By-Laws

1.1 Purpose
The purposes of this Corporation are to accomplish and effectuate the purposes set forth in the Articles of Incorporation, and such other activities as the membership shall determine necessary to carry out such purposes.

The term Rolling Hills Estates hereinafter shall be construed to embrace a Subdivision situated in the vicinity of Sedona, Coconino County, Arizona, as the same is constituted by plat or record and as the same shall hereinafter be constituted by the recordation of any additional plat or plats entitled Rolling Hills Estates which shall increase the number of lots and premises contained in such Subdivision. Such recordation of any additional plat or plats may only be done if previously authorized by a majority vote of the Board of Directors of the Association and by a majority vote of the Members of the Association.

ARTICLE II - OFFICERS

2. Section 1. Executive Officers:
The Executive Officers of the Corporation shall be a president, one or more Vice Presidents, and a Secretary and a Treasurer. The Officers shall be elected annually by and from the Board of Directors. They shall take office immediately after election. The Officers shall reside within the aforesaid Subdivision.

2. Section 2. President: Subject to the direction of the Board of Directors, the President shall be Chief Executive Officer of the Corporation, and shall perform such other duties as from time to time may be assigned to them by the Board of Directors. The President shall be ex-officio a member of all committees.

2. Section 3. The Vice President(s): The Vice President(s) shall have such power and perform such duties as may be assigned to them by the Board of Directors or the President. In case of the absence or disability of the President, the duties of that officer shall be performed by such Vice President as may be delegated the said duties by the Board of Directors.

2. Section 4. The Secretary: In books provided for that purpose, the Secretary is responsible for keeping the minute of all proceedings of the Board of Directors and of all committees, and the minutes of the members’ meetings and shall publish a newsletter and mail it to all Association members; they shall have custody of the corporate seal and such books and papers as the Board of director may direct. They shall in general perform all the duties incident to the Office of Secretary, but may acquire paid or unpaid services to assist in the duties subject to the control of the Board of Directors or the President. They shall also perform such other duties as may be assigned to them by the President or the Board of Directors.

2. Section 5. The Treasurer: The Treasurer shall have custody of all the receipts, disbursements, funds and securities of the Corporation, and shall perform all duties incident to the office of Treasurer, subject to the control of the Board of Directors or the president. The Treasurer may hire the services of an accountant to perform some of the duties, but is still responsible for the conduct of the office. They shall perform such other duties as may from time to time be assigned to them by the Board of directors or the President. If required by the Board of Directors, they shall give bond for the faithful discharge of their duties, in such as the Board of Directors may require.

ARTICLE III - BOARD OF DIRECTORS

3. Section 1. Number of Members: The business and affairs of this Corporation shall be managed by the Board of Directors, which shall consist of seven (7) members. All of the members of the Board of Directors shall consist of members of the Corporation, and shall be residents of the subdivision aforesaid.

3. Section 2. Executive Committee: The Board of Directors may elect from their number an Executive Committee consisting of not less than three (3) members of the Board of Directors, which committee shall have all the powers of the Board of Directors between meetings, regular or special. The President of the Corporation shall be a member of, and shall be chairman of the Executive Committee.

3. Section 3. Regular Meetings: The Board of Directors shall meet for the transaction of business at such place as may be designated from time to time. All meetings of the Board of Directors are open to all members of the Association and all members so desiring shall be permitted to attend and listen to the deliberation and proceedings. Notice of the meeting will be posted on the RHEIA website and/or in the guardhouse window approximately 5 days prior to the meeting. However, Association members who are not Board members may not participate in any deliberation or expression unless expressly so authorized by a vote of the majority of a quorum of the Board. Any portion of a meeting may be closed to members of the Association if the closed portion of the meeting is limited to consideration of employment of personal matters for employees of the board; or contemplated matters relating to the Association's documents or rules.

3. Section 4. Special Meetings: Special Meeting of the Board of Directors may be called by the President, or by three (3) members of the Board of Directors, for any time and place, but within forty (40) miles of Sedona, provided reasonable notice of such meetings shall be given to each member of the Board of Directors before the time appointed for such meeting. Notice of the meeting will be posted on the RHEIA website and/or in the guardhouse window, not less than 24 hours prior to the meeting.

