Honey Creek Ridge: Articles of Incorporation

ARTICLES OF INCORPORATION

HONEY CREEK RIDGE HOMEOWNERS' ASSOCIATION

ARTICLE I

Name

The name of the corporation (the "Association") is HONEY CREEK RIDGE

HOMEOWNERS' ASSOCIATION.

ARTICLE II

Duration

The Association has perpetual existence.

ARTICLE III

Purpose

The purposes for which the Association, a nonprofit charitable organization, is

organized are:

(1) To provide an entity to protect and enforce the right and obligations of the

owners of real property located within the plats known as Honey Creek Ridge , recorded

as Honey Creek Ridge Division No. 1, No. 2, and No. 3, respectively, King County,

Washington, and to engage in all such activities as are incidental or conducive to the

attainment of the objectives of the Association and all activities which are permitted to be

done by a nonprofit corporation under any laws that may now or hereafter be applicable

or available to this Association. The powers of this Association shall be subject to and

shall be exercised in accordance with the provisions of the Declarations of Covenants,

Conditions, Restrictions and Easements for Honey Creek Ridge filed with the King

County Office of Records and Elections as they may from time to time be amended

(hereinafter "Declaration");

(2) exclusively for charitable, religious, educational, and scientific purposes,

including, for such purposes, the making of distributions to organizations that qualify as

exempt organizations under Section 501(c) (3) of the Internal Revenue Code of 1986 (the

"Code"), as amended, or the corresponding section of any future federal tax code; and

(3) To engage in any other l a d l business activity whatsoever which may

hereafter from time to time be authorized by the Board of Directors; provided, however,

that the purposes for which the Association is formed shall at all times comply with

Section 50 1 (c) (3) of the Code.

ARTICLE IV

Powers

The Association shall have the power to take any lawful action necessary,

appropriate or desirable to carry out its purposes consistent with the Washington

Nonprofit Corporation Act, Chapter 44.03 RCW (the "Act") and Sections 501 (c) (3) and

170 (c) (2) of the Code.

ARTICLE V

Prohibited Activities

(1) No substantial part of the activities of this Association shall be devoted to

attempting to influence legislation by propaganda or otherwise, and the Association shall

not participate, or intervene, directly or indirectly (including the publication or

distribution of statements), in any political campaign on behalf of or in opposition to any

candidate for public office.

(2) Notwithstanding any other provision of these articles, the corporation shall

not carry on any activities not permitted to be carried on (a) by an Association exempt

from federal income tax under Section 501 (c) (3) of the Code, or (b) by a corporation,

contributions to which are deductible under Section 170 (c) (2) of the Code.

(3) It is intended that the Association qualify as a publicly supported 501 (c) (3)

organization. However, should the Association be deemed a private foundation by reason

of a determination by the Internal Revenue Service, the following provisions shall apply

to the operation; of the Association:

(a) The Association shall distribute its income for each taxable year at

such time and in such manner as not to become subject to the tax on undistributed income

imposed ‘by Section 4942 of the Code.

(b) The Association shall not engage in any act of self-dealing as defined

in Section 4941 (d) of the Code.

defined in Section 4943 (c) of the Code.

(d) The Association shall not make any investments in such manner as to

subject it to tax under Section 4944 of the Code.

(e) The Association shall not make any taxable expenditures as defined in

Section 4945 (d) of the Code.

ARTICLE VI

Private Foundation Status

Should the Association be determined at any point in time to be a private

foundation within the meaning of the Code, the following provisions shall govern the

Association's operations:

(1) the Association shall distribute its income for each taxable year at such time

and in such manner as not to become subject to the tax on undistributed income imposed

by Section 4942 of the Code;

(2) the Association shall not engage in any act of self-dealing as defined in

Section 4941 (d) of the Code;

(3) the Association shall not retain any excess business holdings as defined in

Section 4943 (c) of the Code;

(4) the Association shall not make any investments in such manner as to subject it

to tax under Section 4944 of the Code; and

(5) the Association shall not make any taxable expenditures as defined in Section

4945 (d) of the Code.

ARTICLE VI

Registered Office

The address of the registered office of the Association is 1800 SE 7th Court,

Renton, Washington 98055; the name of the registered agent at such address is Debra

Jones.

ARTICLE VII

Incorporator

The name and address of the incorporator are Lakeridge Development, Inc., P. 0.

Box 146, Renton, Washington 98057.

