Blue Lake is a community located in the beautiful granite hills on the southern shores of Lake LBJ in the Texas Hill Country. The City of Marble Falls is just 15 miles to the northeast and Austin is just 50 miles to the east of Blue Lake. The Llano County Municipal Utility District was established here in 1979. It is a state chartered municipal untility district and operates as a Texas state municipal entity. Llano County MUD controls the water plant and water distribution in the Blue Lake area. The Blue Lake Property Owners Association was formed June 19, 1965 to manage the community when that function was released by the developer, Blue Lake Properties, Inc. HILLTOP AT BLUE LAKE RESTRICTIVE COVENANTS AND PERMITTED EXCEPTIONS

This DECLARATION, made on the date hereinafter set forth by Congress International Inc., as Texas corporation, referred to as "Declarant"WHEREAS, BLUE LAKE ESTATES (herein called "Blue Lake" is a real estate subdivision situated on Lake Lyndon B. Johnson in Llano County, Texas, and

WHEREAS, Declarant is the owner of the real property described in Exhibit A of this Declaration and desires to create and maintain thereon a quality residential community for the benefit of present and future owners of the said property and to provide for preservation of values and common amenities in this community, and

WHEREAS, Declarant wishes to create an agency which will be assigned the powers of maintaining and administering the common areas and enforcing the covenants and restrictions and disbursing the assessments and charges hereinafter created;

WHEREAS, Declarant requested and was granted annexation of the property described in Exhibit A into Blue Lake Estates and the Llano County Municipal Utility District #1, owners of real property described in Exhibit A shall be entitled to the enjoyment of all rights and privileges of that community.

NOW, THEREFORE, Declarant declares that the real property described in Exhibit A is and shall be held, transferred, sold, conveyed, occupied and enjoyed subject to the covenants, restriction::, charges and liens ("Restrictive Covenants") hereinafter set forth, in addition to the covenants, restrictions and charges of the Blue Lake Property Owners Association, and in the event of the differences between these covenants and those of the Blue Lake Property Owners Association covenants, the more restrictive shall govern.

ARTICLE I: Definitions and Terms

1. The following words as used in this Declaration shall have the following meanings:

a)	"Annual Charge" shall mean and refer to the annual assessment placed against each Lot to fund the regular operations and maintenance obligations of the Association in accordance with Article 11.6 and the Bylaws of the Association. "Architectural Review Committee" (or "ARC") shall mean and refer to that three member committee appointed by the Board under Article II and empowered to review and approve plans before construction as per Article V. The Architectural Review Committee shall also be empowered to enforce these restrictions during construction to insure compliance with an approved Development Plan.
b)	"Association"shall mean and refer to the nonprofit entity, a.k.a Hilltop at Bluelake Owners Association, which Declarant shall cause to be formed as herein provided and its successors or assigns.
c)	"Board"shall mean and refer to the three member board appointed and/or elected to administer the Association under Article II and the Bylaws of the Association.
d)	"Common Facilities" shall mean and refer to all existing and subsequently provided improvements including, but not limited to, the right of ways, drainage facilities, security gates, mailboxes, landscaping and other improvements intended for the common use of all the Members which the Association may now or in the future hold or enjoy.
e)	"Development Plan" shall mean and refer to that set of plans, either for new construction or major remodeling, described and submitted in accordance with Article V hereunder for the approval of the Architectural Review Committee.
f)	"914 Elevation Line" shall mean and refer to the contour line separating those lower elevations which are common landscape areas from the buildable portion of each Lot.
g)	"Lot" shall mean and refer to each of the residential Lots shown upon the recorded final subdivision plats of the Properties.
h)	"Major Remodeling" shall be a material change altering the exterior appearance.
i)	"Member" shall mean and refer to all those Owners who, by right of ownership, are members of the Association.
j)	"Owner" shall mean and refer to the record owner, whether one or more persons or entities, of the fee simple title to any Lot in the Properties.
k)	"Properties" shall mean and refer to the properties described in Exhibit A, which are the subject of this declaration.
l)	"Special Assessment" shall mean and refer to those irregular charges, separate and in addition to Annual Charges, approved by 60 % of the votes of the voting Members as necessary to meet the obligations of the Association.
m)	"Subdivision(s)" shall mean and refer to those legal subdivisions, made of the Properties and as finally platted in Llano County, Texas.