3. Section 5. Quorum: The Board of Directors shall act only as a Board, and the individual Directors shall have no power as such. A majority of the Directors for the time being in office shall constitute a quorum for the transaction of business, but a majority of those present at the time and place of any regular or special meeting, although less than a quorum, may adjourn the same from time to time, without notice, until a quorum be at hand. The act of a majority of Directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise provided by law.

3. Section 6. Order of Business: The Board of Directors may from time to time determine the order of business at its meetings.

3. Section 7. Chairman: At all meetings of the Board of Directors, the President, or in their absence, a Vice President chosen by the Board of Directors present, shall preside.

3. Section 8. Terms of Members of the Board of Directors: Members of the Board of Directors shall be elected by the members of Corporation. The members of the Board shall elect for a term of 1 to 3 years as needed to maintain a one third turn-over in board position per year.

3. Section 9. Annual Report: The Board of Directors, after the close of the fiscal year, shall submit to the members of the Corporation a report as to the condition of the Corporation and its property, and shall submit also an account of the past year. In addition, they shall also submit to the members of the Corporation a preliminary estimate of the revenues and the expenses for the year ahead.

3. Section 10. Financial and Other: All financial and other records (including minutes of the Board meetings) shall be made reasonably available for examination by any lot owner and their authorized agents. These books and records kept by or on behalf of the Association and the Board may be withheld from disclosure to the extent that they relate to personnel matters, communication between the board and an attorney for the association, pending or contemplated litigation, matters relating to enforcement of the Association’s documents or rules, meeting minute or other records of a session of a Board meeting or Association meeting that is not required to be open to all members as described in Section 3 of this Article.

3. Section 11. Vacancies in the Board of Directors: Whenever a vacancy in the membership of the Board of Directors shall occur, the remaining members of the Board of directors shall have the power, by a majority vote, to select a member of the Corporation who resides in the Subdivision aforesaid to serve until the next annual election by members of the Corporation.

3. Section 12, Board Members Absence: Whenever a Board member is not present for three consecutive meetings or misses three meetings in a continuous six months, the Board has the right to deem the position vacant, and the remaining members of the Board of Directors shall have the power, by a majority vote, to select a member of the Corporation who resides in the Subdivision aforesaid to serve until the next Annual Election by members of the Corporation.

ARTICLE IV - MEETING OF MEMBERS

4. Section 1. Annual Meeting: There shall be annual meeting of the members of the Corporation at such place as may be designated, provided, however, an annual meeting may not be announced for a location exceeding forty (40) miles from Rolling Hills Estates, to be held on the second or third Saturday in March of each year for the transaction of such business as may come before the meeting. Notice of the annual meeting shall be sent to all members between 30 and 50 days prior to the meeting. Thirty (30) days notice is the preferred policy.

4. Section 2. Special Meetings: Special meetings of the members of the Corporation shall be held whenever called by the Board of Directors or the holders of at least ten (10) memberships. Notice of each special meeting, stating the time, place and in general terms, the purpose or purposes thereof shall be sent by certified mail to the last known address of all members of the Corporation at least ten (10) days prior to the meeting.

4. Section 3. Proxy: Every member may cast one (1) vote, either in person or by proxy for each lot owned in fee simple by that particular member, solely or jointly, or by the Corporation owning the lot or lots, of which they are a stockholder and the member thereof.

4. Section 4. Quorum: At any meeting of the members, a quorum shall consist of members owning, jointly or solely, in fee simple, or members representing the Corporation owning in fee simple a majority of the lots in Rolling Hill Estates present, either in person or by proxy, and a majority in amount of such quorum shall decide any question that may come before the meeting.

