or these By-Laws shall constitute a quorum. If, however, such quorum shall not be present or represented at any meeting, the Members entitled to vote thereat shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum as aforesaid shall be present or be represented.

Section 5. PROXIES. At all meetings of Members, each Member may vote in person or by proxy. All proxies shall be in writing and filed with the Secretary. Every proxy shall be revocable and shall automatically cease upon conveyance by the Member of his Lot.

Section 6. LOCATION. All meetings of the Association that are required by law to be open to all Lot Owners shall be held at a location within the Project or, if there is no suitable meeting room within the Project, at a suitable meeting room elsewhere in Montgomery Township. A meeting room shall not be deemed to be suitable if it is not large enough to accommodate a reasonable number of Lot Owners who might wish to attend such open meeting.

ARTICLE IV

BOARD OF TRUSTEES: SELECTION: TERM OF OFFICE:

Section 1. NUMBER. The affairs of the Association shall be managed by the Board which shall consist of five (5) Trustees. Until the first special meeting of Members called for the purpose set forth in Article III, Section 1 above, the Board shall consist of Trustees appointed by Declarant. Thereafter, the Board shall consist of a combination of Member-elected and Declarant-appointed Trustees, subject to the provisions of Article III, Section 1 above.

Section 2. COMPOSITION OF TERM.

(a) Declarant-appointed Trustees. Such Trustees shall serve at the pleasure of the Declarant at any time and from time to time and at Declarant's sole discretion. Such Trustees need not be Members of the Association.

(b) Member-elected Trustees. Such Trustees shall be elected by the Members at special meetings as per Article III,

Section 1 above and, when the Board is fully controlled by Members other than Declarant, at annual meetings. Prior to the election of Trustees at the first annual meeting, Member-elected Trustees shall serve until the first annual meeting, whichever shall first occur. All Member-elected Trustees shall be Members.

Section 3. TERM OF OFFICE. At the election at the initial annual meeting, the three (3) Trustees receiving the fewest votes shall be elected for a term of one (1) year and the other two (2) Trustees shall be elected for a term of two (2) years. If Declarant shall be entitled to appoint any Trustees at that time, the term of any such Declarant-appointed Trustee shall be a one (1) year term. Thereafter, the term of each Trustee shall be for the term of two (2) years.

Section 4. REMOVAL. Any Trustee may be removed from the Board, with or without cause by a majority of the Members of the Association. In the event of death, resignation or removal of a Trustee, his successor shall be selected by the remaining Trustees and shall serve for the unexpired term of his predecessor.

Section 5. COMPENSATION. No Trustee shall receive compensation for any service he may render to the Association. However, any Trustee may be reimbursed for his actual expenses incurred in the performance of his duties.

Section 6. ACTION TAKEN WITHOUT A MEETING. The Trustees shall have the right to take any action in the absence of a Board meeting which they could take at a Board meeting by obtaining the written approval of all the Trustees, Any action so approved shall have the same effect as though taken at a meeting of the Board.

ARTICLE V

NOMINATION AND ELECTION OF TRUSTEES

Section 1. NOMINATION. Nominations for election of non-Declarant Members to the Board shall be made by a Nominating Committee appointed by the Board. Nominations may also be made from the floor at any meeting at which Trustees are to be elected. The Nominating Committee shall consist of a Chairman, who shall be a member of the Board and two (2) or more Members of the Association. The Nominating Committee shall be appointed by the Board prior to each meeting of the Members at which Trustees are to be elected and shall serve until the close of such meeting. Appointments to the Nominating Committee shall be announced at each annual meeting. The Nominating Committee shall make as many nominations for election to the Board as it shall in its discretion determine, but not less than the number of vacancies that are to be filled.

Section 2. ELECTION. Election to the Board shall be by written ballot. At such election, the Members or their proxies may cast, in respect to each vacancy, as many votes as they are entitled to exercise under the provisions of the Declaration. The persons receiving the largest number of votes shall be elected.

Section 3. RESIGNATION AND REMOVAL. The unexcused absence of a Member-elected Trustee from three (3) consecutive regular meetings of the Board shall be deemed a resignation. Any Member-elected Trustee may be removed from the Board, with or without cause, by a vote of a majority of the Members of the Association at a general or special Meeting of the Association. A Trustee may resign at any time.

Section 4. VACANCIES. In the event of death, resignation or removal of a Trustee, his successor shall be elected by the remaining Trustees and shall serve for the unexpired term of his predecessor, except that any vacancy occurring as a result of the death, resignation or removal of a Declarant-appointed Trustee shall be filled by appointment by the Declarant.

ARTICLE VI

MEETINGSOF TRUSTEES

Section 1. REGULAR MEETINGS. Regular meetings of the Board may be held monthly without notice, at such place and hour as may be fixed from time to time by resolution of the Board, but in no event shall meetings be less than annually. Should said meeting fall upon a legal holiday, then that meeting shall be held at the same time on the next day which is not a legal holiday.

Section 2. SPECIAL MEETINGS. Special meetings of the Board shall be held when called by the President of the Association, or by any two Trustees, after not less than three (3) days' notice to each Trustee.

Section 3. QUORUM. A majority of the number of Trustees on the Board shall constitute a quorum for the transaction of business. Every act or decision done or made by majority of the Trustees present at a duly held meeting at which a quorum is present shall be regarded as the act of the Board.

Section 4. NOTICE, WAIVER OF NOTICE.

(a) Notice of any regular or special meeting of the Board shall be given to each Trustee serving thereon, personally or by telephone, mail or telegram, stating the date, time and place of such meeting., In addition, in the case of special meetings, such notice shall state the purpose of the meeting. Notice of regular meetings shall contain a proposed agenda and be given at least ten (10) days prior to the scheduled date for the meeting.

(b) Before or at any meeting of the Board, any Trustee may, in writing, waive notice of such meeting, and such waiver shall be deemed equivalent to the giving of such notice. Attendance by a Trustee at any such meeting shall be a waiver of notice by him of the time and place thereof unless such attendance is solely for the purpose of objecting to the notice given. If all the Trustees then serving on the Board are present at any meeting thereof, no notice shall be required, and any business may be transacted at such meeting unless one or more of the Trustees are attending solely for the purpose of objecting to the notice given.

Section 5. ACTION BY WRITTEN CONSENT. Any action which may be taken at a meeting of the Board may be taken without a meeting if a consent in writing, setting forth the action taken, shall be signed by all of the Trustees who would be entitled to vote at a meeting for such purpose and shall be filed with the Secretary.

Section 6. EFFECT OF PRESENCE. Any Trustee present at any meeting shall be deemed to have assented to any action taken at such meeting unless his written dissent is filed with the Secretary at or immediately following the adjournment thereof, provided that no Trustee may dissent from any action in which he voted in favor at the meeting.

Section 7. RULES OF ORDER. Where not otherwise provided herein, the Board and Association shall conduct their respective business in accordance with Robert's Rules of order, or such other rules as may be adopted from time to time for such purpose.

Section 8. CONSENT. Whenever the Declaration, these By-Laws, the Book of Regulations, if applicable, or the Articles of Incorporation (collectively the "Governing Documents") shall require written permission of the Board, such permission shall consist of a written statement setting forth the action or activity for which such permission is granted, signed by a member of the Board who shall have been authorized to sign such permission on behalf of the Board by a vote thereof. The action or activity for which permission is granted shall be noted by the Secretary in the records of the Board.

ARTICLE VII

POWERS AND DUTIES OF THE BOARD OF TRUSTEES

Section 1. POWERS. In addition to powers created by law or in the Declaration or Articles of Incorporation, the Board shall have the power to:

(a) adopt, publish and amend rules and regulations governing the maintenance, use, administration, repair and maintenance of the Common Areas and the conduct of Members, their guests, invitees and family members in respect of those Common Areas and to publish same in the Book of Regulations;

(b) suspend the voting rights of a Member during any period in which such Member shall be in default in payment of any Assessment levied by the Association;

(c) exercise for the Association all powers, duties and authority vested in or delegated to

the Association and not reserved to the membership by other provisions of the Governing Documents;

(d) declare the office of a Member-elected Trustee to be vacant in the event such Member-elected Trustee shall be absent from three (3) consecutive regular meetings of the Board;

(e) to take all reasonable action necessary to maintain, operate, preserve and manage the Common Areas, including the mortgaging, leasing or other encumbering thereof;

(f) in its own name, on its own behalf or on behalf of any Owner(s) who consent(s) thereto, to commence and maintain actions and suits to restrain and enjoin any breach or threatened breach of any Governing Documents and to enforce, by mandatory injunction or otherwise, all of the provisions thereof;

(g) subject to the provisions of the Declaration, to grant and convey to any third party easements and rights-of-way in, on, over and under the Common Areas for the purpose of constructing, erecting, operating or maintaining thereon, therein or thereunder (i) lines, cables, wires, conduit or other devices for the transmission of electricity and for lighting, heating, power, telephone, television and for other appropriate purposes, (ii) public sewers, storm water drains and pipes, water systems, heating and gas lines or pipes and (iii) any similar public or quasi-public improvements and facilities;

(h) to employ the services of any person or corporation as manager, together with employees, to manage, conduct and perform the business, obligations and duties of the Association as may be directed by the Board and to enter into contracts for such purpose. Such manager and employees shall have the rights to ingress and egress over such portions of the Properties as are reasonably necessary for the purposes of performing such business, duties and obligations;

(i) without liability to any owner, to cause its agents, independent contractors, and employees, after reasonable notice, to enter upon any Lot for the purposes of maintaining and repairing any portion of the Lot if for any reason whatsoever the owner thereof fails to maintain it as required by the Declaration;

(j) to contract and pay for, or otherwise provide for, the maintenance, restoration and repair of the Common Areas and of all improvements of whatsoever kind and for whatever purpose from time to time located upon or within the Common Areas;

(k) to contract and pay for, or otherwise provide for, trash removal services and utility services, including, but without limitation, water, sewer, garbage, snow removal, lawn maintenance, electrical, telephone and gas services for the Common Areas;

(1) to contract and pay for, or otherwise provide for, the services of architects, engineers, attorneys and certified public accountants and such other professional and non-professional services as the Board shall deem necessary or desirable;

(m) to contract and pay for, or otherwise provide for, the construction, reconstruction, repair, replacement or refinishing of any roads, drives, or other paved areas, and drainage improvements which are part of the Common Areas;

(n) to contract and pay for, or otherwise provide for, such materials, supplies, furniture, equipment and labor as and to the extent the Board deems necessary;