ARTICLE VIII

Directors

The Association shall have two (2) initial directors whose names and address are

Wm. Wayne Jones, Jr. and Debra Ferguson, P. 0. Box 146, Renton, WA 98057.

The initial director shall serve until the organizational meeting of the members or

until her successors are elected and qualified.

ARTICLE IX

Members

The Association shall have one (1) class of members. The designation of such class, manner of election and the qualifications and rights of such members shall be as set forth in the Bylaws of the Association.

ARTICLE X

Voting Rights

Each member shall be entitled to one vote on each matter submitted to a vote of

members as set forth in the Bylaws.

ARTICLE XI

Limitation on Liability of Directors

No director of the Association shall be personally liable to the Association or its

members for monetary damages for his or her conduct as a director, which conduct takes

place on or after the date this Article becomes effective, except for (i) acts or omissions

that involve intentional misconduct or a knowing violation of law by the director, (ii)

voting or assenting to distributions by the Association in violation of these Articles, or

(iii) any transaction form which the director will personally receive a benefit in money,

property or services to which the director is not legally entitled. If, after this Article

becomes effective, the Washington nonprofit Association Act (Title 24 RCW) is

amended to authorize corporate action m h e r eliminating or limiting the personal liability

of directors, then the liability of a director of the Association shall be deemed eliminated

or limited to the fullest extend permitted by the Washington Nonprofit Association Act,

as so amended. Any amendment to or repeal of this Article shall not adversely affect any

right or protection of a director of the Association for or with respect to any acts or

omissions of such director occurring prior to such amendment or repeal. This provision

shall not eliminate or limit the liability of a director for any act or omission occurring

prior to the date this Article becomes effective.

ARTICLE XII

Indemnification of Officers,

Directors, Employees and Agents

1. Definitions. For purposes of this Article:

(a) "Association" includes any domestic or foreign predecessor entity of the Association in a merger or other transaction in which the predecessor's existence ceased upon consummation of the transaction.

(b) "Director" means an individual who is or was a director of the Association or an individual who, while a director of the Association, is or wks serving at the Association's request as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise. A director is considered to be serving an employee benefit plan at the Association's request if the director's duties to the Association also impose duties on, or otherwise involve services by, the director to the plan or to participants in or beneficiaries of the plan. "Director" includes, unless the context requires otherwise, the estate or personal representative of a director.

(d) "Liability" means the obligation to pay a judgment, settlement, penalty,

fine, including an excised tax assessed with respect to an employee benefit plan, or

reasonable expenses incurred with respect to a proceeding.

(e) "Official capacity" means:

(i) When used with respect to a director, the

office of director in the Association; and

(ii) when used with respect to an individual

other than a director, as contemplated in Sections 6 and 7 of this Article XI, the office in

the Association held by the officer or the employment or agency relationship undertaken

by the employee-or agent on behalf of the Association. "Official capacity" does not

include service for any other foreign or domestic corporation or any partnership, joint

venture, trust, employee benefit plan, or other enterprise.

(f) "Party" includes an individual who was, is, or is threatened to be made a

named defendant or respondent in a proceeding.

(g) "Proceeding" means any threatened, pending, or completed action, suit, or

proceeding, whether civil, criminal, administrative or investigative and whether formal or

informal.

2. Right to Indemnification.

(a) The Association shall indemnify any person who was or is a party to any

proceeding, whether or not brought by or in the right of the Association, by reason of the

fact that such person is or was a director of the Association, against all reasonable

expenses incurred by the director in connection with the proceeding.

(b) Except as provided in subsection

(e) of this Section 2, the Association shall indemnify an individual made a party to a proceeding because the individual is or was a director against liability incurred in the proceeding if:

(i) The individual acted in good faith; and

(ii) The individual reasonably believed:

(A) In the case of conduct in the individual's official capacity with the

Association, that the individual's conduct was in the Association's best interests; and

(B) In all other cases, that the individual's conduct was at least not

opposed to the Association's best interests; and

(iii) In the case of any criminal proceeding, the individual had no

reasonable cause to believe the individual's conduct was unlawful.

purpose the director reasonably believed to be in the interests of the participants in and

beneficiaries of the plan is conduct that satisfies the requirement of subsection (b) (ii) of

this Section 2.

(d) The termination of a proceeding by judgment, order, settlement,

conviction or upon a plea of nolo contender or its equivalent is not, of itself,

determinative that the director did not meet the standard of conduct described in this

Section.

