137 CARLTON AVENUE

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E: At closing, each Purchaser shall deposit an Initial Capital Payment equal to two (2) months' estimated monthly common charges for the unit. See "Working Capital Fund." Note F: The projected real estate taxes for the first year of operation contained on Schedule A are based on an assessment of the building before construction is complete. Purchasers are advised that real estate taxes may increase materially when the Building is reassessed after construction is complete. The assessed valuation for the building after construction is complete is projected to be approximately $748,971.00, resulting in taxes of approximately $91,637.00 based on a tax rate of $12.235 per One Hundred Dollars of assessed valuation. See Footnote D to Schedule A for more information regarding the projected assessed valuation after completion of construction. * At closing, each Purchaser shall pay an additional $1,000.00 to defray Sponsor's costs of forming the condominium. See Section "Unit Closing Cos

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izes deductions will be entitled to deduct, for Federal income tax purposes, real estate taxes assessed against his Unit as well as interest on any mortgage indebtedness secured by his Unit. 1 See Sections 163 (interest) and 164 (taxes) of the Internal Revenue Code of 1986, as amended (the "Code"); Revenue Ruling 64-31, 1964-1 (Part I) Cum. Bull. 300.2 These expenses will be deductible when paid or accrued in accordance with the Unit Owner's method of accounting. Under the Tax Cuts and Jobs Act of 2017, the amount of the all state and local taxes able to be deducted, including property tax, is limited to $10,000.00 and the mortgage int erest 1 However, the Internal Revenue Code of 1986, as amended, provides that if the Unit Owner has more than two (2) residences, he/she will not be able to deduct his/her interest of his/her condominium unit loan. See section "Taxes: Deductions to Unit Owners and Tax Status of the Condominium." 2 The New York State and City tax laws inc

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.......... 105 W. COUNSEL'S INCOME TAX OPINION ........................................................................................... 111 X. RESERVE FUND ............................................................................................................................... 117 Y. WORKING CAPITAL FUND ............................................................................................................ 118 Z. CONTRACTS ...................................................................................................................................... 119 AA. IDENTITY OF PARTIES ................................................................................................................. 120 AB. REPORTS TO UNIT OWNERS ...................................................................................................... 122 AC. RESERVATION OF AIR AND DEVELOPMENT RIGHTS .......................................................... 123 AD. DOCUMENTS ON FILE .

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chaser will be required to deposit with the Board an amount equal to two (2) months’ Common Charges for his Unit. 90% of this fee will be used as Working Capital and 10% shall be deposited into the Reserve Account. See Section “Reserve Fund” and “Working Capital Fund”. (iv) Insurance Adjustment. At Closing, Sponsor will collect each Purchaser’s pro-rated share in the first year’s insurance premium from the Closing Date until the end of the first year of operation. This amount will be calculated in proportion to each Purchaser’s percentage of Common Interest and will be used to reimburse Sponsor for payment of the first year’s premium. Purchasers will also pay the second year’s premium in proportion to their Common Interest as part of monthly Common Charges. The Board and the Sponsor will not adjust for insurance. See “Unit Closing Costs and Adjustments”. (v) Defrayment of Sponsor Expenses. Each Purchaser shall pay an additional $1,000.00 at Closing to defray Spo

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s will receive a full refund of the Down Payment. See Section "Procedure to Purchase" for details. (S) No representation is made that the initial working capital fund will be adequate to cover current or future expenses, including repairs or replacements, and if additional funds are required, the Board may increase Common Charges or impose a special assessment . See Section “Working Capital Fund” for details. (T) There will be a reserve fund to provide for major capital repairs or improvements. Since the reserve fund contributions will be collected monthly as part of Common Charges, the reserve fund will not be fully funded until after the first year of operations. At this time, Sponsor has no knowledge of any capital improvements that may have to be made during the first five years of Condominium operation. If the amount in the reserve fund is inadequate to cover major capital improvements needed, there may be an increase in Common Charges or special assessment impose