ARTICLE V - MEMBERSHIPS

5. Section 1. Qualifications: Only persons owning a lot or lots in Rolling Hills Estate, or owning stock in a Corporation owning a lot or lots therein shall be eligible to become a member.
When two or more members are the joint owners of a lot or lots in Rolling Hills Estates, one, and only one, shall become a member. When two or more persons are stockholders in a Corporation owning real property in Rolling Hills Estate, one and only one, shall become a member.
However, any joint owner may serve on any committee formed by the Board of Directors regardless of official membership and shall serve at the pleasure of Board of Directors.
Only members shall be entitled to vote, and each membership shall be entitled to cast one vote for each and every lot, as designated on the plat or plats from time to time of record in Rolling Hills Estates, owned by such membership.
Whenever a member shall cease to own any lot in Rolling Hills Estates, or shall cease to own stock in a corporation that owns a lot or lots therein, such membership shall automatically be dropped from the membership roll of the Corporation.

5. Section 2. Members: A member shall have no vested right, interest or privilege of; in or to, the assets, functions, affair or franchises of the Corporation, or any right, interest or privilege, which may be transferable or inheritable, or which shall continue after the membership ceases.

5. Section 3. Manner of Admission: Anyone purchasing property in Rolling Hills Estates automatically becomes a member of the Rolling Hills Estates Improvement Association, but should submit a written application to the Secretary giving complete information, previous residence, mailing address, telephone number, email address, etc. … and any other necessary information as the Board of Directors may from time to time deem necessary.

5. Section 4. Annual Dues: Every member shall be required to pay annual dues, the amount which shall be determined by the Board of Directors, and may be changed from year to year by the Board of Directors, or by a majority vote of the members. The Board of Directors shall establish a Dues Collection Policy that will specify the collection date for dues. It will also specify the late fee, interest charged, and recording of liens to be implemented by the Board of Directors when dues are not paid on time.

5. Section 5. Membership: There shall be two (2) classes of membership, namely;

Active
Inactive

Only active members may participate in conducting business of Rolling Hills Estates Improvement Association, including voting privileges.
Active members shall be those members who;

Have paid and kept current annual dues and/or assessments in accordance with the terms and provision of these By-Laws.
Are not in breach or violation of the covenants, stipulations and restrictions contained in the Declaration of restrictions pertaining to Rolling Hills Estates and of record of the County Recorder of Coconino County, Arizona, or as the same may from time to time be amended
Are not in breach or violation of the rules and regulations promulgated by the Board of Directors.

All other members shall be deemed inactive members, and inactive member shall have no voting rights during the period that they hold the status of an inactive member. Active members shall be subject to being reduced to the status of inactive members when so determined by the Board of Directors, after finding a breach, violation or default in accordance with any one or more of subparagraphs (a), (b) and (c) of section 5.
An active member may not be reduced to the status of an inactive member until and unless such active member shall have first been served with written notice of the accusations against such member, and shall have been given an opportunity by Board of Directors to produce witnesses, if any, and to be heard.
Notwithstanding anything herein contained to be contrary, the reduction of an active member to the status of an inactive member who continues to own a lot or lots, or interest therein, in Rolling Hills Estates, shall not affect the validity of any special assessment then existing, or thereafter levied, against such lot or lots by the Board of Directors, together with the lien rights vested in the Corporation, arising from a delinquency thereof.

An inactive member shall become an active member upon accomplishment of the following:
(a) Payment to the Corporation of delinquent dues, if any.
(b) Payment to the Corporation of all delinquent special assessment, if any.
(c) Compliance with the covenants, stipulations and restrictions in contained in the Declaration of Restriction aforesaid, if there be a breach or violation thereof.
(d) Compliance with the rules and regulations promulgated by the Board of Directors, if there be a violation thereof.
(d) Payment to the Corporation of the sum of Twenty-Five ($25.00) Dollars.
(f) Application and determination by the Board of Directors to the effect that the applying inactive member is presently in good standing and entitled to regain the status of an active member.