(o) to pay and to discharge any and all liens from time to time placed or imposed upon any portion of the Common Areas on account of any work done or performed by the Association in the fulfillment of any of its obligations and duties of maintenance, repair, operation or administration;

(p) to procure and maintain other insurance in addition to that required to be maintained by the Association pursuant to the Declaration;

(q) to estimate the amount of the annual budget and to include therein such reasonable reserves as are adequate to meet contingencies not expressly provided for as an annual expense item in the annual budget and to levy and collect Assessments from owners in accordance with the Declaration ;

r) as provided in the Declaration, to suspend the voting rights and rights to use the Common Areas of a Member during any period in which such member shall be in default in the payment of any Assessment levied by the Association. Such rights may also be suspended for infraction of rules and regulations governing use of said Common Areas set forth in the Book of Regulations, after notice and hearing, for a period not to exceed sixty (60) days for each infraction;

(s) to perform such other acts, whether or not expressly authorized by the Governing Documents, as may be reasonably necessary or appropriate to enforce or effectuate any of the provisions of the Governing Documents or other powers which the Board may have; and

(t) when control of the Association has passed to the Members, to take no action that would be detrimental to the sales of Lots by Declarant and to continue the same level of maintenance, operation and services, including the establishment of any reserves for replacements, in respect of the Common Areas as existed immediately prior to the assumption of control by the nonDeclarant Members until the last Lot has been sold by Declarant in the ordinary course of business.

Section 2. DUTIES. It shall be the duty of the Board to (a) cause to be kept a complete record of all its acts and corporate affairs and to present a statement thereof to the Members at the annual meeting of the Members, or at any special meeting when such statement is requested in writing by one-fourth (1/4) of the Members who are entitled to vote, and make such records available for inspection by any Member, his agent, or any mortgagee which has an interest in any Lot;

(b) exercise its powers in accordance with the Governing Documents pursuant to any agreements the Association may enter into and discharge its powers in a manner that protects and furthers the health, safety and general welfare of the Members;

(C) supervise all officers, agents and employees of the Association, and to see that their duties are properly performed;

(d) designate depositories for Association funds, designate those officers, agents and/or employees who shall have authority to withdraw funds from such accounts on behalf of the Association, and cause such persons to be bonded as it may deem appropriate;

(e) as more fully provided in the Declaration, to:

(1) fix the amount of the Annual Assessment against each Lot at least thirty (30) days in advance of each Annual Assessment period;

(2) send written notice of each Assessment to every owner subject thereto at least thirty (30) days in advance of each Assessment period. Failure to send such notice to the Owner shall not relieve the owner from the Assessment obligation;

(3) foreclose the lien against any Lot for which Assessments are not paid within thirty (30) days after due date or to bring an action at law against the owner personally obligated to pay the same

(f) issue, or cause an appropriate officer to issue, upon demand by any person, a certificate setting forth whether or not any Assessment has been paid. A reasonable charge may be made by the Board for the issuance of these certificates. If a certificate states an Assessment has been paid, such certificate shall be conclusive evidence of such payment;

(g) procure and maintain, as applicable, adequate liability and hazard insurance as described in the Declaration on any land owned in fee or via easement by the Association;

(h) cause the Common Areas to be maintained including, but not limited to, the storm water detention facilities in perpetuity in a manner consistent with requirements of Montgomery Township and/or Somerset County and in a accordance with the Governing Documents;

(i) upon the assumption by the Members of control of the Board of the Association, Declarant shall forthwith deliver to the Association all items and documents pertinent to the Association such as, but not limited to, a copy of the Declaration, other documents of creation of the Association, By-Laws, minute book, including all minutes, any rules and regulations, an accounting of Association funds, Association funds, all personal property, insurance policies, government permits, if applicable, a membership roster and all contracts and agreements relative to the Association;

(j) the Association, when controlled by the Members other than the Declarant, shall not take any action that would be detrimental to the sales of Lots by the Declarant and shall continue the same level of maintenance, operation and services as immediately prior to their assumption of control until the last Lot is sold by Declarant in the ordinary course of business; and

(k) cause all officers or employees having fiscal responsibilities to be bonded, as it may deem appropriate.

(1) adopt a fair and efficient procedure for the resolution of disputes between individual Lot Owners and the Association, and between different Lot Owners, that shall be readily available as an alternative to litigation.

ARTICLE VIII

OFFICERS AND THEIR DUTIES

Section 1. RENUMERATION OF OFFICERS. The officers of this Association shall be a President and Vice-President, who shall at all times be members of the Board, a Secretary and a Treasurer, and such other officers as the Board may from time to time by resolution create.

Section 2. ELECTION OF OFFICERS. The election of officers shall take place at the first meeting of the Board following each annual meeting of the Members. Until the first annual meeting of the Members, officers shall be appointed by and be members of the Board.

Section 3. TERM. After the first annual meeting of the Members, the officers of the Association shall be elected annually by the Board and each shall hold office for one (1) year unless he shall sooner resign, or shall be removed, or otherwise disqualified to serve.

Section 4. SPECIAL APPOINTMENTS. The Board may elect such other officers as the affairs of the Association may require, each of whom shall hold office for such period, have such authority, and perform such duties as the Board may from time to time determine.

Section 5. RESIGNATION AND REMOVAL. Any officer may be removed from office with or without cause by the Board. Any officer may resign at any time by giving written notice to the Board, the President or the Secretary. Such resignation shall take effect on the date of receipt of such notice or at any later time specified therein, and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.

Section 6. VACANCIES. A vacancy in any office may be filled by appointment by the Board. The officer appointed to such vacancy shall serve for the remainder of the term of the officer he replaces.

Section 7. MULTIPLE OFFICES. The offices of Secretary and Treasurer may be held by the same person. No person shall simultaneously hold more than one of any of the other offices except in the case of special offices created pursuant to Section 4 of this Article VIII.

Section 8. DUTIES. The duties of the officers are as follows:

(a) RESIDENT. The President shall be the chief executive officer of the Association and shall preside at all meetings of the Members and of the Board. The President shall have the powers and duties usually vested in the office of president of any association and of a corporation incorporated under the laws of New Jersey, including, but not limited to, the power to appoint committees from among the Members and the Board from time to time as he may in his discretion decide are appropriate to assist in the conduct of the affairs of the Association;

(b) VICE-PRESIDENT. The Vice President shall act in the place and stead of the President in the event of his absence, inability or refusal to act, and shall exercise and discharge such other duties as may be required of him by the Board;

(c) SECRETARY. The Secretary shall keep the minutes of all meetings of the Association and the Board, shall have charge of such books and papers as the Board may direct and, in addition to those duties specifically assigned to him by these By-Laws, he shall, in general, perform all the duties incident to the office of the secretary of a corporation; and

(d) TREASURER. The Treasurer shall have the responsibility for the funds and securities of the Association and for the deposit of all monies and other valuable effects in the name, and to the credit, of the Association in such depositories as may from time to time be designated by the Board. Records of all receipts and expenditures shall be maintained by the Treasurer, by employees of the Association or by a Manager under the general supervision of the Treasurer. The records shall include expenditures affecting the Common Areas specifying and itemizing the maintenance, repair and replacement expenses of such Common Areas and any other expenses incurred by the Association. Except for current books of account which may be maintained elsewhere, such records shall be available for examination by the Members during regular business hours. In accordance with the actions of the Board in making Assessments against the Owners, accurate records shall be maintained of such Assessments and of the payment thereof by each person so assessed. The Treasurer and any other employee or agent handling funds shall, if required by the Board, furnish a bond in such form and amount and covering such risks as the Board shall require, the premium for which shall be paid by the Association.

Section 9. DELEGATION OF DUTIES TO MANAGER. Certain specific duties of the Secretary and Treasurer of the Association may be delegated by the Board to the manager designated by the Board, if any.

Section 10. COMPENSATION. The officers of the Association shall serve without compensation.

Section 11. EXECUTION OF INSTRUMENTS. No agreement, check, deed, lease or other instrument shall be binding upon the Association unless entered into on its behalf and signed by two (2) officers of the Association or by one (1) officer and one (1) assistant officer or other person designated by the Board; provided, however, that the Board may authorize the manager or specified employees of any such manager to execute checks without the signature of an Association officer, subject to such conditions and limitations as may from time to time be imposed by the Board.

ARTICLE IX

COMMITTEES

The Board shall appoint a Nominating Committee, as provided in these By-Laws. In addition, the Board shall appoint other committees as deemed appropriate in carrying out its duties and purposes.

ARTICLE X

BOOKS AND RECORDS

The books, records and papers of the Association shall at all times, during reasonable business hours be subject to inspection by any Member. The Declaration, the Articles of Incorporation and the By-Laws of the Association shall be available for inspection by any Member at the principal office of the Association, where copies may be purchased at reasonable cost.

ARTICLE XI

ASSESSMENTS

Section 1. LIEN; PERSONAL OBLIGATION. As more fully provided in the Declaration, each Member shall be obligated to pay to the Association an Annual Assessment, and, if applicable, Special Assessments which are secured by a continuing lien upon the Lot against which the respective Assessments are made. Any Assessment which is not paid when due shall be delinquent. If the Assessment is not paid within thirty (30) days after the due date, the Assessment shall bear interest from the date of delinquency at the rate of eighteen (18%) percent per annum, and the Association may bring an action at law against the owner personally obligated to pay the same or foreclose the lien against the Lot, and interest, costs and reasonable attorney's fees of any such action shall be added to the amount of such Assessment. No Owner may waive or otherwise escape liability for the Assessments provided for herein by non-use of the Common Areas or abandonment of his Lot. The Declarant shall not be required to pay any assessments for Lots owned by Declarant except as may be specifically required in this Declaration.

Section 2. RIGHTS OF MONTGOMERY TOWNSHIP. In addition to the aforesaid Assessments and in the event the Association fails to maintain the Common Areas in accordance with the Declaration, Montgomery Township may serve written notice upon the Association, setting forth the manner in which the Association has failed to maintain the Common Areas and said Montgomery Township may, in accordance with the Declaration and subject to law, enter upon and maintain the Common Areas with the cost of such maintenance being assessed against the Association, Lot or Owner as applicably set forth in the Declaration, and same shall be a tax lien upon the applicable Lots and/or Properties, all as provided by law.

Section 3. MISCELLANEOUS PROVISIONS. Until such time as the Association shall make an Assessment for common expenses, Declarant shall pay all of the expenses of the Common Areas. When the Association has made a common expense Assessment, the Assessment shall be assessed against the Lots individually owned and under development in proportion to the benefit derived by the Lots from the items included in the budget.