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in stead. During any such delay, Sponsor will timely pay all expenses of the Condominium, including but not limited to, insura nce premiums and any reserve fund payments. Such expenses will not include individual Unit Owner expenses such as real estate taxes or utility charges. Upon commencement of collection of Common Charges, there will not be any assessment for any item in the approved budget for the Condominium. Sponsor shall remain obligated to update the budget for the Condominium as required by governing regulations. In the event Sponsor elects to delay the collection of Common Charges, Sponsor shall disclose such fact in the Notice of Closing and in the post-closing amendment to the Offering Plan. Such amendment shall also disclose the anticipated period of delay. Sponsor will notify all Unit Owners in writing of the expiration of the delay period at least thirty (30) days p rior to the commencement of collection of Common Charges and will disclose such fact in the f

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and any alteration, addition, or improvement to, the Common Elements; (ii) the establishment and/or maintenance of a general operating reserve or a reserve fund for working capital, for replacements with respect to the Common Elements, or to make up any deficit in the Common Charges for any prior year(s); (iii) the purchase, lease, or sublease by the Condominium Board or its designee, corporate or otherwise, on behalf of all Unit Owners, of any Unit whose owner has elected to sell, lease, transfer, or convey the same or that is to be sold at a foreclosure or other sale; and (iv) generally, the conduct of the affairs of the Condominium. 13. Common Interest: The proportionate, undivided interest in fee simple absolute in the Common Elements appertaining to each Unit, as expressed in the Declaration of Condominium. 14. Condominium: The 137 Carlton Avenue Condominium which was established pursuant to the terms of the Declaration and is to be governed pursuant to the terms

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E: At closing, each Purchaser shall deposit an Initial Capital Payment equal to two (2) months' estimated monthly common charges for the unit. See "Working Capital Fund." Note F: The projected real estate taxes for the first year of operation contained on Schedule A are based on an assessment of the building before construction is complete. Purchasers are advised that real estate taxes may increase materially when the Building is reassessed after construction is complete. The assessed valuation for the building after construction is complete is projected to be approximately $748,971.00, resulting in taxes of approximately $91,876.00 based on a tax rate of $12.267 per One Hundred Dollars of assessed valuation. See Footnote D to Schedule A for more information regarding the projected assessed valuation after completion of construction. * At closing, each Purchaser shall pay an additional $1,000.00 to defray Sponsor's costs of forming the condominium. See Section "Unit Closing Cos

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, services & supplies (7) $ 15,600.00 Insurance (8): $ 7,500.00 Legal fees (9): $ 1,000.00 Audit fees (9): $ 1,500.00 Reserve Fund for Major Repairs (10): $ 3,900.00 $ 38,677 If the First Closing actually occurs, or is revised by amendment to the Plan to be projected to occur, six (6) months or more from the stated anticipated date of the First Closing, Sponsor will amend the Plan to include a revised budget disclosing updated projections. If such amended projections exceed the original projections by 25% or more, Sponsor will offer all Purchasers the right to rescind their offer to purchase and to have their Down Payments refunded. If such right to rescind is exercised within fifteen (15) days after presentation of the amendment, the Down Payment and unexpended sums for special work ordered will be refunded within ten (10) days of Sponsor’s receipt of the notice of rescission. Sponsor may not declare the plan effective w

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g instead. During any such delay, Sponsor will timely pay all expenses of the Condominium, including but not limited to, insurance premiums and any reserve fund payments. Such expenses will not include individual Unit Owner expenses such as real estate taxes or utility charges. Upon commencement of collection of Common Charges, there will not be any assessment for any item in the approved budget for the Condominium. Sponsor shall remain obligated to update the budget for the Condominium as required by governing regulations. In the event Sponsor elects to delay the collection of Common Charges, Sponsor shall disclose such fact in the Notice of Closing and in the post-closing amendment to the Offering Plan. Such amendment shall also disclose the anticipated period of delay . Sponsor will notify all Unit Owners in writing of the expiration of the delay period at least thirty (30) days prior to the commencement of collection of Common Charges and will disclose such fact in the fo

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ling on Board rights or overseeing unit owners’ meetings. There is no attorney on retainer, and the Board may choose an attorney when needed. 10. Reserve Fund for Major Repairs. This item is to provide for major capital expenses, which is the maintenance, improvement or replacement of any aspect of the property that will either enhance the overall value of the property, adapt it to new uses, or increase its useful life. Examples of a major repair or major capital expense are replacement of the roof or the windows, etc. The basis of the figure projected for this item is greater than ten percent (10%) of the Common Charges. At this time, Sponsor has no knowledge of any capital improvements that may have to be made during the first five years of Condominium operation. In the event there is a need for major capital expenditure in excess of the funds available from the reserve fund , the Condominium Board will assess a charge to each Unit Owner in accordance with its percentag