2. The initial Term of these Restrictive Covenants and Permitted Exceptions shall be for 50 years with extensions approved by a two thirds majority of the votes of the Members for periods of not less than ten additional years.

ARTICLE II: Organization

1.	The Declarant shall cause the Association to be organized and formed as a non-profit association under the laws of the State of Texas. The purpose of the Association shall be to promote the health, safety and welfare of the members, to collect annual assessments and administer the maintenance of the Common Facilities of the Association and to enforce the Covenants of the Properties.
2.	The Association shall act through a three member Board of Directors, which shall manage the affairs of the Association. The initial Directors shall be selected by the Declarant to serve until such time as successors are duly elected. The Board shall meet as needed, but no less than semi-annually. It shall be the express duty and authority of the Board to determine any violations of these Covenants and to take enforcement actions.
3.	Each Owner of a Lot shall automatically become a Member of the Association as long as such ownership continues. If and when any future subdivision is made of the Properties, each additional Lot Owner shall also become a voting Member. Each Member shall be entitled to one vote for each Lot owned. The Members shall meet annually to elect the Board of the Association and to confirm the Annual Charge assessment rate.
4.	The Declarant shall retain the responsibility for the Common Facilities of the Subdivision until such time as the improvements are completed thereon and the Declarant, in its sole judgment, shall deem the Association capable of operating and maintaining same. The Board shall then accept, in writing, the maintenance responsibilities for the Common Facilities. Any future facilities such as roads, utilities, water quality controls, etc., shall only be accepted as Common Facilities by written acknowledgment of the Board. The Board shall first be satisfied that any such construction meets the standards of regulatory agencies and any governing authorities.
5.	The Declarant shall appoint a three member Architectural Review Committee (ARC), to serve at Declarant's pleasure, which shall approve the development plans of all facilities to be constructed on the Lots. This committee shall enforce these Restrictive Covenants and standards of the community under the procedures described in Article IV. After January 1, 1999, the Board shall make replacement appointments to this committee. Members of the Board may also serve as members of the ARC. Any exceptions to the requirements of this document which the ARC is specifically authorized to grant must also be approved by the Board.
6.	Each and every Lot in the Subdivision is hereby subjected to and imposed with an Annual Charge of no less than One Hundred and no/ 100 Dollars ($100.00) per annum per Lot subject to increase and payable as per the Bylaws of the Association. Beginning January 1, 1999, the Board shall approve a budget for the annual operations of the Association including the maintenance, replacement, management, and insuring of the Common Facilities including, but not limited to, the drainage improvements, landscaping, and security, including the cost of gates. Members shall hereby be assessed a pro rata portion of the annual operating budget (the Annual Charge) to be paid on a semi-annual basis. Such Charge is in addition to the annual assessment of the Blue Lake Property Owners Association.
7.	Upon approval of 60 % of the votes of the voting Members of the Association, the Board shall levy and collect from time to time, in addition to Annual Charges, such Special Assessments as are necessary to fulfill the obligations of the Association.
8.	Each Owner of a Lot, by accepting a deed or by his claim of ownership, is hereby conclusively deemed to covenant and agree to pay to the Association each and every of the Annual Charges and Special Assessments against his Lot and/or assessed against the Ownership of the Lot as the same shall become due and payable, without demand. These charges and assessments shall be a charge and a continuing lien upon each Lot, together with all improvements thereon. Each Annual Charge or Special Assessment, together with the interest (at the lesser of 18 % per annum or the highest legal rate), collection costs and reasonable attorneys' fees, shall also be the personal obligation of the Owner of the Lot at the time of accrual.
9.	The Association, as a common expense of all Members, may institute and maintain such action at law or in equity against any defaulting Member as is necessary to enforce collection and/or foreclosure of the liens, in accordance with the laws of the State of Texas for real estate foreclosure, against the Lot.

These Restrictive Covenants and Permitted Exceptions may be changed from time to time by the written approval of 60% of the Owners.

