SHIPLEY'S CHOICE HOMEOWNERS ASSOCIATION, INC. ARTICLES OF AMENDMENT AND RESTATEMENT SECOND

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SHIPLEY'S CHOICE HOMEOWNERS ASSOCIATION, INC., a Maryland corporation, having its principal office at 2 Evergreen Road, P.O. Box 1473, Severna Park, Maryland 21146 (hereinafter referred to as the "Association") hereby certifies to the State Department of Assessments and Taxation of Maryland (the "Department") that:

FIRST: The Association desires to amend and restate its Charter as currently in effect as hereinafter provided. The provisions set forth in these Articles of Amendment and Restatement Second are all the provisions of the Charter of the Corporation as currently in effect.

SECOND: The Charter of the Corporation is hereby amended by striking in their entirety Articles FIRST through TENTH, inclusive, and by substituting in lieu thereof the following:

FIRST: The name of the corporation (which is hereinafter called the
"Association") is: SHIPLEY' S CHOICE HOMEOWNERS ASSOCIATION, INC.

SECOND: The Association is not formed for pecuniary gain or profit, direct or indirect, to itself or its members. The purposes for which the Association is formed are as follows:

To organize and operate a non-profit civic organization, which shall be organized and operated exclusively for the promotion of the health, safety, common good and social welfare of the owners of property in, and the residents of that development in Anne Arundel County known as SHIPLEY'S CHOICE and located upon the Property described in that certain Amendment and Restatement of Declaration of Covenants, Conditions and Restrictions dated the 1st day of October, 1983, and all Amendments thereto (hereinafter referred to as the "Declaration"), and recorded among the Land Records of Anne Arundel County, Maryland in Book 3684, pages 49 et seq. and such additions thereto as may hereafter be annexed thereto pursuant to the provisions of the Declaration.

For the general purpose aforesaid, and limited to that purpose (hereinafter sometimes referred to as the "Purpose"), the Association shall have the following specific purposes:

  1. To do any and all lawful things and acts within its powers, as hereinafter set forth, which the Association from time to time may deem to be appropriate in order to benefit, aid, promote and provide for peace, health, safety, convenience, comfort and the general welfare of the owners of property in, and the residents of, the property;
  2. To conduct all activities and perform all responsibilities relating to the operation, maintenance and development of community facilities and services within the Property, as the same are more fully set forth in the Declaration.
  3. To operate and maintain any and all property or facilities which it may acquire for the use and benefit of its members.

Solely in aid of the Purposes of the Association, the Association shall have the following powers:

  1. To purchase, lease, hire, receive donations of, or otherwise acquire, hold, own, develop, improve, maintain and operate and to aid and subscribe toward the acquisition, development or improvement, of real and personal property, and rights and privileges therein, suitable or convenient for the purposes of the Association.
  2. To purchase, lease, hire, receive donations of, or otherwise acquire, hold, own, develop, erect, improve, manage, maintain and operate, and to aid and subscribe toward the acquisition, construction or improvement of, systems, buildings, machinery, equipment and facilities, and any other properly or appliances which may appertain to or be useful in the accomplishment of the Purposes of the Association.
  3. To impose, collect and disburse dues and assessments in accordance with and subject to the provisions of the Declaration.
  4. To solicit, receive and accept donations of money or property or any interest in property from the State of Maryland, County of Anne Arundel, or any subdivision of either, the Federal Government or any agent or instrumentality thereof, or from any person or entity.
  5. To raise money for any particular facilities or service which the Association proposes to provide by means of payment of dues or special assessments by its members and to provide, operate and maintain, and supervise the use of any such facility or service upon the voluntary payment of such dues or assessments by its members;
  6. To make contracts, incur liabilities, and borrow money and to issue bonds, notes or other obligations and secure the same by mortgage or deed of trust of all or any part of the Property, franchise or income owned by the Association and to guarantee the obligations of others in which it may be interested for the furtherance of the Purposes of the Association;
  7. To undertake and prepare or cause to be prepared studies, plans, recommendations, budgets and any other similar things (for submission to any public authority, civic group or association, or for its own use) which relate to any phase or aspect of the physical, social or cultural development of the Property, and to crate, or cause to be created, committees and other organizations for the supervision and implementation thereof;
  8. To engage in and sponsor civic activities relating to the cultural, educational, social and civic affairs of the owners of properly in, or residents of, the Property, and to appear before and represent its members in or before other civic groups, associations, boards or other like organizations;
  9. To sponsor, engage in, conduct and encourage cultural, educational, social and civic and other beneficial activities relating to the Property.
  10. To have and exercise to the extent necessary or desirable for the accomplishment of the aforesaid specific purposes and to the extent that they are not inconsistent with the Purposes of the Association, any and all powers conferred upon corporations of a similar character by the General Laws of the State of Maryland.

THIRD: The post office address of the principal office of the Association in this state is 2 Evergreen Road, P.O. Box 1473, Severna Park, Maryland 21146. The name and post office address of the Resident Agent of the Association is Kathleen M. Elmore, 2 Evergreen Road, P.O. Box 1473, Sevema Park, Maryland 21146. Said Resident Agent is an individual, 18 years old or older, actually residing in this State.

