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1. General Provisions

1.1 Purpose. The Loreto Bay Master Condominium is established pursuant to Law. The purpose of these Master Rules is to govern the use, development, construction, management, administration and maintenance of Private Units, Sub-Condominium Units, and Master Common Areas within the Master Condominium and the relationships between Owners, Master Representatives, and Administrators. Any Person who acquires an interest in any Private Unit or Sub-Condominium Unit is automatically subject to these Master Rules. These Master Rules are intended to establish the broad parameters of governance for the Master Condominium, are based the Law, and will not require frequent amendment. Policies, standards, and guidelines that may be subject to change based on the fluctuating needs of the Master Condominium will be established through the resolutions passed by the Master Condominium Assembly pursuant to the Master Rules and the Law.

1.2. Applicable Law. The Loreto Bay Master Condominium is subject to the Law. These Master Rules must be construed and interpreted in accordance with the Law. In the event any provision of these Master Rules is found to be contrary to the Law or to be invalid by a court of competent jurisdiction, the remaining provisions of these Rules will remain in full force and effect.

1.3. Jurisdiction. Disputes or controversies arising under or relating to the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, and all other applicable rules, regulations, standards, resolutions or guidelines issued by the Master Condominium Assembly are subject to the jurisdiction of the courts of Baja California Sur, Mexico, and any disputes or controversies that are not resolved pursuant to the procedures established in the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, and all other applicable rules, regulations, standards, resolutions, or guidelines issued by the Master Condominium Assembly may be submitted to such courts.

1.4. Modification to Master Condominium Declaration. The Master Condominium Declaration may be amended from time to time exclusively by the Master Condominium Assembly with the approval of 75% (seventy-five percent) of the Undivided Interest Percentage with rights to vote. If necessary, Owners must carry out all of the acts and grant all consents required to effect the corresponding amendment to the Master Condominium Declaration, including amendment of any Sub-Condominium Declaration, if necessary.

1.5. Binding Effect. The Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, and all other applicable rules, regulations, standards, resolutions, or guidelines issued by the Master Condominium Assembly are binding upon all Persons acquiring an interest in a Private Unit or Sub-Condominium Unit or any Occupants thereof, subject to the Law, except that property that is Exempt Property is not subject to these Master Rules.

1.6. Notice.

(a) Notice to the Administrators. Whenever notice must be provided to Administrators pursuant to the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, any other applicable rule, regulation, standard, resolution, or guideline issued by the Master Condominium Assembly, or the Law such notice must be in writing and must be delivered to the Administrators Office.

(b) Notice to Owners. When notice must be given to an Owner, unless otherwise required by the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, any other applicable rule, regulation, standard, resolution, or guideline issued by the Master Condominium Assembly, or the Law, notice shall be deemed effective and sufficient when posted in a prominent location on the Owners property in the presence of two witnesses. Administrators must cause a record of the names and addresses of such witnesses to be made, as well as the date and time on which the posting occurred, and the record must be maintained in the Administrators Office for a period of five years or for such longer period as may be required by the Law. Administrators may send additional notices to the affected Owner by email or contact the Owner personally as a courtesy; however, Administrators are not required to take such additional steps to give notice, unless otherwise required by the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, any other applicable rule, regulation, standard, resolution, or guideline issued by the Master Condominium Assembly, or the Law, and any failure to deliver such additional notices or to contact an Owner personally shall not be grounds for a claim that notice was not provided if notice was delivered by posting on the Owner’s property pursuant to this section.

1.7. Captions and Exhibits; Construction. Captions given to various sections herein and the Table of Contents for these Master Rules are for convenience only and are not intended to modify or affect the meaning of any of the substantive provisions of these Master Rules. Any exhibits referred to in these Master Rules are incorporated as though fully set forth where the reference is made. The provisions of these Master Rules must be liberally interpreted to allow the creation of a uniform plan for the development and operation of the Master Condominium as set forth in these Master Rules.