ARTICLE IV: Building Requirements and Restrictions

1.	No building, structure, signage, or other improvement, whether new or as a major remodeling, shall be constructed, erected or placed upon any Lot unless it is in accordance with a Development Plan approved by the Architectural Review Committee (ARC) pursuant to Article V hereunder.
2.	After the commencement of construction of any structure or improvement on a Lot, the work shall be prosecuted diligently to complete such improvements as soon as possible. In any case, the construction of all exterior and interior construction shall be completed within one (1) year from the commencement of construction, excepting delays due to strikes, wars and acts of God, or other causes beyond the control of the Lot Owner, his successors, heirs or assigns.
3.	No structure of a temporary character, trailer (with or without wheels), mobile or motor home (with or without wheels), or modular or prefabricated home, tent or shack shall be placed on any portion of the Properties, either temporarily or permanently except for such portable buildings as are required during construction.
4.	No residence, garage, or significant structure appurtenant thereto, shall be constructed within ten feet (10') of all the side lot lines within the Properties. An exception will automatically be made for the interior lot lines) where identical owners of two or more adjacent Lots propose to construct a single residence. Drives, parking and underground utilities are permitted within this buffer area. Minor exceptions may be permitted by the ARC on those Lots where such construction will not significantly impede the lake view of adjacent Owners.
5.	No new residence shall be erected on any portion of the Properties of more than two and one-half (2.5) stories or exceeding a maximum height of thirty-five feet (35'). No residence with an air conditioned interior area of less than the applicable minimum number of square feet set forth below, exclusive of garages, porches or other appurtenances or appendages, shall be erected on any Lot:

Type of Structure		Minimum Interior Area
a)	One (1) story residence	2,000 square feet
b)	One and one-half (1.5), two (2) and two and one-half (2.5) story residences	2,400 s.f. (with at least 1,500 s.f. on the first floor)

6.	No residence, garage nor appurtenant structure shall be constructed nearer the lakeside than the 914 Elevation Line. Minor exceptions may be permitted by the ARC on those Lots where such construction will not significantly impede the lake view of adjacent Owners. No Owner shall erect, place or construct any structure such as a pool, gazebo, deck or cook pit beneath the 914 Elevation Line without the specific prior approval of the ARC.
7.	Generally, only new construction materials and structures shall be used in constructing any improvements on the Properties. Exterior finishes shall be durable and of first quality; installed, finished and maintained to provide a quality presentation at all times. Generally, the main building shall be of at least 50% masonry, stucco or its equivalent on the outside wall. Quality redwood, number one cedar, or its equivalent may be permitted if properly installed, finished and maintained. Specific permission for used materials (i.e. brick or windows), historically significant farms or home buildings, first quality log cabins, or for other exceptions to this exterior surface rule shall be made at the discretion of the ARC.
8.	Not more than three feet (3') of vertical surface of concrete slab or foundation of any structure or improvement located on any portion of the Properties shall be exposed to view from any street or adjacent property. Any slab in excess of three feet (3') in height above finished grade shall have at least the excess in height covered with the same materials used on the exterior of the structure. In some cases. dense landscaping may provide acceptable screening, as long as the landscaping is well grown upon installation and maintained under these covenants.Any structure or improvement located on the Properties with a pier and beam foundation shall have all mechanical, electrical, plumbing, and fixtures located thereunder screened from view from any street and from adjacent properties. Any structure or improvement with an open deck shall have its open space beneath such deck screened from any public view.
9.	All residences shall be airconditioned. No window air conditioning units shall be permitted, placed or maintained on or in any building on any Lot in the Properties. Wall type air conditioners and ground mounted units are permitted provided they are screened from the street and adjacent property view.
10.	Roofs of all structures or improvements located on any portion of the properties shall be constructed only of, concrete or ceramic tiles, wood shakes or shingles, or metal. With permission of the ARC, highest quality composition shingles may be used and/or built-up roofs, with ballast, may be used on flat roofs where necessary to the design integrity.
11.	All solar panels or other solar collection devices must be constructed as an integral part of the architectural design of any structure or improvement located on any portion of the Properties. Alternatively, such panels and devices shall be screened from the view of all streets and other Lots.
12.	No external antenna, satellite receiving dish greater than 30" in diameter, or other structure designed or used for receiving any type of radio, television, or other telecommunication signal shall be permitted on any portion of the Properties unless the facility is totally screened from the view of streets and adjacent Lots.
13.	Each residence constructed on any portion of the Properties shall have, either as an integral part of or attached to it or as a detached structure, a garage capable of accommodating at least two standard size passenger automobiles.
14.	All pools shall be constructed substantially at grade. No elevated pools are allowed. Any structure or deck shall have the open space beneath screened from view on all sides.
15.	Street side fencing is not allowed and fences along Lot lines are strongly discouraged. Visible fences are not allowed beneath the 914 Elevation Line except as required for swimming pool safety. All swimming pools are required to be fenced, preferably with open metalwork fences, which minimize the impact on the view. Screening or security fences should be placed as near to a structure or improvement as is practicable and should be of ornamental iron, wood or masonry construction. Courtyard fencing and corresponding site design are encouraged. Split rail, barbed wire, solid board planks, and chain link fences are specifically prohibited on any.
16.	No landscaping shall be planted below the 914 Elevation Line which shall then or in the future materially and substantially impair or limit the view of Lake LBJ from neighboring lots.