5. Section 6. Expulsion of a Member: Members of the Corporation shall be subject to expulsion by the Board of Directors upon the occurrence of any one or more of the following events:
(a) Entry of a judgment for foreclosure of a lien against a lot or lots represented by such member
(b) Breach or violation of the covenants, stipulations and restrictions contained in the Declaration pertaining to Rolling Hills Estates and of record in the office of County Recorder of Coconino County, Arizona, or as the same may from time to time amended.
(c) Breach or violation of the rules and regulation promulgated by the Board of Directors.
Notwithstanding anything herein contained to the contrary, the expulsion of a member who continued to own a lot or lots, or an interest therein, in Rolling Hills Estates, shall not affect the validity of any special assessment, then existing or thereafter levied against such lot or lots by the Board of Directors, together with the liens rights vested in the Corporation arising from a delinquency thereof.
A member may not be expelled and removed from membership until and unless such member shall have first been served with written notice of the accusation against such member, and shall have been given an opportunity by the Board of Directors to produce witnesses, if any, and to be heard.

ARTICLE VI - LOSS OF PROPERTY

6. Section 1. Non-Liability: The Board of Directors shall not be liable or responsible for the destruction, or the loss of, or damage to, the property of any member, or the guest of any member, or visitor, or other person.

ARTICLE VII - LEVY OF ASSESSMENTS

7. Section l. Levy of Assessments: For the purpose of providing necessary funds to carry out the purposes and objects of the Corporation and necessary operating expenses of the Corporation, there shall be levied annually an assessment against each lot in Rolling Hills Estates as the same may from time to time be constituted, the amount of which shall be determined by at least a two-thirds (2/3rds) majority of the Board of Directors. Upon the levying of such assessment the Secretary shall give immediate notice in writing, by mail, to the last known address of the owner or owners of each lot giving notice of the levying of such assessment and the amount thereof and requiring payment to be made within thirty (30) days of the date of the mailing of such notice. Said notice shall contain the provisions of these By-Laws and of the Declaration of Restrictions respecting the penalty attendant on to pay such assessment promptly when due. In the event of failure to pay the same when due, such assessment shall go upon a delinquency list to be maintained by the Secretary and in the event of failure to pay the same within ninety (90) days from the date of delinquency, then and in such event the officers of the Corporation shall cause to be recorded in the Office of the County Recorder, a proper notice with respect to each delinquency, the amount of money and the number of the lot and the name or names of the owner(s) thereof; all in accordance with the requirements of these By-Laws and of the Declaration of Restrictions against the lots within said Subdivision.

7. Section 2. Lien: In the event of failure of a lot owner to pay such assessment or dues promptly when due, the amount of the assessment or dues shall constitute a lien upon the lot against which such assessment is levied. The Board of Directors is authorized to direct the Secretary of the Corporation to compile a list of all such lots and the amount of the unpaid assessment or dues levied against each such lot and to direct the President and Secretary of the Corporation to certify such unpaid assessments to the County Recorder of Coconino County, Arizona, and to cause the same to be entered as a lien upon the lot against which the assessment was made and unpaid when due, subject to state and county taxes and mortgages of record. The Board of Directors may authorize the President and Secretary of the Corporation to enforce a lien in equity by foreclosure thereof as a real estate mortgage. The foreclosure judgment shall award to the Corporation reasonable attorney's fees and taxable court costs incurred in connection with the foreclosure. The President and Secretary shall release any such lien upon payment of the delinquent assessment or dues by or on behalf of the owner of the lot or lots against which such assessment was made.

7. Section 3. Certificate of Charges: Upon demand, the-President and the Secretary shall furnish to any owner or mortgagee, or person interested, a certificate showing the unpaid assessment charges against any lot or lots.

7. Section 4. Subordination: The Board of Directors may, at their discretion, subordinate in writing, the liens of the Corporation against any lot or lots for the benefit, or better security, of a mortgage to become effective subsequent to the effective date of the lien or liens possessed by the Corporation.

ARTICLE VIII - NOTICE

8. Section 1. Notice: Whenever, according to these By-Laws, a notice shall be required to be given to any member or director, it shall not be construed to mean personal notice, but such notice may be given in writing, by depositing the same in the post office in Sedona, Arizona in a postpaid, sealed wrapper, addressed to such member or director at their address as the same appears on the books of said Corporation, and the date of such mailing shall be deemed the time of giving of such notice.