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required to deposit with the Board two (2) months’ estimated monthly Common Charges for his unit. 90% of this payment shall be deposited into the working capital fund bank account and may be used as working capital . 10% shall be deposited into the separate Reserve Fund Bank Account. F. Sponsor’s Attorney Fees. Purchaser shall pay a fee of $2, 250.00 to Jeffrey Zwick and Associates, P.C., 266 Broadway, Suite 403, Brooklyn, New York 11211 for services rendered in connection with preparing documents. Should Sponsor's counsel be required to attend a Closing outside their office at the request of Purchaser or its representatives, Purchaser will be responsible for paying an attendance fee of $500.00. In addition, there shall be a fee of $200.00 per hour if the duration of the Closing exceeds two (2) hours due to the fault of Purchaser or its representatives . There is an additional fee of $250.00 for any work in connection with obtaining a mortgage. There shall be a fee of

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ng instead. During any such delay, Sponsor will timely pay all expenses of the Condominium, including but not limited to, insurance premiums and any reserve fund payments. Such expenses shall not include individual Unit Owner’s expenses such as real estate ta xes or utility charges. Upon commencement of collection of Common Charges, there will not be any assessment for any item in the approved budget for the Condominium. Sponsor shall remain obligated to update the budget for the Condominium as required by governing regulations. In the event Sponsor elects to delay the collection of Common Charges, Sponsor shall disclose such fact in the Notice of Closing and in the post -closing amendment to the Offering Plan. Such amendment shall also disclose the anticipated period of delay. Sponsor will notify all Unit Owners in writing of the expiration of the delay period at least thirty (30) days prior to the commencement of collection of Common Charges and will disclose such fact in t

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S. CONTROL BY SPONSOR Page 84 b. create an additional reserve fund for repairs, alterations, unanticipated expenses and/or contingencies which exceed 5% of the projected common expenses for the budget year; c. increase, decrease, eliminate or otherwise change the number, type, classification or working hours of the building’s service staff (if any), or to hire additional service staff. d. increase, decrease, or eliminate building services; e. increase, decrease, eliminate or otherwise change the amounts or types of insurance coverage from the coverages existing on the date of the First Closing. (ii) Borrow money on behalf of the Condominium Association. B. Limitations on Veto Control. Sponsor may not exercise veto power over expenses described in Schedule B, or over expenses required: (i) to comply with applicable laws or regulations; (ii) to remedy any notice of violation; (iii) to remedy any work order by an insurer ; or (iv) to remedy any immediately hazardo

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Charges. During any such delay, Sponsor will timely pay all expe nses of the Condominium, including but not limited to, insurance premiums and any reserve fund payments. Such expenses shall not include individual Unit Owner’s expenses such as real estate taxes or utility charges. Upon commencement of collection of Commo n Charges, there will not be any assessment for any item in the approved budget for the Condominium. Sponsor shall remain obligated to update the budget for the Condominium as required by governing regulations. In the event Sponsor elects to delay the collection of Common Charges, Sponsor shall disclose such fact in the Notice of Closing to Purchasers and in the post -closing amendment to the Offering Plan. Such amendment shall also disclose the anticipated period of delay. Sponsor will notify all unit owner s in writing of the expiration of the delay period at least thirty (30) days prior to the commencement of collection of common charges and will disclo

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dominium at least ten (10) days prior to the date set for the adoption of such budget. 4. Capital Reserves. The Board has the power to accumulate reserve funds for capital replacements or other purposes to meet the needs of the Condominium in accordance with the Declaration and By-Laws. There are no restrictions on these powers. 5. Repair and Maintenance Of Units and Common Elements A. Maintenance. (i) First Class Condition. Each Unit and all portions of the Common Elements shall be kept in first-class (same as new, excepting normal wear and tear) condition, order and repair (and free of snow, ice and accumulation of water with respect to any terrace, patio, roof or other part of the Property exposes to the elements) by the Unit Owner or the Board, whichever is responsible for the maintenance thereof, and such Unit Owner or the Board, as the case may be, shall promptly make or perform, or cause to be made or performed, all maintenance work that is necessary in con