ARTICLE V: Review Process

The Architectural Review Committee (ARC) shall consist of three members appointed by the Board and serving at the Board's pleasure. The ARC shall meet as needed to provide prompt review of plans and/or confirm violations. At least two members of the ARC shall constitute a quorum. The Board of the Association will delegate the authority for approval of development plans to the ARC.

Neither the ARC, the Board, nor any member thereof shall ever be liable to any Owner or other person, firm or entity for any damage, loss or injury suffered or claimed on account of:

(a)	the approval or disapproval of any development plan, in whole or in part;
(b)	the construction or performance of any work on the Properties, whether or not pursuant to a Development Plan;
(c)	the development of the Properties.

The approval by the ARC of a Development Plan shall not operate as an adoption, representation or determination by the ARC, or any member thereof, as to the safety or legality of the design encompassed in that plan.

The approval of an Owner's Development Plan shall in no way supersede or substitute for any approvals or permits required by any governmental authorities having jurisdiction.

The Development Plan to be submitted in accordance herewith shall be submitted in duplicate to the ARC at the registered address of the Association and shall consist of at least the following:

a plat or map drawn to scale of 1"=40' depicting the following:

(i)	existing property lines, right-of-ways and easements on the Lot and all adjacent Lots (including drainage easements). existing vegetation (with trees having a diameter of 8" or greater generally located) and other existing natural features and improvements;
(ii)	the location on the Lot and the dimensions and shapes of all proposed and existing structures (clearly marked to distinguish proposed construction) and all other improvements, including but not limited to buildings, garages, driveways, trash facilities, private waste disposal systems, exterior lights, brides, culverts, pools, patios, fences and walls;
(iii)	a landscape plan depicting trees and shrubs to be added or removed, as well as identifying any walls, fill or impermeable ground cover;

a complete set of plans and specifications for all improvements to be constructed, including the design of a private septic system;

a detailed description of the exterior color and finishes of all structures;

a large scale drawing including description of colors, materials and finishes for all address or identification signs;

a contact name and address for return of comments, approval or disapproval and ;

such other information as the ARC may reasonably require, and;

a review fee of $50 payable to the Association.

The ARC shall have broad discretion in approving or disapproving any Development Plan. Such approval or disapproval of any Development Plan by the ARC shall be final and shall be communicated in writing to the submitting Owner at the address indicated with the submittal. In the event the ARC fails to respond within twenty (20) days such Plan shall be deemed to be approved. The ARC shall certify in writing to the Blue Lake Property Owners Association that the Development Plan meets the requirements of these covenants, with permitted exceptions.

Development on the Lots is envisioned as compatible with our rural, hill country heritage.Accordingly, the ARC will encourage the use of designs, materials and appurtenances which exhibit those characteristics. Before granting approval of a Development Plan the ARC shall consider, but not be limited to:

the appearance and aesthetics of the proposed improvements and its compatibility with other structures in the Subdivision;

the impact of the contemplated improvements on the neighboring Lots and the general environment with special emphasis on maintaining views and drainage;

the maintenance of existing vegetation and the use of native landscaping and/or xeriscaping (as opposed to irrigation plans which might rely on extraordinary usage from the public water supply);

the location, material, height and purpose of walls, fences and auxiliary structures.

Each Owner is responsible for the full cost of repairs for damages to Common Facilities or other Lots caused by contractors or other agents during construction. Prior to commencing any major construction or site work, the owner shall deposit $500.00 to the Association as a security for repairs and cleaning of Common Facilities, or damages to ~ any other part of the Property. Any and all remaining, undisputed deposit shall be returned to the Owner within thirty days after receipt of a letter notifying the Association of substantial completion of construction.