8. Section 2. Waiver of Notice Any notice required to be given by these By-Laws may be waived by the person entitled thereto.

ARTICLE IX - COMPENSATION

9. Section 1. Compensation: The Board of Directors shall have power to authorize and pay such compensation to employees of the Corporation as the Board of Directors may deem to be in the best interests of the Corporation, provided, however, that no member of the Board of Directors or officer of this Corporation shall receive any compensation either for services performed as an officer or as a member of this Board of Directors.

ARTICLE X - EXPENDITURES

10. Section 1. Expenditures: No officer shall be authorized to incur any expense, liability or indebtedness on behalf of the Corporation in excess of Two Hundred ($200.00) Dollars, except upon the prior approval of the majority of the Board of Directors.

ARTICLE XI - ARCHITECTURAL CONTROL COMMITTEE

11. Section 1. Architectural Control Committee: There shall be one standing Committee, to be known as the Architectural Control Committee. This Committee shall be constituted in accordance with, and shall perform the function and duties set forth in the Declarations of Restrictions pertaining to Rolling Hills Estates and of record in the office of the County Recorder of Coconino County, Arizona or as the same may from to time be amended. The committee shall have the authority to use the services of a qualified consultant, and to charge a sum not exceeding Five Hundred Dollars ($500) for each set of plans and specifications submitted to it for approval to defray of plan checking. In addition, the Architectural Control committee shall have the authority to use the services of a qualified consultant to inspect the premises during the construction process as may be provided by for by the then most current Architectural Control Committee Guideline. The committee may charge prospective builders $500 for plan and specification review, and may require a security deposit in advance to cover the cost of inspection review, road and site repair, cleanup, etc. as provided in the New Home Construction Fee Schedule.

ARTICLE XII - AMENDMENTS

12. Section 1. Amendments: The By-laws of this Corporation may be amended, altered or repealed by the affirmative vote of the majority of the Board of Directors at any regular meeting, subject only to a repeal of the change by action of the members at any succeeding annual meeting.

ARTICLE XIII - CORPORATE SEAL

13. Section 1. Corporate Seal: The corporate seal of the Corporation be in the form of two (2) concentric circles, between their circumference appearing the name of the Corporation, ROLLING HILLS ESTATES IMPROVEMENT ASSOCIATION, and within their inner circle appearing the words, Corporate seal — 1969-Arizona. The corporate seal shall remain in the custody of the Secretary, and shall be affixed by them to all certificates of membership of the Corporation, and to all instruments in writing requiring the corporate seal for complete execution. An impression thereof is directed to be affixed to these By-laws below this section.

ARTICLE XIV - FISCAL YEAR

14. Section 1. Fiscal Year: The Fiscal year of the Corporation shall begin on the 1st day of January, and terminate on the 31st day of December each calendar year.

ARTICLE XV - FINES

15. Section 1. Schedule of Fines: The Board of the Directors of the Corporation (hereinafter called the "Board"), by majority vote or written consent shall adopt a schedule specifying the recommended fines (or range of fines) for particular violations (or categories of violations) of the Second & Third Amended Declaration of Covenants, Conditions and Restrictions (CC&R's), as the same may be amended from time to time or of the Architectural Control Committee Review Guidelines provided, however, that no fine shall exceed the maximum sum authorized by the Board by a majority vote. The Board is authorized to enforce property restriction in the CC&R's and the Architectural Control Committee Review Guidelines (collectively the "Restrictions") by levying fines pursuant to the Schedule of Fines authorized herein. The Board’s authority to levy fines shall not preclude an action by the Association for injunctive relief, as provided in the Restrictions. In any particular case, the Association may levy a fine, seek injunctive relief, or pursue both remedies.
The Association's authority to enforce the Restrictions shall not preclude enforcement by other persons, as provided in the CC&R's as amended. It is expressly recognized that it would be impractical or extremely difficult to fix actual damages in the case of breach of the Restrictions. The schedule of fines and any actual fines imposed shall be deemed a reasonable estimate of the damages of the Association and its members in case of breach of the Restrictions. The fines, therefore, shall be in the nature of liquidated damages.