(e) The Association shall not indemnify a director under this Section 2:

(i) In connection with a proceeding by or in the right of the Association in

which the director was adjudged liable to the Association; or

(ii) In connection with any other proceeding charging improper personal

benefit to the director, whether or not involving action in the director's official capacity,

in which the director was adjudged liable on the basis that personal benefit was

improperly received by the director.

(f) Indemnification under this Article XI, Section 2 in connection with a

proceeding by or in the right of the Association is limited to reasonable expenses incurred

in connection with the proceeding.

3. Advance for Expenses.

(a) The Association shall pay for or reimburse the reasonable expenses

incurred by a director who is a party to a proceeding in advance of final disposition of the

proceeding and in advance of any determination and authorization of indemnification

pursuant to Section 5 of this Article XI1 if:

(i) The director furnishes the Association a written affirmation of the

director's good faith belief that the director has met the standard of conduct described in

Section 2 of this Article XI; and

(ii) The director furnishes the Association a written undertaking, executed

personally or on the director's behalf, to repay the advance if it is ultimately determined

that the director did not meet the standard of conduct.

(b) The undertaking required by subsection (a) (i) of this Section 3 must be an

unlimited general obligation of the director but need not be secured and may be accepted

without reference to financial ability to make repayment.

4. Court-ordered Indemnification. A director of the Association who is a party to

a proceeding may apply for indemnification or advance of expenses to the court

conducting the proceeding or to another court of competent jurisdiction. On receipt of an

application, the court after giving any notice the court considers necessary may order

indemnification or advance of expenses if it determines:

(a) The director is entitled to mandatory indemnification, in which case the

court shall also order the Association to pay the director's reasonable expenses incurred

to obtain court-ordered indemnification;

(b) The director is fairly and reasonably entitled to indemnification in view of

all the relevant circumstances, whether or not the director met the standard of conduct set

forth in Section 2 of this Article XI, or was adjudged liable as described in Section 2(e)

of this Article XII, but if the director was adjudged so liable, the director's

indemnification is limited to reasonable expenses incurred; or

the Articles of Incorporation, Bylaws, or any applicable resolution or contract, to payment

or reimbursement of the director's reasonable expenses incurred as a party to the

proceeding in advance of final disposition of the proceeding.

5. Determination and Authorization of Indemnification.

(a) The Association shall not indemnify a director under this Article XI1

unless authorized in the specific case after a determination has been made that

indemnification of the director is permissible in the circumstances because the director

has met the standard of conduct set forth in Section 2 (b) of this Article XII.

(b) The determination shall be made:

(i) By the Board of Directors by majority vote of a quorum consisting of

directors not at the time parties to the proceeding;

(ii) If a quorum cannot be obtained under (I) of this subsection, by majority vote of a committee duly designated by the Board of Directors, in which designation directors who are parties may participate, consisting solely of two or more directors not at the time parties to the proceeding;

(iii) By special legal counsel;

(A) Selected by the Board of Directors or its committee in the manner prescribed in (i) or (ii) of the subsection; or

(B) If a quorum of the Board of Directors cannot be obtained under (i) of this subsection and a committee cannot be designated under (ii) of this subsection, selected by majority vote of the full Board of Directors in which selection directors who are parties may participate; or

(iv) By the members, except that those members who are also directors and at the time parties to the proceeding, may not vote on the determination.

(c) Authorization of indemnification and evaluation as to reasonableness of expenses shall be made in the same manner as the determination that indemnification is permissible, except that if the determination is made by special legal counsel, authorization of indemnification and evaluation to reasonableness of expenses shall be made by those entitled under subsection (b) (iii) of this Section to select counsel.

6. Indemnification of Officers.

(a) An officer of the Association who is not a director shall be indemnified, and is entitled to apply for court-ordered indemnification under Section 4 of this Article XII, in each case to the same extent as a director; and

(b) The Association shall indemnify and advance expenses to an officer who is not a director to the same extent as to a director under this Article XII.

(c) The Association may also indemnify and advance expenses to an officer who is not a director to the extent, consistent with law, that may be provided by a general or specific action of its Board of Directors, or contract.

7. Indemnification of Employees and Agents.

(a) The Association may indemnify employees and agents of the Association, and may afford the right to such employees or agents to apply for court-ordered indemnification under Section 4 of this Article XII, in each case to the same extent as a director; and

(b) The Association may indemnify and advance expenses to an employee or agent of the Association who is not a director to the same extent as to a director under this Article XII.