ARTICLE XII

CORPORATE SEAL

The Association shall have a seal in circular -form having within its circumference the words: "YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC."

ARTICLE XIII

LIABILITY AND INDEMNIFICATION

Section 1. LIABILITY OF TRUSTEES, OFFICERS, AND OTHER COMMITTEE MEMBERS. Trustees, officers, assistant officers and committee members, to the fullest extent permitted by law:

(a) shall not be liable to any Member, or any other person or entity, as a result of any actions taken or omitted to be taken in such capacities, or for any mistake of judgment, negligence or otherwise, except for their own willful misconduct or gross negligence;

(b) shall have no personal liability in contract to a Member, or any other person or entity, under any agreement, instrument or transaction entered into or executed by them on behalf of the Association in the performance of their duties;

(c) shall have no personal liability in tort, direct or imputed, to a Member or any other person or entity, by virtue of acts performed by them or by agents, employees or contractors employed or retained by them, on their behalf in their official capacity, except for their own willful misconduct or gross negligence; and

(d) shall have no personal liability arising out of the use or misuse of the Properties or any part thereof, or which might in any other way be assessed against or imputed to them as a result, or by virtue of, their capacities as such.

Section 2. INDEMNIFICATION.

(a) The Association shall, to the fullest extent. permitted by law, indemnify and hold harmless any person, his, heirs and personal representatives, from and against any and all personal liability, and all expenses, including counsel fees, incurred or imposed, or arising out of, or in settlement of, any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, instituted by any one or more Owners or any persons or entities, to which he shall be or shall be threatened to be made a party by reason of the fact that he is or was a member of the Board or an officer or assistant officer, or a member of any committee, other than to the extent, if any, that such liability or expense shall be attributable to his willful misconduct or gross negligence, provided, in the case of any settlement, that the Association or Board shall have approved the settlement, which approval shall not be unreasonably withheld. The indemnification by the Association set forth in this subsection (a) shall be paid by the Association and shall be assessed and collected in accordance with the terms of the Declaration in the same manner as Annual Assessments;

(b) The Association shall indemnify any such person, his heirs and personal representatives in the same manner and to the same extent as provided in subsection (a) above where such action, liability or expense arises out of his serving as a Trustee, officer or assistant officer, or committee member and relates to the condition of, or any event concerning, the Common Areas. The indemnification by the Association set forth in this subsection (b) shall be paid by the Association and shall be assessed and collected in accordance with the terms of the Declaration in the same manner as Annual Assessments;

(c) The Association shall indemnify any such person, his heirs and personal representatives, in the same manner and to the same extent as provided in subsection (a) above where such action, liability or expense arises out of such person serving as a Trustee, officer or assistant officer, member of any committee, and relates to any other matter concerning or affecting the Properties. The indemnification set forth in this subsection (c) shall be paid by the Association and shall be assessed and collected pursuant to the terms of the Declaration and in the same manner as Annual Assessments; and

(d) The right of indemnification set forth in Section 2 (a), (b) and (c) above shall not be exclusive of other rights, if any, to which the person indemnified may be entitled by law or agreement, or by vote of the Members or the Board or otherwise.

Section 3. LANGUAGE CONCERNING LIABILITY IN AGREEMENTS. The agreements, deeds, leases or other instrument entered into by the Association may provide that the Board and the officers or assistant officers executing the same are acting on behalf of the Association and shall have no personal liability thereunder and that any claim by the other party or parties with respect thereto or to the subject matter thereof shall be asserted solely against the Association.

Section 4. NOTICE OF SUIT AND OPPORTUNITY TO DEFEND. Complaints brought against the Association, Members as a class, Owners as a class or the officers, assistant officers, committee members, employees or agents thereof, in their respective capacities as such, or against the Common Areas as a whole, or any part thereof, shall be directed to the Association, which shall promptly give written notice thereof, to all persons named or indirectly affected and shall be defended by the Association.

ARTICLE XIV

AMENDMENT OF BY-LAWS

Section 1. METHOD.

(a) The provisions of these By-Laws may be amended by the affirmative vote of Members who hold three-quarters of the outstanding votes of all Members; provided, however, that if such amendment shall make any change which would affect any of the rights, privileges, powers and options of the Declarant, such amendment shall require the joiner of Declarant; and

(b) Amendments shall become effective upon adoption unless the amendment specifically calls for a different date.

Section 2. CONFLICT. In the event of a conflict between the provisions of these By-Laws and the Declaration, the Declaration shall prevail.

Section 3. SPECIAL AMENDMENTS. Notwithstanding anything contained herein to the contrary, the Board, by its own action, without the approval of the Members, shall have the right to:

(a) with the approval of the ZBA, if required, amend these By-Laws in order to comply with the rules or requirements of any governmental or quasi-governmental body or any institution purchasing, holding or insuring a security interest in any portion of the Properties;

(b) with the approval of the ZBA, if required, amend these By-Laws for any other purpose at any time prior to the first conveyance of the title to any Lot to a purchaser who is not the Declarant; and

(c) without the approval of anyone, amend these By-Laws to correct clerical or typographical errors herein.

Section 4. CERTAIN LIMITATION. Declarant shall not be permitted to cast any votes allocated to unsold Lots in order to amend any Governing Documents for the purpose of changing the permitted use of a Lot or for the purpose of reducing the Common Areas.

