Section 1. Notice to Board of Directors. A Unit Owner who mortgages his Unit shall notify the Board of Directors through the Managing Agent of the name and address of his mortgagee. The Board of Directors shall maintain such information in a book entitled “Mortgagees of Units.”
Section 2. Notice of Unpaid Assessments. The Board of Directors, whenever so requested in writing by a Mortgagee, shall promptly report any then unpaid assessments due from, or any other default by, the owner of the mortgaged Unit.
Section 3. Notice of Default. The Board of Directors shall give written notice to a Unit Owner of any default by the Unit Owner in the performance of any obligations under the Act or Condominium Instruments, and, if such default is not cured within 60 days, shall promptly send a copy of such notice to each holder of a mortgage covering such Unit whose name and address has theretofore been furnished to the Board of Directors.
Section 4. Examination of Books. Each Unit Owner and each Mortgagee shall be permitted to examine the books of account of the Condominium at reasonable times and upon reasonable notice, on a business day, but not more often than once a month.
Section 5. Notices of Damages. Condemnation. The Board of Directors shall timely notify: (i) the Mortgagee of a Unit whenever damage to the Unit covered by the mortgage exceeds $1,000, or whenever the Unit or portion thereof is made the subject matter of any condemnation or eminent domain proceeding or is otherwise sought to be acquired by a condemning authority; and (ii) all Mortgagees whenever damage to the Common Elements exceeds $10,000, or whenever the Common Elements or any portion thereof is made the subject matter of any condemnation or eminent domain proceeding or is otherwise sought to be acquired by a condemning authority. For purposes of this Section, the Board of Directors, when giving notice to any Mortgagee, shall also notify the Federal Home Loan Mortgage Corporation (FHLMC), the Federal National Mortgage Association (FNMA) or the Veterans Administration (VA) and any other public or private secondary mortgage market entity participating in purchasing or guarantying mortgages of Units in the Condominium if the Board of Directors has notice of such participation.
Section 6. Termination of Management Contract. The prior written approval of at least two-thirds of all First Mortgagees shall be required to effectuate any decision by the Unit Owners Association to terminate professional management and assume self-management of the Condominium.
Section 7. Audited Financial Statement. Each Mortgagee shall be entitled to receive, upon request, a copy of the annual audited financial statement within one hundred twenty (120) days following the end of the Association’s fiscal year.
Section 8. Rights of First Mortgagees. Unless at least two-thirds (2/3) of the First Mortgagees (based upon one vote for each first mortgage owned) have given their prior written approval, the Unit Owners Association shall not:
(a) change any Unit’s Common Element Interest except as permitted by the Declaration;
(b) partition or subdivide any Unit or that Unit’s Common Element Interest of the Condominium, or abandon, partition, subdivide, encumber, sell or transfer the Common Elements of the Condominium (the granting of easements for public utilities or for other public purposes consistent with the intended use of the Common Elements shall not be deemed a transfer within the meaning of this clause) except as may be permitted by the Declaration;
(c) by act or omission seek to abandon or terminate condominium status of the project except as provided by statute in case of substantial loss to the Units and Common Elements of the Condominium;
(d) modify the method of determining and collecting assessments or allocating distributions of casualty insurance proceeds or condemnation awards:
(e) use the proceeds of casualty insurance for any purpose other than replacement, repair or reconstruction of the Units or Common Elements except as permitted by the Condominium Act.
Section 9. “First Mortgagee”. “Mortgagee”, and “Mortgage”. As used in this Article and generally in the Declaration and Bylaws, “First Mortgagee” includes the holder of a note secured by a first Deed of Trust or Mortgage encumbering a Unit and recorded among the land records of Fairfax County. The term “Mortgagee” refers to the holder of a note secured by any Deed of Trust encumbering a Unit recorded among the land records of Fairfax County. The term “Mortgage” includes any Deed of Trust recorded among the said land records.
Section 10. Other Mortgagees Rights. All First Mortgagees or their representatives shall be entitled to attend meetings of the Unit Owners Association. In addition thereto, all Mortgagees shall have the right to examine the books and records of the Condominium and require the submission of annual financial reports and other budgetary information.
Section 11. Amendment to the Declaration or to the Bylaws of the Unit Owners Association. Except as otherwise permitted by the Condominium Instruments, the written approval of two-thirds (2/3) of all institutional holders of First Mortgages will be required for any material amendment to the Declaration or Bylaws of the Unit Owners Association.
Section 12. Presumptive Approval. The Association shall be deemed to have received the written consent of a Mortgagee if the Association sends the text of the proposed amendment by certified mail, return receipt requested, to the Mortgagee at the address supplied by such Mortgagee in a written request to the Association to receive notice of proposed amendments to the Bylaws and receives no written objection to the adoption of the amendment from the Mortgagee within sixty (60) days of the date that the notice of amendment is sent by the Association. If the Mortgagee has not supplied an address to the Association, the Association shall be deemed to have received the written consent of a Mortgagee if the Association sends the text of the proposed amendment by certified mail, return receipt requested, to the Mortgagee at the address filed in the land records or with the local tax assessor’s office, and receives no written objection to the adoption of the amendment from the Mortgagee within sixty (60) days of the date that the notice of Amendment is sent by the Association.