FIRST AMENDMENT TO DECLARATION OF COVENANTS CONDITIONS AND RESTRICTIONS FOR ARAPAHOE RIDGE

THIS FIRST AMENDMENT TO DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR ARAPAHOE RIDGE ("Amendment") is made this ___ of August, 1997 by KDB Homes, Inc., a Delaware corporation ("Declarant"), Arapahoe Ridge Partners LLC, a Colorado limited liability company ("Arapahoe Ridge"), Arapahoe Partners Investment Group LLC, a Colorado limited liability company ("Arapahoe Investment"), Raintree Homes, Inc., a Colorado corporation ("Raintree"), Watt Residential Partners, a California general partnership ("Watt") and Acacia Credit Fund 5-ALLC, a Delaware Limited liability company ("Acacia").

Recitals

1. Declarant is the Declarant under that certain Declaration of Cove­nants, Conditions and Restrictions recorded at Reception Number 01682718 in the records of the Clerk and Recorder of Boulder County, Colorado (the "Declaration"). All defined terms used herein shall have the same meaning as set forth in the Declaration unless expressly provided to the contrary herein.
2. Arapahoe Ridge, Raintree, Watt and Acacia each own portions of the real property defined in the Declaration as the Annexable Property.
3. Arapahoe Investment owns the real property described as Outlot D, Arapahoe Ridge Filing No. 2, Amendment No. 1, that, by this Amendment, is to be included in the Annexable Property under the Declaration.
4. Declarant, Arapahoe Ridge, Raintree, Watt and Acacia desire to amend the Declaration in order to correct the legal description of the Annexable Property and to amend the number of Lots permitted in Article I, Paragraph 1.1 of the Declaration.

NOW, THEREFORE, in accordance with the foregoing, and the covenants and conditions contained herein, Declarant, Arapahoe Ridge, Raintree and Watt hereby declare that the Declara­tion shall be amended as follows:

1. The second sentence of Article I, Paragraph 1.1 of the Declaration is hereby amended to read:

   Declarant and AR intend to develop the Property, subject to the Permitted Exceptions as a high quality, Planned Community of apartments, townhomes, condominiums, cluster homes and single family residential homes with a maximum of seven hundred (750) Lots, in accordance with the terms and provisions of the Colorado Common Interest Ownership Act.

2. Exhibit B to the Declaration, is hereby amended to include the real property described on the Amendment to Exhibit B, attached hereto.

In the event of a conflict between the terms and provisions of this Amendment and the terms and provisions of the Declaration, the terms and provisions of this Amendment shall govern and control.

This Amendment may be executed in counterparts each of which shall be an original and all of which, when taken together, shall constitute one instrument notwithstanding that all the par­ties have not executed the same counterpart. The parties agree that signatures transmitted by fac­simile shall be binding as if they were original signatures.

IN WITNESS WHEREOF, Declarant, Arapahoe Ridge, Raintree, Watt and Acacia have duly executed this Amendment this ____ day of August, 1997.

The undersigned, on behalf of FIRST STATE BANK, hereby consents to the foregoing Amend­ment and agrees that their Deed of Trust, in the amount of $555,786.36, recorded in the records of the Clerk and Recorder of Boulder County, State of Colorado on March 25, 1997 at Reception No. 1685749 and the Deed of Trust, in the amount of $1,773,600.00 recorded March 25, 1997 at Reception No. 1685750 are subordinate and subject to the Declaration and this Amendment.

FIRST STATE BANK

By:
Title:

The undersigned, on behalf of Bank United, hereby consents to the foregoing Amendment and agrees that their Deed of Trust, in the amount of $1,275,000.00, recorded in the records of the Clerk and Recorder of Boulder County, State of Colorado on March 20, 1997 at Reception No. 1684709 is subordinate and subject to the Declaration and this Amendment.

BANK UNITED

By:
Title:

The foregoing instrument was acknowledged before me this _____ day of May, 1997, by Peter J. Klymkow, as President of KDB Homes, Inc., a Delaware corporation.

WITNESS my hand and official seal.

My commission expires _____________________.

Notary Public

The foregoing instrument was acknowledged before me this _____ day of May, 1997, by Barry L. Talley, as Manager of Arapahoe Ridge Partners LLC, a Colorado limited liability com­pany.

WITNESS my hand and official seal.

My commission expires _____________________.

Notary Public

The foregoing instrument was acknowledged before me this _____ day of May, 1997, by Barry L. Talley, as Manager of Arapahoe Partners Investment Group LLC, a Colorado limited lia­bility company.

WITNESS my hand and official seal.

My commission expires _____________________.

Notary Public

The foregoing instrument was acknowledged before me this _____ day of May, 1997, by John Roberts, as President of Raintree Homes, Inc., a Colorado corporation.

WITNESS my hand and official seal.

My commission expires _____________________.

Notary Public

The foregoing instrument was acknowledged before me this _____ day of August, 1997, by as of Watt Residential Partners, a California general partnership.

WITNESS my hand and official seal.

My commission expires _____________________.

Notary Public

The foregoing instrument was acknowledged before me this _____ day of May, 1997, by , as of Acacia Credit Fund 5-ALLC, a Delaware limited liability company.

WITNESS my hand and official seal.

My commission expires _____________________.

Notary Public

AMENDMENT TO EXHIBIT B
TO
DECLARATION OF COVENANTS CONDITIONS AND RESTRICTIONS
FOR ARAPAHOE RIDGE

OUTLOT D,

ARAPAHOE RIDGE FILING NO. 2,

AMENDMENT NO. 1,

COUNTY OF BOULDER,

STATE OF COLORADO.