ARTICLE XV

FISCAL YEAR

The fiscal year of the Association shall begin on the first day of January and end on the last day of December of every year, unless changed by resolution of the Board.

ARTICLE XVI

SEVERABILITY

The provisions here of shall be deemed independent and severable, and the invalidity, partial invalidity or unenforceability of any one provision or portion hereof shall not affect the validity or enforceability of any other provision or portion hereof.

ARTICLE XVII

MISCELLANEOUS

Section 1. HEADINGS. The headings introducing the text of the several sections of these By-Laws are solely for convenience of reference and shall not constitute part of these By-Laws or affect their meaning in any way.

Section 2. REFERENCE OF PRONOUNS. All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular and plural as the identity of the person or persons or entities referred to may require.

Section 3. FAILURE TO INSIST ON STRICT PERFORMANCE IN NO WAIVER. The failure of the Association or Board to insist in any one or more instances upon the strict performance of any of the terms, covenants, conditions or restrictions of the Governing Documents or Association rules and regulations or to exercise any rights or option therein contained or to serve any notice or to institute any action shall not be construed as a waiver or a relinquishment for the future of such term, covenant, condition, restriction, option or right, but such term, covenant, restriction, option, or right shall remain in full force and effect. The receipt of the Board of any payment of Assessments from any owner with knowledge of the breach of any covenant of the Governing Documents or Association rules and regulations shall not be deemed a waiver of such breach, and no waiver by the Association or the Board of any provision of the Governing Documents of the Association rules and regulations shall be deemed to have been made unless expressed in writing and signed by duly authorized members of the Board.

ARTICLE XVIII

DISSOLUTION

The Association cannot be dissolved unless the interests, rights and obligations of the Association in and to the Common Areas shall first be offered for dedication and/or assignment to Montgomery Township. If Montgomery Township shall not accept said dedication or assignment, then such interests, rights and obligations of the Association shall be transferred to such other public or private agency or instrumentality as will most nearly carry out the original intention of this Declaration. The provisions herein shall apply also if the Association ceases to operate, and in such case, it shall be the duty of the Owners herein to cause said rights and obligations to be dedicated, assigned or transferred as provided herein.

IN WITNESS WHEREOF, we, being all of the Trustees of the Yorkshire Woods Homeowners Association, Inc. have hereto set our hands and seals this ____ day of _____________, 199__.

SCHEDULE "D"

ARTICLES OF INCORPORATION

OF

YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC.

In compliance with the requirements of Title 15A, Chapter 1 et seq. of the Revised Statutes of New Jersey, the undersigned, all of whom are of full age, have this day voluntarily associated themselves together f or the purposes of forming a corporation not for profit and do hereby certify:

ARTICLE I

NAME

The name of the Association is YORKSHIRE WOODS HOMEOWNERS ASSOCIATION, INC.

ARTICLE II

PRINCIPAL OFFICE

The principal off ice of the Association is located at 375 Phillips Boulevard, Trenton, NJ 08618.

ARTICLE III

REGISTERED AGENT

Stephen P. Mutascio, whose address is 375 Phillips Boulevard, Trenton, NJ 08618 is hereby appointed the initial registered agent of this Association.

ARTICLE IV

PURPOSE AND POWERS OF THE ASSOCIATION

This Association does not contemplate pecuniary gain or profit to the Members thereof , and the specific purpose of or which it is formed is to provide for the administration, management, preservation, utilization and control of the Common Areas of the Association as described in that certain Declaration of Covenants, Conditions and Restrictions (hereinafter "Declaration") establishing various rights and obligations for the Owners of Lots who are Members of the Association, which Declaration is intended to be recorded simultaneously herewith in the office of the Clerk of Somerset County, New Jersey. In connection with the use of the Common Areas, the Association shall promote the health, safety and welfare of the Members and shall have the following powers;

(a) To exercise all the powers and privileges and to perform all of the duties and obligations of the Association as set forth in the Declaration and the By-Laws of the Association, as the same may be amended from time to time as therein provided, said Declaration and By-Laws being incorporated herein as if set forth at length;

(b) To fix, levy, collect and enforce payment by any lawful means, of all charges or Assessments pursuant to the terms of said By-Laws of the Association, to pay all expenses in connection therewith and all office and other expenses incident to the conduct of the business of the Association, including all licenses, taxes or governmental charges levied or imposed against the property of the Association;

(c) To acquire (by gift, purchase or otherwise), own, hold, improve, build upon, operate, maintain, mortgage, convey, sell, lease, transfer, dedicate for public use or otherwise dispose of real or personal property in connection with the affairs of the Association;

(d) To borrow money, to mortgage, pledge, deed in trust or hypothecate any or all of its real or personal property as security for money borrowed or debts incurred; and

(e) To have and to exercise any and all powers, rights and privileges which a corporation organized under the Non-Profit Corporation Law of the State of New Jersey by law may now or hereafter have or exercise.

ARTICLE V

MEMBERS

Every person or entity who is a record owner of a fee simple interest in a Lot described in the Declaration shall be a member of the Association. The foregoing is not intended to include persons or entities who hold an interest merely as security for the performance of an obligation. Ownership of any Lot shall be the sole qualification for membership.

ARTICLE VI

BOARD OF TRUSTEES

The affairs of the Association shall be managed by a Board of Trustees. The Board of Trustees shall be composed of five (5) persons who need not initially be Members of the Association. The names and addresses of the persons who are to act in the capacity of Trustees until the selection of their successors are:

Stephen Mutascio

375 Phillips Boulevard

Trenton, NJ 08618

Michael Neill

375 Phillips Boulevard

Trenton, NJ 08618

Anthony Rostock

375 Phillips Boulevard

Trenton, NJ 08618

Richard Gitter

375 Phillips Boulevard

Trenton, NJ 08618

Carol Smith

375 Phillips Boulevard

Trenton, NJ 08618

ARTICLE VII

TERM

The Association shall exist perpetually, but may be dissolved at any time pursuant to appropriate law and the provisions of the Declaration.

ARTICLE VIII

MERGERS AND CONSOLIDATIONS

To the extent permitted by law, the Association may participate in mergers and consolidations with other non-profit associations organized for the same general purposes, provided that any such merger or consolidation shall have the assent of seventy-five (75%) percent of the votes present and entitled to be cast at any meeting of the Association, duly constituted for such purpose, a quorum being present.

ARTICLE IX

MEMBERSHIP

The qualifications for Members shall be set forth in detail in the By-Laws of the corporation or in the Declaration.

ARTICLE X

DISSOLUTION

The method of distribution of assets of the corporation upon dissolution shall be set forth in the By-Laws of the corporation or the Declaration.

ARTICLE XI

AMENDMENTS

These Articles may be amended at any meeting of the Association duly constituted for such purpose, a quorum being present, by an affirmative vote of seventy-five (75%) percent of the vote present and entitled to be cast.

IN WITNESS WHEREOF, for the purposes of forming this non-profit corporation under the laws of the State of New Jersey, we, the undersigned, constituting the incorporators of this Association, have executed these Articles of Incorporation this day of , 199_.

Gary R. BackinoffDawn A. Hamon

3131 Princeton Pike3131 Princeton Pike

Building 6-ABuilding 6-A

Lawrenceville, NJ 08648Lawrenceville, NJ 08648

Filomena VencellerLinda Dorsey Benfer

3131 Princeton Pike3131 Princeton Pike

Building 6-ABuilding 6-A

Lawrenceville, NJ 08648Lawrenceville,NJ 08648

Robert N. Ridolfi

3131 Princeton Pike

Building 6-A

Lawrenceville, NJ 08648

STATE OF NEW JERSEY)

):S.S.

COUNTY OF MERCER)

BE IT REMEMBERED, that on this day of , 199 _ , before me , the subscriber, an Attorney at Law of the State of New Jersey personally appeared Gary R. Backinoff, Dawn A. Hamon, Filomena Venceller, Linda Dorsey Benfer and Robert N. Ridolfi, who, I am satisfied are the persons named in and who executed the within Instrument, and thereupon they acknowledged that they signed, sealed and delivered the same as their act and deed, for the uses and purposes therein expressed.

___________________________

Alan G. Frank, Jr.

Attorney at Law of New Jersey

Prepared By: _____________________

Alan G. Frank, Jr., Esq.

SECOND CORRECTIVE AMENDMENT TO DECLARATION OF

COVENANTS, CONDITIONS AND RESTRICTIONS FOR

YORKSHIRE WOODS

THIS SECOND CORRECTIVE AMENDMENT ("Second Correction") is made this day of August, 1995, by ROBERT F. JOHNSTON, with an office at181 Cherry Valley Road, Princeton, NJ 08540 (hereinafter referred to as "Johnston").

W I T N E S S E T H:

WHEREAS, on December 21, 1994, a certain Declaration of Covenants, Conditions and Restrictions for Yorkshire Woods was caused to be recorded in Deed Book 1990 at Page 558 in the Somerset County Clerk's office (the "Declaration") with reference to Lots 41, 42,- 42.01, 42.02 and 49 in Block 34001 on the Montgomery Township (Somerset County) New Jersey Tax Map (the "Property") by Johnston (the "Declarant"); and

WHEREAS, on December 20, 1994, Johnston did convey a portion of the Property to Trafalgar House Property, Inc. ("Trafalgar"), which such portion is described in that certain deed from Johnston to Trafalgar recorded on December 21, 1994 in the Somerset County Clerk's office in Deed Book 1990 at Page 658; and

WHEREAS, on January 16, 1995, a certain First corrective Amendment to the Declaration (the "First Correction") was recorded in Deed Book 1996 at Page 536 in the Somerset County Clerk's Office; and

WHEREAS, it has since been determined that a certain common easement shown on Exhibit "All to the originally recorded Declaration was erroneously depicted; and

WHEREAS, Johnston and 'Trafalgar, being t1he only owners of Property burdened by the Declaration, desire that a correction of said erroneous depiction of the common easement shown on Exhibit "A" be made at this time by an amendment to the Declaration; and

WHEREAS, such amendment is permitted by the provisions of Section 6 of ARTICLE XI of the Declaration without the approval of any other person or entity;

NOW, THEREFORE, Johnston, pursuant to those rights of amendment reserved in Section 6 of ARTICLE XI of the Declaration to amend same in accordance with the provisions thereof does hereby effect the following amendment to such Declaration:

(1) Exhibit "All attached to the original Declaration is hereby deleted in its entirety and replaced by the depiction attached to this Second Correction as Exhibit "A".

(2) Except to the extent amended hereinabove, the Declaration remains in full force and effect and the Property described therein remains subject to all of the terms and conditions thereof.