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X. RESERVE FUND Page 117 X. RESERVE FUND The budget and section 2.4(A)(xxv) of the Bylaws provides for a reserve fund to provide for major capital expenses, which is the maintenance, improvement or replacement of any aspect of the Property that will either enhance the overall value of the property, adapt it to new uses, or increase its useful life. Examples of a major capital expense are replacement of the roof or the windows , or installation of a building wide HVAC system . The basis of the figure projected for this item must be at least ten percent (10%) of the Common Charges. It is intended that the Board, at all times, maintain the reserve fund in an amount equal to 10% of Common Charges. This account will be a separate bank account from the working capital account, The Reserve Fund will be funded by monthly from a portion of Common Charge payments made by Unit Owners including Sponsor so long as Sponsor still owns Units. 10% of each Common Charge payment

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Y. WORKING CAPITAL FUND Page 118 Y. WORKING CAPITAL FUND Sponsor, as agent of the Board, will collect from each original Purchaser at the time of the Closing an Initial Capital Payment equal to two (2) months’ estimated Common Charges for the Unit. The Sponsor will deliver the funds collected to the Board. 90% of the funds so collected shall provide the necessary working capital for the Condominium. These funds may be used for certain prepaid items, organizational costs, and for such other purposes as the Board of Managers may determine and may be replenished as the Board sees fit. The remaining 10% of this Initial Capital Payment shall be deposited into the Reserve Fund bank account which is a separate bank account. While the Sponsor is in control of the Board, the working capital fund shall not be used to reduce estimated Common Charges. There will be no adjustments at Closing between the Board and the Sponsor. NO REPRESENTATION IS MADE THAT THE INITIAL WO

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and any alteration, addition, or improvement to, the Common Elements; (ii) the establishment and/or maintenance of a general operating reserve or a reserve fund for working capital, for replacements with respect to the Common Elements, or to make up any deficit in the Common Charges for any prior year(s); (iii) the purchase, lease, or sublease by the Condominium Board or its designee, corporate or otherwise, on behalf of all Unit Owners, of any Unit whose owner has elected to sell, lease, transfer, or convey the sa me or that is to be sold at a foreclosure or other sale; and (iv) generally, the conduct of the affairs of the Condominium. 13. Common Interest: The proportionate, undivided interest in fee simple absolute in the Common Elements appertaining to each Unit, as expressed in the Declaration of Condominium. 14. Condominium: The 137 Carlton Avenue Condominium which was established pursuant to the terms of the Declaration and is to be governed pursuant to the te

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charges. During any such delay, Sponsor will timely pay all expenses of the Condominium, including but not limi ted to, insurance premiums and any reserve fund payments required by lenders. This will not include individual unit owners’ expenses such as electricity and gas. Upon commencement of collection of common charges, there will not be any assessment for any item in the approved budget for the condominium. Sponsor shall remain obligated to update the budget for the Condominium as required by governing regulations. In the event Sponsor elects to delay the collection of common charges, Sponsor shall disclose such fact in the closing notice to Purchasers and in the post -closing amendment to the Offering Plan. Such amendment shall also disclose the anticipated period of delay. Sponsor will notify all unit owners in writing of the expiration of the delay period at least thirty (30) days prior to the commencement of collection of common charges and will disclose such fact

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eto these actions. 1. Raise common charges or levy a special assessment to: a. make an alteration to the common elements; b. create an additional reserve fund for repairs, alterations, unanticipated expenses and/or c ontingencies which exceed 5% of the projected common expenses for the budget year; c. increase, decrease, eliminate or otherwise change the number, type, classification or working hours of the building’s service staff (if any), or to hire additional service staff. d. increase, decrease, or eliminate building services; e. increase, decrease, eliminate or otherwise change the amounts or types of insurance coverage from the coverages existing on the date of the First Closing. 2. Borrow money on behalf of the Condominium Association. Notwithstanding the foregoing, Sponsor may not exercise veto power over expenses described in Schedule B, or over expenses required : (i) to comply with applicable laws or regulations; (ii) to remedy any notice of violation; (

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rrent or future expenses, including repairs or replacements, and if additional funds are required, the Board may increase Common Charges or impose a special assessment . See Section “Working Capital Fund” for details. (T) There will be a reserve fund to provide for major capital repairs or improvements. Since the reserve fund contributions will be collected monthly as part of Common Charges, the reserve fund will not be fully funded until after the first year of operations. At this time, Sponsor has no knowledge of any capital improvements that may have to be made during the first five years of Condominium operation. If the amount in the reserve fund is inadequate to cover major capital improvements needed, there may be an increase in Common Charges or special assessment imposed. See “Reserve Fund.” (U) As provided in the Bylaws, Sponsor will retain control of the Board until five (5) years from the date of the First Closing or until Sponsor owns no Unsold Units, whic

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(AA) No bond or other security has been posted to secure S ponsor's obligations. Should Sponsor fail in its obligation to pay all Common Charges, Special Assessments and real estate taxes with respect to Unsold Units, the Board may file a lien against the Unsold Units in accordance with law and Purchasers under contract will be offered rescission. See “Rights and Obligations of Sponsor”.

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. Selling Agent: Sponsor or a NY licensed real estate broker appointed by Sponsor to market and sell the Condominium Units. 55. Special Assessments: The charges allocated and assessed by the Condominium Board to the Unit Owners, pro-rata in accordance with their respective Common Interests (except as otherwise provided in the Declaration or in the By -Laws), in accordance with paragraph (D) of Section 6.1 of the By-Laws. 56. Sponsor: As per New York State regulations for newly constructed and vacant condominiums, means "any person, partnership, joint venture, corporation, company, trust, association or other entity or agent thereof who makes or takes part in a public offering or sale in or from the State of New York of participation interests or investments in real estate including condominium interests in realty." The Sponsor of this offering plan is 137 Carlton LLC. 57. Time of the Essence: Purchaser must cure a default or satisfy a condition in th

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ng Plan which are to be performed subsequent to the closing date will survive delivery of the deed. C. Sponsor agrees to pay all Common Charges, special assessments and real estate taxes with respect to Unsold Units. Spons or represents that it has the financial resources to meet its obligations with respect to Unsold Units. Such obligations shall be funded through the sales of Unsold Units and from other funds of the Sponsor. No bond or other security has been posted to sec ure Sponsor's obligations. D. Sponsor will cause the Board to maintain the Property in substantially the same condition and manner as on the date of First Closing until expiration of the Initial Control Period. E. If Purchaser is or becomes the tenant or the occupant of the Unit before the Closing of title thereto pursuant to an Interim Lease and, before such Closing, the Unit is damaged by casualty or otherwise, such Purchaser shall assume the risk of loss and the obligation to repair the dama

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onsor’s prior written approval with regard to the below items. During this time, Sponsor may veto these actions. (i) Raise Common Charges or levy a special assessment to: a. make an alteration to the Common Elements;

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discharge the same; E. Common Charges: to determine amounts and establish the means and methods of payment of, and to collect, Common Charges and Special Assessments from Unit Owners, and to use the Common Charges and Special Assessments collected from Unit Owners, as well as all other funds held by the Board or received in connection with the operation of the Property, for the administration of the Condominium, including, without limitation: (a) the payment of Common Expenses and (b) the making of restorations, additions, alterations and improvements to the Common Elements; F. Loans: to borrow money on behalf of the Condominium when required in connection with the operation, maintenance, repa ir, restoration, improvement, alteration and replacement of the Common Elements, provided, however, that: (a) with respect to the borrowing of any sum in excess of $25,000.00 in any one fiscal year (regardless of the balance of any loans outstanding from previous fiscal years) in

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all be permitted to mortgage, pledge or hypothecate his Unit unless and until he shall have paid in full to the Board all unpaid Common Charges and special assessments theretofore assessed against such Unit and shall have satisfied all unpaid liens; (ii) no Unit Owner shall execute any mortgage or other document mortgaging , pledging or hypothecating title to his Unit without including therein its Appurtenant Interests, it being the intention to prevent any severance of such combined ownership. Any mortgage or other instrument purporting to affect one or more of such interes ts without including all such interests shall be deemed and taken to include the interest or interests so omitted, even though the latter shall not be expressly mentioned or described therein so that at all times, all of the Units interests in the Condominium shall remain and shall not be severed;