(c) The Association may also indemnify and advance expenses to an employee or agent who is not a director to the extent, consistent with law, that may be provided by a general or specific action of its Board of Directors, or contract.

8. Insurance

The Association may purchase and maintain insurance on behalf of an individual who is or was a director, officer, employee, or agent of the Association, or who, while a director, officer employee, or agent of the Association, is or was serving at the request of the Association as a director, officer, partner, trustee, employee, or agent of another foreign or domestic corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise, against liability asserted against or incurred by the individual in that capacity or arising from the individual's status as a director, officer, employee, or agent, whether or not the Association would have power to indemnify the individual against the same liability under this Article XII.

9. Indemnification as a Witness.

This Article XII does not limit an Association's power to pay or reimburse expenses incurred by a director in connection with the director's appearance as a witness in a proceeding at a time when the director has not been made a named defendant or respondent to the proceeding.

10. Report to Members.

If the Association indemnifies or advances expenses to a director pursuant to this Article IX in connection with a proceeding by or in the right of the Association, the Association shall report the indemnification or advance in writing to the members with or before the notice of the next members' meeting.

11. Member Authorized Indemnification.

(a) If authorized by a resolution adopted or ratified, before or after the event, by the members of the Association, the Association shall have the power to indemnify or agree to indemnify a director made a party to a proceeding, or obligate itself to advance or reimburse expenses incurred in a proceeding, without regard to the limitations contained in this Article XII (other than this Section 11); provided that no such indemnity shall indemnify any director from or on account of:

(i) Acts or omissions of the director finally adjudged to be intentional misconduct or a knowing violation of law;

(ii) Conduct of the director finally adjudged to be an unlawful distribution; or

(iii) Any transaction with respect to which it was finally adjudged that such director personally received a benefit in money, property, or services to which the director was not legally entitled.

(b) Unless a resolution adopted or ratified by the members of the Association provides otherwise, any determination as to any indemnity or advance of expenses under subsection (a) of this Section 11 shall be made in accordance with Section 5 of this Article XII.

12. Validity of Indemnification.

A provision addressing the Association's indemnification of or advance for expenses to directors that is contained in the Bylaws, a resolution of its members or Board of Directors, or in a contract or otherwise, is valid only if and to the extend the provision is consistent with the Nonprofit Association Act and any other applicable law.

13. Interpretation.

The provisions contained in this Article XII shall be interpreted and applied to provide indemnification to directors, officers, employees and agents of the Association to the fullest extent allowed by applicable law, as such law may be amended, interpreted and applied from time to time.

14. Savings Clause.

If this Article XII or any portion thereof shall be invalidated on any ground by any court of competent jurisdiction, the Association shall nevertheless indemnify each director as to reasonable expenses and liabilities with respect to any proceeding, whether or not brought by or in the right of the Association, to the full extent permitted by any applicable portion of this Article XII that shall not have been invalidate, or by any other applicable law.

15. Nonexclusivity of Rights.

The right to indemnification under this Article XII for directors, officers, employees and agents shall not be exclusive of any other right which any person may have, or hereafter acquire under any statute, provision of the Articles of Incorporation, Bylaws, other agreement, vote of members or disinterested directors, insurance policy, principles of common law or equity, or otherwise.

Article XIII

Distribution of Earnings

No part of the net earnings of the Association shall inure in whole or in part to the benefit of or be distributable to any officer, director, member, trustee or other individual having a personal or private interest in the activities of the Association except that the Association shall be authorized and empowered to pay reasonable compensation for services rendered, make reimbursement for reasonable expenses incurred in its behalf, and to make payments and distributions in furtherance of the purposes stated Article III hereof.

Article XIV

Distribution upon Dissolution

Upon the dissolution of the Association, all of its assets remaining after payment of creditors shall be distributed to an organization or organizations selected by the Board of Directors, provided that such organization or organizations are qualified as exempt from taxation under the provisions of Sections 501 (a) and 501 (c) (3) of the Code. In no event shall any of the corporation's assets be distributed to the officers, directors or members of the Association.

Article XV

Amendment of Articles

The Association reserves the right to amend, alter, change or repeal any provision contained in these Articles of Incorporation in the manner now or hereafter prescribed by law, and all rights and powers conferred herein on directors are subject to this reserved power.

The Articles of Incorporation were filed with the State of Washington on November 4, 1997.
Wm. Wayne Jones, Jr.
President, Lakeridge Development, Inc.

Debra Jones
Registered Agent in the State of Washington for the Honey Creek Ridge Homeowners Association.

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