TRAFALGAR JOINS IN THE EXECUTION HEREOF FOR THE PURPOSE OF ACKNOWLEDGING ITS CONSENT TO THE PROVISIONS OF THIS FIRST CORRECTIVE AMENDMENT.

STATE OF NEW JERSEY:

:S.S.

COUNTY OF MERCER

I CERTIFY that on August 1995, ROBERT F. JOHNSTON personally came before me and acknowledged under oath, to my satisfaction, that this person:

(a) is named in and personally signed this Instrument; and

(b) signed and delivered this Instrument as his act and deed.

STATE OF NEW JERSEY:

:S.S.

COUNTY OF MERCER:

I CERTIFY that on August 1995, STEPHEN MUTASCIO personally came before me and this person acknowledged under oath, to my satisfaction, that:

(a) this person is the assistant secretary of TRAFALGAR HOUSE PROPERTY, INC., the corporation named in this Instrument;

(b) this person is the attesting witness to the signing of this Instrument by the proper corporate officer who is Anthony M. Rostock, the Division Vice President of the corporation;

(c) this Instrument was signed and delivered by the corporation as its voluntary act duly authorized by a proper resolution of its Board of Directors; and

(d) this person signed this proof to attest to the truth of these facts.

Prepared By: ____________________

Alan G. Frank, Jr., Esq.

FIRST CORRECTIVE AMENDMENT TO DECLARATION OF

COVENANTS, CONDITIONS AND RESTRICTIONS FOR

YORKSHIRE WOODS

THIS FIRST CORRECTIVE AMENDMENT is made this day of January, 1995, by ROBERT F. JOHNSTON, with an office at 181 cherry Valley Road, Princeton, NJ 08540 (hereinafter referred to as "Johnston").

W I T N E S S E T H:

WHEREAS, on December 21, 1994, a certain Declaration of Covenants, Conditions and Restrictions for Yorkshire Woods was caused to be recorded in Deed Book 1990 at Page 558 in the Somerset County Clerk's office (the "Declaration") with reference to Lots 41, 42, 42.01, 42.02 and 49 in Block 34001 on the Montgomery Township (Somerset County) New Jersey Tax Map (the "Property") by Johnston (the "Declarant"); and

WHEREAS, Section 6 of ARTICLE XI of the Declaration gives the Declarant the right to amend the Declaration in whole or in part, without the approval of other Members (defined in the Declaration), at any time prior to the first conveyance of title to any Lot (defined in the Declaration) from among the Property to a nonDeclarant purchaser, subject to certain limitations as are set forth in said Section 6 of ARTICLE XI and which such limitations are not, f or the purposes of this First Corrective Amendment, relevant or applicable; and

WHEREAS, on December 20, 1994, Johnston did convey a portion of the Property to Trafalgar House Property, Inc. ("Trafalgar"), which such portion is described in that certain deed from Johnston to Trafalgar recorded on December 21, 1994 in the Somerset County Clerk's office in Deed Book 1990 at Page 658; and

WHEREAS, it has been determined that there was a typographical error on Page 4 of Exhibit "B" to the Declaration; and

WHEREAS, Johnston and Trafalgar, being the only owners of the Property burdened by the Declaration, desire that a correction of said typographical error be made at this time by an amendment to the Declaration; and

WHEREAS, such amendment is permitted by the provisions of Section 6 of ARTICLE XI of the Declaration without the approval of any other person or entity;

NOW, THEREFORE, Johnston, pursuant to those rights of amendment reserved in Section 6 of ARTICLE XI of the Declaration to amend same in accordance with the provisions thereof does hereby effect the following amendment to such Declaration:

(1) The word "Township" appearing in line 6 of the paragraph entitled "Dam Inspection and Record Keeping" on page 4 of Exhibit "B" to the Declaration is hereby deleted and replaced by the words "appropriate public entity".

(2) Except to the extent amended hereinabove, the Declaration remains in full force and effect and the Property described therein remains subject to all of the terms and conditions thereof.

TRAFALGAR JOINS IN THE EXECUTION HEREOF FOR THE PURPOSE OF ACKNOWLEDGING ITS CONSENT TO THE PROVISIONS OF THIS FIRST CORRECTIVE AMENDMENT.

STATE OF NEW JERSEY:

:S.S.

COUNTY OF MERCER:

I CERTIFY that on January _, 1995, ROBERT F. JOHNSTON personally came before me and acknowledged under oath, to my satisfaction, that this person:

(a) is named in and personally signed this Instrument; and

(b) signed and delivered this Instrument as his act and deed.

STATE OF NEW JERSEY:

:S.S

COUNTY OF MERCER:

I CERTIFY that on January 1995, STEPHEN MUTASCIO personally came before me and this person n acknowledged under oath, to my satisfaction, that:

(a)this person is the assistant secretary of TRAFALGAR HOUSE PROPERTY, INC., the corporation named in this Instrument;

(b) this person is the attesting witness to the signing of this Instrument by the proper corporate officer who is Michael J. Neill, the Division President of the corporation;

(c) this Instrument was signed and delivered by the corporation as its voluntary act duly authorized by - a proper resolution of its Board of Directors; and

1. this person signed this proof to attest to the truth of these facts.

sworn and subscribed to before me this _______ day of January, 1995 ________________________

Stephen Mutascio

___________________________

Alan G. Frank, Jr.

Attorney at Law of New Jersey

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