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ssess Common Charges, the Board shall have the right, subject, in all respects, to the strictures contained in Section 2. 4 of the bylaws , to levy special assessments to meet the Common Expenses. All special assessments may be payable either in one lump sum or in installments, as the Board shall determine, provided, however that the Board shall give each Unit Owner not less than fifteen (15) days' notice prior to the date upon which such special assessment, or the first installment thereof, shall be due and payable, which notice shall set forth, in reasonable detail, the nature and purpose thereof. The Board shall have all rights and remedies for the collection of special assessments as are provided herein for the collection of Common Charges . Special assessments shall be levied against all Unit Owners in proportion to their respective Common Interests as follows: (i) assessment or increase in Common Charges to repair or maintain the Common Elements shall be levied agai

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in the reserve fund is inadequate to cover major capital improvements needed, there may be an increase in Common Charges or the Board may impose a special assessment. The reserve fund may not be used to reduce projected Common Charges in the Plan. NEITHER THE DEPARTMENT OF LAW NOR ANY OTHER GOVERNMENT AGENCY HAS PASSED UPON THE ADEQUACY OF THE RESERVE FUND OR THE PHYSICAL CONDITION OF THE BUILDING.

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4. Selling Agent: Sponsor or a NY licensed real estate broker appointed by Sponsor to market and sell the Condominium Units. 55. Special Assessments: The charges allocated and assessed by the Condominium Board to the Unit Owners, pro -rata in accordance with their respective Common Interests (except as otherwise provided in the Declaration or in the By -Laws), in accordance with paragraph (D) of Section 6.1 of the By-Laws. 56. Sponsor: As per New York State regulations for newly constructed and vacant condominiums, means "any person, partnership, joint venture, corporation, company, trust, association or other entity or agent thereof who makes or takes part in a public offering or sale in or from the State of New York of participation interests or investments in real estate including condominium interests in realty." The Sponsor of this offering plan is 137 Carlton LLC. 57. Time of the Essence: Purchaser must cure a default or satisfy a condition in

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ary to discharge the same; (v) to determine the amount and establish the means and methods of payment of, and to collect, the Common Charges and Special Assessments from Unit Owners; (vi) to borrow money on behalf of the Condominium when required in connection with the operation, maintenance, repair, restoration, improvement, alteration and replacement of the Common Elements, provided, however, that: (a) the affirmative consent of all of the members of the Board shall be required for the borrowing of any sum in excess o f $25,000.00 in any one fiscal year (regardless of the balance of any loans outstanding from previous fiscal years); (b) the affirmative consent of all of all Unit Owners shall be required for the borrowing of any sum in excess of $25,000.00 in any one fiscal year (regardless of the balance of any loans outstanding from previous fiscal years); (c) no lien to secure repayment of any sum borrowed may be created on any Unit or its Appurtenant Interests wi

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rogress payments. If the Trust Funds shall be less than sufficient to discharge the cost and expense of performing the Work, the Board shall levy a Special Assessment against all Unit Owners for the amount of such deficiency in proportion to their respective Common Interests, and all proceeds of such Special Assessment shall become part of the Trust Funds. However, if the insurance proceeds are not sufficient to discharge the cost and expense of performing any work attributable to any part of the building which is not a "Common Element", such cost and expense must be paid by the owner or owners of the Units or Limited Common Elements which were damaged and no special assessment may be levied against the Unit Owners. If, conversely, the Trust Funds shall prove to be more than sufficient to discharge the cost and expense of performing the Work, such excess shall be paid to the Unit Owner of the damaged unit, except that no payment shall be made to a Unit Owner unt il there has

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Managing Agent and (ii) a separate listing for each Unit, setting forth, among other things, the amount of each assessment of Common Charges and Special Assessments levied against such Unit, the date when due, the amounts paid thereon and the balance, if any, remaining unpaid. (B) Within (4) four months after the end of each fiscal year of the Condominium, the Board shall submit to each Unit Owner, and, if so requested, to any Permitted Mortgagee, an annual report of the receipts and expenditures of the Condominium prepared by an independent accountant. The cost of preparing and distributing each such report shall be borne by the Unit Owners as a Common Expense. ARTICLE 6 - COMMON CHARGES Section 6.1. Determination of Common Expenses and Fixing of Common Charges. A. Commencement of Collection. (i) The Board will commence collection of common charges at the First Closing provided the Sponsor has not exercised its option to pay all expenses of operation of the