FOURTH: The Association is not authorized to issue capital stock.

FIFTH: Every Owner shall automatically be a member of the Association. "Owner", for purposes of this Article Sixth shall mean and include the owner of the fee simple or long term leasehold interest in any lot within the property described in the Declaration, or any common or joint interest therein if such lot is owned by more than one person or entity.

No person or other entity shall be a member of the Association after he ceases to own or hold the interest in a portion of the properly which theretofore qualified him for membership under the provisions set forth above.

Contract sellers of any of the interests set forth above in connection with qualification for membership in the Association shall be members, but those having an interest merely as security for the performance of an obligation shall not be members of the Association.

SIXTH: All members, so long as the same shall qualify under Article Fifth above, shall be entitled to vote on each matter submitted to a vote at a meeting of members. There shall be two classes of members, Class A and B. The Class A members shall be all Owners of Lots with the exception of the Declarant under the Declaration. The Class B member shall be the Declarant. The Class B member shall be entitled to one (1) vote for each lot in which it holds an interest. However, the Class B membership shall cease and be converted to Class A membership on the first to occur of the following: (i) when Declarant no longer owns any real properly subject to the Declaration, or (ii) December 31, 1999, or (iii) in the event of annexation of additional properties, Class B membership shall be revived with respect to those lots contained in the annexed property; provided, however, that this Class B membership shall cease and be converted to Class A membership twenty (20) years from the date of recordation of the deed of
Dedication for such annexed property.

Each Class A member of the Association shall have one vote, subject to the following exceptions and conditions:

  1. If any Class A member owns or holds more than one lot, such member, subject to the provisions of this Article Sixth, shall be entitled to one vote in each issue for each Lot held.
  2. When any lot is owned or held by more than one Class A member as tenants by the entireties or in joint tenancy or tenancy in common or any other manner of joint or common ownership or interest, such members shall collectively be entitled to only one vote relative to that lot, and if such members cannot jointly agree as to how that vote should be cast, no vote shall be allowed with respect to such lot, unit, share, membership or other interest. If a Lot is owned by two or more persons, the vote of any one of these owners binds all, unless the secretary of the Association is provided written notice to the contrary, and is furnished with a true copy of the instrument or order which so provides for a designated authorized person to vote on behalf of that Lot's appurtenant membership.
  3. Any Class A member who is in violation of the Declaration, as determined by the Board of Directors, or who fails to pay any dues or any special assessment established by the Association shall not be entitled to vote during any period in which any such dues or assessments are due and unpaid or in which such violation continues.
  4. The Board of Directors may make such regulations, consistent with the terms of the Declaration and this Charter, as it deems advisable for any meeting of members, in regard to proof of membership in the Association, evidence of right to vote, the appointment and duties of inspectors of votes, registration of Class A members for voting purposes, and such other matters concerning the conduct of meetings and voting as it shall deem fit.
  5. On any matter submitted to the members for vote, any member entitled to vote may cast a vote without attending the meeting in question by either of the following procedures, at the member's election:

Any vote cast under either of the procedures set forth herein shall have the same force and effect as if the member in question had appeared at the meeting and had cast the vote in person.

SEVENTH: The affairs of the corporation shall be managed by a Board of three to seven (3 to 7) Directors, all of who shall be members of the Association.

Any vacancy occurring in the Board of Directors may be filled at any meeting of the Board of Directors by the affirmative vote of a majority of the remaining directors, though less than a quorum of the Board of Directors, or by a sole remaining director, and if not previously so filled, shall be filled at the next meeting of members of the Association. Any director so elected to fill a vacancy shall serve as such until the expiration of the term of the director, the vacancy in whose position that director was elected to fill.

EIGHTH: The following provisions are hereby adopted for the purpose of defining, limiting and regulating the powers of the Association and of the directors and members:

  1. The Board of Directors shall have power to determine from time to time whether and to what extent and at what times and places and under what conditions and regulations the books, accounts and documents of the Association or any of them shall be open to the inspection of members, except as otherwise provided by statute or by the By-Laws.
  2. The Association may enter into contracts and transact business with any director or member or with any corporation, partnership, trust or association of which any director or member is a stockholder, director, officer, partner, member trustee, beneficiary, employee or in which any director or member is otherwise interested; and such contract or transaction shall not be invalidated or in any way affected by the fact that such director or member has or may have an interest therein, which is or might be adverse to the interests of the Association, provided that the fact of such interest shall be disclosed or known to the other directors or members acting upon such contract or transaction; and such director or member may be counted in determining the existence of a quorum at any meeting of the members or the Board of Directors which shall authorize any such contract or transaction and may vote thereat to authorize any such contract or transaction, with like force and effect as if he were not so interested. No director or member having disclosed or made known an adverse interest shall be liable to the Association or any member or creditor thereof or any other person for any loss incurred by the Association under or by reason of any such contract or transaction, nor shall any such director or member be accountable for any gains or profits realized there from.
  3. Any contract, transaction or act of the Association or of the Board of Directors which shall be ratified by a majority of the members of each class having voting powers and attending any annual meeting, or attending any special meeting called for such purpose, shall so far as permitted by law be as valid and as binding as though ratified by every member of the Association, provided that a quorum of members shall be present at any such meeting.
  4. Any person who is serving or has served as a director or officer of the Association may be indemnified by the Association, insofar as it is able, and insofar as the Board of Directors shall by resolution determine, against expense actually and necessarily incurred by him in connection with the defense of any action, suit or proceedings in which he is made a party by reason of having been such a member or director, except in relation to matters as to which such person is adjudged in such action, suit or proceeding to be liable for negligence or misconduct in the performance of duty.
  5. The presence of members holding one tenth (1/10th) of the total votes eligible to be cast shall constitute a quorum at any meeting of members, whether present in person or by proxy. If a quorum is not present at any meeting of members, a majority of the members present may call a further meeting of members, in accordance with the provisions of Section 5-206, the Corporations and Associations Article of the Annotated Code of Maryland as from time to time amended, or other applicable law and at such further meeting a quorum shall be the members present in person or by proxy, and by majority vote of those present in person or by proxy may approve or authorize any proposed action, and take any other action, including, without limitation, the election of directors, which might have been taken at the original meeting, if a sufficient number of members had been present.
  6. The Association reserves the right to make from time to time and at any time any amendment to its Charter, as then in effect, which may be now or may hereafter be authorized by law, provided, however, that the Declaration may be amended only as therein set forth, and provided that no amendment shall be made except upon the affirmative vote of (i) two-thirds (2/3) of the Board of Directors then in office, and, (ii) a majority of the members entitled to vote.
  7. There shall be no liquidation, dissolution, or winding up of the Association, nor any transfer of any of the assets of the Association except upon the affirmative vote of two-thirds (2/3) of the Board of Directors then in office, and, in addition (i) upon the affirmative vote of at least two-thirds (2/3) of each class of membership entitled to vote, or (ii) upon the execution by members of each Class entitled to cast two-thirds (2/3) of the votes of those entitled to vote of a written instrument approving the proposed action. Upon any liquidation, dissolution or winding up of the Association hereunder, the property of the Association, both real and personal shall be dedicated to and vested in any non-profit corporation formed and operated for purposes similar to those set forth herein for the Association, Anne Arundel County, the State of Maryland, or the United States of America, in the order stated.
  8. The Board of Directors of the Association shall in each year elect from among its members a President who shall preside at all meetings when present.
  9. The Board of Directors shall designate one (l) person (who need not be a member of the Association) to serve as the Manager (or Financial Advisor) of the Association. The Manager of the Association shall, ex officio, be the chief financial officer of the Association. It shall be the function and the responsibility of the Manager of the Association to (i) attend all meetings of members, and meetings of the Board of Directors, and to maintain appropriate corporate records of all proceedings; (ii) to keep the fiscal records of the Association and to assist in the preparation of budgets in connection with the conduct and operation of the affairs of the Association; (iii) generally to advise the Association in the conduct and operation of its financial affairs; and (iv) to administer and manage the day-to-day financial affairs of the Association under the general supervision of the Board of Directors.
  10. The Board of Directors of the Association may from time to time establish dues and assessments to be payable by the members of the Association, in accordance with the provisions of the Declaration.
  11. In exercising the right granted. To the Association hereunder to place mortgages or deeds of trust on any part of the property owned by the Association, the Board of Directors shall have the right, without referring the matter to a vote of the Association, to place a mortgage or deed of trust on a portion of the property, provided that the proceeds of such mortgage or deed of trust, after paying any expenses incurred in connection with such borrowing, are devoted solely to the construction of improvements on that part of the property so subjected to the mortgage or deed of trust. All mortgages or deeds of trust not specifically permitted by the preceding sentence must be submitted to and approved by a majority of each Class of the members of the Association entitled to vote.

NINTH: The duration of the Association shall be perpetual.

WHEREAS: by action taken by not less than two-thirds of the Board of Directors of the Association, pursuant to and in accordance with Section 2-603 and 2-609 of the Corporations and Associations Article of the Annotated Code of Maryland, the Board of Directors of the Corporation duly advised the foregoing Articles of Amendment and Restatement Second, and by the affirmative vote of a majority of each class of members of the Corporation this day of, 1998 in accordance with the Corporations and Associations Article of the Annotated Code of Maryland, the members of the Corporation duly approved said Articles of Amendment and Restatement.

IN WTTNESS WHEREOF, Shipley's Choice Homeowners Association, Inc. has caused these presents to be signed in its name and on its behalf by its President and its corporate seal to be hereunder affixed and attested by its Secretary on this day of 1998, and its President acknowledges that this Articles of Amendment and Restatement Second are the act and deed of Shipley's Choice Homeowners Association, Inc. and, under the penalties of.

 

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