ARTICLE VI: Use Restrictions

Each Lot, regardless of the improvements thereon, shall be used and occupied for single family residential purposes only and no Owner shall use or permit use for any purpose other than a private single family residence of the Owner or his tenant and their families. The renting of rooms or apartments separately from the main residence is specifically prohibited. No Lot shall be used or occupied for any business, commercial, trade or professional purpose except as incidental to the resident.

a)	No sign of any kind shall be erected on any portion of the Properties, including political signs, signs advertising goods, wares, real estate or services for sale or rent; and/or construction company or repair company signs, except:
(i)	During construction of any major structure to be located on any portion of the Properties, an Owner shall be permitted to erect a single sign which identifies the designer and/or builder(s) responsible for the structure or improvement, of a size not to exceed 4' x 4'. Any such designer and/or builder(s) sign shall be removed from the Properties immediately upon completion of the final inspection of the new construction.
(ii)	Each Lot Owner is permitted no more than two identification signs on the street side of his Lot. Each sign shall be no more than 144 square inches and include only street address and/or the resident's name.
(iii)	Project marketing signs including lot identification and real estate sales signs for the initial sale of land in a Subdivision.
b)	The Association is specifically empowered to remove, without notice, any sign which is in violation of these restrictions including identification signs not specifically approved by the ARC.

No exterior speakers, horns, whistles, bells or other sound devices (other than those used exclusively for security purposes) shall be located, used or placed on any portion of the Properties so as to result in a material annoyance or disruption to the residents of the Properties.

No noxious or offensive activity shall be carried on or permitted upon any Lot or portion of the Properties which may be or become an annoyance or nuisance to the community or other Owners. The Board shall have the authority to determine whether a specific activity is noxious or offensive. Specific prohibitions include, but are not limited to:

No trucks larger than one ton, motor vehicles not currently licensed, boats, trailers, campers, motor or mobile homes, or other such vehicles shall be permitted to be parked on any Lot or street, except in a closed garage.

No vehicles of any sort may be parked on the street in front of any Lot for any period to exceed twenty-four (24) hours.

No motor bikes, motorcycles, motor scooters, go-carts, or other such vehicles shall be operated on the Properties, if, in the sole judgment of the Board of Directors of the Association, such operation, by reason of noise or fumes emitted or manner of use, shall constitute a nuisance or threat to safety.

No accumulation of garbage, trash or rubbish of any kind shall be permitted nor the burning of these or other items (except during the development of the Properties and then only during such hours as permitted by law).

No use or discharge of firearms, firecrackers or other fireworks on the Properties shall be made or permitted, nor shall there be any form of hunting or trapping.

No animals, except domestic household pets within the ordinary meaning and interpretation of such words, may be kept, maintained or cared for on any portion of the Properties.

No unsightly articles shall be permitted to remain on any portion of the Properties so as to be visible from adjacent property or from the public or private thoroughfares.

a)	Without limiting the generality of the foregoing, all trailers, graders, trucks (other than pickups and sports utility vehicles), boats, tractors, motor homes, campers, wagons, buses, motorcycles, motorscooters and/or garden maintenance equipment shall be kept at all times, except when in actual use, in a closed structure or screened from view. No repair or maintenance work shall be done on any of the foregoing, or on any automobile (except for minor emergency repairs), except in an enclosed garage or other structure;
b)	No clothes shall be dried in full public view;
c)	No portion of the Properties shall be used for storage of materials and/or equipment except for normal residential requirements incidental to construction of the improvements thereon.
d)	All garage doors shall be kept closed except for normal access time.

All structures and improvements, including walls, fences and appurtenances, on the Properties shall be kept in a good state of repair at all times. Each Owner shall be responsible to maintain and clean the Lot and all structures and improvements thereon so as to avoid the creation of hazards to health or safety. If, in the sole opinion of the Board, a violation exists to this policy, the Board shall give sixty days written notice to the Owner of the offending Lot. If appropriate remedial action is not begun before the expiration of the notice period, the Board tray authorize such repairs, clean-up or maintenance as it sees fit and charge a Special Assessment against that Lot and Owner.

All external lighting shall have its source shielded and directed in such a manner as to insure that such source is not visible from adjacent Properties. No Owner shall erect, maintain or use any external lighting which shall be considered, in the sole judgment of the Board of Directors, to be a nuisance to the community or to any other Owner.

No oil drilling or mining operations of any kind shall be permitted upon or from any Lot.

EXHIBIT A
Lots 1-8 Hilltop at Blue Lake, a subdivision in Llano County, Texas, according to the plat thereof recorded in Volume 10, Page 92 of the Plat Records of Llano County, Texas

Visitors to Llano County Municipal District # 1 since December 2001