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nsor’s prior written approval with regard to the below items. During this time, Sponsor may veto these actions. 1. Raise common charges or levy a special assessment to: a. make an alteration to the common elements; b. create an additional reserve fund for repairs, alterations, unanticipated expenses and/or c ontingencies which exceed 5% of the projected common expenses for the budget year; c. increase, decrease, eliminate or otherwise change the number, type, classification or working hours of the building’s service staff (if any), or to hire additional service staff. d. increase, decrease, or eliminate building services; e. increase, decrease, eliminate or otherwise change the amounts or types of insurance coverage from the coverages existing on the date of the First Closing. 2. Borrow money on behalf of the Condominium Association. Notwithstanding the foregoing, Sponsor may not exercise veto power over expenses described in Schedule B, or over expenses required :

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of and assess Common Charges, the Board shall have the right, subject, in all respects, to the strictures contained in Section 2.4 hereof, to levy Special Assessments to meet the Common Expenses or to fund additional projects. All Special Assessments may be payable either in one lump sum or in installments, as the Board shall determine, provided, however that the Board shall give each Unit Owner not less than fifteen (15) days' notice prior to the date upon which such Special Assessment, or the first installment thereof, shall be due and payable, which notice shall set forth, in reasonable detail, the nature and purpose thereof. The Board shall have all rights and remedies for the collection of Special Assessments as are provided herein for the collection of Common Charges (including, without limitation, the provisions of Section 6.4 hereof). Special Assessments shall be levied against all Unit Owners in proportion to their respective Common Interests as follows: (i) as

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liens for real estate taxes assessed against such Unit. (B) No Unit Owner shall be liable for the payment of any part of Common Charges or any Special Assessments assessed against his Unit subsequent to a sale, transfer, or other conveyance by him of such Unit, together with its Appurtenant Interests. A purchaser or other successor -in- title to the owner of a Unit shall be liable for the payment of all Common Charges and any Special Assessments accrued and unpaid against such Unit prior to his acquisition thereof, except that, to the extent permitted by Law, a Permitted First Mortgagee acquiring title to a mortgaged Unit or a purchaser at a mortgage foreclosure sale held with respect to a Permitted First Mortgage shall not be liable, and such mortgaged Unit shall not be subject to a lien, for the payment of any Common Charges and Special Assessments assessed subsequent to the recording of such Permitted First Mortgage and prior to the acquisition of title to such Unit by

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Permitted Mortgagee, the Board shall promptly report to such Permitted Mortgagee any default by his mortgagor(s) in the payment of Common Charges or Special Assessments or in the observance or performance of any of the provisions of the Condominium Documents as to which the Board has knowledge then exists. The Board shall, when giving notice to a Unit Owner of any such default, also send a copy of such notice to his or her Perm itted Mortgagee, if so requested. However, the Board shall have no liability for any failure, through oversight or negligence, in notifying a Permitted Mortgagee of any default by his or her mortgagor under the Condominium Documents, provided that (i) the Board shall advise such Permitted Mortgagee of the default promptly after discovering such failure and (ii) if the Board shall foreclose a lien on such mortgagor's Unit pursuant to the terms of Section 6.4 hereof by reason of such default, the Board shall pay to such Permitted Mortgagee the net procee

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to a mortgagee defaults in performing any act or ma king any payment which is that party's responsibility hereunder, including common charges and or special assessments, for a period of sixty (60) days after the obligation to pay, and said default is not cured within fifteen (15) days of written notice of said default. iii) At least ten days' prior written notice to all of the insureds, including all Permitted Mortgagees shall be sent if any insurance policies insuring the Building and all service machinery contained therein covering the interest of the C ondominium, the Condominium Board, all of the Unit Owners and all Permitted Mortgagees, as their interests may appear may are to be either cancelled, or be allowed to lapse, or substantially modified. iv) If the Declaration and the By-Laws are to be amended and such amendment would materially interfere with any right or interest of any mortgagee. v) In addition, the mortgagee and guarantor of the mortgage on any