15. Section 2. Notice of Violation: No action shall be taken with respect to any reported violation of the Restrictions until at least one Architectural Control Committee member has observed the lot to determine that the violation exists. If the Architectural Control Committee member is denied access to the lot by the Owner, the violation shall be deemed to exist. The Architectural Control Committee shall issue written notice of each violation to the Owner of the lot on which the violation exists, as determined, with reference to the Association Membership Book. The notice shall specify,

The nature of the violation, including the particular Restriction (s) being violated;
The steps required to comply with the Restriction(s);
The time period allowed for compliance; and
The consequence of non-compliance, including the potential fine.

The notice may be issued by the Architectural Control Committee and shall be mailed or delivered to the Owner.

15. Section 3. Report of Non-Compliance/Notice of Fine: As soon as practicable after the compliance deadline stated in the notice of violation, an Architectural Control Committee member shall inspect the lot to determine whether the violation has been cured. If the Architectural Control Committee member is denied access to the lot by the Owner, the violation shall be deemed to be continuing.
The committee member who inspects the lot shall prepare a brief report of compliance or noncompliance. If the violation has not been cured, the report shall recommend an appropriate fine pursuant to the schedule of fines. The Architectural Control Committee shall review the report and, pursuant to the vote or written consent of a majority of the Architectural Control Committee, shall accept, reject, or modify the recommended fine. Written notice of the recommended fine (or other action of the Architectural Control Committee) and the date, time and place that the Board shall consider whether or not to impose the fine shall be issued to the Owner as soon as practicable and at least three days prior to the meeting of the Board.
If at the meeting of the Board, the Board actually imposes a fine, the Board shall promptly give notice of the assessment of the fine as set forth in Section 4.

15. Section 4. Assessment of Fine: The notice of the fine shall specify:

The amount of the fine. Any fine computed on a daily basis shall be retroactive to the deadline for compliance specified in the original notice of violation.
Deadline for payment.
Method of Payment
Procedure for requesting a hearing
Consequence of non-payment.

15. Section 5. Right of Hearing: If the Owner wishes to dispute the fine, a written request for hearing shall be provided to the Board within ten (10) days after the Owner receives the notice of fine. The request for hearing shall be mailed or delivered to the Board at the Association’s principal office.
As soon as practicable after receiving the request for hearing, the Board shall fix a date, time, and place for the hearing and shall notify the Owner in writing at last ten (10) days before the hearing date. The hearing be no later thirty (30) days after the Board receives the request for hearing.
The chairperson of the Board shall preside at the hearing, which shall be an informal proceeding. A written record, which need not be a verbatim transcript, shall be kept unless the parties agree to having the hearing recorded on tape. The Owner, may be represented by an attorney or other qualified person, provided that written notice is given to the Board at least (3) days before the hearing. The Owner shall be solely responsible for any fees or other of expenses such attorney or representative.
Within ten (10) days after the hearing, the Board shall inform the owner of it’s decision in writing. The Board may take any action, which seems reasonable under the circumstances including, without limitation, reducing or vacating the fine or extending the time for compliance. The action shall be approved by the vote or written consent of a majority of the Board.

15. Section 6. Fines have same effect as Assessment: The effect of a fine, as well as the respective rights and obligations of the Association and the Owner with respect to a fine, shall be the same as for assessments under the article of the CC&R's titles "Homeowner's Association".

ARTICLE XVI - PARLIAMENTARY ORDER

16. Section 1. Parliamentary Order: The rules contained in the latest edition of Robert's Rules of Order shall guide the Association in all cases in which they are applicable and in which they are not inconsistent with Arizona law, Articles of Incorporation, these By-Laws and any special rules the Association may adopt.

BY LAWS OF ROLLING HILLS ESTATES IMPROVEMENT ASSOCIATION(a non-profit Arizona Corporation)

ARTICLE I - PURPOSE

​ARTICLE II - OFFICERS