III SCOPE AND LIMITATIONS OF RESERVE STUDY
The complete RSI Reserve Study shall consist of two main divisions:
1. Condition of Property Survey: The purpose of the survey is to provide an educated estimate as to the anticipated remaining life
expectancy, estimate current replacement cost, and quantification of those components that may require major repair or replacement within a
30 year projection period. RSI can survey only those areas that are visible and readily accessible at the time of said survey. Client shall grant
RSI and all necessary personnel proper access to the site for the performance of the survey. Client shall be responsible for providing RSI
information concerning those concealed areas and components to which access is restricted. It shall be assumed that all components have
been designed and constructed properly and that life cycles will approximate normal industry performance standards. RSI shall not be liable
for accurate determination of remaining life expectancies of components that may have been improperly designed and constructed. Client
understands that the survey is not for the purposes of ascertaining compliance with any standards, codes, ordinances or other regulations. On
major components for which industry performance standards are not available and for which the client could have a potential liability, RSI may
make arbitrary estimates based upon past performance, RSI's prior experience, or instructions from client. RSI, in conjunction with client,
review of the "Request For Proposal", current budget, declaration, other pertinent documents, and a site survey, will prepare an inventory of
components to be included in the study. Client shall be responsible for review of said inventory for errors and/or omissions therein as this can
affect the outcome of the study. Client understands that they are responsible for all regular repairs and maintenance of the components as this
can significantly affect life expectancy. Due to the nature and complexity of many properties, accurate measurement is not always practical.
Client accepts the fact that some measurements may not be exact and that some approximation by RSI is inevitable. Client understands that
the survey will be performed by personnel with an extensive background in general construction principles, however, such personnel are not
specialists in every craft or profession. Therefore, if RSI recommends consultation with other specialized experts, client understands this must
be performed at client’s expense. Client accepts that the study will be based upon conditions only as they exist on the day(s) of the survey
and understands that anticipated events may not materialize and unpredictable circumstances could well occur. Rates of deterioration and
repair/replacement costs frequently vary and such variations could significantly affect the study.
2. Reserve Funding Study: The Reserve Funding Study will be based upon the results of the Condition of Property Survey, including
remaining life expectancy, current replacement cost and component life cycles. RSI may incorporate assumptions into the study relating to
investment yields, inflation applicable at the time of the study, previously scheduled special assessments and future regular assessment
changes. RSI shall not be held responsible for the accuracy of information prepared and provided by others, or omissions of pertinent
information. Client shall be responsible for supplying and verifying accuracy of all information on the "Financial Information Sheet". Client will
be responsible for any study revision costs pertaining to errors or omissions thereon. Based upon information available, RSI agrees to provide
sufficiently complete criteria to assist in compliance with the Reserve Study aspects of most Common Interest Development codes, standards
and similar regulations, and AICPA guidelines. The funding study will include a computation of major component liability by year, a component
replacement schedule, funding plans, funding plan graphs and a calculation of "percent funded". Due to constantly changing costs of inflation,
investment yields and other factors, it is recommended that an update of the Reserve Study be performed on an annual basis.
VII DISPUTE RESOLUTION
1. ARBITRATION Any dispute concerning the interpretation of this agreement or arising from the reserve study,
except one for payment of fees, shall be resolved informally between the parties or by arbitration conducted in accordance
with the rules of the American Arbitration Association, except that the parties shall select an arbitrator who is familiar with
the reserve study profession. If the parties are unable to mutually select an arbitrator, the parties shall request and require
the American Arbitration Association to select an arbitrator. Such selection shall be binding on the parties.
2. ATTORNEY'S FEES The prevailing party in any dispute arising out of this agreement, the reserve study or the
report thereon, shall be awarded all attorneys’ fees, arbitrator and other costs
VII LIMIT OF LIABILITY
RSI, its principals, agents, and employees shall have a limitation on liability as set forth below. This limitation applies to anyone who claims to
have been damaged, or to have had to pay expenses, due to any alleged omission or mistake in the Reserve Study. This limitation is binding on
the Client, members of Client’s association, or other similar groups, and on all spouses, heirs, principals, agents, designees, assigns thereof, and
any other person or entity who may claim through the Client. Client acknowledges and agrees that it will accept a refund of the fees paid under
this agreement as full settlement of any and all claims that may arise from this Reserve Study or RSI's correction thereof. Client assumes the risk
of all loss greater than the fee paid for the Reserve Study.
Client understands that a Reserve Study without a limit on liability to the fees paid is available for an additional fee. Please initial and remit the
appropriate fees only if unlimited liability is desired:
